Supply chain efficiency of red chili based on the performance measurement system in Yogyakarta, Indonesia

Abstract

This study aimed to describe the relationship structure of the red chili supply chain based on actors and their activities and to measure the efficiency of the red chili supply chain using the Performance Measuring System (PMS) framework. The distribution of the red chili supply chain in this study began with farmers in Kulon Progo, Yogyakarta, and extended to consumers in Jakarta, Indonesia. The sampling technique was carried out in several stages for 132 respondents consisting of red chili farmers and consumers. The supply chain relationship structure was analyzed descriptively, while the efficiency of the red chili supply chain was examined using the PMS framework, including indicators of production costs, transaction costs, profits, and return on investment. The results revealed that the relationship structure of the red chili supply chain was formed by three chains consisting of eight actors: farmers, middlemen, wholesalers at the regency level, auction markets, Kramat Jati Central Market or Pasar Induk Kramat Jati (PIKJ) dealers, PIKJ centeng, retailers, and consumers. According to production costs, transaction costs, profits, and the rate of return on investment, chain three was the most efficient with chain actors comprising farmers – auction markets – wholesalers at the regency level – PIKJ dealers – PIKJ centeng – retailers – consumers.

Keywords

• efficiency
• supply chain
• performance measurement system
• red chili