Utilization of electronic marketing and economic determinants to improve income of dairy cattle farmer in Boyolali , Central Java-Indonesia

This study aimed to analyze the impact of electronic marketing utilization and to determine the economic determinants to increase the income of small dairy farmers in Boyolali, Central Java, Indonesia. A survey of 80 dairy farmers from the Cepogo District, Boyolali was determined by simple random sampling. The results showed that the average milk production was 8.3 liters/head/day, the revenue of IDR 3,824,000 per month, production costs of IDR 2,105,000 per month, and income of IDR 1,719,000 per month. Furthermore, by using electronics marketing, farmers could sell 40% of their products to coffee shops and generate revenue of IDR 5,411,500, production costs of IDR 2,705,000 and income of IDR 2,706,500. The utilization of the electronic marketing could increase R/C from 2.1 to 2.43. Economic factors that influence income are market prices, transportation and communication costs, marketing costs and distance traveled. Based on the results of the study it can be concluded that the use of the electronic market can expand the market, increase milk prices and ultimately will increase


INTRODUCTION
Milk is one of the important livestock commodities in Indonesia. Because of the milk demand is greater than its supply, the Indonesian government still import milk from other countries such as from New Zealand and Australia. In Indonesia, the purpose of dairy cattle raised to produce fresh milk. Setianti et al. (2017) stated dairy cattle in Indonesia only produce fresh milk less than 10 liters/heads/day. Further, Setianti et al. stated milk production was influenced by number lactation cow, quality and quantity of milk, and price decided by cooperative and milk processing industry. While the problems faced by dairy cattle farmers in Boyolali are lack of market accessibility and low milk quality.
The milk processing industry has a dominant position to decide the milk market price. In Boyolali, the dairy cattle business is done by farmers to add their income besides the main business as a crop farmer. Dairy cattle farmers sell milk through direct marketing. Dairy cattle farmers usually sell fresh milk to the cooperative around their area. Dairy cattle farmers have not utilized yet the electronic market. Utilization technology could increase marketing effectiveness (Bahera et al., 2015). The research focused on dairy cattle income in Indonesia was done by some researchers (Dolewikou et al., 2016;Setianti et al., 2017;Haloho et al., 2013). Setianti et al. (2017) stated that dairy cattle farms have an advantage for a farmer to give additional income besides the income from a crop farmer. In Central Java, usually, dairy cattle farmers raise 2-3 heads of dairy cattle. Farmer raise dairy cattle use traditional technology, so milk production is low and the milk quality is poor. They sell fresh milk to the cooperative at a low price. The utilization of electronic marketing will able to increase income because farmers can access other markets that have higher price (Baumuller, 2018;Gillespie et al., 2007;Larsen and Gilliand, 2009).
Utlization of industry 4.0 to market milk is needed. Some researches were done using industry 4.0 on agricultural sector (Depeyrot and Duval (2018) Kim et al. (2019) stated industry 4.0 was applied in mastitis detection. Improving marketing technology can improve the market price. Application of industry 4.0 in innovation technology would improve business efficiency (Annosi et al. (2019), Lezoche et al. (2020) and Frank et al. (2019)). Industry 4.0 could solve the production, innovation, financial and marketing as well (Lezoche et al., 2020) Electronic marketing using internet was done by some researchers (Mathews et al. (2015), and M'kwiriga and Imaita (2018)). Further M'kwiriga and Imaita (2018). stated utilization electronic marketing would increase market price and improve market efficiency.
Up to present many coffee shop growths in Boyolali Regency follow the lifestyle of young generation. The electronic market is still not utilized yet by the farmer. Almost all dairy cattle farmers in Boyolali still utilized traditional marketing strategy, dairy cattle farmer still not used yet internet, WhatsApp, etc to market their fresh market, so the research which investigated the scenario of utilization electronic marketing to increase their income is needed. The objectives of the study were to analyze the impact of electronic marketing utilization and to determine the economic determinants to increase the income of small dairy farmers in Boyolali, Central Java, Indonesia.

