CHANNEL DISTRIBUTION, MARKETING AND MARGIN PROFIT ORNAMENTAL CUTTING LEAVES DISTRICT OF KARANGASEM AND TABANAN TO DENPASAR CITY

AND THE SURROUNDING

IDA AYU MAHATMA TUNINGRAT, A.A.P.AGUNG SURYAWAN W., PRIMI SAFITRI SARASWATI Jurusan Teknologi Industri Pertanian Fakultas Teknologi Pertanian Universitas Udayana ABSTRACT The objectives of this study were to determine the number of patterns of distribution channels of the ornamental cutting leaves from the Regency of Karangasem and Tabanan to consumers in the city of Denpasar and surrounding areas, and to evaluate and determine the distribution channels that had the largest and the smallest marketing margins and the profit margins. The research was conducted by survey, interview and literature study. The population observed in this research were 3 (three) farmers, 1 (one) wholesalers and 6 (six) retailers of ornamental cutting leaves. Population in this research was taken as sample. Three farmers of ornamental cutting leaves were from 2 (two) regency, that was Karangasem and Tabanan Regency. In the regency of Karangasem, there was a farmer in the village of Segara Katon and at Tabanan Regency, there were 2 (two) farmers namely the villages of Tua and Kerambitan. They sold the ornamental cutting leaves to middleman (wholesellers and retailers). In the marketing of ornamental cutting leaves, marketing margin and profit margin in the regency of Karangasem reached Rp150 (60%) and Rp68 (27.2%). The biggest marketing margin and profit margin in the regency of Tabanan with size M was in farmer 2 (two) to retailer 1 (one) to consumer 1 (one) that was Rp2,500 (250%) and Rp2,004 (200.4%), while the smallest marketing margin and profit margin with size M was in farmer 3 (three) to retailer 6 (six) to consumer 6 (six) that was Rp500 (50%) and Rp108 (10.8%).

INTRODUCTION Bali is very potential in the field of tourism. Various arts and culture in Bali, it invites sympathy for the tourists coming to Bali. With the increasing number of tourists coming to Bali, then start growing hospitality business, bungalows, and so forth. It is also used by providers of ornamental plants such as flowers to decorate the hotel rooms and hotel rooms. In a series of cut flowers, there are several types of leaves that complement the decorative pieces such as floral leaves florida beauty Dracaena, Philodendron, Leather leaf, Cordyline, fir, sri ivory, and other sablung. Leaf decorative pieces are often found himself starting in Bali and started to be developed and has a market opportunity is quite high (Anon, 2009a). In 2009, widespread planting of ornamental cut leaves an area of 5673 m2, 2972 m2 area of harvested area and production for these leaves as many as 19,973 stems (Anon, 2009b). During this time many people who only know the different kinds of cut flowers because of its beauty, but they did not know that the leaves of cut also has a special attraction on the leaves and also a classic ornamental plants that are still a few people know. Since 1998 the use of ornamental leaves to serve as the leaf pieces

increasingly taken into account in world horticulture market, recorded in early 1998 commodity trade figures of 15.1% when compared to the value of cut flower trade, and has increased in 1999 to 16.94 % (Anon, 2009a). This caused more ornamental piece that leaves these days are not only used as a complementary support leaves the circuit, but is predominantly been used as the main element of the circuit (Anon, 2009a). Distribution channels have significant impact on selling price of the manufacturer. Suppliers and parties involved in the distribution channels have profit margins and costs that need to be identified, because consumers ultimately pay all profit margins and costs throughout the distribution channels (Widjaja, 2006). Selection of distribution channels is a very important issue because the error in this election could complicate efforts to slow even distribution of goods and services from producers to consumers. Based on this, it is necessary to do research on distribution channels ornamental leaves cut from Karangasem and Tabanan regency up to the consumer in the city of Denpasar and surrounding areas, but it should also be investigated about marketing and profit margins in distribution channels such ornamental cut leaves.

