Roadmap for value chain analysis on broiler marketing in Makassar

Makassar City is a potential area for the development of the broiler marketing value chain. The main challenge in developing the broiler value chain is high price fluctuations, both input and output. Value chain analysis on broiler marketing in Makassar aims to identify and analyze value chain channels, distribution of costs and benefits, as well as market characteristics. Analysis of the distribution of costs and benefits is carried out using the Hayami method. The results of the research show that there are irregular price fluctuations and imbalances in market structure at each level of the value chain. Each marketing chain of broiler chickens in Makassar City gains a disproportionate profit at each marketing level with the value creation contribution made and the risks borne by each marketing level. The total profits of large retailers are greater than those of brokers and small retailers, while the value creation activities and risks of large retailers are smaller than those of brokers. Unnatural fluctuations in the price of chicken meat are the impact of the government’s lack of role as a supervisor and regulator in the value chain activities of broiler marketing. The development of the broiler marketing value chain must focus on regulatory oversight, improving access to markets, information and capital to increase the competitiveness of business actors.


Introduction
The value chain is a complex activity carried out by several actors and aims to create a final product through a process chain starting from the procurement of raw materials to the distribution process [1].
The concept of the value chain is a concept that was first introduced by Porter in 1985.This concept describes activities ranging from the supply of raw materials, production to the distribution of products or services to consumers [2].Value chain analysis is usually used to evaluate industries and their systems [3].An effective value chain is the key to competitive advantage that can provide added value to actors in the value chain.The value chain is described as a series of activities to carry or distribute a product or service that has previously undergone physical changes or input from service providers and then sends it to consumers for recycling after use.Value chain analysis can provide added value to consumers through identifying the stages of the value chain in the industry, besides that value chain analysis can streamline the costs incurred by an industry.In the value chain analysis, there are 2 types of activities, namely primary activities and supporting activities.Primary activity consists of 5 activities, namely inward logistics, operations, outbound logistics, marketing and sales and service.Supporting activities  According to Kumar and Rajeev (2016), the value chain is defined as a representation of activities in an industry that have added value, cost structure and are based on efficiency strategies [5].In order for an industry to be more successful, it requires knowledge of consumer needs and the ability of an industry to meet consumer needs based on the competitive strategy that has been made.Value chain analysis can be used to analyze and evaluate an industry to create a required competitive strategy.The steps in value chain analysis are breaking down the activities in the value chain that are involved in the supply chain.The second step is assessing the potential for adding added value through cost advantage and differentiation.The third step is to determine a strategy that can help the industry achieve its goals.The existence of value chain analysis can be used to make company strategy by understanding the company's relationship with suppliers and customers and reducing costs [6].According to Friska (2010), value chain analysis aims to identify strengths or weaknesses that occur along the value chain, from raw materials to customer service.The value chain includes activities that occur from relationships with suppliers to relationships with consumers [7].
Globalization in various economic and business sectors currently has an impact on the competitive ability of agribusiness products, both in capturing the domestic market and in facing increasingly tight export markets.One agribusiness that has strategic value, especially in the provision of animal protein to meet domestic nutritional needs and export opportunities, in addition to its role in taking advantage of employment opportunities, is the poultry business (chicken), which has become an industry that has a complete component from the upstream sector to the downstream.poultry companies can absorb a total workforce of 20,414 people divided between 15,016 permanent workers and 5,398 temporary workers in 2022 [8].The contribution of the livestock sub-sector's gross domestic product (GDP) to agriculture is 4.05%, while for the agricultural sector to national GDP it is 14.50% in 2021 [9].This shows that the role of the livestock sub-sector in agricultural development is quite significant, where the poultry industry is the main driver of business development in the livestock sub-sector.Total production in the poultry sector will reach 4,253.54tons of meat and 6,322.55tons of eggs in 2022 [10].The increasing population in Indonesia has caused the food sector to also increase [11].One of the food commodities that is favored by the people in Indonesia and is the choice to meet protein needs is chicken meat.This is because the price is quite affordable and generally meets people's tastes.South Sulawesi is one of the provinces that produces quite a large amount of broiler chickens.This can be seen from data on broiler chickens in South Sulawesi from 2019 to 2020 which have continued to increase.In 2019 the number of broiler chickens in South Sulawesi was 64,260,187 and in 2020 there were 65,231,867 [12].
The condition of Makassar City as a metropolitan city is dense enough that it is not possible to build a livestock industry including broiler farms.This is because for a broiler farm is very dependent on the availability of land that is large enough and far from settlements.One of the potentials of Makassar City is trade where broiler is one of the commodities originating from outside Makassar City which is traded by broiler distributors.Therefore, this study aims to develop a roadmap for value chain analysis in broiler marketing in Makassar.

