Strategic Management Analysis: Javara II
Chapter 1: Introduction
Indonesian local brand nowadays has broken the boundaries internationally in many different areas. One of the brands introducing Indonesian spices and agricultural product is Javara. Supplying Indonesia’s forgotten biodiversity heritage, Javara has successfully introducing it to national and international market. Having the product quality and its motion in prospering the Indonesians local farmers as their focus, Javara create a meaningful partnership with farmers, foragers, fishers, and food artisans nationwide who enable Javara to provide the finest wide ranged product originated from Indonesia’s soil that can be offered to the world.
Stand under PT. Kampung Kearifan Lokal, Javara was founded when doing business work in providing advices, a trained Intellectual Property Rights lawyer and consultant called Helianti Hilman in October 2008; Javara is born answering the concern of farmers in the forgotten heritage and culture. The passion, dedication, and perseverance of the indigenous communities support her motion in leaving her job, found Javara and immersing herself in developing the possibilities in mission of delivering food biodiversity and participate in the market together with its vision in sustaining the forgotten culture. Their vision and mission also support their values which are “good food is leisure, good health is treasure, and good deed is a pleasure”. The clear concept of its vision, mission and value created a clear, measurable and supporting value proposition which are first, featuring food biodiversity heritage, culinary tradition & indigenous knowledge, traceable origin-specific products, healthy, nutritious and adaptable to meet the consumer appetite and ethically traded and create impacts across the supply-chain. The name of the brand itself is a wish that Javara, will always bring the best, champion worthy products from Indonesia to the world.
Holding the saying, “Those who control the brands control the whole market”, the founder of Javara starts the business from the core to its product, brand name and other internal factors. It creates the brand, which the consumer can relate to through the value represent in the product. Putting importance in security and the brand’s legality, Javara did their best to protect their rights, equity and their brand. Javara is found to address social problem and its original idea is to help marketing the product produced by the local farmers keeping the local culture and keeping it from extinction. Javara also build the dignity of local farmer by putting their names all over the packaging and making the farmers feels proud and entitled of the products.
As a business, Javara has created scope of activities which a continuous movement that describe their job in delivering the best product and services as well as doing legal activities and doing constant development on the products. Ranged from honey, jam, and spread products, sweetener, coffee, tea, and beyond, rice, grains, and beans, flour, baking ingredients, sauce and condiments, pasta and noodles, coconut oil, snacks and nuts, salt, spice, herbs and seasoning, raw crackers, until hampers and gifts, that 300 products out of 900 products offered has meet organic certified ubder the EU, US, NOP and Jas standards. Javara has been able to sell many best seller products domestically and internationally with the help of 50.000 small holder farmers across Indonesia. Intervening along the supply chain, the company strengthen the suppliers capacity, provide safety for the workplace, and market the products internationally which providing worthy prices for the partnering farmers and any other vendors along the chain.
Doing business as the distributor of the products, Javara has done some activities that carry the company through its branding. One of the activities is the sales, distribution and export which entail providing food service, managing the flagship store, retail outlets, food service, online and industrial clients. Javara also did marketing and public relation related activities which entails food identity branding, a continuous activity to boost the brand name and also practicing ethical business in order to keep true with the vision and mission of the company. Doing these activities keep Javara true to its nature and building the company’s name to the public and serving the partners as well. As in its production processes, Javara make sure that their product can be exported to countries with different standards worldwide. Nowadays, Javara has been certified for the US, Europe, and Halal certifications which allows its products to be exported to over 20 countries in 5 continents. In the added value food processing process, Javara put their efforts in earning organic and other certifications by abroad standards, as well as did more to ensure that their product quality is assured by developing its own production house. Javara also continuously develop their product by keep innovating and learning about the heritage food culture to continue develop recipes to highlights the beauty of Indonesia’s heritage food ingredients. The next activity that Javara does is post harvesting process. Not only keeping the role of being distribution channel. Javara plant their capital and does investments by providing technological and technical assistance while also producing offtaker for farmers and artisans. Noticing the importance of its communities, Javara build their relationship with the food producer communities and the indigenous communities and continue providing them positive social impacts to the community.