MATERIALS AND METHOD The method used in this study is the method of interviews and surveys, using questionnaires to collect data that is spread on farmers, wholesalers and retailers (florists). The research was conducted in the district of Karangasem, Tabanan and Denpasar on Bali, started from February to April 2011. Basic considerations for making this research sites Karangasem and Tabanan regency is the producer of ornamental leaves cut in the province while in Denpasar Bali because it follows the path cut distribution of ornamental leaves produced by the producers (farmers) from the regency of Karangasem and Tabanan (Anon, 2009b). Determination of Population and Sample The population in this study were all cut decorative leaves farmers in Karangasem and Tabanan regency. The population of ornamental cut leaves farmers in Karangasem, an individual farmer at Segara Village Katon Amlapura and in Tabanan District 2 persons namely farmers in the Old Village District and the Village of Marga Subdistrict Kerambitan Kerambitan., So that the whole is used as the study sample. Intermediate traders cut ornamental leaves are used as samples are all retailers and wholesalers through which the distribution of ornamental cut leaves. Middlemen are determined by snowball sampling, ie by following the path leaves the distribution of ornamental pieces produced by the producers (farmers) on the basis of information obtained. Stages of marketing sampling leaf ornamental pieces can be seen in Figure 1. Variable Observations The variables will be observed in this study include: a. The marketing of ornamental cut leaves

Observing or studying the distribution channels through which the leaves of ornamental pieces resulting from Karangasem and Tabanan regency up to the consumer in the city of Denpasar and surrounding areas. b. Volume sales of ornamental leaves cut at harvest (stem) Working out how many bars the sale of ornamental leaves cut every once in a harvest. c. Production costs incurred (Rp/month) Calculating production costs incurred d. Manufacturers selling price (Rp/trunk) by the farmer per month.

Calculating the selling price of each bar producers to consumers. e. Consumer purchase price (Rp/trunk) Calculate the purchase price of each bar consumers from the trader. f. Marketing costs (Rp) Calculating the cost of marketing for each of the existing lines include the cost of transportation, storage and other costs. Quantitative Analysis Quantitative analysis is used to calculate margins and marketing margins obtained by the respective distribution channels. Profit margins and marketing margins are used to determine the distribution of the cost of each marketing activity, the prices received by farmers and benefits of each distribution channel as well as evaluating the path that the greatest benefit from their existing distribution channels. The steps taken to compute the marketing margin and profit margins are: a. Calculating marketing margins by using the formula (Ibrahim, 1998): MP = HJ - HB Description: MP = Marketing Margin (Rp.) HJ = Selling Price (Rp.) HB = Purchase Price (Rp.) b. Calculating percentage marketing margins by using the formula Ibrahim, 1998): HJ - HB X 100% % MP = HB where: % MP = Marketing Margin (%) HJ = Selling Price (Rp.) HB = Purchase Price (Rp.)

c. Calculate the percentage of marketing costs by using the formula (Ibrahim, 1998): % BP = where: % BP = Marketing Costs (%) BP = Marketing Fee (Rp.) HB = Purchase Price (Rp.) d. Calculating profits by using the formula (Ibrahim, 1998): K = (HJ-HB) - BP where: K = Profit (USD) HJ = Selling Price (Rp) HB = Purchase Price (Rp) BP = Marketing Fee (Rp) e. Calculating the percentage profit margin using the formula (Ibrahim, 1998): MK =% MP% -% BP where: % MK = Profit Margin (%) % MP = Marketing Margin (%) % BP = Marketing Costs (%) Qualitative Analysis Qualitative analysis is the analysis done by outlining or describing the results of quantitative analysis in the form of relevant statements. Qualitative analysis is also used for the supply of information or provide a clear picture of the problem (Singarimbun and Effendi, 1989). Qualitative analysis is performed to determine the amount of marketing distribution channels ornamental leaves cut from Karangasem and Tabanan regency up to the consumer of Denpasar and surrounding areas and determine the most dominant path traversed to the City of Denpasar and surrounding areas. RESULTS AND DISCUSSION Characteristics of Farmers This type of ornamental cut leaves contained in Bali province of Dracaena Florida Beauty and Philodendron selloum, where the age of ornamental cut leaves that have been harvested from planting saplings (seadling) is 180 days and 90 days. When harvesting the leaves of ornamental pieces is due to morning and evening to avoid leaf respiration in a longer. At the time of harvesting sorting by size, leaf integrity, straight stems and leaf color. Broad leaf cut ornamental garden is 30 acres and 5 acres. Within 1 (one) month of the harvest done 4 times and 8 times, where the number of Dracaena Florida Beauty production in a single harvest is 1,000 stems and philodendron size S: 50 bars and M: 230 rods. Ornamental cut leaves are sold to wholesalers and retailers. Farmers sell direct by approaching wholesalers and

