Asep S. Subanda: Successfully Managing Rural Resources

0
1321

There is nothing special about the appearance of this young man with the slightly dark complexion. But don’t underestimate him. Asep Sulaiman Sabanda, who is of medium build, was one of the nominees for Ernst & Young Social Entrepreneurship of The Year (Ernst & Young SEOY).

Asep, a young entrepreneur born on Jan 16, 1977 in a village in Subang, West Java, was the most modest of all nominees attending the award giving ceremony at a hotel in Jakarta. However, he is now ascending the ladder of prosperity.

He established his company, PT Santika Duta Nusantara, in his village and now hundreds of poultry breeders are ascending the ladder of success with him. “They are not my employees,” said Asep, adding that they are business partners. He said that he had adopted the germplasm working system in his business, which resembles the network marketing strategy.

This strategy, Asep said, is mutually beneficial to his company and his business partners. PT Santika Duta Nusantara is the “germ” (nucleus), while the chicken breeders are the “plasms” (cells). Under this system each poultry breeder raises chickens in their homes.

As the nucleus, PT Santika supplies chicken feed, medicine for the chickens and guidance to ensure maximum breeding results. “My employees visit each poultry breeder twice a week to take records of breeding development and provide guidance,” Asep said.

On the other hand, the breeders, as the cells, must raise their chickens efficiently and effectively to reach a set target. In addition, the nucleus must also purchase the chickens bred by the cells at a price agreed upon earlier in a contract to be later sold at various places. “If the price of chickens in the market drops, for example because of an avian flu case, the nucleus must pay according to the price agreed upon in the contract. On the other hand, if the price of chicken rises, the price paid by the nucleus remains as in the contract,” Asep said.

The nucleus entrepreneur, Asep said, must be very smart in handling price fluctuations. This business system may fail, he went on, if price fluctuations cannot be predicted or wisely handled. Some companies that failed in implementing this business strategy cheated their breeders, therefore giving rise to the impression that this business strategy exploits breeders.

Thanks to Asep’s business acumen, his company is managing some 450 poultry breeders producing about 2.2 million chickens for every breeding cycle (about eight weeks). His customers also develop 150 other poultry breeders.

When he first implemented this business strategy in 2001, he managed only 20 breeders producing some 60,000 chickens per breeding cycle. He has now stopped increasing the number of poultry breeders because he has reached the maximum management level. “The quantity can no longer be augmented. I’m now developing this breeding business ‘vertically’. The uplink business is the animal feed business,” he said.

In this way, said the father of three, a company can continue to develop. “Don’t stop at one line of business,” he stressed.

Besides his ability to cope with price fluctuations, Asep’s key to success is transparent communication with his breeders. “If we buy second-rate chicken feed, for example, we must be honest with the breeders and give them a plausible explanation,” he said.

On the other hand, the breeders must also be honest with him about their chickens. In this way, mutual trust will grow between his company and the breeders and then there will be no room for suspicion.

Asep also attributes his success in developing this business to the fact that he was a breeder himself between 1998 and 2001. “That’s why I have a strong empathy with the breeders and understand their needs,” he said.

Thanks to his success, Asep currently manages three poultry breeding locations: an area in Subang and in Bandung (both in West Java) and in Malang, East Java. Asep plans to apply this germplasm business concept in another business line he is developing. “I’m convinced that this business model can be applied in any business sector and that this is an ideal system for Indonesia,” he said.

Asep is in the midst of developing a corn cultivation business in East Java, also employing the germplasm business concept. “Some day I will apply this system in the mining sector,” said Asep, who is currently engaged in a mining project in Kalimantan with a turnover of billions of rupiah.

In addition, he has started another business in the trading and service sector. A diesel-oil company from Malaysia will partner with him in marketing diesel oil in Indonesia.

Still, Asep is convinced that his core business is poultry breeding. “I began with poultry breeding and this made me the success I am today,” he noted.

However, there is one thing that he wants to prove with his present success. “I want to destroy the myth that success must be built from the city,” he said confidently.

“My head office for poultry breeding matters is located in a village, not in the city. I began my business from a village and, thank God, my business has begun to enter the ASEAN market.”

In this way, he added, we can cut migration to large cities. “There is a lot of unproductive land in rural areas so many villagers are jobless. That’s why we need institutions or companies to manage, motivate and coordinate these villagers to become productive so that they won’t migrate to the cities.”

“I’m not simply earning money but wish to empower rural people,” he said about his purpose in developing his business.

He said in this case he modeled himself on Prophet Muhammad. “Besides successfully spreading Islam, he also successfully developed business by empowering his followers,” said Asep, who graduated from Gontor Islamic boarding school in East Java. He said he also had an obsession to develop entrepreneurship training for rural people.

Perhaps because he reveres Prophet Muhammad, Asep uses fair play in every business move. “Once I tried to take a business opportunity unfairly, but thank goodness, I failed,” he said, reminiscing.

Asep also believes that one must be honest in doing business. If indeed there is something that you don’t think other people should know, just be diplomatic. “If you happen to sustain losses and someone asks you about it, just say ‘well, that’s normal’. Or, at least, just keep quiet and smile. It’s simple, right?” he said.

His business experience has taught him that there are three things that enables one to score their success: willingness, ability and opportunity. “Willingness comes from within oneself,” he said.

Ability, he went on, is a collective unit as it is a combination of personal ability and the ability to find and gather people capable of taking on a job accurately and correctly. As for opportunity, he added, it comes from God the Almighty. “Even though you have the greatest willingness and ability, if you are still unsuccessful it means that in God’s eyes you are yet to be capable of success!”

It has come as no surprise that the panelists of Ernst & Young SEOY, which was held for the first time in Indonesia with the support of Scwab Foundation for Social Entrepreneurship, chose Asep as one of the finalists. (Arif T. Syam)

The Jakarta Post, January 18, 2007