Strategy and Innovation of Mushroom Business in Rural Area Indonesia: Case Study of a Developed Mushroom Enterprise from Cianjur district, West Java, Indonesia

Abstract

Mushroom farming has become attractive business in agricultural sector due to its simplicity and flexibility of cultivation and quite profitable. Health awareness of Indonesian people about mushroom gives a positive impact to mushroom business. Behind the good aspects, several evidence argued that production performance of mushroom business is not optimal related to less capacity and deficiently appropriate knowledge. This paper aims to learn the unique strategy and innovation from local mushroom enterprise which is very famous in Cianjur distric, West Java, Indonesia in order to improve the business performance. Using technological (innovation) approach and qualitative method, this study concluded that there are two types of strategies, one relating to the technological part, and the other relating to the organization part. The technological focuses on attracting market and enhancing the yield productivity. The organization part focuses on developing capacity to fulfill the demand by making a contract agreement resembling contract farming with local society. For local society, the contract agreement has benefit to minimize both market failure and production problems under supervison support and without monopoly action. The strategies were capable of being successful innovation by interacting and cooperating with external sources, and performing certain adjustment with local condition.