(Jakarta, Kompas, 5 October 2007), The small bet profit gained by the company a mid sharp increase in sales caused the management of PT Sierad Produce Tbk to change its business strategy.
One of the main players in the integrated national poultry industry gives priority to the development of the contract farming and slaughterhouse.
The company shall also increase the production of feedmill, day old chicken (DOC), increase in the use of local corn, increase in the marketing area of the feedmill, and to produce the premium quality feedmill.
Some of these breakthrough are conducted to deal with the increase of the feedmill price amid the decrease in the purchasing power of the people.
Deputy Managing Director of PT Sierad Rodolfo P. Pantoja, Thursday (4/10) in Jakarta, stated that poultry industry is not able to avoid the fact of rising price of feedmill.
On the other hand, the company is not able to increase the price of the feedmill too high since it will cause difficulties for the breeder, amid the decrease in the purchasing power of the people.
Corporate Secretary of PT Sierad Elies Lestari Setiawan said that, during January – August 2007 the company had posted sales of Rp 1,026 trillion or increased by 34.02% compared to the previous period of Rp 766 billion.
On the other hand, the profit of the company increased by 5.37% or Rp 14 billion from the previous year of Rp 13 billion.
The debt to equity ratio for this year is only 0,2 compare to the figure of 2006 that reached 0.16%. The net profit of the company was also contributed by some of savings initiatives in the operations of the company.
Production of Day Old Chicken.
According to Rodolfo, currently the company produces 1.5 million day old chicken weekly. From this amount, only 900,000 that were purchased by the partners breeders, the rest is sold to the independent breeders.
By encouraging the extension of partnership program, it is expected to increase the population of DOC into 1.2 million Day Old Chickens per week.
The more DOC that is absorbed by the partners breeders, it will increase the sales of feedmill that currently has installed capacity of 55-60%.
In line with the new policy issued by the Regional Government of Jakarta concerning the distribution of poultry, Sierad will also expand its operation into the slaughterhouse. Sierad had also obtained loan from PT Bank Negara Indonesia Tbk (BNI) in the amount of Rp 225 billion to increase working capital.
This loan was secured with the land, buildings and feedmill machinery in Sidoarjo, East Java, and Balaraja, Banten.
In the future, Sierad will also continue the program of cost efficiency and opens up the depo closest to the market in order to reduce transportation cost.