Risk Mitigation Priorities in a Sustainable Pasteurized Milk Supply Chain: A House of Risk Approach in a Small-Scale Dairy Company

¹ Department of Agroindustrial Technology, Faculty of Agricultural Technology, Universitas Brawijaya, Indonesia
² Research Fellow at Universitas Muhammadiyah Yogyakarta, Indonesia
³ Agribusiness Study Program, Faculty of Agriculture, Universitas Muhammadiyah Yogyakarta, Indonesia

^* Corresponding author: lestari@umy.ac.id

Abstract

The pasteurized milk supply chain plays a strategic role in economic, social, and environmental sustainability, yet is vulnerable to risks at every level. This study aims to identify key risks, prioritize risk agents, and formulate effective mitigation strategies for a pasteurized milk supply chain in Indonesia. The House of Risk was used through a two-stage analysis with input from 9 experts representing farmers, collectors, and processing companies. The mapping yielded 38 risks and 30 risk agents, and a priority assessment was calculated using aggregate risk potential and an effectiveness-to-difficulty ratio. Key findings identified Farmer's error in cattle rearing as the most dominant risk agent with low milk quality and quantity as the next priority. Priority mitigation strategies included education on cattle rearing management, the development of SOPs on farms, and monitoring of on—farm activities. Integrated on-farm activity scheduling and business record-keeping were implemented in the next phase to strengthen efficiency, traceability, and data-driven decision-making. A phased approach focused on the upstream sector increased system resilience, reduced waste, maintained raw material quality, and strengthened partnerships between stakeholders. Practical implications demonstrate the readiness for adoption in small-to medium-scale businesses and the relevance of its application to other fresh food commodities with similar characteristics.