Erman Muhammad Ali, Shopkeeper at Rumbai Market, 48 years old, Riau
While Indonesia produces enough food to meet the needs of its 250 million people, access and distribution vary greatly. Half the population lives in rural areas, spread throughout the country’s 34 provinces and 18,000 islands. According to the World Food Programme, many communities live in remote areas with little to no infrastructure—this is where Indonesia’s poverty is concentrated.
The private sector plays an important role as a catalyst for rural development. Typically, investment creates jobs, improves accessibility and raises standards of living. Rural development also means roads will be built, schools will be set up, medical facilities will be improved, and as a result, populations grow. And as populations grow, so do local markets like the one in Rumbai, not far away from where a Golden Agri-Resources (GAR) plantation is located.
The markets are an important part of rural infrastructure, more so in remote areas. While local families traditionally grow much of their own produce, the markets provide critical access to staples and other food needed to meet their everyday nutritional needs.
Erman Muhammad Ali owns a small grocery shop in Rumbai Market in Riau, where he sells essential dry goods such as rice, flour, and sugar. He also sells Filma and Kunci Mas cooking oils, which are high-quality cooking oils produced by GAR. Cooking oil is an essential product in the Indonesian family diet as much of their cuisine is based on stir-frying, deep-frying or sautéing. In fact, the average family uses two to three litres of cooking oil each month, and rely on small stores such as Erman’s to buy it.
However, getting essential products to small independent shopkeepers operating in remote markets is no easy task and goes through a complex distribution network before reaching its end consumers. Dealers sell to distributors, sub-distributors, wholesalers, supermarkets, retailers, and processing industries. Wholesalers distribute the cooking oil products directly to retailers and sometimes households. Then, independent shopkeepers sell their supply directly to local families as well as fellow retailers.
From time to time, Erman finds it difficult securing adequate stocks for his Rumbai store. This is in spite of the vast supply of cooking oil produced in Riau, so much that the majority is exported overseas. But the distribution network improves in tandem with infrastructure development, and Rumbai has come a long way since it was founded as a private sector settlement in the 1950s, on the banks of the Siak River, accessible only by riverboat.
Learn more about Filma cooking oil here.
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