Study of Technical Efficiency of The Cocoa Industry Using Data Envelopment Analysis

The processed cocoa agroindustry is entering a new phase of hypercompetitive business where all companies focus on becoming low-cost producers. The problem becomes complex, with the tendency to decrease business units yearly. This study aims to determine which decision-making units (DMUs) have technical efficiency in producing processed cocoa products sustainably. Researchers used purposive sampling to determine research locations, questionnaires and interviews to collect data, and Data Envelopment Analysis (DEA) to analyze data. The study results show that all DMUs produce different percentages of technical efficiency, so they are categorized into three types: high, medium, and low. The score distribution shows thirty efficient DMUs and seven inefficient DMUs. In order to achieve operational efficiency and stability of DMU, it is necessary to improve the allocation of cocoa raw material input, labor costs, and industrial capital input. The conclusion is that industrial efficiency has a vital role in the existence of DMU if it can pay attention to the quality and quantity of production at an optimal efficiency scale and can meet domestic and export demand so that it is competitive in global markets.