Serutala works with CV Putra Tunggal Malang, a cosmetics manufacturer behind beauty and body care companies such as Nafiku. Both companies are bound by a contract in which CV Putra Tunggal Malang acts as the supplier of products such as soap bars, shampoo bars and conditioner bars. Up to point 7, the production process is done by PT Putra Tunggal Malang and the back end of the process is done by Serutala, which is.
CV Putra Tunggal Malang must apply for a license from the National Drug and Food Regulatory Agency (BPOM) for handmade body care products such as soaps, shampoos and conditioners. It is about assessing the impact of the production process on the environment and implementing safety measures at work to protect employees. Consumers are increasingly aware of the environmental impact of their choices, including everyday personal care products.
In line with previous trends, customers are more health conscious and need soaps that can offer them additional benefits such as natural extracts, added vitamins and added moisturiser. This is a result of the pandemic, which has led to greater awareness and conscientiousness when choosing personal hygiene products. Customers are much more willing to buy products from small local brands compared to generic supermarket brands such as Unilever, Reckitt and P&G.
This is pushing both local and global brands to market their products through e-commerce platforms such as Tokopedia, Shopee, Bukalapak and even TikTok Shop before it was banned.
PESTLE Analysis
High competitive rivalry: Market saturated with fast trends; intense competition for unique brand and market share. Even if Serutala has a unique brand of traditional Indonesian food, any competitor can copy it so easily. Expand the product line to include new ● Offer bargain prices on shampoo bar offerings such as lip and body balms and buttery balms, catering to the preferences of upper middle class women living in the audience large environmentally conscious female from Gen cities in Indonesia.
Emphasize the handmade aspect, locally based on market dynamics, taking into account the sourcing of ingredients, and distinctive shapes, the premium positioning and the costs of marketing materials to reinforce structures. Leverage a dual-channel approach by: ● Use social media to maintain a strong online presence for the target audience, share positive direct customer sales and collaborate with testimonials and emphasize the subtle, eco-friendly home goods distributors. Strengthen collaboration with existing ● Collaborate with influencers affiliated with consignment stores such as Splendore Craft, the store for eco-friendly and handmade products and the Eco-Friendly Bulk Store in that niche, ensuring a wider reach and in cities such as Jakarta and Bandung authentic product recommendations exist.
Explore possible collaborations through materials marketing efforts, introducing distribution channels in the brand's eco-friendly commitment to the handmade home goods industry, local sourcing and traditional designs. Encourage customer engagement through interactive posts, contests and polls on social media platforms, fostering a sense of community. Allocate a portion of your marketing budget to targeted online advertising and promotions and grow organically.
Segmentation, Targeting, Positioning (STP)
This number of defective products will decrease by 50 products every year, with a minimum of 50 defective products 3. The shipping cost is Rp 9,840,000 per year based on actual data and will increase every year with the inflation rate. Sales of bar soap, shampoo bar and conditioner amount to 3000 pieces per year, each product 12.
Operational Expenditure
Project Financing
Financial Simulation
For the sales unit of soap, conditioner and shampoo it is 3000 of each product per year. For unit sales of foam mesh and wood tray is 1000 each product per year. Every year, there will be 200 defective products for soaps, shampoo bars and conditioners.
In the next future year until the end of the project period, there will be 50 reduced products with a minimum of 50 defective products each. First, COGS, shipping costs, and selling costs can be a variable cost because when production increases, it means that the cost of each product will also increase. These fixed costs consist of marketing expenses, salary expenses, environmental management fees, electricity costs, water costs, telephone costs and depreciation.
It can happen because SERUTALA's COGS are very low and they can sell it at a high price. To calculate gross profit projection, the company needs some data such as revenue and variable costs. COGS is the amount of money it takes to make a product and cost of sales is the amount of money to sell the product, including cost of sales in some e-commerce.
From this graph, every variable, such as COGS, shipping costs, and cost of sales, is always increasing year over year. On the other hand, the turnover and also the gross profit always increase year by year. But gross profit is always far higher than COGS and also cost of sales.
Based on this chart, SERUTALA's net profit after tax is increasing year by year.
Analysis of Financial Feasibility of the Project
If the net present value (NPV) is greater than 0, the project can be accepted and feasible because the total net present value of free cash flows to the firm is greater than the initial investment. Based on the financial decision, if the NPV is greater than 0, the project can be accepted. Internal rate of return is a method of determining the discount rate where the net present value of the firm will be 0.
If the internal rate of return is greater than the weighted average cost of capital, the project can be accepted. If the internal rate of return is lower than the weighted average cost of capital, the project may be rejected. Based on the calculation, the Internal Rate of Return (IRR) of the SERUTALA project is 27.2%.
According to the financial decision, if the Internal rate of return is greater than the weighted average cost of capital, the project is feasible and can be accepted. If the payback period is below the maximum payback period, the project can be accepted. If the repayment period is above the maximum repayment period, the project may be rejected.
The profitability index is the comparison between the net present value of the firm's total free cash flow and the initial investment of the project. In the formula, the profitability index is the net present value of the firm's total free cash flow divided by the total initial investment is year 0. If the value of the profitability index is greater than 1, the project is feasible and profitable.
If the value of profitability index is lower than 1, the project is not feasible and not profitable. According to the financial decision, if the value of the profitability index is greater than 1, the project is feasible and can be accepted. The SERUTALA project is therefore feasible and can be accepted because the profitability index is 2.0 greater than 1.
RISK ANALYSIS
Technical Risks
This means that COGS does not really affect the company's revenue because the profit margin for SERUTALA itself is really high.
Operational Risks
The risk that the investment of SERUTALA shareholders will be lost due to unprofitability. SERUTALA's shareholders will lose their assets because SERUTALA is not a public company or a limited partnership. The risk that SERUTALA will not be able to meet its operating expenses in the next few years 9.
Risk that SERUTALA's COGS will increase and cause the profit margin to become small 10.
CONCLUSION
