BACKWARD INTEGRATION AS A BUSINESS STRATEGY TO INCREASE COMPANY PROFITABILITY (CASE STUDY: PT GRAHA ALAM INDO SENTOSA, PEMALANG, CENTRAL JAVA, INDONESIA)

• Main Author: Energia Pratama N, Binsar
• Format: Theses
• Language: Indonesia
• Subjects: Manajemen umum
• Online Access: https://digilib.itb.ac.id/gdl/view/64908
• Institution: Institut Teknologi Bandung

The real estate business is one of the businesses which can survive during this covid pandemic situation in Indonesia. This business is in line with the population growth in Indonesia. This paper will focus more on the real estate developer who focused on the subsidized housing project. Since the government regulates the subsidized house selling price, the developer struggles to provide the best quality building to meet the low selling price (the situation is getting worse due to the covid-19 pandemic, which has lasted for the past two years). In order to deal with that, the developer implements the backward integration business strategy by producing the building material by itself through the business unit called Sambeng PreCast. This research will elaborate on the success of the backward integration approach and whether or not it can significantly contribute to the company's sales and profits. The author would do all of the company's internal and external analysis, calculate whether the strategy is profitable or not, and find the best possible funding strategy to support the strategy. Based on the discussion in the all chapters available (business exploration, business solution, and financial analysis), profitability has been positively benefited by the backward integration business plan followed by PT Graha Alam Indo Sentosa via the business unit (Sambeng PreCast). Using a backward integration strategy, the corporation can automatically reduce building costs (COGS) and automatically improve profits. So, the company is advised to continue or even expand the backward integration business strategy.