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Patchouli Oil Farming: An Alternative to Poverty Alleviation through Smallholders Business

Patchouli oil farming is a farming business that has been carried out for many years in Aceh Province. This business was one of the most favored businesses, but now it has become one of the less desirable farming business because the selling prices fluctuations have discouraged farmers to continue the production. Therefore, this study examines the feasibility of patchouli cultivation as a source of smallholders' income by using business feasibility indicators. These indicators include B/C Ratio, Payback Period, and Return on Investment (ROI). The data collected through surveys based on the prepared questionnaire then analyzed qualitatively and quantitatively. The calculation result is B/C ratio of 1,9, ROI of 50,4% and a payback period of 7,9 months. The results of the analysis obtained indicate that the business is feasible to develop as a business for smallholders because it is profitable and has a payback period of investment in just one planting period. Furthermore, the fluctuations in patchouli oil prices did not make this business unfit to develop because this study found that the business was a feasible event when the selling price of patchouli oil was at the lowest level. However, the interest of smallholders to re-develop this business still needs to be improved and the socialization to promote this farming business as a source of income for smallholders needs to be employed as one of the local government policies in poverty alleviation efforts.