The logistics system planning for red onion: case study of Sulawesi and Maluku Islands

Abstract

Abstract Red onion is a horticultural product produced in several regions of Java Island. This commodity only grows in certain seasons where the production time of one region to other regions is different. The lack of logistics design makes traders from producing regions unable to deliver it to demanded areas due to inappropriate selection of transportation combination and its schedule. This increases its distribution cost in Sulawesi Island and Maluku regions. This research aims to plan a red onion logistics system distribution for West Sulawesi, Southeast Sulawesi, Central Sulawesi, Gorontalo, North Sulawesi, Maluku and North Maluku, by taking into account the production location based on the onion harvest time, combination of shipping method, ship type, scheduling and quality so it will arrive on time with maintained quality. The logistic system is designed by using an optimization method to obtain optimal transportation modes and minimum unit costs. The optimization results show that the most suitable shipment is to use container ship owned by private shipping company, either in full container load (FCL) or in less container load (LCL). The average logistics costs to Sulawesi Island and Maluku Region are IDR 3,037/kg (USD 0.21/kg) and IDR 2,296/kg (USD 0.16/kg), respectively. These are 31% and 27% lower than the previous values, while the average damage rates are 4% and 5%, 6% and 5% lower than before.