Research methods
This research was conducted in January 2023 in Makassar City.The method used in determining the sample is the snow ball sampling technique.In this technique the sampling is adjusted to the research objectives where the sampling is not determined on the quality but on the understanding being studied.The number of samples will grow (snow ball) until the required information is sufficient for snow ball sampling through several stages.The research method used is descriptive qualitative and descriptive quantitative.The data analysis used uses the approach to the Hayami method, (1987), the Hayami method is used to calculate added value, costs and profits between marketing value chain actors [13].The basic calculation used in this study is Rp/kg of raw materials.

Results and discussion
As a result of identification in the field, the marketing value chain channel for broiler chickens in Makassar City consists of three channels.Each value chain path produces a different distribution of added value for each business actor which can be seen in Figure 2  The value chain in broiler marketing in Makassar City consists of three channels with four chain actors namely brokers, large retailers, small retailers, and consumers.In channel 1, brokers sell broilers to large retailers, then large retailers sell to small retailers, then small retailers sell to end consumers.In Differences in value chain paths are one of the reasons for differences in the rate of acquisition of added value for each business actor.Based on table 1, on channel 1 the broker gets an added value of IDR 4,000/kg by selling broiler to large retailers, large retailers get an added value of IDR 8,000/kg by selling to small retailers, while small retailers get an added value of IDR 3,000/kg by selling directly to consumers.On channel 2, brokers gain an added value of IDR 4,000/kg by selling broilers to small retailers, while small retailers earn an added value of IDR 3,000/kg by selling directly to consumers.On channel 3 consumers buy broiler chickens at a cheaper price than on channels 1 and 2 by buying directly from baskets with added value received by baskets of IDR 4,000/Kg.

Consumer
Analysis of the marketing value chain for broiler chickens in Makassar City shows that the value chain influences the formation of prices and profits for business actors.Value chain channel 1 is the most efficient for large retailers, channel 2 is the most efficient for small retailers, while channel 3 is the most profitable for consumers.The length of the distribution chain affects the efficiency of distribution activities.The shorter the value chain path, the more efficient the distribution activities.
Analysis of market characteristics aims so that business actors can meet consumer needs properly according to the characteristics of the prevailing market [14].Market characteristics are an aspect that must be well understood by all business actors in the marketing of broiler chickens.Strengthening understanding of market characteristics consists of market segment analysis, Critical Success Factor (CSF) analysis, how to access the market, and the current market structure.Market characteristics of broiler marketing business actors in Makassar City are summarized in Table 2  Table 2 shows that each business actor in the broiler industry value chain in Makassar City has various market segments and demand specifications.Several business actors have the same market segment, but each business actor has a specific strategy to meet consumer needs and determine prices.The pricing strategy for broiler products considers several factors such as purchase quantity, competitive conditions, product quality, and the payment system.

Conclusion
The value chain of broiler marketing in Makassar City consists of 3 channels.Value chain channel 1 is efficient for large retailers, channel 2 benefits small retailers, while channel 3 is the most profitable for consumers.The profits obtained by each business actor are not in accordance with the contribution of value creation and the risks borne, because the marketing of broiler chickens in Makassar City leads to an imperfect market competition.From the broker's point of view, the market structure is very profitable.Mastery of market access makes the broker a price maker in both the input and output markets.Large retailers and small retailers face a perfectly competitive market structure, because the number of sellers and buyers is relatively equal.The development of the broiler marketing value chain in Makassar City requires the role of business actors, the government together with universities to realize regulatory improvement and supervision, access for business actors both access to technology, information, markets and capital.

Small Retailer Big retailer Broker
, the broker sells the broiler directly to the small retailer, then the small retailer sells it to the final consumer.Channel 3 is the shortest channel, namely the broker sells broilers directly to the final consumer.Analysis related to the marketing value chain path of broiler chickens in Makassar City shows that the value chain path influences price formation and added value caused by activities in each business actor which can be seen in table1.

Table 1 .
Distribution of value added value chains and profits, 2023.

Table 2 .
below: Market characteristics of broiler value chain business actors, 2023.