The key takeaways from deep dive sharing session hosted in BLOCK71 Jakarta. Experts from various backgrounds will share their views on what’s happening in the logistics industry and interesting things that will come in the next few years. Kopi Chat Deep Dive is a signature event of BLOCK71 Jakarta held every quarter. Our goal is to bring together experts to give talks that are industry-focused, and on an in-depth subject, to foster learning and understanding of a specific industry in Indonesia.

1. Kopi Chat Deep Dive Takeaways
LOGISTICS IN INDONESIA
The Present and the Future
13th July 2017

2. Our distinguished panel (from left to right): Peter Choi (GO-SEND); Johari Zein (JNE); Sebastian
Togelang (Kejora Ventures); Ashwath Ramesh (Lazada Indonesia); Adrian Lim (Popbox) as moderator,;
Sriman Kota (IBM Asia Pacific)

3. “With the growth of ecommerce (...). Everyone knows that parcels need to be
delivered, (and) with the likes of JNE, GO-JEK, and Uber coming to play,
logistics is sexy again.” - Adrian Lim, PopBox
“(The) most challenging thing is that (customers) want things fast, and want
things cheap. A growing middle class with more disposable income want you to
bridge 17,000 countries in a cost effective way.” - Peter Choi, Go-send
“In terms of physical delivery, we cannot catch up with the speed of ecommerce.
So, e-commerce is driving the logistics company, but we must be careful
because logistics might limit the growth of e-commerce.” - Johari Zein, JNE
Landscape of Indonesian Logistics

4. “Lot of things are manual at the moment, so the integration of technology with
the infrastructure of indonesia and the increasing number of players will have
a positive effect on the price.” - Sebastian Togelang, Kejora Ventures
“Today, a lot of people say that the problem of indonesia is the 18K islands. But
that’s not the problem. That’s the context. The problem is that infrastructure
between these islands do not exist.” - Ashwath Ramesh, Lazada
“We’re in the process where there’s a lot more happening in terms of spreading
our wings and reaching more. Optimization is always working behind the scenes
in terms of leveraging technology. “ - Sriman Kota, IBM
Landscape of Indonesian Logistics

5. “First step is, are all delivery companies in ID able to scan the package at the
hub? These are the simplest problems in tech that should be enabled before
going further. (...) Nobody even agrees on the same post code.” - Ashwath
Ramesh, Lazada
“The indo postal codes keep changing, there are a lot of new provinces and
kabupaten. Soon, we will establish a standardised version in the future.” - Johari
Zein, JNE
“Internet and smartphone penetration (are) both rapidly taking form. More
people have access to what we can provide them. More and more mobile
purchases outweigh internet purchases. This increase in demand is enabling the
industry to take form.“ - Peter Choi, Go-send
Technology in the Industry

6. “We’re already doing it, investing in physical assets and structures. All our
facilities are equipped with this technology. Our focus is dead clear. We’re
B2C delivery and it’s super clear. Not playing in the Go-Jek market and last-
mile delivery. (...) We need to wire ourselves to what customers are
expecting today through data and not through perception.” Ashwath Ramesh,
Lazada
Industry Investment

7. “Every customer expects theirs to be delivered first. This needs to be solved,
we cannot satisfy every customer. In another 5 years, maybe 16 million
parcels need to be delivered in a day. At 20% market share, maybe 3 million
parcels a day. We have to add fifty-five thousand employees to deliver.
Who’s going to pay for this just to maintain market share?” Johari Zein, JNE
What Drives Customer Expectations?

8. “Combining good execution and tech can solve the basic problem. That’s our
focus. It’s a mix of proper execution and scaling with technology and solving
the basic needs. The growth of ecommerce is so fast that logistics players
are struggling to keep up.” - Sebastian Togelang, Kejora Ventures
“Prime for investment and entrepreneurship is labor force management. This
is an area that is an unmanaged service right now. Ramping up courier
capacity for ramadan or 1212 sales is not an easy challenge. They need to
be trained and used to it. They don’t get these skills automatically, they need
training.” - Ashwath Ramesh, Lazada
Main Areas with Investment Potential?

9. “We have worked with truck companies using image and video recognition for
safety and tracking. It can monitor location and driver fatigue. It’s basically
taking the camera feed and saying ‘are you staying in the lane or not’.” -
Sriman Kota, IBM
“If you think about it too far it’s not relevant. We have to think about the
present and how IOT can solve things. We try to optimize routes and how we
can truck from A to C with inventory. These kinds of things are not too far,
unlike drones, that can affect the industry a lot that will happen in the next 3-5
years.” - Sebastian Togelang, Kejora Ventures
Status of Tech in Logistics

10. “Indonesia has a huge area, and on a minimum we need to have three
players at the size of JNE. The market is still open. Of course, we need to
take a look at cost. It’s not as easy because of the infrastructure and
geography of indonesia. If anybody can solve the problem, it will be a good
opportunity.” Johari Zein, JNE
“The good thing about logistics is that it’s impossible for a winner to take it all.
There’s a lot of opportunities for a lot of players.” - Sebastian Togelang,
Kejora Ventures
Competition in Logistics

11. “The opportunity is big. And me as an investor and an indonesian I hope that
the players play in a healthy way. Too much price dumping and price war is
not good for this market.” - Sebastian Togelang, Kejora Ventures
“Let’s say with 16 million per day in the next 5 years, and we consider 20% by
pos indonesia, and 20% from us, there’s still 60% that need to be fulfilled.” -
Johari Zein, JNE
“Go-Jek has done is find a niche in on-demand. Whether for consumers or
ecommerce. Over time, as we get more and more data points, we can explore
and play in these niches.“ - Peter Choi, Go-send
Competition in Logistics

12. “Have you standardized data? Have you taken care of the labor force skill level?
Investment in infrastructure? Built shipping lanes and roads? These are the things
that aren’t solved in one year, as fast as we are progressing in the execution phase,
we also need the guys upstream and investing in infrastructure to keep up.” -
Ashwath Ramesh, Lazada
“On delivery, there has been no change from the beginning from when i was born until
now. You have to wait at your points. This area needs to be changed. Hopefully next
year we can change your habits from waiting at shipment points to coming to our point
to pick up. It will solve a lot of cost, and we won’t have any undeliverable parcels.” -
Johari Zein, JNE
“Payments. It’s a very painful process right now in ecommerce. How can we smoothen
out that process for more e-commerce growth?“ - Peter Choi, Go-send
This Time Next Year

13. “One year is too short to tell. We would like to hear about the focus on quality and
avoid buzzwords.” - Sebastian Togelang, Kejora Ventures
“End of the day, the question is; have you understood me more as a consumer? Do you
know me better now? There’s a lot of data to see how we can serve customers better.”
- Sriman Kota, IBM
This Time Next Year

14. Kopi Chat Deep Dive Takeaways
@Block71 Jakarta
A special thanks to everyone who attended
Kopi Chat @BLOCK Jakarta and made the
event possible!
13th July 2017