Marketing centralization carried out by PT Pupuk Indonesia (Persero), as part of the business transformation at Pupuk Indonesia launched by the Minister of BUMN Erick Thohir, has proven successful in increasing the company's performance.
This centralization effort further strengthens the ability of Pupuk Indonesia and its subsidiaries to serve and secure the supply of domestic fertilizers, especially subsidized and non-subsidized fertilizers.
On the other hand, this centralization has also succeeded in increasing market penetration both at home and abroad for companies with commercial products, both fertilizers and non-fertilizers, as well as optimizing company revenues from this sector.
This was conveyed by the Main Director of PT Pupuk Indonesia (Persero), Bakir Pasaman in a written statement received by Kabar Bisnis.com, Monday (9/1/2023). According to Bakir, after the company centralizes marketing in 2021, there will be a significant increase in the company's performance.
"We are still waiting for the results of the audit, but thank God the company's revenue and profits have increased significantly, where in 2022 we managed to achieve revenue of around IDR 103 trillion with a profit of around IDR 19 trillion (unaudited), where 65% of revenue comes from commercial and non-fertilizer products. . With this marketing centralization, we can optimize the company's sales to the commercial sector, especially for sales of ammonia and urea both in terms of tonnage and optimizing selling prices," Bakir explained.
Fertilizer sales to the non-subsidized sector, particularly to retail and corporate consumers, in 2022 will reach 4.08 million tons or 101% of the target and sales of non-fertilizer products will reach 1.45 million tons or 130% of the target. "We need to emphasize that we can do this while still prioritizing domestic supply, both the need for subsidized fertilizers and non-subsidized fertilizers or commercial products," said Bakir.
Through this centralization, Pupuk Indonesia also developed a program of 1,000 fertilizer kiosks for commercial and non-subsidized products to facilitate farmers' access to Pupuk Indonesia Group products.
"We hope that with the Toko Pe-I commercial kiosk program, farmers and other consumers can more easily find our products. Our current target is to build 1,000 kiosks and later we want Pe-I shops to be available in all districts so that there are no more complaints of difficulty finding fertilizer," said Bakir.
The success of marketing centralization, according to Bakir, is because it eliminates competition between subsidiaries that have been competing with each other. In addition, centralization can also reduce distribution costs and optimize the speed of product distribution. "Besides that, it also increases the bargaining power of the corporate sector and overseas customers so that we can get a good selling price," said Bakir.
The holding functions of marketing, promotion and market penetration both at home and abroad are also taken over by the holding so that the subsidiary companies can focus and achieve optimal production as efficient units. "So now the holding is looking for markets and customers, carrying out marketing activities including opening offices abroad in Dubai," added Bakir.
Meanwhile, the Main Commissioner of Pupuk Indonesia, Darmin Nasution stated that Centralization at Pupuk Indonesia had been running for almost 2.5 years, where the previous holding function had changed to being an activist holding. The Board of Commissioners considers that the centralization that has been carried out is in line with the company's master plan mandated by Write Shares.
Centralization has brought significant progress for Pupuk Indonesia as a national company, not only aimed at providing agricultural and plant nutrition solutions, but centralization has also encouraged company transformation in the context of restructuring fertilizer industry subsidies.
