ID Logistics aims to double growth in next 3 years

JAKARTA. Logistics services provider ID Logistics Indonesia, part of France-based ID Logistics, aims to double its revenue growth within the next two or three years as the company prepares to expand its business.

The company is preparing strategies and innovations to reach the three-year goal as the domestic business climate is improving under the new administration, Logistics Indonesia general manager Vincent Holley said at a press conference in Jakarta on Wednesday.

“The growth target for 2015 will be in line with our current growth. However, we will implement next year a smarter logistics system, which will provide customers with better and smarter distribution,” he said.

Holley said Indonesia was known as a difficult place to do logistics business because the country was an archipelago with over 17,000 islands. Traffic congestion was also a problem coupled with an increase in fuel prices and high pollution.

In addition to those challenges, Holley said there was a changing trend in terms of buying processes in Indonesia, where more retail and convenience stores are developed in places closer to housing areas, as well as the high growth of the e-commerce industry.

To overcome the challenges, Holley said the company’s research and development team had developed an environmentally friendly and cost-saving approach through its services as a form of innovation and as a sustainable solution for its customers.

“We are supported by an IT-based mechanism called Warehouse Management System and Transportation Management System, which will optimize the flow and value of goods based on carbon dioxide emissions calculations,” he said.

The company would also introduce next year its two new low-emission types of trucks, Euro IV and Euro VI. The Euro IV would allow customers to pay 5 percent less while the Euro VI would be 33 percent more efficient, according
to Holley.

Holley said the trial of the new trucks would begin on routes between Cikarang and West Bekasi in West Java once the company obtained the necessary permit in the second quarter next year.

As of last year, ID Logistics Indonesia posted Rp 109 billion (US$8.85 million) in total revenue with 53 percent average annual growth over the last five years. The company has booked 700 percent revenue growth since it started operations in Indonesia seven years ago.

“We served 70 shipments in Indonesia as of last year, with a contribution still less than 5 percent of the group’s total revenue. However, we hope the portion will grow bigger as our business in Indonesia expands,” Holley said.

ID Logistics Indonesia has 400 employees working in 40,000 square meters of warehousing at three sites and two regions throughout the country. The company’s area of operation or distribution centers currently covers Java, Bali, Sumatra, Sulawesi and Pontianak in Kalimantan, he said.

Holley said the company was planning to increase its coverage to Balikpapan, Kalimantan next year and Papua in the next four or five years, declining to mention the total investment for the expansion.

The company currently serves various types of customers in the industrial, retail and consumer goods, pharmaceutical, automotive and e-commerce sectors. More than 50 percent of the company’s logistics business was contributed by PT Trans Retail Indonesia (Carrefour).

“In 2013, the French Carrefour Group’s Indonesian division was acquired by Trans Retail Indonesia, but our relationship remains good,” he said.

Globally, ID Logistics Group was established in 2001 and has run business operations in 14 countries, with major customers including Danone, Nestle and Philips.

ID Logistics Group chairman and CEO Eric Hemar said the group recorded 31.5 percent growth to ¤735 million in total revenue. As of September this year, the group booked ¤640 million in revenue with a growth of 23.8 percent. (Grace D. Amianti)