Asia Logistics Insights:Driving Continuous Improvement to Make Indonesia a

Logistics Hub in Asia-Pacific

Togar M. Simatupang

School of Business and Management

Bandung Institute of Technology

Presented at Jakarta International Logistics Summit & Expo and Indonesia Transportation Supply Chain and Logistics (ITSCL) at JIEXPO Kemayoran Jakarta

19-21 October 2016 1

Overview

• Problem Statement

• ASEAN Logistics Outlook: Logistics Hub

• Benchmarking

• Proposed Logistics System in Indonesia

• Concluding Remarks

2

Problem Statement

3

Questions

• What is the position of Indonesia in ASEAN

logistics?

• How is the benchmarking of logistics

development in Japan and ASEAN Countries?

• What is the appropriate logistics system applied

in Indonesia?

• Can Indonesia achieve efficient logistics

performance or exceed other countries?

4

ASEAN Logistics Outlook: Logistics Hub

5

Why AEC is so attractive?

6

Larger portion of total middle class population is coming from Asia and ASEAN

7

Source: http://aseanup.com/overview-of-e-commerce-in-southeast-asia/8

ASEAN ECONOMIC COMMUNITY (AEC)

9

10Source: http://asiafoundation.org/in-asia/2010/09/22/philippines-spearheads-asean-effort-to-establish-regional-ro-ro-sea-transport-network/

Asia-wide Partnership for Seamless Logistics

11Source: http://www.iist.or.jp/wf/magazine/0508/0508_E.html

ASEAN-Japan-India Logistics Network

12

Source: http://www.mofa.go.jp/policy/oda/white/2011/html/honbun/b1/s3_2.html

Indonesia Logistics Costs Can Match Asian Peers in Two Decades

• Indonesia is on the right trajectory to reduce its logistics costs to 19 percent of its gross domestic products (GDP) by 2020.

• Government efforts to modernize ports and open up the logistics sector to foreign investment.

• Total logistics costs could further decline to 9 percent of the GDP by 2035 with further reform in port operating models and the development of better port infrastructure.

• The country would need to consolidate its fragmented forwarding industry and solve unbalanced cargo flows between its islands.

• Today logistics costs account for 26 percent of Indonesia's $861 billion economy.

• The is one of the worst numbers in all of Asia, and far behind Singapore's 8 percent, Malaysia's 14 percent, Japan's 9 percent and South Korea's 13 percent of GDP.– Roland Berger: "From our analysis, Indonesia has the potential to bring [down] the cost of logistics ...

but it must escalate reforms in the industry to achieve this ambitious target. The public and private sectors need to work collaboratively to reduce this burden,“

Source: http://jakartaglobe.beritasatu.com/business/indonesia-logistics-costs-can-match-asian-peers-two-decades-roland-berger/ 13

Benchmarking

14

Thailand’s International Trade Logistics Policies and Measures

Source: Chackrit Duangphastra (2011) 15

Thailand Electronic Trade Logistics

Forwarder

Customs Broker

Trucking

Warehouse

Shipper

ConsigneeAirlines

Global NetworkDomestic Network

ASEAN Single Window

EAST ASIA

Global Logistics Network

Europe

Thailand e-Logistics

Portal

16

Capacity Building Progress Report for Thailand

17

SCG Logistics in Cambodia

Source: Nithi Patarachoke (2012)

18

JICA’s Comprehensive Approach to Trade and Investment

19

Streamlining Trade Procedures and Distribution Logistics

20

RationaleLower the cost and risk of transnational economic activity and promote the efficient division of

labor within the region.Improve the efficiency not only of production activities but also of distribution between

production centers and from production to consumption sites.

JapanEast Asia Physical Infrastructure

Advancements in information technology and the standardization of distribution tools such as pallets

Current Cooperation

Emphasis on logistics (e.g. Just In Time, Supply Chain Management)

Future Priority

Action TargetReduce within five years the time needed to deliver goods from the point of production to destinations by more than two third

Actions Plan

Training of Certified Logistics Master Promotion of IT in the logistics sector More efficient customs clearance

Streamlining the flow of goods

Private Sector Needs

Source: Satoshi Suenega(2004), "Japan’s Technical Cooperation in Logistics", Technical Cooperation Division, Ministry of Economy, Trade and Industry.