retailers. The selling price for Dracaena Florida Beauty is Rp250.00 and Philodendron selloum size S = Rp500.00 while the size of M = Rp1, 000.00. Farmers' production costs incurred in Karangasem is Rp824, 000,000 whereas in Tabanan is Rp630, 875.00. Characteristics of Large Dracaena Florida Wholesalers buy from farmers that there is beauty in Karangasem 4 times in one month with the volume of supply in a single purchase is 1,000 bars. Wholesalers purchase price from farmers is Rp250.00/batang. In every purchase, big traders do sorting by size (2530cm), leaves intact, smooth and green. The leaves have shrunk by 1% as the leaves wilt and are not intact, bent rods so that can not be sold. Older sells ornamental leaves cut in 3 days once the purchase is the price to consumers is Rp400.00/batang, where customers are hotels which have become a subscription purchase at retail. Characteristics Merchants Retailers Philodendron selloum Merchants Retailers buy from farmers located in Tabanan as much as 8 times in one month with the volume of supply in a single purchase for the size of S = 40 M = 625 bars and rods. Wholesalers purchase price from farmers to the size of S = Rp500.00 and M = 1,000.000. In every purchase, retailers do sorting based on size S = 10-20cm; M = 21-30cm, leaves intact, did not wilt and green colors. The leaves have shrunk by 2% as the leaves wilt and are not intact, the color yellow so it can not be sold. Older sells ornamental leaves cut in 3 days once the purchase is the selling price to the consumer to the size of S = Rp1, 000.00 and M = Rp2, 100.00, where customers are hotels which have become a subscription purchase at retail. Decorative Leaf Cut Distribution Channel Based on the results of research in the field against the respondents: three farmers, one of wholesalers and retailers 6 people. Note there are two distribution channels ornamental leaves cut from the farmers, namely: A. Karangasem regency (Dracaena florida beauty) Farmers Consumer Wholesalers B. Tabanan (Philodendron selloum) Farmers Merchants Retailers Consumer With 6 different retailers, can be translated into: B.1 PC1 P2 K1 B.2 PC2 P2 K2 B.3 PC3 P2 K3 B.4 PC4 P2 K4 B.5 PC5 P3 K4 B.6 PC6 P3 K6 Distribution Channel A (P1 PB K) Leaf decorative pieces are manufactured by P1 type Dracaena Florida Beauty is harvested at age 180 days with a total production for all harvests of 1,000 rods. P1 sells ornamental leaves cut by ordering direct PB to P1, then directly harvesting the leaves of ornamental pieces and packaged so that tomorrow morning, escorted by using a flatbed car (pick up). PB who purchase ornamental cut leaves are then do the sorting based on whole leaves (not torn), straight stems and dark green and thick before being sold to consumers or to make flower arrangements that will be

