Indonesian Logistics Overview - ppsdma.bpsdm.dephub.go.idppsdma.bpsdm.dephub.go.id/.../2018/09/Indonesian-Logistics-Overview.pdf · Indonesian Logistics Overview ASOSIASI LOGISTIK

Indonesian Logistics Overview

ASOSIASI LOGISTIK DAN FORWARDER INDONESIA

INDONESIAN LOGISTICS AND FORWARDERS ASSOCIATION

YUKKI NUGRAHAWAN HANAFI

Chairman

15 Packages of Economic Policies

20159 Sept 2015

Package 1

Improvement of industrial

competition level

29 Sept 2015

Package 2

Investment promotion and

foreign exchange

7 Oct 2015

Package 3

Expanding access to financing

and reducing production costs

15 Oct 2015

Package 4

Wage system guarantees and

securing work termination

22 Oct 2015

Package 5

Asset revaluation and

access to sharia financing

5 Nov 2015

Package 6Drive economies in the periphery

and the smoothness of raw

material of medicine

7 Dec 2015

Package 7

Industry tax incentives and

land certification

21 Dec 2015

Package 8

Business certainty and

investment of aircraft and

oil maintenance services

201627 Jan 2016

Package 9

Electricity and

logistics infrastructure

11 Feb 2016

Package 10

Openness of investment

29 Mar 2016

Package 11Financing access, Dwelling Time,

and pharmaceutical industry

28 Apr 2016

Package 12

Ranking enhancement of

Ease of Doing Business

24 Aug 2016

Package 13

House provision for

low income communities

10 Nov 2016

Package 14Drive economies in the periphery

and the smoothness of raw

material of medicine

201715 Jun 2017

Package 15

Development of national

logistic industry

2



Understanding Logistics

“Logistics is that PART of the SUPPLY CHAIN PROCESS that plans, implements, and controls the efficient, effective flow and storage of goods, services, and related information from the point-of-origin to the point-of-consumption in order to meet customers’ requirements” (Council of Logistics Management)…

Lambert, 4th Edition



3

Suppliers

Food Processing,

Factory

Distribution

CenterWholesaler Retailer

ConsumerThe flow of goods, information, and costs

: Logistic activities

Logistics and Supply Chain Management

Effective organizing activities on the flow of raw materials, inventories of manufactured goods, finished goods, and related information from the point of origin to the point of consumption to meet customer needs.

