Pulau Pasaran is known as the main centre of salted anchovy fish production in Bandar Lampung City which have capabilities to produce twenty to thirty tons of salted anchovy fish a day and will be marketed to several region on Java Island and Sumatera Island. This study is proposed to (1) identify the business process of the anchovy fish processing industry at Pulau Pasaran, (2) analyise the performance of the anchovy fish processing industry at Pulau Pasaran, and (3) formulate better strategy that can be applied in optimising performance of the anchovy fish processing industry at Pulau Pasaran. The technique of determining respondents using purposive sampling. The number of sampling in this study was 18 respondents namely anchovy processing business owners, crafter, fishers, experts in the field of fisheries, and community group leaders in the area of Pasaran Island. This study using Porter's Value chain analysis combined with Structure, Conduct, Performance (SCP) analysis and also SWOT Analysis to see any gaps between the real conditions and the desired conditions of the existing performance on Pasaran Island. The result showed that the performance of the anchovy processing cluster industry in Pulau Pasaran was not optimal because the industrial owner did not have a bargaining position in determining prices and product quality standards that were not optimal. The formulated strategies are create diversified products and improve product quality standard to optimised performance on Pulau Pasaran.