PRO FARMER SUPPLY CHAIN PERFORMANCE OF HERBAL MEDICINE

Abstract

Increasing education, healthy lifestyle trends, and awareness of the benefits of herbal medicines lead to the increasing demand for herbal medicines. These opportunities need to be utilized by herbal medicine farmers to increase farmers' profits.  The selection and development of herbal medicine supply chain model, which takes the farmers' sides, is highly possible to increase the farmer's profit.The purpose of this study was to determine the performance of the herbal medicine processed supply chain that benefited farmers the most. Data collection obtained by surveying and field observation. The primary respondents were the traditional herbal medicine manufacturer and modern herbal medicines manufacturers, who bought raw materials to farmers either directly or through intermediaries. Respondents were selected purposively for retailers and snowball for traders. The analysis method used was trading margin and market share.The result of the research is that there are two trading channels, the first channel comprising farmers - processors - retail and the second trading channel involving farmers - intermediaries - whole sellers - processors - retail. The most efficient market performance, trading margins, and farmer's share are obtained from the first trading channel because it has the smallest trading margin and the largest farmer's share.Research Limitations: has not calculated the amount of product added value in detail.The originality of this research is that it integrates business actors in the production process from upstream to downstream.