Indonesia as a Logistics Hub in Asia-Pacific

21

Key drivers and restraints for Indonesia transportation & logistics market

Poor infrastructure development, together with unavailability of qualified professionals, will still be a major constraint hindering Indonesia logistic industry development in several years ahead. 22

Insight of Nusantara Logistics Chain

23

Indonesia’s Logistics Sector:Making Connections

• At 24% of GDP, Indonesia’s logistics costs are significantly higher than most other countries in the region. • Bringing this down to 16% of GDP, the same as Thailand, would realise huge savings of some $80 billion USD a year, according to World Bank calculations. • Infrastructure development as planned by the government will reduce this to 19.2% by 2019. • While an improvement, this is well above the 8% of GDP typical for developed nations leaving plenty of scope for investment and innovative solutions as companies seek to reduce their logistical burdens.

It is important for Indonesia’s logistics sector to start adopting a more integrated approach that ensures efficiencies across the entire supply chain

Source: http://www.gbgindonesia.com/en/services/article/2016/indonesia_s_logistics_sector_making_connections_11383.php24

Supply Chain Integration

International Suppliers International Freight Destination

Markets

Management & Co-ordination of the Global Supply Chains

between Manufacturers and Regional DC/ Retail Outlets

DrayageCustomsInsuranceFinancingPort

ServicesShipping

LinesFrt. Fwd

Asia Export

DC

Export volume from each port of loading, e.g. HK, Shanghai, etc.

Order volume from each DC/destination

Logistics Model

Buyer Consolidation at Source

De-Consolidation at Destination

Shipment Equipment

Carrier & Network Selection

Frequency and Schedule of Shipments

Forecast Coverage & Demand Velocity

Strategic locations of inventory

Storage cost differentialReplenishment Model

Order Processing

Source: Tommy Lui (2011) 25

The concept of Nusantara Logistics Chain (NLC)

Land Use Population

Logistics Chain

Local Economic

Development

Transport System

The Environment

The development of an integrated transport system, consisting of different modes and with strong relationships between the development of the transport system, the economic development, the land use development and the environmental impacts of these developments.

Logistics Corridors

Logistics Landscape

Inclusive Businesses

Logistics Services

GreenLogistics

26

The implementation of Nusantara Logistics Chain

Economic Policy:Tax incentives, subsidies and

financial aids for inclusive business, private-public

partnership

Public Awareness:Public education, promotion,

training

Legal Support:Enforceable laws and

regulation, guidelines and procedures, penalty for

violation

Infrastructure and Technology:Provision of logistics

infrastructure, Investment in appropriate technology,

standardization of practices and procedures

Public Contribution and

Participation:Forum of Development,

Institution building, Logistics Competencies Development

27

The Benefits of Logistics Improvements

Source: http://people.hofstra.edu/geotrans/eng/ch5en/appl5en/benefits_logistics_improvements.html 28

The Proposed Leverages

29

1.Logistics Landscape2. Logistics and supply chain for development

3. Single window

4. Multi modal transport system

5. Coastal Logistics6. Network based logistics visibility

platform

7. Logistics Business Development

8. Green Logistics

9. Development forums for Nusantara logistics chain at each

economic corridor

1. Logistics Landscape

Source: http://aftercity.mit.edu/?p=47930

2. Logistics for Development

Source: http://people.hofstra.edu/geotrans/eng/ch6en/conc6en/nodeslinkages.html

Nodes, Linkages and Urban Form

31

3. Single Window System

Source: http://www.insw.go.id/

Two Pillars Policy: Trade-System & Port-System Trade-System (“TradeNet”) :

Aims to improve and speed up services in export-import

documents clearance (Flow of Document)

Port-System (“PortNet”) :

Aims to support the acceleration of cargo handling in

export-import goods traffic (Flow of Goods)

Trade-System, as one of main pillars in NSW System

will exchange data through NSW Portal:

from Customs System :realization of Data

import/Export

from Trade System (GA) :licensing export Import

Port-System,as one of main pillars in NSW System will exchange data through NSW Portal:

FromCustoms System : Cargo Manifest (inward/outward) Release Approval (SPPB/PE)

FromPort System (GA) : Discharge List/Loading List Gate in/Gate out List

Customs

TradePort- import/Export Licensing

- import/Export Regulation

- Trade Information

- Info Manifest- Utilization Rep- License Reconc.

