SawitPRO Handles Upstream Issues for Palm Oil Farmers with Digital Solutions
It has been operating since 2023, founded by former top official at RGE Group Abhishek Singh
Palm oil or raw palm oil (CPO) is one of Indonesia's leading export commodities. Citing data from the Central Statistics Agency (BPS), the value of CPO exports will reach $29,62 billion in 2022, up 3,56% from the previous year. Meanwhile, its export capacity is 26,22 million tons.
Interestingly, oil palm plantations in Indonesia are dominated by 3 million small farmers (self-help/smallholders) with a percentage of around 40%, the rest is owned by the government and the private sector. These independent farmers generally have land of less than 25ha.
Even though it is industrially prospective, in reality they do not have sufficient knowledge to cultivate oil palm according to standards good agricultural practice (GAP) implemented by government/private oil palm land, such as suitable land for planting oil palm, use of seeds, fertilizer, and other efforts to increase the productivity of their land.
Even for marketing, they only have the alternative of selling it through middlemen at low prices. This upstream challenge is what we want to try to solve Palm PRO with three solutions presented:
- SawitPRO members: for business owners to manage their business efficiently, such as monitoring worker performance, consulting with Palm Oil Doctors, purchasing plantation and daily necessities, and loyalty programs from Sawit Points,
- Palm PRO Workers: record worker activities regularly,
- Palm Oil FarmersPRO: record activities, report income, costs and profits, calculate estimated yields using a smart calculator, monitor international CPO prices.
- SawitPRO Partner: in the form of a site to increase supplier loyalty through reports real-time, campaign adjusted, and incentive distribution.
The three applications above are integrated with three supporting solutions, namely:
- Palm Points: growing loyalty through various incentive programs,
- Palm Shop: platform marketplace for the needs of oil palm plantations and daily needs,
- Palm Doctor: online consultation (AI Chatbot based via WhatsApp and teleconsultation) to improve the quality of FFB (Fresh Fruit Bunches), as well as field visits from experienced agronomists to improve harvest productivity and land management.
Before launching the three products above, the startup led by Abhishek Singh carried out a lot of direct research in the field and discussed with small farmers in Riau for some time. For the record, this province has the largest oil palm plantations in Indonesia with an area of 3,49 million ha or 20,75% of the total national area in 2023.
“Anyone can make an application. The challenge is to compete to create the latest and most sophisticated applications, but how to create solutions that truly answer problems in the field. "The application must be easy to use, understand and useful," he explained DailySocial.id.
Abhishek is not new to the world of palm oil, previously he worked and held important positions at the RGE (Royal Golden Eagle) Group, a natural resource-based business group owned by entrepreneur Sukanto Tanoto. There he also served in its subsidiaries such as APRIL, Asian Agri, and Apical.
In his view, the gap in knowledge of independent farmers in cultivating oil palm is very far from the SOPs usually carried out on privately owned oil palm plantations. As a result, productivity is greatly reduced.
“We took best practice from the plantation industry, when is the right time to harvest, when to prune, etc. They can access all this information, as well as buy fertilizer on the SawitPRO e-commerce. So farmers can reduce cost, more production, productivity increases.”
He believes that this approach is able to answer problems in all upstream aspects that have been faced in the field. Moreover, the post-pandemic momentum is considered quite appropriate to enter this commodity, because there has been an increase in internet penetration. Players in the ecosystem are no longer using feature phone in their daily lives, so that the increase in digital literacy is also affected. "So that's it timing, we were quite lucky.”
At just one year old, SawitPRO plans to expand into regions, such as Sulawesi, Jambi and North Sumatra. The last two provinces are included in the 10 provinces with the largest oil palm plantations in Indonesia. Apart from that, attracting academics from universities to create more actors in the palm oil supply chain ecosystem in order to create a sustainable palm oil industry.
Currently, SawitPRO operates in Riau with its head office in Jakarta. Various partnerships have been established with the ecosystem, such as attracting more than 10 thousand independent farmers, 12 Farmer Shops, 49 DO agents, and as much as 379 thousand mt of FFB production has been produced.
The business model used by SawitPRO is a subscription package, there is a fee paid by the business owner. The nominal subscription fee is not stated. Abhishek only confirmed that the company was able to generate positive income in the first year.
Therefore, in line with the big target, he targets SawitPRO to be able to make a profit at least this year with an efficient team, around 70 people.
"We want to be a startup that focuses on making a profit on its first day because we don't want to be in a situation where we have to fire employees later on. "The first year was difficult, but this year at least we can make a profit even though the nominal value is small."
Although not detailed further, Abhishek revealed that SawitPRO already had external investors to support operations in its first days.