February 29, 2024

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Indonesia Logistic Start-Ups Focus on Assisting MSMEs Embrace Digitisation

Logistics costs in Indonesia are the highest in Asia, accounting for 24%, compared to less than 5% in more developed markets. However, due to the country’s unique geography, adapting a supply chain model from other countries such as China or neighbouring Thailand and Malaysia is impractical, simply because goods cannot be transported by truck on land alone. To reach remote areas on each island, a multimodal system that includes land, sea, and warehousing should be used.

Andree Susanto, the CEO and Co-Founder of Waresix has written extensively about the developments in this sector in various articles. In his piece on innovating and digitalising the logistics sector, Andree speaks of the silver lining the pandemic has brought – serving as a catalyst for innovation in the industry. The rapid increase in demand is pushing logistics players to explore digital innovation to increase efficiencies and lower costs in a bid to meet needs profitably. Nonetheless, he juxtaposes this with the caveat that the sudden growth of the e-commerce market has added pressure on the already strained supply chain.

There is also significant sectoral fragmentation, which is characterised by a lack of transparency and real-time information. Now, 90% of orders and matching are done offline, and 80% of deliveries are done manually, with slow verification and a lack of instructions. Many tasks are also carried out informally. Contracts, for example, are typically handwritten, and communication is ad hoc and through informal channels. Drivers may also be paid months after making a delivery. As a result, key resources such as trucks and warehouses are underutilised, resulting in long wait times for drivers and, ultimately, the consumer.

As the industry positions itself for recovery and growth in the post-pandemic environment, technology must play a bigger role in enabling key stakeholders to quickly respond to evolving market realities and consumer demands.

With this, several Indonesian start-ups, such as the leading logistics start-up and the import-export e-commerce site platform, have been presented to assist Indonesian MSMEs in gaining access to the export market. They recently collaborated to increase the export market penetration of Indonesian MSMEs. The import-export e-commerce platform offers exporters and importers one-stop services such as banking, export insurance, logistics companies, and verification and certification services.

A leading logistics start-up, on the other hand, had strengthened end-to-end logistics and warehousing services to increase global expansion and trade opportunities for Indonesian businesses, particularly MSMEs, abroad. The shipper will manage and operate the platform warehouse specifically for export purposes as part of the cooperation agreement. It is hoped that with this warehouse management, the product distribution process available on the import-export e-commerce platform will be better and faster.

The founder and COO of the leading logistics start-up hope that this collaboration can support the platform in supporting logistics needs. The shipper is designed to provide wider and more equitable access to quality logistics services throughout Indonesia, especially for SMEs. “We hope that this collaboration can further strengthen the business of both parties and can increase the volume of Indonesia’s exports,” said the import-export e-commerce site platform founder and CEO.

According to the founder and COO of the leading logistics start-up, his company is designed to provide wider and more equitable access to logistics services throughout Indonesia, especially for MSMEs. “Our company provide fulfilment and delivery services through a network of centres, delivery partners and digitally managed retail points,” he said.

The leading logistics start-up manages its warehousing in more than 200 locations across Indonesia, with a total area of nearly 600,000 m2. The warehousing operations of this company have received ISO 9001:2015 Quality Management System Certification. In addition, the company has formed alliances with over 40 freight forwarders to ship goods both domestically and internationally. If this collaboration is successful, it will benefit local MSMEs in the logistics sector and encourage exports.

There is room for growth and development in the country’s logistics sector, and one thing is certain: as the founder of a logistics company pointed out, digital transformation is critical for the logistics sector in Indonesia to evolve. While start-ups like the logistic company are leading the charge, the logistics sector is set to mature, but the transformation will take time.

To propel emerging, middle-income countries like Indonesia’s economic growth, logistics must be made safer, more reliable, and more efficient. Last year was a litmus test for logistics, and after surviving an unprecedented period, we are optimistic about its prospects and eager to contribute to its long-term technological development.

PARTNER

Qlik’s vision is a data-literate world, where everyone can use data and analytics to improve decision-making and solve their most challenging problems. A private company, Qlik offers real-time data integration and analytics solutions, powered by Qlik Cloud, to close the gaps between data, insights and action. By transforming data into Active Intelligence, businesses can drive better decisions, improve revenue and profitability, and optimize customer relationships. Qlik serves more than 38,000 active customers in over 100 countries.

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CTC Global Singapore, a premier end-to-end IT solutions provider, is a fully owned subsidiary of ITOCHU Techno-Solutions Corporation (CTC) and ITOCHU Corporation.

Since 1972, CTC has established itself as one of the country’s top IT solutions providers. With 50 years of experience, headed by an experienced management team and staffed by over 200 qualified IT professionals, we support organizations with integrated IT solutions expertise in Autonomous IT, Cyber Security, Digital Transformation, Enterprise Cloud Infrastructure, Workplace Modernization and Professional Services.

Well-known for our strengths in system integration and consultation, CTC Global proves to be the preferred IT outsourcing destination for organizations all over Singapore today.

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Planview has one mission: to build the future of connected work. Our solutions enable organizations to connect the business from ideas to impact, empowering companies to accelerate the achievement of what matters most. Planview’s full spectrum of Portfolio Management and Work Management solutions creates an organizational focus on the strategic outcomes that matter and empowers teams to deliver their best work, no matter how they work. The comprehensive Planview platform and enterprise success model enables customers to deliver innovative, competitive products, services, and customer experiences. Headquartered in Austin, Texas, with locations around the world, Planview has more than 1,300 employees supporting 4,500 customers and 2.6 million users worldwide. For more information, visit www.planview.com.

SUPPORTING ORGANISATION

SIRIM is a premier industrial research and technology organisation in Malaysia, wholly-owned by the Minister​ of Finance Incorporated. With over forty years of experience and expertise, SIRIM is mandated as the machinery for research and technology development, and the national champion of quality. SIRIM has always played a major role in the development of the country’s private sector. By tapping into our expertise and knowledge base, we focus on developing new technologies and improvements in the manufacturing, technology and services sectors. We nurture Small Medium Enterprises (SME) growth with solutions for technology penetration and upgrading, making it an ideal technology partner for SMEs.

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HashiCorp provides infrastructure automation software for multi-cloud environments, enabling enterprises to unlock a common cloud operating model to provision, secure, connect, and run any application on any infrastructure. HashiCorp tools allow organizations to deliver applications faster by helping enterprises transition from manual processes and ITIL practices to self-service automation and DevOps practices. 

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IBM is a leading global hybrid cloud and AI, and business services provider. We help clients in more than 175 countries capitalize on insights from their data, streamline business processes, reduce costs and gain the competitive edge in their industries. Nearly 3,000 government and corporate entities in critical infrastructure areas such as financial services, telecommunications and healthcare rely on IBM’s hybrid cloud platform and Red Hat OpenShift to affect their digital transformations quickly, efficiently and securely. IBM’s breakthrough innovations in AI, quantum computing, industry-specific cloud solutions and business services deliver open and flexible options to our clients. All of this is backed by IBM’s legendary commitment to trust, transparency, responsibility, inclusivity and service.

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