Melon farmer Mr Ade Dwi Adedi, 54, who started planting melons in 2006 with the assistance of two helpers, now teams up with 40 fellow farmers in Cilegon city, Banten, to supply Indonesia’s leading supermarket chains, such as Hero and Giant.
While he used to work on a 0.5 hectares plot of land with an output of five to seven tonnes each harvest season, he now handles 4 hectares, producing up to 60 tonnes, thanks to the financing from crowdlending platform TaniFund, TaniHub’s affiliate start-up.
Connecting to the market and getting fair prices for agricultural products are among the major difficulties faced by millions of farmers like Mr Ade in Indonesia, where the agriculture sector remains the second biggest contributor to the gross domestic product.
Several start-ups, including TaniHub and Limakilo, have introduced their e-commerce platforms to connect farmers and buyers, cutting a complicated supply chain and allowing producers to benefit from better prices.
TaniHub co-founder and president Pamitra Wineka said the e-commerce platform tries to address the most crucial problem in the domestic agricultural sector – access to market.
Farmers can also receive higher prices and faster payment by joining TaniHub, Mr Pamitra added.
The agricultural start-up, established by six co-founders including Mr Pamitra and CEO Ivan Arie Sustiawan in mid-2016, is raising funds to finance its future expansion after securing sizeable Series A funding from Indonesia’s venture capital firm Alpha JWC Ventures.
Another start-up, Limakilo, links farmers mostly with end-consumers through its retail network in Jakarta and West Java, called Kios Kilo.
Limakilo co-founder Lisa Ayu Wulandari said that by trying to reduce the lengthy supply chain, the start-up hopes to push up farmers’ bargaining power and shift up to 10%, out of the 35% profit margin enjoyed by the middlemen, to producers.
Limakilo, which Ms Lisa set up with two friends, Mr Arief Setiawan and Mr Walesa Danto, is raising funds to back up its expansion plan. In 2016, it attracted significant seed funding from Singapore-based venture capital firm East Ventures.
Ms Lisa said the fresh investment will be used to set up its trading network in Bogor, Tangerang and Bekasi in West Java. It also seeks to diversify its products by adding green beans and ginger as well as locations of sourcing.
Agriculture Ministry’s Horticulture Director-General Suwandi acknowledged the positive impact of the start-ups in the local agricultural sector, citing the benefits felt by both farmers and consumers.
Mr Suwandi also believed that the e-commerce platform will increasingly become a marketing trend in the agricultural sector in the future along with the continuous development of information technology.
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Source: The Straits Times, 27 August 2018