Definition of Agribusiness — “How do people around the world know about biscuits, ice cream, milk, cheese, sweets, and many other foods? How do they get it every day, while the items they need are imported goods?”. It’s all because of the strength of supply chain management and logistics strategies applied to the agribusiness industry in the world. This management strategy identifies the problem, analyzes it to be able to provide a solution to the problem.
Let’s get to know agribusiness and food supply chain management and logistics!
What is Agribusiness? Definition of Agribusiness…
Definition of Agribusiness (according to KBBI: agribusiness) is a business based on agricultural business or other fields that support it, both in the upstream and downstream sectors. The mention of “upstream” and “downstream” refers to the fundamental view that agribusiness works on the food supply chain.
According to Lambert & Cooper (1998), the supply chain is defined as the main business process integration of end users through genuine suppliers providing products, services and information that add value to customers and other stakeholders. Put simply, the supply chain is a series of goods / physical flows, information and processes used to deliver products or services from the source location (supplier) to the destination location (customer or buyer).
So, it can be understood that its business activities in agribusiness are definitely using the path of food supply chain management (food supply chain management) running from upstream to downstream.
The core of food supply chain management objectives are:
- Satisfying consumers as per requirements; and
- Performing all processes efficiently, be economically and sustainably.
Below is a description of Supply Chain Activity of Palm Oil Industry:
Local Companies Doing Successful Business in SCM (supply chain management) and Logistics
Marcos Trans Indonesia, Making Hundreds of Million Through Supermarket Logistics Services
Marcos Nasution, A 29-year-old man graduated from Master of Economics of Krisnadwipayana University is believed to be the Head of Field III Transportation and Transportation HIPMI and Vice Chairman of Transportation Association Forwarding and Logistics Indonesia (ALFI) West Java in 2015 thanks to its success in raising the transportation business. Here is a row of activities in his logistics company starting from the moment he started the business to become rich and successful:
- To be able to seize opportunities in the field of logistics that focus on working on supermarket chains, changing the fate of Marcos Nasution. Distributing goods from warehouse to booth, Marcos now has a company beromzet hundreds of millions of dollars.
- This man from Padang Sidempuan is a successful entrepreneur in the field of freight transportation services from the warehouse retailers who do not have a fleet of logistics to be brought to their outlets.
- Marcos built a logistics service business focusing on targeting supermarket chains since 2011.
- Through the flag of business PT. Marcos Trans Indonesia formed in 2013, its clients are now well-known retailers, such as Hero, Lion Superindo, Farmers Market / Ranch Market, and Carrefour.
- The market opportunity for the distribution of goods from the retailer’s warehouse to the outlet network is promising. Because, not all supermarkets have their own logistics fleet, so they use delivery services. Understandably, the retail business focuses on the retail sector, not in its logistics sector. This opportunity is captured by Marcos.
- Delivery of goods from the retailer’s warehouse to the outlet is represented by or the driver coordinator in charge of communicating the loading and unloading of goods as well as the administration of the mail and other related matters.
- Only from the capital of a truck unit six-wheeled truck, Marcos can add up to seven units of trucks in 2013. This is not separated from the development of retail business in the homeland that continues to grow. As the supermarket business grows, the business will be lifted up. Moreover, retail entrepreneurs must have a target of opening new outlets.
- Currently, he has 29 truckloads of six tires as his main fleet.
- The company also puts a technical team that will monitor the condition of each unit of the truck fleet.
- If the delivery of goods is busy, the company can serve as many as 35 deliveries to 40 shipping a day for the Greater Jakarta area.
- Then he will hire an additional truck assisting the delivery operations. Turnover can reach Rp 300 million to Rp 400 million per month.
Linc Group ”The King of Service Industry in The Supply Chain”
- Linc Group was established since 2001 with major business lines including dry storage (warehouse), liquid storage (liquid terminal), domestic distribution, and freight forwarding. His success, Hans Leo, becomes a successful CEO and president director who has made this company dominate the largest service industry in Indonesia as a top supply chain management player in Indonesia.
- In his eyes about Indonesia, he saw that there are many opportunities that can be utilized. One of them is the condition of infrastructure that is still minimal. Poor infrastructure is a business opportunity and not a hindrance. “Here the population is big. A lot of raw materials to be deployed, many industrial activities to be completed. Much needs to be done from the logistics provider to the customer. So here the opportunity is huge. Therefore I focus on this business, “he said.
- Now Linc Group is growing very rapidly. At the end of 2015, Linc Group extended its business by opening an e-commerce enabler & fulfillment service called 8Commerce.
