InfoSAWIT, JAKARTA – A company is basically operated to get profits. The profits can be reachable by the support of good human resource to produce highly.
The main goal of plantation companies and the smallholders is to get the profits. The profits for the company are as the basic to divide devidend, compensation, bonus for the workers, the numbers of tax to pay, something to validate a good company, something to measure the achievement of management, the base to make decision or investment policy. While for the smallholders, profits are to increase their welfare.
In Accounting, profits means as the disparity between the selling and the cost to spend. Profit means the selling is reduced by the cost. If the selling is the same with the cost, the company has no loss (break even point). If the selling is cheaper than the cost, it means, the companies or smallholders got losses. The selling is from the selling price per unit and multiplied by the sold unit.
In plantation companies, the numbers of fresh fruit bunch (FFB) production and the numbers of FFB are the same. The FFB production is directly sold to the palm oil factory (POF). If there are some restant, they should be transported to the POF right in the next morning.
So the factors influencing the profit of the companies or smallholders are the numbers of FFB which are produced or sold (kg/ton) and the FFB selling price per kg/ton and the FFB cost itself.
The FFB selling price is determined by the demand and offer. It is also infuenced by some factors, such as, the CPO export volume, CPO price and others.
The palm oil plantation company chose to get more profits by increasing the FFB production. The increasing FFB production would press the production cost. In this case, it remains stable.
Production means the activity to produce or make the service or goods. The production is the activity to create or add the value of goods to fulfill needs. In palm oil plantation company, the goods which is produced is fresh fruit bunch (FFB). (Maruli Pardamean / Author, Palm oil Plantation Practitioner)
For more, please read InfoSAWIT January and February 2018