ESSAY ENTREPRENEURSHIP

Leisa Reclina Christi

Indonesia is a large country with more than 13.000 islands. It has 27 million people and almost

half of them work as farmer. Agriculture is a base foundation of Indonesias economics.

However, many people start to leave this field or doesnt want their children to work in this field

because of its difficulties to get proper income. Many farmers in Indonesia still live below

poverty line.

One of the problem is because the lack of processing and industrialization. We kept supply fresh

or raw materials with low price and import finished product from another country with higher

price. The government also understand about this problem, thats why there are many programs

available to help farmers to produce their own products and not only as raw materials.

Through these programs, the governments provide help like give equipment or machine for free

for a group of farmers in some villages. Most of the times, they also provide them with some

experts to supervise the program. However, these program is not always succeeding or worked.

Those equipment or machines usually ended up being sold or neglected, because the farmers

cant divide their work. They spend most of their time to focus on their crop, so they almost have

no time to spend on another work.

Sometimes they also have problem to sell their product. They cant always sell it right to the

market due to the rapid change of the fresh products. Usually they sell it to the wholesaler, who

buys their products in a big amount with standard price even lower to sell it again with double

price to industry or export it to another country.

Indonesian farmers also have problems in distribution. Most of the people who works as farmers

are live in a village. Sometimes it is very far from the city and still unreachable by modern

transportation. Its make it hard to sell their product to another region or city, so they also depend

on the wholesaler to buy their products or sell it to people around them which is also works as

farmers.

Another problem is they have this habits to grow crop that have high price on some season. If

there is a crop that have high price, they will simultaneously grow these crops. Its a good

strategy actually but unfortunately applied incorrectly. Because of this habits, thus crops will be

abundant on the market and instead of getting some fortune, the price of the crops will drop and

increase the price of another crops.

So, I actually have this long time plan which is I hope not only worthy for me but also can help

farmers in my country.

In Indonesia there is a business entity known as cooperative (koperasi Indonesia). Its more

like partnership than company because they mostly depend on their people including the fund

and assets. Its like an organization which is also work like a bank.

Cooperative is an organization of business owned and operated by the individual for the common

interest. Cooperatives bases its activities based on the principles of motion economy of the

people based on the principle of kinship.

The principle of cooperation is a system of ideas -abstract idea which are instructions for

building a cooperative effective and durable. The principle of cooperative latest developed the

International Cooperative Alliance (Federation of international non-governmental cooperative) is

Membership is open and voluntary

 Democratic management,
Member participation in the economy
Freedom and autonomy
Development of education, training, and information.

In Indonesia alone has created the Law no. 25 of 1992 concerning Cooperatives. The principle of

cooperation according to Law no. 25, 1992 are:

Membership is voluntary and open

Management is done democratically
Net Income division conducted fairly in accordance with their respective business service

member
Giving remuneration is limited to capital
autonomy
cooperative education
Cooperation among cooperatives

Principles Cooperation under Law No. 17 Th. 2012, namely: Capital consists of principal savings

and cooperative capital letters (SMK)

Most of the cooperation is work in money business. They chose the administrator (chairman,

secretary, treasurer etc) among the members to take care the administration and the management

of the organization for some decade and will change periodically. All the members have

mandatory and voluntary installment. The mandatory installment has to be paid every month to

their account in an amount that has been approved. While for the voluntary installment is a

payment that is made as their wish. All of those money will go into their accounts and the

organization will raise the money mostly by giving loans to the members (only members can get

loans). After one year, they will calculate all the net income and divided it into all members

based on money in their account. It just like the stock business, the more you have in your

account, the more you can get.

The basic idea is to create such business using cooperation principles. Not only to create money

flow, but also to provide supports for the farmers. The main target for the members are the

farmers. As cooperation, they can make an account as member and paid the mandatory

installment to the corporation. But, as this cooperation work mainly for farmers who doesnt

have stabilized salary each month, then instead of pay every month, they can pay the mandatory

installment for each season, which is will be every three or six months. The amount of payments

will also vary based on the methods of payment. The main differences is on the voluntary

installment. Unlike the mandatory installment, the members can pay the installments not only by

cash but also by goods. They can bring their agricultural products and sell it to the corporation

with standard prices. The payment will go directly to their account which they can take it or save

it.

As I said before, this cooperation is not only to create money flows, but also to provide supports

for the farmers problems as I mention in the beginning. The main activity is not only to keep the

money flowing by giving loans with interests but also by selling products. Alongside the

cooperation, there will be another business using the resources provided by the cooperation.

Farmers dont have enough time to process their raw materials into finished products, then the

cooperation can do it instead. With the money from the members and also the materials from the

farmers, cooperation can start working to produce their own products and sell it with better price.

Through the net income that will be divided to every member in the end of year, the farmers

(who cooperated as members) can also get the benefit indirectly. As for the cooperation, it gets

help with the fund raising, and also it has enough supply of the fresh materials.

Of course, this is a big work. Therefore, start from the bottom, we can start by create a small

cooperation, raise the fund by loans until hit some exact points then start to make products and
accept certain agricultural materials which is essential to the business as the payments. On this

point, not all agricultural materials can be accepted as payments, but only a certain crops that is

essential to the products. We can start produce a products which the materials is produce by most

farmers on the region or by most of the members, therefore, we can easily get the materials and

also it fulfills the main goals to help the farmers selling their products.

The cooperation can grow in time and in the end can accept all kinds of crops and store it. We

can not only use it as materials for the products but can also distribute it to another region or

even export it with greater price. It can also help the balance of the products, we can keep up

with the situation and provide the distribution of the excessive products to another region that

lacks such products. It will be more helpful if there is another branches or agent that can provide

such information. Therefore, the price of the products can remain stable or at least the change of

the price will not be too extreme.

This concept can be even greater if it can get on government sides. Instead of give the help such

as subsidized fertilizer or else directly to the farmers, cooperation can be help of distributing thus

help, therefore it will be used more efficiently. Because the cooperation can also provide the

farmers with experts to see if they really need that kind of help or not. So the excessive products

can be divided wisely and organized instead of loaded it all to the farmers.

This will be a great help not only for the farmers but also can open a lot of work chances for

unemployment in Indonesia. Still, it needs a lot of efforts and time to make it happens. But,

nothing is impossible if we want to work on it.