The Importance of Logistic and Transportation



4

Logistik

Enabler bagi perdagangan

Bagian dari membangun daya saing bangsa

Menunjang terciptanya efisiensi nasional

Mendorong National Economic Integration

Menjamin ketersediaan, akses, stabilisasi harga,

dan kualitas barang

Network of National Logistics System



5

Desa

Desa

Desa

Integrasi Jaringan Lokal dan Nasional Koneksi Jaringan Global

HubPelabuhan

InternasionalEROPA

AntarPulau

Kota/Kab

HubPelabuhan

InternasionalASIA

HubPelabuhan

InternasionalAMERIKA

PelabuhanInternasional

Indonesia

Antar Pulau

Antar Pulau

Desa

Desa

Desa

Desa

Desa

Kota/Kab

Kota/Kab

HubPelabuhan

InternasionalAFRIKA

HubPelabuhan

InternasionalAUSTRALIA

Desa

Indonesia

PorosMaritim

Matrix of Logistics Infrastructure



6

Jari

ng

an

Keu

ang

ana

Pelaku Jasa Perbankan, Asuransi, LKBB

Mo

ney

Infr

astr

ukt

ur

Logi

stik

Sarana ATMInternet Banking

SMS Banking

T/TCashBasis

Jari

ng

anIn

form

asi Pesan

Applikasi

Sarana Transportasi

Data

Jaringan Fisiak

Informasi

Dokumen

Dat

a

Aplikasi

Keamanan Aplikasi Khusus Saluran Pengiriman

Messaging Hub

Jaringan Telekomunikasi

Jari

ng

an

Tran

spo

rtas

i

Fasilitas Penyimpanan

Sarana Transportasi

IntermodalTransportasi

Simpul Transportasi

Moda Transportasi

W/H, CY, CFS, Container, Pallet, Depot

Frei

ght

Kapal Laut, Kapal Udara, Truk, Kereta Api, Pipa

Dermaga Dermaga Terminal Terminal Terminal Terminal

Pelabuhan

Laut

Pelabuhan

Sungai

Bandar

Udara

Pelabuhan

DaratanStasiun Depot

Laut Sungai Udara Jalan Rel Pipa

Jari

ng

an

Dis

trib

usi

Penyedia Produsen, Importir, Eksportir

Trad

e

Penyalur Pedagang, Distributor, Grosir, Agen, Peritel

PrasaranaTerminal Agri, pasar Induk, Pasar Tradisional, Kios, Warung,

Hyper/Super/Mini Market

Logistics Service Provider



7

1PL : Shipper / Consignee (Pengirim / penerima barang)

2PL : Actual Carriers (airline, shipping line atau operator truk)

3PL : Sebuah perusahaan yang menyediakan beberapa layanan logistik,

termasuk transportasi, pergudangan, cross-docking, manajemen

persediaan, pengemasan, dan freight forwarding.

4PL : Perusahaan konsultan yang mengkhususkan diri dalam bidang

logistik, transportasi dan manajemen rantai pasok. Terkadang digambarkan

sebagai penyedia layanan non-aset, peran mereka adalah untuk

memberikan ruang lingkup yang lebih luas pengelolaan seluruh rantai

pasokan.

5PL : Penyedia layanan logistik yang melakukan rencana, mengatur dan melaksanakan solusi logistik atas nama pihak kontraktor (terutama sistem informasi) dengan memanfaatkan teknologi tepat guna, memperluas ruang lingkup lebih lanjut untuk e-bisnis.

Supply Chain Management



8

Supply chains are complex interdependent systems and involve:

Supply Demand

Oil and alternative energy

Transaction Systems

Commercial Power

Strategic Asset Investment

Procurement Information Technology

Supply Chain Management

Business Processes

Legal and Regulatory Systems

People and RelationshipsLogisticsTransport

Geo-Political Economy

Labour

Finance

Whole of Chain Thinking

Sector Overview – Logistics Sector

The growth of each logistics service in ASEAN has continued to achieve double-digit growth. In particular, express & small parcel (last mile delivery) and cold chain (low temperature logistics & refrigerated warehousing) are expected to grow the most rapidly.

Logistics Market Size by Country

Logistics ServiceContract Logistics*

Air & Sea Freight ForwardingExpress & Small

(incl. land transportation and warehousing) Parcel

* Contract Logistics/ Third-Party Logistics (3PLs) normally providing long-term

contract carriage and warehousing services supplying tractors, drivers and management.

2013 2017 2013 2017 2013 2017Country CAGR CAGR CAGR

(US$ billion) 13-17 13-17 13-17

Singapore 1.0 1.3 7.3% 3.7 5.0 7.7% 0.7 0.9 9.8%

Malaysia 1.2 1.8 10.2% 1.9 2.6 8.8% 1.4 2.7 23.0%

Thailand 1.5 2.2 9.7% 2.1 2.8 8.0% 1.7 2.9 17.1%

Indonesia 2.4 3.7 11.7% 1.9 3.0 11.8% 4.0 7.6 21.7%

Vietnam 0.6 0.9 10.9% 0.9 1.4 12.5% 0.6 1.0 20.9%

Philippines 0.7 1.0 11.3% 0.6 0.9 12.3% 1.2 2.4 24.1%

Japan 21.5 23.5 2.3% 7.2 7.8 1.9% 23.8 25.8 2.8%



9

Pros) Strong Growth in Logistics Market (3PL)

3PL revenue expects to grow at CAGR (Compound Annual Growth Rate) of 11.7% for the forecast period of 2013 to 2017due to the increment of 3PL outsourcing needs in Indonesia.

The growth rate would be the highest percentage among ASEAN6.

Indonesian Contract Logistics Market Forecast(2013-2017F)

Contract Logistics Market SizeBy Country

Country 2013 2017Growth

13-17(%)

Indonesia 2,402 3,747 11.7

Thailand 1,543 2,233 9.7

Malaysia 1,244 1,837 10.2

Singapore 961 1,276 7.3

Philippines 659 1,011 11.3

Vietnam 603 910 10.9

10



Pros) Strong Growth in Sea Freight Forwarding andDomestic Express and Small Parcel Market Freight forwarding revenue expects to grow at CAGR of 11.8% for the forecast period of 2013 to 2017.