In addition to the 2 big companies above, there are 12 agribusiness companies that managed to award the government of Kadin Indonesia, among others, PT Bumi Tangerang Mesindotama with an investment of Rp 800 billion, PT Karya Indah Alam Sejahtera Rp 360 billion, and PT Tiga Pilar Sejahtera Food Rp 2.2 trillion, PT Sukses Mantap Sejahtera Rp 2.7 trillion, PT Nestle Indonesia Rp 1.8 trillion, PT Smart (Sinarmas) Rp 1.47 trillion, PT Great Giant Pineapple Rp 1.9 trillion, PT Agri Makmur Pertiwi Rp 50 billion, PT Bina Mentari Tunggal Rp 300 billion, PT Laju Perdana Indah (Indofood Group) Rp 2.5 trillion, PT Tri Putra Agro Persada Rp 100 billion and PT Bakrie Sumatera Plantation Rp 1.8 trillion.
According to Suryo Bambang Sulisto as the Chairman of Kadin Indonesia, in his speech at the Jakarta Food Security Summit, at JCC, Jakarta, Senayan (7/2/2012), the 12 companies have realized their projects in six economic corridors.
Taking Successful Career Opportunities and Doing Business in Food Supply Chain and Logistics in Indonesia
Taking Successful Career Opportunities in Food Supply Chain and Logistics
Supply Chain Professions:
- Supply chain manager
- Transporting Manager
- Customer Service Representative
- Field Service Representative
- First-Line Supervisor
- Inventory Manager
- Logistics Analyst
- Maintenance supervisor
- Procurement Specialist
- Production Control Analyst
- production planners
- purchase Analyst
- Shipping & Receiving Analyst
- Storage & Distribution Manager
- Supply chain manager
- Traffic Coordinator
- Warehouse Manager
Successful Career As A Supply Chain Manager:
Because Supply chain management is an activity that manages all the necessary steps in order that the product is able to hand consumers (from farm to fork), which is basically a system which includes processes including raw materials, processing, storage of products in the warehouse, moving from the distribution center to the stores, and offering customer service, the role of the person in charge as a manager in this case is necessary for the smooth operation of the supply chain to ensure every step is perfect at the right place and time.
As a manager, the task to be done is to buy or make procurement of materials to support production. So the thing that needs to be done is to analyze and supervise the storage, use, and organize materials and supplies. Manager will negotiate price and delivery of materials to produce cost savings and reduce lead time (time between initiation and completion of production process). Manager will assess the entire flow of goods and materials to ensure efficient delivery, quality of goods, and timely delivery of goods.
Some of the tasks of the Supply Chain manager are:
- Material resource planning
- Enterprise resource planning
- Audit and monitor suppliers
- Source components under pressure
- Setting new suppliers
- Monitor and develop existing supply chains
- Initiate and lead cost-saving initiatives
- Negotiate and manage contracts
Jobs as A Supply Chain Manager
Supply chain management jobs include:
- Purchasing agent
- Warehouse manager
- Inventory manager
- Production control
- Materials / Materials
Required Education Level
To become a supply chain manager, there are several stages of work required. The lowest level is the association degree in supply chain and logistics management, which covers the basics of supply chain management, manufacturing planning and control systems, purchasing, and physical distribution of goods to customers. By only following 61 credits of lectures, career opportunities and professions as mentioned above can be easily achieved.
However, the most needed degree in supply chain management is a degree in business, engineering, and operations management. While the desired master degree is MBA.
Course Classes in Supply Chain Management
Various classes can be taken with a degree in supply chain management:
- Financial Accounting
- Managerial Accounting
- Software Worksheet
- Business Operations Management
- Business Writing
- Business management
- Business Law
- Business Mathematics
- Business Ethics
- Supply Chain Management
- Inventory Control
- Material Requirements Planning (MRP)
- Just-in-Time (JIT) Inventory
Additional Skills Needed To Become A Supply Chain Manager
In addition to management skills, another skill needed by a supply chain manager is the skill of using a computer along with various types of computer software to track materials and goods. Because today technology plays such a huge role in all work.
Not only technology, it takes strong leadership skills, critical thinking skills, analytical skills, communication skills and the ability to help train and develop staff in work teams. Those are the common skills that will be gained through education, training and work-related experiences.
