Share Farming Interest Scheme: Case Study Of Company-Xyz Berhad
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Date
2015
Authors
Lew, Ai Chien
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Abstract
This pioneer study assesses the Central Oil Palm Planter’s Scheme (COPPS) – a regulated share farming scheme which introduced by Company-XYZ Berhad since 2011. A qualitative investigation was conducted using the Porter’s Five Forces and SWOT analysis. Primary data was gathered through personal interviews with founders and senior executive officers within the organization, and supported by secondary data that collected from global sources.
Apart from the fixed and guaranteed returns, COPPS is an interest-sharing scheme that does not required specific knowledge of planting. Nevertheless, COPPS does possess certain degree of risks due to oil palm market volatility, uncertain yield potentials and the industry risks, namely the operation risks, environmental risks, financial risks as well as the legal and regulatory risks. All these uncertain elements have raised the investors’ concern of dividend payout capability. In addition, mushroomed of Ponzi scheme that adopted similar business module causes prospects doubt over the business motives of COPPS.
The analysis reveals that proper management, efficient crisis managing skills, educational marketing approach are essential steps taken to define Company-XYZ Berhad’s financial status and strengthen COPPS’ reputation. Despite the challenges mentioned, the Company-XYZ management team has tried their best efforts to ensure COPPS success. The success of COPPS implies that interest scheme approach could be a promising business model for a new business entity if properly managed. Company-XYZ has also set a positive example to regain public confident towards ‘investment scheme’ and the concept of sustainable entrepreneurship should be promoted
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Keywords
Share Farming Interest Scheme , Central Oil Palm Planter’s