Willing to be positive impacts to the community, Javara keep their eyes open for the needs of the community and the future challenges faced by the food producer community. Knowing that challenges and willing to provide solutions, Javara creates rural business opportunities and employment which allow the youth and women in the community to achieve reverse urbanization. Being in the coverage of Javara, the community has a safer work condition while keep exploring the skill and the capacity which will increase the marketability and the profitability of the product produced. It is also a way for Javara to keep the product in a great quality and keep improving it, by also educating the people and help the community to gain knowledge. This activity also improves the ability of the people to make nutritious food for their own consumptions which directly affect their health, food quality, and productivity.
Chapter 2: Analysis and Discussion
International Opportunities
Having big dream in building a large scope distribution channel, Javara always knew they wanted to cross the boundaries and always tried their best to build the channel as well orientating the brand to reach both internal and external market. Exporting will definitely increase the market possibility. It will also gain abroad consciousness around Javaras’ product which will directly prosper the local farmers, gatherer and other partners participating in the food production. However unlike other global companies, Javara did not make their production house outside of Indonesia. They don’t use the common strategy for global distribution and solely using export strategy while building support outside of Indonesia such as making workshops and activities abroad. Javara make sure to make a tight knitted relationship with their partners and client abroad to ensure that their exporting activity done smoothly. Due to that, Javara will constantly think an innovative way to ensure ways to keep the product safe during the modes of transport while exporting. International opportunities allow the company to serve bigger rays of products to match the international taste.
The Choices of International Entry
There are a lot of choices for company when it comes to finding the modes of entry in a new territory. Depending on the type of business, the targeted country culture, the politics, geographical, economical, demographical conditions, the possible ways in entry, the required capitals or factors for the business to run are also some factors from many others that should be considered while choosing the most suitable way. In general there are 5 ways or types which businesses use in order to enter a new territory of market. Every single one of them has its own disadvantage and advantage which affect the decision.
From the most involved home company to the least involved home country to the company in host country, there are new wholly owned subsidiaries, acquisition, strategic alliances, licensing and exporting. New wholly owned subsidiary, which is practically the company in the home country moved wholly to the host country without through an adjustment to the host country condition that creates a potentially above-average returns, maximum control over the company in the host country as everything is exactly how it was in the home country. Usually the movement would be costly, complex and time consuming as well as owning a high risk. Being less involved, the business can try acquisition method which require the business to merge with worthy local business or operation which allow them to adjust faster and better in the new market. However this method is not completely safe due to the possibility of having merger problem, high cost and negotiation problem due to the acquisition to the other company and most probably it is going to need more preparation time while finding good partner to merge with locally. To solve the cost and high risk problem, doing strategic alliance might be a way to do it. It is done by sharing cost, resources, and risk which makes the alliance manageable. However there might be slight problem with the integration of 2 companies’ culture combined into one shared company. It is also important to put the line between the 2 companies so that the rights and rules are crystal clear for both parties. Coming to the less involved home country company, licensing is a way for business to enter the country. It has low cost, low risk, but that also come with little control and low returns as well. Licensing needs constant observation, supply and the home company needs to educate the licensee about the company before letting them run the business under the name of the company. The last is exporting which require higher cost but give the company less control if they don’t have enough support in the host country. The support means the store, the documents, and any other things which allow the product to be distributed without the existence of the company in the country.
Focusing on distributing local products, it is impossible for Javara to open any production channel abroad, but they create support for the benefit of the distribution channel. The support Javara has relies on its certification which allows them to be accepted to many different countries. Even though they do not own a specific store specifically selling their products, but they successfully send their product to the seller who are usually supermarkets, import distributors, factories, and also some other vendors. This routine activity makes the percentage of local and international consumption lies on 40% and 60%. With the help of a very meticulous branding and slow build to the vendors outdoor, Javara continue build their brand and successfully fulfill its purpose. Even though the cost of the transport might be high and Javara might lose control of its product, but it is positively accurate that exporting products is suitable way for Javara to distribute their products.