sent to the hotels. B.1 Distribution Channel (PC1 P2 K1) PC1 order Philodendron selloum 8 times in one month with the volume of supply as many as 30 rods with the size M of all purchases. P2 usually take orders directly to the PC1 ornamental cut leaves on a motorbike because the number of orders ornamental cut leaves ranged between 20-30 stems. Before selling to PC1, P2 perform sorting by size pieces of leaves, leaves intact (not torn), colored green and the stems straight. After arriving at the florist, then also do the sorting before they are sold directly to consumers and to make flower arrangements. B.2 Distribution Channel (PC2 P2 K2) Distribution channels is the same as the path B.1 pattern, but the difference between supply volumes PC2 of all purchases for sizes S and M each 20 rods and also do sorting before being resold. Oldest leaves are usually 5 days a decorative piece was sold back to the time of purchase. B.3 Distribution Channel (PC3 P2 K3) Distribution channels is the same as the pattern lines B.1 and B.2. The volume of supply of ornamental leaves cut as many as 30 stems PC3 for sizes S, usually a maximum of 3 days the leaves of ornamental pieces sold must have been either sold directly to consumers or flower arrangements made in accordance with the purposes of the hotels. Sorting is also done based on the integrity of the leaf (not torn) and leaf color is green, because if the leaves are yellow, the leaves can not be made flower arrangements and sold directly to consumers. B.4 Distribution Channel (PC4 P2 K4) Same with any other distribution channels, PC4 also buy ornamental leaves cut by as much as 10 cigarettes a size S and size M: 20 bars because of this new florist opened a few years and have not had a lot of subscriptions wreaths to hotels, but PC4 has become a customer fixed by buying as much as 8 times in a month. With very small amounts, no later than 3 days the new leaves of ornamental pieces sold again. B.5 Distribution Channel (PC5 P3 K5) P3 produces leaf Philodendron selloum type of ornamental pieces. PC5 usually order a size M Philodendron selloum 8 times in one month with a supply volume of 500 rods in a single purchase. P3 has the manpower to bring order customers on a motorbike. Before selling to PC5, P3 perform sorting by size pieces of leaves, leaves intact (not torn), colored green and the stems straight. After arriving at the florist, then also do the sorting before they are sold directly to consumers and to make flower arrangements. B.6 Distribution Channel (PC6 P3 K6) Distribution channels is the same as the track pattern B.5. The volume of supply of ornamental leaves cut by 55 rods PC6 for M size, usually no later than 3 days the leaves of ornamental pieces sold must have been either sold directly to consumers or flower arrangements made in accordance with the purposes of the hotel as many have already subscribed PC6 hotels to book series interest for the purposes of the hotel. Sorting is also done based on the integrity of the leaf (not torn) and leaf color is green, because if the leaves are yellow, the leaves can not be made flower arrangements and sold directly to consumers.

Farmer Production Costs and Benefits Advantages leaf growers of ornamental pieces can be distinguished based on 7 channels of distribution. Selling prices, production costs (fertilizers, pesticides, labor, transportation, water, plastic, cotton, cardboard, rubber bands, scissors, bucket, sickle, rope) and the benefit of farmers. P1 advantage in Karangasem regency Rp 62.75/batang. This is caused by high production costs and low selling price of farmers, because here P1 is not a big priority to profit but customer satisfaction. The biggest advantage in Tabanan are on track B.5 (PC5 P3 K5) with a profit of Rp 901.28/batang, because of the high price from farmers and supply purchases a large volume so that total revenue was too great, despite the high production costs, but the amount of revenue far greater than the cost of production, then the profits were too great. Smallest gain in Karangasem regency located on the path B.6 (PC6 P3 K6) with a profit of Rp 102.56/batang. This is caused by high production costs and the purchase of a small volume of supply so that the total income does not vary much with production costs incurred. Post-harvest processes on the P1 Dracaena Florida Beauty leaves that have dark green ready to be harvested. Leaves that have been cut from the tree were collected into 10 (ten) bars and tied with rubber bands. After the end of the stem leaf ornamental pieces that have been tied, wrapped with cotton and soaked briefly in water to eliminate dehydration. Tip of the leaf stems of ornamental pieces that have been soaked, then put in plastic that contains a little water to cut decorative leaves remain fresh. Before being distributed, ornamental cut leaves are packaged using cardboard and covered with newspaper to avoid direct sunlight, after which the leaves of ornamental pieces ready to be distributed to the city of Denpasar with a pick up for 3 hours. For more details, can be seen in Appendix 3 (p. 45-46). Post-harvest processes on the P2 Tree Philodendron selloum have a minimum of 5-6 stems are ready to be harvested, which sought to set aside three leaf stems remain stimulated to grow. Leaves that have been cut from the tree were collected into 10 (ten) bars and tied with raffia. After the end of the stem leaf ornamental pieces that have been tied up, cut to the length of the rod tip with one another the same. Ornamental cut leaves the rod tip and then immersed in a bucket filled with water, then cut decorative leaves are ready to be distributed on a motorbike. For more details, can be seen in Appendix 4 (p. 47-48). Post-harvest processes on P3 Post-harvest processes on the same P3 with P2. Tree Philodendron selloum have a minimum of 5-6 stems are ready to be harvested, which sought to set aside three leaf stems remain stimulated to grow. Once it leaves that had been cut from a tree were collected into 10 (ten) bars and tied with raffia. After the end of the stem leaf ornamental pieces that have been tied up, cut to the length of the rod tip with one another the same. Ornamental cut leaves the rod tip and then immersed in a bucket filled with water, then cut decorative leaves are ready to be distributed on a motorbike. For more details, can be seen in Appendix 5 (p. 49-50).

