Millennial Business Eliminates Middlemen

Irma Tambunan

· 5 minutes read

A small cooperative in the middle of an oil palm plantation is growing rapidly. It is unexpected. Various business units have been established and they have rapidly expanded at the hands of the young people. The commitment to grow together has been fruitful.

Juhardi, 35, can now tread lightly. He and 115 members of the Tani Sido Mulyo farmers group managed to escape the middlemen\'s snare. Every time they need money, they no longer have a headache. They just go to the KUD Karya Mukti village cooperative unit in Pelepat district, Bungo regency, Jambi. The loan disbursement is fast.

In six years, Juhardi, once trapped in debt, has successfully built an oil palm fruit delivery service. Later, he started a fertilizer distribution business. "If I want to build any business, I am no longer bothered about finding capital. Just borrow from the cooperative," Juhardi said on Saturday.

KUD Karya Mukti is engaged an all-round business. It provides various needs of the residents. A number of its business units have grown rapidly. There are minimarkets and stores that offer photocopying service, office stationary, screen printing, building materials and oil palm seedlings. In addition, the cooperative has also established a fertilizer factory and runs a drinking water refill businesses, as well as lodging services.

Mukti\'s business has been expanding rapidly amid public doubts on the role of cooperatives. Since 1986, many cooperatives have been formed in the region, along with the arrival of transmigrants. However, almost none have grown according to expectations.

KUD Karya Mukti was previously inactive for six years. Ten years later, the government rolled out the Primary Cooperative Credit (KKPA) program, involving the role of plasma farmers and oil palm plantation companies. In order to survive, the existing 13 cooperatives were then merged.

KUD Karya Mukti was then appointed to handle the credit settlement of about 5,000 local farmers, members of the 13 cooperatives. The credit settlement process took time to complete. It was only in 2011 that all the credit given the plasma farmers was settled.

Developing the business

After all the credit to the plasma farmers was settled, Riswanto,49, who was appointed to lead the cooperative, began to think about business development. He embraced young people. Initially, they were recruited to open an online electricity payment service. The business turned out to be in demand. Furthermore, they opened department and fertilizer stores. The business was quite good. From there the ideas of opening a number of new business units continued to flow.

Since 2011, 18 business units have been formed. All grow rapidly. Besides being involved in fertilizer production, selling goods and services, the cooperative has also opened a financial service. The cooperative offers a special saving for children and cooperative members.

Unexpectedly, the circulation of the money in the village grows quickly as the wheel of the village economy has begun to accelerate. The average cooperative turnover exceeds Rp 100 billion per year.

The Manager of the Savings and Loan Unit of Karya Mukti Cooperative, Wahid Mizudin (30), said that savings and loan transactions are around Rp 100 million (US$7,000 ) a year. As for the value of community savings at the cooperatives has reached Rp 11 billion. That implies a growing prosperity.

The increase in business units absorbs more labor. At present, 45 young people aged 20-35 years run business units. They come from various educational backgrounds, high school level to college. "Right now, there are already at least 80 young people who have applied to work in cooperatives," Riswanto said.

Knowing the growing interest of the young men to work in the cooperative, the cooperative management plans to build more units. The cooperative plans to open sewing and embroidery businesses, culinary, and pharmacy business. In August, 15 village youth will take part in sewing and embroidery training. After the training, then they will build the business.

Human Resources

Riswanto realizes that every business needs human resources. Therefore, 10 percent of the funds from the cooperative\'s business are allocated as investments to help educate members or their families.

Experts are often invited to offer training. Cooperative managers are also sent to study outside the area. Companies are involved. One of the subsidiaries of PT Astra Agro Lestari, which operates a plasma plantations in the area, has sent experts to train the young people.

The cooperative’s farmer members have improved cultivation skills. With its growing business, the cooperative has been able eliminate the presence of middlemen. Borrowing to cooperatives is much easier and less expensive.

The real role of the cooperative has also attracted the world\'s attention. The cooperative received an award as an Outstanding Cooperative in 2013 and 2016. This year, in commemorating the Cooperative Day, KUD Karya Mukti again received a similar award.

Riswanto said the key to the success of the cooperative was togetherness and openness to all members. If both are implemented, thousands of cooperatives in this country will grow and develop and not sink like now. "The foundation of the cooperative must be strong," he said.

Editor:

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