The growth of sea freight would be larger than air freight for the next few years.

Domestic express and small parcel market in 2017 expects to be twice larger than the market size in 2013

Freight Forwarding Market Forecast(2013-2017F)

Express and Small Parcel Market Forecast(2013-2017F)

-

500

1,000

1,500

2,000

2,500

3,000

3,500

2013 2015F 2016F 2017F

Sea

Air

1,948

3,043

1,107

841

1,845

1,198

CAGR

11.8%

2013-2017

(USD million)

Sea freight (CAGR 13.6%)

Air freight (CAGR 9.3%)

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

2013 2015F 2016F 2017F

International

domesticCAGR

11.8%

2013-2017

(USD million)

International (CAGR 14.5%)

Domestic (CAGR 17.4%)

470

3,561

6,758

806

4,031

7,564

11



Expanding Middle Class

Pros) Rising Middle Class in Indonesia

Forecast of Household Disposable Income(2014-2030F)

1,107

841

1,845

1,198

470

3,561

6,758

806

0

10

20

30

40

50

60

70

80

2014 2030 2014 2030 2014 2030 2014 2030 2014 2030 2014 2030 2014 2030

Indonesia Vietnam Philippines Thailand Malaysia Singapore Japan

Affluent Class : Yearly Disposable Income of > US$ 35,000

Middle Income Class : Yearly Disposable Income of US$ 5,000 - 35,000

Lower Income Class : Yearly Disposable Income of < US$ 5,000

Household

in Millions

Affluent +

Middle Class

Households

Change+59% +120% +83% +43% +44% +28% 4%

12



Pros) Rapid Growth on Modern Trade in Indonesia

Modern Trade vs. Traditional Trade in ASEAN

1,107

841

1,845

1,198

470

3,561

6,758

806

70 72 74

3843

4740

4551

1217 19

2329 32

4 5 60%

50%

100%

10 15 20 10 15 20 10 15 20 10 15 20 10 15 20 10 15 20

Singapore Malaysia Thailand Indonesia Philippines Vietnam

Modern Trade Traditional Trade

7(MT) : 3 (TT)

4 : 6

5 : 5

2 : 8

3 : 7

1 : 9

13



Pros) By the rising middle classes in Indonesia and the increasing popularityof mobile devices, Indonesia is the fastest growing and the largest market in ASEAN.

1,107

841

1,845

1,198

470

3,561

6,758

806

Country

2015

EC Market Size

(USD million)

CAGR

2011-2015

CAGR

2016-2020

Indonesia 1,682 44.4% 37.0%

Thailand 1,441 21.7% 12.0%

Singapore 980 12.4% 10.0%

Vietnam 698 44.0% 22.7%

Malaysia 519 15.9% 10.7%

Philippines 354 14.4% 6.7%

China 293,045 65.4% 11.7%

Japan 69,074 13.5% 9.9%

14



Cons) The Cost of Logistics Remains High

1,107

841

1,845

1,198

470

3,561

6,758

806

Logistics Cost per GDP, Indonesia (Indonesia, 2013-19F) Logistics Costs (ASEAN, 2014)

1,621,81

2,08

2,40

2,76

3,18

3,67

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2013 2014 2015F 2016F 2017F 2018F 2019F

25.7% 25.7%25.0%

24.0%23.5%

22.1%21.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

Logistics costs

(Trillion IDR) Logistics costs to GDP

25.725.0

13.2 13.0

8.1 8.1

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

ID VN TH MY SG (Reference)JP

15



Cons)Require to bridge a gap between Indonesia’s infrastructure budget and actual

1,107

841

1,845

1,198

470

3,561

6,758

806

Share of Infrastructure Spending to GDP, ASEAN (2014) Government Spending on Infrastructure (2012-17)

Indonesia’s infrastructure spending to GDP ratio is one of the lowest among other ASEAN countries

The new government show its commitment to increase its budget for infrastructure. The planned government infrastructure spend increase by 9% in the 2016 budget on the precious year’s planned spend. However, there has been a huge gap between the revised state budget and the actual over the past four years.

