Determining The Profit Margin In “Patchouli Oil” Supply Chain: A Case Study In Indonesia

Abstract

Patchouli oil is a type of oil obtained from the extraction of patchouli leaves and dried stems. In this study, the extraction process, also known as distillation, is conducted by Small and Medium Enterprises (SMEs) in West Pasaman, Indonesia. Patchouli oil must go through several steps before being by manufacturers, such as farmers, intermediaries, collectors. The interview and survey conducted show that SMEs are currently declining in West Pasaman due to the low selling price of patchouli oil while the production cost is high that declined farmers. Most traders do not add value to the product as they only collect patchouli oil and pass it on to next stages. This study aims to determine the production cost and profit margin of each stage in the supply chain of patchouli oil. Data were collected by interviewing the stakeholders, i.e., patchouli farmers, SMEs refining patchouli oil, collectors, and exporters. The production cost determined using traditional costing method. The results indicate that farmers obtain IDR 1.236 per day, while traders and collectors obtain respectively IDR 10.000 and IDR 3.833 a day. Surprisingly, the intermediary traders obtain the highest profit margin although they do not contribute to the added value of the product.

Optimization of factors influencing enzyme activity and product selectivity and the role of proton transfer in the catalytic mechanism of patchoulol synthase

“…Master mixes were split to glass vials with 500 μl reaction volume each. To initiate the reaction different substrate concentrations (1,5,20,30,50,80, 100, 150 μM) were added, reaction mixtures were overlaid with 150 μl of isooctane and incubated at 34 C for 2, 4, 6, 8, and 10 min. To stop the reaction, the mixture was shaking for 30 s and centrifuged for 5 min at 14,000 rpm and room temperature.…”

“…Patchouli is an aromatic plant with essential oils that is cultivated in the subtropical regions of India, China, and Southeast Asia like Indonesia. Patchouli oil has immense export potential due to its low production costs and high demand in the perfume and cosmetics industry . Usually the production is done in small companies where the equipment does not meet European standards and there are less regulatory oversights.…”

“…Main component responsible for the typical woody patchouli scent is the terpene alcohol (−)‐patchoulol with a percentage of 40–50% . However, patchouli oil contains more than 20 other different terpenes that determine the complex composition of the oil . The contained sesquiterpenoids have functionalized cyclic structures such as (−)‐patchoulol, which are difficult to synthesize by chemical synthesis .…”

“…[9][10][11] However, patchouli oil contains more than 20 other different terpenes that determine the complex composition of the oil. 5,8,11 The contained sesquiterpenoids have functionalized cyclic structures such as (−)-patchoulol, which are difficult to synthesize by chemical synthesis. 13 The formation of this broad variation of terpenes from the central substrate E,E-farnesyl pyrophosphate is catalyzed by a single enzyme, the patchoulol synthase (PTS).…”

Determinants of Profitability of Sweet Potato Production in Camarines Sur, Philippines

“…However, farmers get the lowest profit with a huge sacrifice compared to other players in the business in this case. Agricultural products purchased at farms are usually cheaper than those sold on the regular market [14]. Another way is to market their produce individually via local traders.…”