- import/ Export Declaration

- In/Outward Cargo Manifest

- Import/Export Approval

- Sea/ Air-Port Permit- Goods/Ships Handling- Loading/Disch.Goods- In/Out Goods

- Info Vessel

- Info CY/ WH

- Cont.Tracking

- Info Manifest/RKSP

- Loading/Disch.List

- In/Out Reconciliation

32

4. Multi Modal Transport System

Source: http://people.hofstra.edu/geotrans/eng/ch3en/conc3en/multimodal.html

33

Source: http://sic.ici.ro/sic2006_2/art07.html

34

5. Coastal Logistics

Transport of resin chips between the Ehime Plant and Nagoya Plant was switched to coastal shipping routes

Source: http://www.toray.com/guideline/forcustomers/ethics/eth_002.html35

6.Networked Logistics Platforms

Source: http://www.clresearch.com/research/detail.cfm?guid=07598B62-3048-79ED-99F8-974CD7202097

36

7. Logistics Business Development

Source: http://www.scandria.eu/en/scandria-logistic-business-development-strategy.html 37

8. Green Logistics

Source: http://log.logcluster.org/operational-environment/green-logistics/index.html

Green or sustainable logistics is concerned with reducing environmental and other negative impacts associated with the movement of supplies.

38

Sistem Logistik Ikan Nasional (SLIN)

39

Jenis Rantai Pasokan Ikan

Rantai Pasok Berorientasi Transaksi

Rantai Pasok Berorientasi Kapasitas

Rantai Pasok Berorientasi Integrasi

Penyimpanan

Pengadaan

Transportasi

Distribusi

Penyimpanan

Pengadaan

Transportasi

Distribusi

Penyimpanan

Pengadaan

Transportasi

Distribusi

Ranah kewenangan Provinsi dan Wilayah

Pengelolaan Perikanan

Ranah kewenangan Pusat dan Antar Wilayah Pengelolaan Perikanan

• Transaksi niaga sesuai pasar lokal.• Kepentingan masing-masing untuk

meningkatkan margin.• Tidak ada koordinasi antar pelaku

sepanjang rantai logistik.• Kementerian hanya menjadi

regulator dan pengawas.

• Transaksi niaga sesuai pasar klaster.• Kepentingan bersama untuk

meningkatkan kapasitas.• Ada koordinasi pemecahan masalah

lokal.• Inisiatif daerah dengan dukungan

kementerian.

• Kontrak niaga sesuai pasar nasional.• Kepentingan bersama untuk menjamin

ketersediaan dan stabilisasi harga.• Ada koordinasi penjaminan mutu dan

kestabilan harga.• Inisiatif kementerian dengan pelaksana

operator koodinator. 40

Tingkat Kedewasaan Tatakelola Rantai Pasokan Ikan

Tatakelola rantai pasokanperikanan yang bertanggung jawabadalah suatu prinsipyang berstandarinternasional bersifatsukarela dan global untuk mencapai rantai pasok perikanan yanglestari.

Transaksional:

berdagang dan sendiri-sendiri

Bertanggung-Jawab:

patuh dan beretika

Terpadu:

transparan dan berstandar

Cerdas:

cepat tanggap dan inovatif

Tatakelola rantai pasok terintegrasi adalah transparansi ketelusuranaliran barang, aliran informasi permintaandan persediaan, dan aliran keuangan di sepanjang titik rantaipasokan.