CONCLUSIONS 1. The number of distribution channels ornamental cut leaves of Karangasem and Tabanan regency up to the consumer in the city of Denpasar and surrounding areas there are 2 (two). 2. Distribution channels cut ornamental leaves that produce the greatest profit margins and marketing and the smallest, namely: a. Distribution channels cut into ornamental leaves Dracaena Florida Beauty which produces marketing and profit margins in Karangasem regency Rp 150 (60%) and $ 68 (27.2%). b. Distribution channels cut into ornamental leaf Philodendron selloum which produces the largest marketing margins in Tabanan with leaves the size of M contained in Farmer 2 to the first retailer to the consumer an amount of Rp 2,500 (250%). c. Distribution channels leaf Philodendron selloum ornamental pieces that generate the largest profit margins in Tabanan with leaves the size of M contained in Farmer 2 to the first retailer to the consumer an amount of Rp 2004 (200.4%). d. Distribution channels cut into ornamental leaf Philodendron selloum marketing that generates the smallest margin in Tabanan with leaves the size of M contained in the Farmers 3 to 6-toconsumer retailers 6 of Rp 500 (50%). e. Distribution channels cut into ornamental leaf Philodendron selloum that produces the smallest profit margins in Tabanan with leaves the size of M contained in the Farmers 3 to 6-to-consumer retailer of Rp 6 108 (10.8%). It is also suggested that: 1. Needs to be done to deliver information to farmers about the various types of leaves of ornamental pieces, this is certainly a great opportunity for farmers in particular and stakeholders (investors) to another in general. 2. Need to do a feasibility study on the ornamental leaves cut further research.
REFERENCES Anonymous. 2009a. Business Opportunities Leaf Cut. PT. Madya Bina Persada. Jakarta http://www.bungarawabelong.com/index.php?act=newsall&l=detail&id=10052&pg=2. [Accessed on February 15, 2011] Anonymous. 2009b. Agricultural Statistics Annual Report Decorative Leaf Cut. Department of Agricultural and Horticultural Crops Food of Bali, Denpasar Ansori, N.M. 2010. Cultivation Cut Flowers and Ornamental Plants. PT Publisher IPB Press. Bogor Ibrahim, Y.M.H. 1998. Business Feasibility Study. Rineka reserved. Jakarta Kotler, P and Armstrong, G. 2001. Principles of Marketing. Eighth Edition. Grants. Jakarta Nitisemito, U. S. 1984. Marketing. Ghalia Indonesia Swastha, B. 1996. Marketing principles. Third Edition. Second mold. Liberty. Yogyakarta Swastha, B. 1997. Channel Marketing, Quantitative Analysis of Concepts and Strategies. First Edition. Fifth mold. BPFE-UGM. Yogyakarta Swastha, B and Irawan. 1998. Modern Marketing Strategies. Second Edition. Fifth mold. Liberty. Yogyakarta Widjaja, T. 2006. Value Chain Analysis (Value Chain) and Competitive Advantage (Competitive Advantage). Harvarindo. Jakarta

Appendix 1. Code CODE LIST P1 PB K P2 1 PC K1 PC2 P2 K2 PC3 P2 K3 PC4 P2 K4 PC5 P3 K5 PC6 P3 K6 Description: P1: Farmer 1 (Beny Ariawan Riangsa) P2: Farmers 2 (I Wayan Wisnawa) P3: Farmer 3 (I Made Suidiarta) PB: Large (D'Oasis) PC1: Merchant Retailer 1 (Marta Florist) PC2: Merchant Retailer 2 (Eva Sari Florist) PC3: Merchant Retailer 3 (Pearl Bali) PC4: Merchant Retailer 4 (Arya Florist) PC5: Merchant Retailer 5 (Laksana Goddess) PC6: Merchant Retailer 6 (Syahla Florist) K: Consumers (Four Seasons, Intercontinental, Melia Bali) K1: Consumer 1 (Westin, Inna Kuta Beach, Ayana Resort) K2: Consumer 2 (Jody Villa, Villa Maya Loka) K3: Consumer 3 (Dyana Villas, Barokah) K4: Consumers 4 (Rosani Park, Villa Brawa) K5: Consumers 5 (Made Bali, Aston, Kayu Manis) K6: Consumer 6 (All Seasons Legian Beach, D'Oasis)