MATERIALS AND METHODS
The survey method was used in the study. Eighty (80) dairy farmers were chosen as the respondent by simple random sampling. The study was conducted in Cepogo District, Boyolali. The district was chosen because this district has the highest milk production (9,565,219 liters/year) in Boyolali Regency compared to other districts. The primary data was collected through direct interviews with the farmer and data were observed in the field. Revenue, cost of production and income were computed in this study. The feasibility was projected if the electronic marketing is applied. If farmers use electronic marketing, they can sell 40% of their products to coffee shops and 60% of products will be sold to cooperative. The coffee shop would order fresh milk using electronic devices like cellular phone and the farmer would deliver the milk. When the farmer sold fresh milk to the cooperative they got IDR 5,000/liter but if they sell the fresh milk to the coffee shop in Boyolali district they will get IDR 8,000/liter. Income was calculated based on the formula of Septiani et al. (2017): TR = Py x Y TC = TFC + TVC π = TR -TC where TR is the total of dairy farmer revenue (IDR/month), TC is the cost total of dairy farmer (IDR/month), π is income (IDR/month), TFC is total fixed cost (IDR/month), Py is the output price (IDR/month), Y is the total of the output (liter/month) and TVC is the total of variable cost (IDR/month)

Return/Cost Ratio
Return cost (R/C ratio) was calculated based on the formula of Septiani et al. (2017): R/C on total cost = (Total revenue)/(Total Cost) = TR/(TC) Assessment criteria were: a. If the value of R/C ratio> 1 then, dairy cattle business is feasible. b. If the value of R/C ratio <1 then the dairy cattle business is not feasible. c. If the R / C ratio = 1 then the farm is said to break even point (BEP) Regression analysis was determine to effect of economic factor on dairy cattle farmer income. Y = a + b1X1+ b2X2+b3X3+b4X4+e where Y = Income (IDR/month), a = constant, b1, b2, b3, b4 = regression coefficients, X1 = market price (IDR/liter), X2= transportation and communication cost (IDR/month), X3 = labor cost (IDR/month), X4 = market distance (km), and e = error

Characteristic of Dairy Cattle Farmers
The age of respondents (40-50 years) was 20%, respondents age 50-60 years were 80 %. The young generation less interested to do dairy cattle business, because of low income was obtained. The lactation cow owned by them is 3 heads on average. The milk production was 8,3 liters/cow/day. Up to present all of farmers still sold fresh milk to the Cepogo cooperative ( Table  1). The milk price was IDR 5,000 per liters but if the coffee shop bought fresh milk, they paid IDR 8,000 per liter. Some coffee shop is developed in Boyolali urban area, this coffee shop needs milk supply from the dairy cattle farmer. The distance between dairy cattle center and Boyolali urban was around 15 km. Dairy farmers still market fresh milk traditionally, they brought to the cooperative.

Cost of Production
Variable cost consists of feed concentrate cost, artificial insemination cost, vitamin cost, grass feed cost, and labor cost Feed concentrate cost was the highest number (34.44%) as shown in Table 2. Labor cost was computed as 28.50 % of the total production cost. The farmers usually fed concentrate feed to cattle every day. The concentrate of feed related with milk production. Nutrient availability tends to produce good milk in quantity as well as quality. In agreement with Septiani et al. (2017) feed cost was the highest cost in the dairy cattle business. Efforts to looking for low-cost feed were needed to decrease the production cost.

Revenue
It can be seen in Table 3, revenue comes from selling milk, selling young dairy cattle and the gain of cattle. Revenue from selling milk per month was IDR 2,490,000, revenue from selling calf was IDR 950,000 per head and the gain of cattle was IDR 974,000. The revenue of dairy cattle farmers in Boyolali is greater than revenue dairy cattle farmers in Semarang Regency which reported by Dolewikou et al. (2016). The revenue of dairy cattle farmers in Semarang Regency was just only IDR 4,414,000 per month. The revenue was greater in Boyolali because the milk market price in Boyolali was higher than in Semarang Regency. Manure not utilized yet as revenue, usually farmer use this for land fertilizer.   (Table 6). The increasing market price when the farmers applied the electronic market. The increasing market price when utilized electronic market. The market price was IDR 8,000 when using electronic market scenario. This market price would increase revenue. The price would high than the price in dairy cooperative because the coffee shop was the direct consumer. This result in agreement with Annosi et al. (2018) and Khana et al. (2019) which stated utilization industry 4.0 on marketing strategy would increase the revenue. Utilization of industry 4.0 would trigger the farmer to always maintain the quality of the product.

Income
Income dairy cattle farmer was 3,850,400 and R/C was 2.4. Irissaria et al. (2019) stated the application of industry 4.0 in beef production increased the income (Table 7). The utilization of industry 4.0 tends to improve the milk market sold. The R/C ratio increased when the electronic market applied. The study in agreement with Hemme et al. (2014), which stated increasing market price would increase the income. The increasing number of R/C ratio showed the scenario using electronic marketing more Utilization of Electronic Marketing (A. Setiadi et al.) 247