41

Arsitektur Logistik Efektif

Mutu Tinggi – Biaya Rendah – Waktu Antar Pendek

Integrasi Hulu-Hilir Governansi Hulu-Hilir Proses (SOP) Standar Kapasitas Logistik

Nilai Tambah dan Daya Saing

Kerjasama, Insentif, Infrastruktur, ITK, SDM, Kelembagaan, Jasa Logistik

42

Manajemen rantai pasokan (MRP) menyangkut pengelolaan kegiatan dan hubungan di dalam perusahaan, dengan pemasok, dengan pelanggan, atau rantai pasokan secara keseluruhan.Dimensi MRP adalah: • Koordinasi kegiatan bisnis di dalam pelaku• Kerjasama kegiatan bisnis antar pelaku atau agen rantai pasok

Konsep Kreasi Rantai Nilai Ikan

Kreasi Nilai:1. Peningkatan Kapasitas Rantai Logistik2. Peningkatan Integrasi Rantai Pasok3. Efektivitas Tata Kelola Rantai Pasok

Ko-Kreasi:1. Inovasi bersama dan

terbuka2. Kemitraan3. Pembiayaan

Kemampuan:1. Transparansi2. Standarisasi3. Sertifikasi4. Ketelusuran

Tawaran Pengungkit Nilai:

Isu-Isu Logistik Ikan:1. Ketidakstabilan pasokan

dan sumberdaya ikan2. Disparitas geografi,

ketersediaan, dan harga3. Lemahnya partisipasi

perbaikan mutu

Kreasi Nilai Sosial:1. Kestabilan pasokan ikan

dan harga2. Efisien rantai pasokan dan

kelestarian ekosistem3. Penciptaan usaha baru dan

pendapatan yang berkeadilan

Penyimpanan Distribusi

Transportasi

Pengadaan

Rantai Pasokan Terintegrasi hulu-hilir

Kapasitas Rantai Logistik

Tata kelola rantai pasokan

43

Portofolio Rencana Induk SLIN

SEKTOR HULU SEKTOR HILIR

PERIKANAN TANGKAP

PERIKANAN BUDIDAYA

PENGOLAHAN DAN PEMASARAN HASIL

PERIKANAN

KONSUMEN

Konsumsi Ikan

Industri Pengolahan Ikan

Tuna Tongkol

Cakalang (TTC),

kembung, bandeng

Tuna Tongkol

Cakalang (TTC),

kembung, bandeng

Keterkaitan fungsional (integrasi) rantai pasok hulu

hilir dengan kesatuan tindakan dalam ikanan kelembagaan

Kondisi yang diharapkan:ada jaminan ketersediaan

pasokan, peningkatan harga di level produsen, stabilitasi harga

antar musim

Pentahapan Pengembangan Sistem Logistik Ikan:

1. Bertanggung-jawab2. Transparansi3. Standarisari4. Sertifikasi5. Stabilisasi6. Inovasi7. Kecerdasan

Rancang Bangun Sistem Logistik:1. Pengelolaan produksi dan

pemasaran2. Sarana dan Prasarana3. Iptek dan kapasitas SDM4. Teknologi informasi dan

komunikasi5. Jasa logistik6. Kelembagaan

Dukungan prakarsa pemangku kepentingan lokal dalam

mewujudkan ketahanan pangan ikan daerah dan kerjasama

dengan prakarsa nasional sistem logistik yang terintegrasi..

Kebijakan Prioritas Produk:1. Bahan baku: TTC, kembung,

bandeng2. Ikan beku melalui rantai

pendingin (cold storage)

44

Rancang Bangun SLIN

Tujuan

Sasaran

Strategi

Program

Meningkatkan kapasitas dan stabilisasi sistem produksi dan pemasaran perikanan nasional.

Memperkuat dan memperluas konektivitas antara sentra

produksi hulu, produksi hilir, dan pemasaran secara efisien.

Meningkatkan efisiensi manajemen rantai pasokan ikan,

bahan dan alat produksi, serta informasi dari hulu sampai

dengan hilir.

