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The shining businesses in the digital era

Saturday, 11 February 2017 | Andy Dwijayanto, Dede Suprayitno

JAKARTA. It has to be admitted that the digital era has impacted to all areas of life, including to the business sector. Executive Director of ICT Institut Heru Sutandi said, the internet technology has been implemented in all business segments. “A business, which still relies on conventional way, will be difficult to survive,” Heru told KONTAN.

According to Heru, there are three business segments with the most massive development, namely e-commerce, financial inclusion, and transportation business.

For an example, with the supports of large amounts of funds, the online transportation businesses of Grab, Uber, and Go-Jek have been growing rapidly in Indonesia.

The character of Indonesians, who love to travel, is match with the business, “While, the investors are arranging the (business) strategies and executing (the strategies),” said Jefri R. Sirait, the Chairman of Indonesian Venture Capitals and Start Ups Association.

The massive growth of online transportation businesses has overcome conventional transportation business. Some conventional transportation companies finally have decided to collaborate with the online transportation systems. Recently, conventional taxi companies Taksi Putra, PT Express Transindo Tbk, and PT Blue Bird Tbk have partnered with online transportation providers, namely Grab, Uber, and Gojek Indonesia, respectively.

Aside of transportation business, the e-commerce business also has been growing massively. Even, a number of conglomerates also involve in this business. For the examples, Salim Group in Lazada and Zalora, Djarum Groups (owned by Michael and Budi Hartono) in blibli.com and kaskus.co.id, as well as Elang Mahkota Group (owned by Eddy Kusnadi Sariaatmadja) in bukalapak and bobobobo.

The online business still offers big opportunities to the entrepreneurs, such as small-medium scale industries (IKM). To date, there are only 9% of 56 million small-medium scale industries involve in online business. “I predict that the online business will grow at minimum by 30%-50% in this year,” said the Chairman of Indonesian e-Commerce Association (IDEA) Aulia Ersyah Marinto.

Conventional businesses, such as conventional retailers, admitted that the competition with online business is getting fiercer. “There is no option, except following them," said Tutum Rahanta, Vice Chairman of Indonesian Retail Merchants Association, who is also the Director of Pojok Busana. Recently, Pojok Busana is considering penetrating to online business through market place. Likewise, PT Ramayana Lestari Sentosa Tbk (RALS) is also considering expanding to online market.

The similar conditions happen to the hospitality business. Recently, AirBnb application has rocked the hospitality business in Bali. President Director of PT Red Planet Indonesia Tbk NG Suwito said, the conventional hoteliers have to be equipped with online booking instruments to survive.

(Muhammad Farid/Translator)

Reporter: Andy Dwijayanto, Dede Suprayitno
Editor: Yudho Winarto