Economic Analysis of Clove Leaf Oil Distillation Business (Case Study of Clove Leaf Oil Distillation Household Industry in Babang Village, South Larompong District, Luwu Regency, South Sulawesi)

Abstract

The clove leaf oil refining business contributes to job creation and improving the standard of living of clove farmers. The research was carried out in Babang Village, South Larompong District, Luwu Regency from May to July 2021, to find out the description of the clove leaf oil refining business, Break Even Point (BEP), total production and BEP prices as well as the level of efficiency in using the costs of the clover leaf oil refining business. This research is a case study of the clover leaf oil refining household industry in Babang Village, South Larompong District, Luwu Regency. The data used is primary data and secondary data. The data analysis used is descriptive, BEP analysis, and R/C Ratio analysis. The research results show that the clover leaf oil refining business in Babang Village was established in 2010. The distillation technique used was water and steam distillation techniques with a distillation process time of 10 hours. This business does not yet have a business name, product label, and no cash flow records. The results of the BEP calculation for the production amount are 144 kg and the BEP price is IDR 117,790/kg, while the business production amount is 169.2 kg with an average price of IDR 138,500/kg. The results of the comparison of total revenue with total costs (R/C) are greater than one, namely 1.17, which shows that the clover leaf oil refining business in Babang Village has achieved an economic scale and is efficient in terms of cost use.