Terwujudnya peningkatan kapasitas dan stabilisasi sistem

produksi dan pemasaran

Terwujudkan penguatan dan perluasan konektivitas antara sentra produksi hulu, produksi

hilir, dan pemasaran

Terwujudnya efisiensi manajemen rantai pasokan ikan,

bahan dan alat produksi, serta informasi dari hulu sampai hilir

Pengelolaan produksi dan pemasaran di

bidang perikanan

Penyediaan dan pengembangan

sarana dan prasarana

Pengembangan iptek, dan

peningkatan kapasitas SDM

Pemanfaatan dan pengembangan

TIK di bidang perikanan

Pengembangan jasa logistik di

bidang perikanan

Pengembangan kelembagaan dan

tata kelola di bidang perikanan

• Integrasi pias atau jalur logistik nasional dari produksi ke pemasaran

• Pembinaan pengembangan sistem logistik ikan daerah

• Sistem standar mutu dan keamanan serta sertifikasi

• Penyediaan sarana dan prasarana logistik pendingin

• Pengembangan inovasi iptek produksi, pemasaran, dan logistik perikanan

• Pengembangan pendidikan, pelatihan, dan penyuluhan di bidang produksi, pemasaran, dan logistik

• Penyediaan dan diseminasi informasi produksi dan pemasaran

• Pengembangan sistem informasi manajemen logistik ikan nasional

• Pengembangan sistem ketelusuran

• Pengembangan usaha dan investasi bidang jasa logistik perikanan

• Jaringan layanan penyedia jasa logistik perikanan

• Pemberian insentif bagi jasa penyedia logistik

• Pengembangan kelembagaan pengelolaan SLIN

• Pembentukan kelembagaan pendukung SLIN pada tingkat pusat, provinsi, dan kota/kabupaten

• Tata kelola akuntabilitas kelembagaan45

Tata KelolaImplementasi pengembangan SLIN dilakukan secara sinergi dan terpadu di seluruh daerah dengan dua pendekatan:• Atas-bawah:

pengembangan pias logistik ikan nasional yang dipilih berdasarkan potensi integrasi sentra produksi dan konsumsi.

• Bawah-atas: pengembangan sistem logistik ikan daerah menuju pemberdayaan komoditi keunggulan daerah dan ketahanan pangan ikan.

Kebijakan tata kelola:• Penyelarasan kepentingan

pelaku dalam SLIN dengan prinsip kerjasama.

• Pengembangan, implementasi, dan replikasi untuk mencapai tujuan termasuk sertifikasi.

Kajian Kelayakan

Rencana Tindak

Implementasi

Pemantauan dan Evaluasi

Sosialisasi, kemitraan saling menguntungkan, pelatihan, sistem ukuran kinerja, teknologi

Tahapan 1-6 bulan 7-12 bulan 13-18 bulan 19-24 bulan

Kajian Kelayakan

Kerjasama

Rencana Tindak

Implementasi

Pemantauandan Evaluasi

Tahapan Pengembangan Program SLIN

46

Peta Jalan SLIN

Bertanggung-jawab

Tranparansi: registrasi, sistem informasi, dan ketelurusan

Standarisasi

Sertifikasi

Stabilisasi

2016

20172018

20202019

47

Concluding Remarks

48

Concluding Remarks

• The logistics industry is presented with new opportunities, such as the growing importance of intra-regional markets, the expansion of E-Commerce and in providing specialized services to a range of industry sectors.

• Indonesia’s macro logistics is considered as high economy costs that prevent industrialization and new business investment.

• Bottlenecks in the transportation and logistics industry include underdeveloped infrastructure, conflicting regulation, inefficiencies in goods movement, and paper-based trade facilitation.

• Indonesia’s national logistics system has been formulated and issued by the Government. However, the system still lacks of public awareness and fragmented to the local economic development.

• Nusantara Logistics Chain is introduced to enhance interlink between logistics landscape to social and economic development for empowering the growth of inclusive business that increase value added of local resources.

• Leverages available to Nusantara Logistics Chain include: Logistics Landscape, Logistics and supply chain for development, Single window system, Multi modal transport system, Coastal Logistics, Network based logistics visibility platform, Logistics Business Development, Green Logistics, and Development forums for Nusantara logistics chain at each economic corridor.

49

Thank You

50