Internal Innovation Process
Internal innovation process is a process of the changes made internally due to the existence of innovation. The goals of doing internal innovations include fostering innovation culture and creativity, providing systematic tools to create new products and new ways in proving better services, and create business sustainability by making constant improvements to the existing business lines. The changes or the development created could be in a big scale or in a smaller scale with big or little changes made inside an organization. It could affect the organizational structure, supply chain, production process to increase efficiency, or cost saving activity. This movement however, require an innovative and development to ensure that this activity will continue the life of the company as well as providing better access to something better for the company. These internal innovations will promote new behaviors which benefit the new culture. They also will shape the environment so that the worker can have proper resources, capital, time and freedom to focus on the new innovation. And finally the company will be able to turn creative ideas, and process it into real value creation.
As how Javara was born for the first time, it was a start-up created by someone who has entrepreneurial skill which created such a wonderful way in connecting the weak link as well as channels and provide a big missing chamber which makes the brand a big help to the community. From the entrepreneurial mindset, the internalities of the company is created and shared among the workers as well as become the compass of the company. Due to the existence of the entrepreneurial mindset, the leadership is there and so all the values and create innovations in order to best address the following issues: limited land plots and resources for revenue generation; climate change leading to crop failures; on-farm food waste due to market failures; the gap between what the farmers have and what the consumer wants; and finally, managing the perceived value within the overall supply chain from farmers to market. Innovation for Javara has many definitions which include technical innovation such as product development, food processing and technology. Business model also need to be innovated as in the modes of distribution.
Value Creating Diversification
Product wise, Javara has a lot of different diversification on their product depending on the origin of the material. Business wise, Javara’s businesses are not way from the food area which makes it less diversifies but it is strongly support the core of the business.
Chapter 3: Summary and Suggestions
One of the brands introducing Indonesian spices and agricultural product is Javara. Having the product quality and its motion in prospering the Indonesians local farmers as their focus, Javara create a meaningful partnership with farmers, foragers, fishers, and food artisans nationwide who enable Javara to provide the finest wide ranged product originated from Indonesia’s soil that can be offered to the world. The name of the brand itself is a wish that Javara, will always bring the best, champion worthy products from Indonesia to the world.
Stand under PT. Kampung Kearifan Lokal, Javara was founded when doing business work in providing advices, a trained Intellectual Property Rights lawyer and consultant called Helianti Hilman in October 2008; Javara is born answering the concern of farmers in the forgotten heritage and culture.
Holding the saying, “Those who control the brands control the whole market”, the founder of Javara starts the business from the core to its product, brand name and other internal factors. Javara is found to address social problem and its original idea is to help marketing the product produced by the local farmers keeping the local culture and keeping it from extinction.
As a business, Javara has created scope of activities which a continuous movement that describe their job in delivering the best product and services as well as doing legal activities and doing constant development on the products. Javara has been able to sell many best seller products domestically and internationally with the help of 50.000 small holder farmers across Indonesia.
Doing business as the distributor of the products, Javara has done some activities that carry the company through its branding. Doing these activities keep Javara true to its nature and building the company’s name to the public and serving the partners as well. As in its production processes, Javara make sure that their product can be exported to countries with different standards worldwide.
Nowadays, Javara has been certified for the US, Europe, and Halal certifications which allows its products to be exported to over 20 countries in 5 continents. In the added value food processing process, Javara put their efforts in earning organic and other certifications by abroad standards, as well as did more to ensure that their product quality is assured by developing its own production house.
Noticing the importance of its communities, Javara build their relationship with the food producer communities and the indigenous communities and continue providing them positive social impacts to the community. Being in the coverage of Javara, the community has a safer work condition while keep exploring the skill and the capacity which will increase the marketability and the profitability of the product produced.
Focusing on distributing local products, it is impossible for Javara to open any production channel abroad, but they create support for the benefit of the distribution channel. Even though the cost of the transport might be high and Javara might lose control of its product, but it is positively accurate that exporting products is suitable way for Javara to distribute their products.
Innovation for Javara has many definitions which include technical innovation such as product development, food processing and technology. Product wise, Javara has a lot of different diversification on their product depending on the origin of the material. Business wise, Javara’s businesses are not way from the food area which makes it less diversifies but it is strongly support the core of the business.
References:
https://javara.co.id/our-journey/
https://medium.com/creatorspad/the-case-for-internal-innovation-abb6d5aa2de9
https://www.ubudfoodfestival.com/innovative-indonesia-helianti-hilman/
https://www.iedunote.com/diversification