Because these job prospects globally are very promising and needed, other skills that will help a person become successful as a supply chain manager include:
- Knowledge of foreign languages
- Understanding of international standards
- Technical background in engineering or computer science
- Manufacturing experience or knowledge
Career Advancement in Supply Chain Management
One of the ways to start a career in supply chain management is to have a bachelor’s degree. A bachelor’s degree will allow a person to get a job in a manufacturing company and start gaining experience in supply chain management.
Entry level positions in supply chain management include fleet management, purchasing agents, shipping and receiving agents, inventory analysts, routing managers, or work experience in a particular industry. The more work experience, the more opportunities available. In addition to experience, it could also be considered to earn a master’s degree in supply chain management or an MBA to advance the next career.
Salary in Position as Supply Chain Manager
According to the Bureau of Labor Statistics of Outlook Handbook Workers, the average annual wage of purchasing managers is $ 89,160 in 2008. The lowest performer is less than $ 51,490, and the highest is over $ 142,550.
Working as a Consultant and Lecturer of Supply Chain Management
Other career prospects that can be occupied in the field of supply chain is as a supply chain consultant, which is not only working for some companies, but also can be a lecturer at the university as a lecturer and actively join the independent institutions engaged in education, training, consulting, research, and development of logistics and supply chain in Indonesia.
The role of activation is to improve the logistics performance of private companies and SOEs, and contribute to the improvement and development of logistics through several relevant ministries and government agencies, such as the Coordinating Ministry for Economic Affairs, Ministry of Transportation, Ministry of Commerce, etc., including in the implementation Blueprint for National Logistics System Development.
The salary offered to a senior consultant is very diverse, but certainly several times much higher than a staff working in a single company. Very promising. isn’t it?
2) Successful in Doing Business in Field Of Food Supply Chain and Logistics
In addition to being a manager or consultant, a person can start or continue his or her career as an entrepreneur. Five richest people in Indonesia quoted by Forbes magazine managed to develop his wealth in the field of agriculture. They succeed in dismissing the negative stereotypes about agriculture that make it difficult to make someone rich, in the midst of a crisis of public confidence about the condition of Indonesian agribusiness. The five conglomerates are Bachtiar Karim, Eddy Kusnadi Sariatmadja, Peter Sondakh, Murdaya Poo and Chairul Tanjung.
Careers are not only about the need for money, but also talk about the progress and sustainability of the vision of one’s life forward. To become a successful career in the agribusiness world, it takes a sufficient knowledge of competence, a desire for a good career and high building vision, so that the success of a career is only a matter of time.
The opportunity to become successful in agribusiness is enormous. Starting a career as an entrepreneur in Indonesia is the right choice. So what is said by the Governor of Special Region (DI) Yogyakarta Sri Sultan Hamengkubuwono X is right, that to be a developed nation, at least 2% of the Indonesian population who become entrepreneurs.
Data up to April 2014, the latest data from Global Entrepreneurship Monitor (GEM) shows that the number of entrepreneurs in Indonesia is only 1.65% of the total population of Indonesia. “This number is still far from the ideal number, and still inferior to the neighboring countries, such as Singapore, Malaysia and Thailand, all of which are 7 percent, 5 percent and 3 percent of the total population respectively.” said Sri Sultan, in his speech at the One in twenty Movement, Business Coach Training (BCT), Yogyakarta.
based on these data, the government’s efforts in boosting the number of entrepreneurs in Indonesia one of them is by working with universities to increase the number of entrepreneurs in the country. As the views of the President of Bandung Institute of Technology Alumni Association (IA ITB) Ridwan Djamaluddin said that his party has the same desire to make the alumni of ITB as an agent of change by contributing to the regions through investment and business cooperation as well as improving the quality of human resources (HR) regions, so as to encourage regional economic growth.
The supply chain (SCM) is a key element for economic growth and stability worldwide. SCM in the field of food is the life of agribusiness activities, so that SCM and logistics can not be separated from agribusiness activities. Careers as supply chain managers require a detailed oriented vision and a thorough understanding of the processes that bring products from raw materials to the finished product.
The biggest challenge of SCM actors in Indonesia is influenced by the wide and sprawling geographic location, culture and access to information technology, all of which serve to ensure that the availability and procurement of goods to reach the hands of consumers on time and on the right location.
Meanwhile, said Rocky, who holds one of the world’s largest logistics companies in Indonesia, CARAKA GROUP and DHL, which he has 13 years in the logistics sector, concluded that there are 4 things that become obstacles in this business in Indonesia, broad, culture, infrastructure, and bureaucracy.
That is definition of agribusiness, I hope full benefits. Don’t forget follow my website. Thank You!