2.0%2.4% 2.5%

3.2%3.6%

7.7%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

Indonesia Singapore Philippines Malaysia Thailand Vietnam0

50

100

150

200

250

300

350

400

450

2012 2013 2014 2015 2016 2017

Revised State Budget

Actual

(Trillion IDR)

16



Cons) Indonesia ranks 63rd in LPI /2016

Need to improve in each logistics indicator

1,107

841

1,845

1,198

470

3,561

6,758

806

Logistics Performance Indicators: LPI Results (2016)

The international LPI analyzes countries in six components :• The efficiency of customs and border clearance (“Customs”)• The quality of trade and transport infrastructure (“Infrastructure”)• The ease of arranging competitively priced shipments(“International shipments, Ease of arranging shipments”)• The competence and quality of logistics services-trucking, forwarding, and customs brokerage(“Service quality, Quality of logistics services”)• The ability to track and trace consignments(“Tracking and tracing”)• The frequency with which shipments reach consignees within scheduled or expected delivery times(“Timeliness”)

CountryLPI

Rank

LPI

Score

Customs

Rank

Infrastructure

Rank

International

Shipments

Rank

Logistics Quality

and Competence

Rank

Tracking and

Tracing

Rank

Timeliness

Rank

Germany 1 4.23 2 1 8 1 3 2

Luxembourg 2 4.22 9 4 1 10 6 1

Sweden 3 4.20 8 3 4 2 1 3

Netherlands 4 4.19 3 2 66 3 6 5

Singapore 5 4.14 1 6 5 5 10 6

Belgium 6 4.11 13 14 3 6 4 4

Austria 7 4.10 15 12 9 4 2 7

UK 8 4.07 5 5 11 7 7 8

Hon Kong 9 4.07 7 10 2 11 14 9

US 10 3.99 16 8 19 8 5 11

Switzerland 11 3.99 10 7 14 14 12 14

Japan 12 3.97 11 11 13 12 13 15

Australia 19 3.79 22 18 21 17 19 21

China 27 3.66 31 23 12 27 28 31

Malaysia 32 3.43 40 33 32 35 36 47

India 35 3.42 38 36 39 32 33 42

Thailand 45 3.26 46 46 38 49 50 52

Indonesia 63 2.98 69 73 71 55 51 62

Vietnam 64 2.98 64 70 50 62 75 56

Bunei 70 2.87 57 66 62 93 68 84

Philippines 71 2.86 78 82 60 77 73 70

Cambodia 73 2.80 77 99 52 89 81 73

Myanmar 113 2.46 96 105 144 119 94 112

Lao PDR 152 2.07 155 155 148 144 156 133

17



(Reference)

Lack of Road Network Connectivity

The result of poor connectivity in Indonesia causes a longer lead time and an insufficient supply chain.

The density of road network has been staying at around 0.3 kilometers per km2 of land over the past 5 years.

Density of Road Network(2011-2015)

1,107

841

1,845

1,198

470

3,561

6,758

806

0.1 0.1 0.1 0.1 0.10.3 0.3 0.3 0.3 0.3

0.4 0.4 0.4 0.4 0.40.5

0.6 0.6 0.60.70.7 0.7 0.7 0.7 0.70.7 0.7 0.7 0.7 0.7

4.84.9 4.9 4.9

5.0

0.0

1.0

2.0

3.0

4.0

5.0

6.0

2011 2012 2013 2014 2015

Myanmar Indonesia Thailand Malaysia Vietnam Philippines Singapore

(kilometers per km2 of land)

18



28.4 29.3 30.1 30.8 31.4

46.6 45.7 45.4 45.0 44.8

52.7 52.2 52.1 52.0 51.9

57.0 56.8 56.7 56.7 56.6

80.978.1 77.2 76.9 76.6

98.5 98.5 98.5 98.5 98.5100.0 100.0 100.0 100.0 100.0

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.0

2011 2012 2013 2014 2015

Philippines Myanmar Vietnam Indonesia Malaysia Thailand Singapore

(Reference)

Undeveloped Infrastructure (Unpaved Roads)

The weak infrastructure and unpaved road will slow down the growth of logistics industry.

The proportion of paved roads has been staying at around 57% of total road network in Indonesia over the past 5 years.

Proportion of Paved Roads(2011-2015)

470

806

(kilometers per km2 of land)

19





Documents

Indonesian Logistics Overview - ppsdma.bpsdm.dephub.go.idppsdma.bpsdm.dephub.go.id/.../2018/09/Indonesian-Logistics-Overview.pdf · Indonesian Logistics Overview ASOSIASI LOGISTIK