Small companies survive crisis the best<\/p>\n
The business sector has long been feeling the pinch of the
\neconomic crisis, with many companies going bankrupt or slowing
\ndown their pace. But there are some survivors which are able to
\nmaintain their performance or even step up a gear. The Jakarta
\nPost reporters Edith Hartanto, Budiman Moerdijat, Devi Asmarani,
\nKosasih Daradjat, Dwi Atmanta and correspondent M. Ahyani
\ncompiled the following report. Pictures by Oka Budi Yogaswara.<\/p>\n
JAKARTA (JP): Small is beautiful and modesty shows the way to
\nsurvival in this unpredictable spell of economic adversity
\nparalyzing most business fronts across the country.<\/p>\n
While business heavyweights are counting their losses accrued
\nfrom their lust for multibillion dollar investments, some midsize
\nand small businesses, which virtually stayed out of the public
\nspotlight during the boom of the past few decades, are coming
\ninto their own.<\/p>\n
And when the once-superfluous conglomerates are handing the
\ngovernment a severe headache with their apparently unpaid
\nexternal debts and massive layoffs, small and medium companies
\nare stepping in to ease the pain.<\/p>\n
Atih Surjati Herman, head of the small industry development
\nagency at the Ministry of Trade and Industry, says that small and
\nmidsize firms are the most likely firms to survive the crisis.<\/p>\n
\"Some of them are benefiting from their rising export volumes
\nbecause of their competitive prices. There are also companies
\nwhich are enjoying export hikes but, although managing to
\nsurvive, are weak when it comes to price-bargaining power,\" she
\nsays.<\/p>\n
With the rupiah weakening against the U.S. dollar, products
\nwith a high imported content have been largely blamed for killing
\nmany business sectors.<\/p>\n
Atih singles out, among other things, food, handicraft and
\nfurniture producers for their use of local materials, and
\nsuggests that other businesspeople follow suit.<\/p>\n
Such a call, however, underlines the irony of the country's
\nsuccessful development story over the past 30 years for
\nagricultural expert Bungaran Saragih.<\/p>\n
He criticizes the government for encouraging industrialization
\nwhich failed to exploit agricultural resources, despite the fact
\nthat most of the country's population makes its living from their
\nland.<\/p>\n
\"How come that a country which is blessed with fertile soil
\nlike Indonesia has to import food?\" asks Saragih, a professor at
\nthe Bogor Institute of Agriculture.<\/p>\n
Another scientist, Thobby Mutis of the Jakarta-based Trisakti
\nUniversity echoes Saragih's criticism, saying that instead of
\nstressing land cultivation policies, the government has spent too
\nmuch time on controversial policies such as the national car
\nprogram, high-tech industries and clove and orange trade
\nregulations.<\/p>\n
Export-oriented<\/p>\n
Irwan Suryanto of Majalengka, West Java, turns a deaf ear to
\nthe controversy surrounding state development planning. He finds
\nnothing remarkable in the government's recent \"I love Indonesian
\nproducts\" drive because he has been advocating it for years.<\/p>\n
The 48 year old finds himself on the right track after seeing
\nhis leather soccer-ball industry escape the steamrolling monetary
\nturmoil.<\/p>\n
A junior high school graduate, Irwan bounced back from a Rp
\n200 million loss in 1994 with the brilliantly picked new
\norientation of targeting overseas markets.<\/p>\n
Employing some 800 local handcrafters, who mostly work from
\ntheir respective homes, Irwan's company produces 30,000 balls a
\nmonth. Some of the balls will be used in the World Cup that
\nstarts in June in France.<\/p>\n
World soccer body FIFA estimates the global demand for soccer
\nballs at 150,000 per day, compared to the domestic demand of
\n75,000 per month.<\/p>\n
Such a huge market is the major reason why Irwan insists on
\nsticking to his old business, rather than expanding it to making
\nother sports equipment.<\/p>\n
With a relatively cheaper price, thanks to the rupiah's
\ndepreciation against the U.S. dollar, Irwan's balls are in high
\ndemand in China, Russia, the United States, Middle East, Latin
\nAmerica and Europe.<\/p>\n
Sukyatno Nugroho, owner of the Es Teler 77 restaurant chain,
\nis another rare success tale who, like Irwan, doesn't want to
\nhear empty talk about how the business sector is struggling with
\nthe worst crisis in decades.<\/p>\n
\"No economic theories can solve this crisis. I'm just an
\nordinary person. I'm just treading my own way to save the 3,000
\npeople working for me,\" he says.<\/p>\n
Despite the slowdown, the 50-year-old businessman is spreading
\nhis wings to Brunei and Singapore.<\/p>\n
But it took Sukyatno, a native of Pekalongan, Central Java,
\nalmost two decades to reach such a height. Starting his business
\non the street, he made use of what can be considered a
\nconservative approach to build up his own kingdom. He currently
\ncontrols 234 outlets, 21 of which were opened during the monetary
\ncrisis.<\/p>\n
\"I form strong partnerships with small businesspeople who do
\nnot rely on bank credits. This is one of the keys to our
\nsuccess,\" he says.<\/p>\n
He adds he avoids opening outlets in high-class buildings, not
\nonly because of fears about expensive rents but due to his
\ndecision to target the middle class.<\/p>\n
\"My conservative style drew laughter from my friends, but now
\nit's proven to be right,\" he recalls.<\/p>\n
\"I enjoy doing everything myself, including buying materials
\nin markets or cleaning tables. I prefer becoming number one
\nperson in my own company to a tycoon rated below 100
\n(nationally),\" he says.<\/p>\n
Suprapti Wahyuni, who runs a garment and handicraft company in
\nBekasi, West Java, has seen her company survive the crisis,
\nalthough she says it is earning less than it should be.<\/p>\n
Her firm, PT Wahyu Purnomosari, has raised the output of its
\nladies garments from 2,000 dozen a month to 2,500 but only after
\nshe offered a 25 percent discount to her traditional buyers from
\nthe United States, the United Arab Emirates and several other
\nAsian countries.<\/p>\n
\"The dollar we receive is smaller because its exchange rate
\nmultiplies by three to four times compared to the rupiah, while
\nproduction costs such as labor wages and engine expenses remain
\nhigh,\" she says.<\/p>\n
With nobody knowing when the crisis will end, Saragih asserts
\nthat opportunities for businesspeople to regain ground remain
\nwide open if they turn to agroindustry.<\/p>\n
\"We are actually watching an agribusiness boom, with a tomato
\nselling at Rp 500,\" he says. (team)<\/p>",
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