Indonesia's ASSA boost logistics, delivery to capitalize on e-commerce boom

27, Apr. 2020

Photo by chuttersnap on Unsplash
Photo by chuttersnap on Unsplash

By Anita Fildzah

JAKARTA, NNA – PT. Adi Sarana Armada Tbk (ASSA), the Indonesian operator of rental vehicles for businesses, is tapping on its strengths in transportation and logistics to capitalize on the e-commerce boom with added investments, a new app-based delivery service and the launch of warehousing services targeted for this year.

Since last year, ASSA has pumped in $50 million to expand its logistics facilities. It is making plans to set up a cross-border logistics center with potential collaboration with other companies.

"We predict that the highest growth in the future is the logistics business. Because we have seen that e-commerce growth is still very high as we studied several countries that are more advanced than us," Jany Candra, director of ASSA, told NNA in an exclusive interview.

Catering to the rise in online shopping, the company has been working hand in hand with its delivery subsidiary, PT. Tri Adi Bersama, to complete the transportation process at the client's doorstep.

The company has introduced an app called Anteraja, which offers businesses and individuals the convenience of sending their goods with its delivery service without the need to use a storage service before shipment.

Specially designed for e-commerce, Anteraja was launched in September 2019. Beginning with 10,000 parcels at day after it kicked off, it now handles more than 100,000 parcels daily.

Committed to good customer service and delivery fulfillment, the company has ensured that the job of delivery must be handled by its own employees, and not outsourced, said Candra.

He told NNA that Anteraja now has approximately 2,600 couriers serving throughout the country but it still has to hire workers daily because of growing demand for delivery services.

The company is targeting to set up Titipaja warehousing centers this year to cater to e-commerce merchants. Working with several major e-commerce players, it has been running a trial for six months in Jakarta and hopes to start a similar pilot project in Medan in North Sumatra.

ASSA's logistics business has been growing 15 percent a year. Although the growth rate is higher than the 10 percent growth of its mobility business, the revenue from its car rental service still dominates the lion's share of its earnings with its contribution of 2 trillion rupiah ($129 million) last year.

ASSA foresees the potential of logistics revenue surpassing the car rental business in three years.

"The shipping business is growing so fast. Now, we handle more than 100,000 parcels a day. So, in the next three years, we can expect 500,000 parcels a day," reckoned Candra as he painted an optimistic scenario.

Adi Sarana Armada has three business arms covering mobility, logistics and used cars. It started offering corporate car rentals in 2003. Today, it operates a massive fleet of almost 26,000 cars throughout Indonesia.