“ Our invaluable insights into the countrys logistics industry will provide foreign partners the solid foundation for success in Indonesia. ”
Pahala Kencana originally started as a family business providing public transportation in the form of commuter night bus services. We initially operated with only one bus transporting passengers between cities before expanding our armada and diversifying our business. Now we transport cargo through our courier services as well as extending our business into the travel and leisure industry. Our current strategy is a prudent approach that aims to build upon our expertise in the local market. As such, we believe that by separating our transportation and courier business, we have become more efficient and cost-effective which provides us with greater opportunities to take advantage of the country’s growing logistics sector.
With Indonesia’s large population and rising incomes, we see a rising number of start-up businesses needing our services. And as the Indonesian government focuses on upgrading the country’s infrastructure, the archipelago will experience an increasing demand for a more streamlined flow of goods and services between users and suppliers from across the country as well as transportation provisions for the growing tourism industry. We have more than 600 point of sales, 16 branches, and a fleet of over 400 with 190 vehicle units. Our company can therefore facilitate the needs of foreign investors who are looking to take advantage of these promising sectors.
The general outlook for the future is promising for our industry. The government is aiming to pursue infrastructure projects that are vital in bringing down distribution costs within our sector. Currently Indonesia has the highest logistics distribution costs in Asia, accounting some 15% of the total operational costs compared to 5% in other Asian nations. However, taking into account Indonesia’s growing domestic market, the completion of infrastructure projects can have a multiplier impact on other logistic sectors such as our ports and airport development as well as the railway system. We believe the government is doing their best efforts in this regard so that in the long-term, the country’s infrastructure can meet the rising demand of trade and goods movement within Indonesia and the international market.
We are also looking for expansion towards Sumatra and Kalimantan. With the abundance of natural resources in Kalimantan attracting foreign investment, the government is pushing for more infrastructure development in Kalimantan as well as Sumatra as part of its efforts to boost development in provinces outside of Java. Therefore we aim to take advantage of the increasing industrialisation of these provinces to achieve our goals in expanding our businesses.
We see our courier and logistics with the greatest potential going forward but we are looking to expand in all areas of our business. The country’s rise in online shopping and e-commerce presents the potential for further growth within Indonesia’s logistics sector. The changing lifestyles among the country’s urbanised demographic are always seeking solutions to logistical issues. With our local expertise we can provide the reliable service that will offer greater convenience to this demographic.
We are very much open to foreign partnerships. We are looking for international partners that have the experience and the technological know-how needed to assist us in making our business operations more efficient and professional. Our invaluable insights into the country’s logistics industry will provide foreign partners the solid foundation for success in Indonesia as our company looks to further develop through technology transfer as well as system management, building upon our already strong local network.
Our aim is to become a major player within our industry. This goal can be achieved faster through collaboration with international partners that have more experience and capital within this sector. Through Pahala Kencana’s travel and leisure business we have gained experience in collaborating with international clients from all over the world. Through this exposure we believe that foreign entities will experience a much smoother engagement when collaborating with us.
Coupled with our comprehensive knowledge of the local market, forming international partnerships will increase our market share nationally as well as regionally. Furthermore, these collaborations will provide us with the expertise in people management such as through the training of our human resources as we look to our young and tech-savvy employees to advance our business in the industrialised economy.
Indonesia is a very lucrative market and our company serves as a reliable local partner for interested entities and investors. Currently for logistics, we serve 8,000 consignees each day in more than 100 cities demonstrating our standing as a leading logistics provider in Indonesia. Our company believes that through our position in the local market, foreign businesses have an effective means to enter Indonesia.