The UBER For Trucks In Indonesia Is Here

Mohamed Kasshif
Jul 27, 2017 · 3 min read

‘Uber’ is no longer just a brand referring to the American technological company that revolutionised the way taxi and car rides can be booked, essentially offering a service that works on demand. Now, several companies across the globe are inspired by the on demand concept, and have spun their own versions of it across many industries worldwide. In Indonesia specifically, the concept of ‘uberisation’ has become more relevant than ever before in one industry- logistics.

The term ‘Uber’ has become a verb.

The Horror of Logistics in Indonesia

Often described as outdated and inefficient when compared to other logistics industries across the globe, the need for disruption has long been overdue. A few startups like Caritruk, Lontar and Kargo.co.id are taking on the challenge to penetrate the market. There are several logistics companies in Indonesia, trucks carrying a huge load of goods can be seen in major cities like Jakarta as well as on roads that connect towns and provinces across the archipelago.

However, there is an inherent obstacle of shipping goods from one island to another, as there are more than 17,000 islands across the nation, making it a logistical nightmare. To illustrate, sending goods from Bali to Java would need to be multi modal (a combination of trucks and sea vessels). As a result, causing a surge in shipping costs.

On the other hand, considering the fact that Indonesian is still a developing economy, roads, ports and routes in several areas are inadequate to sustain the transportation of goods. For instance, roads in Jakarta and Surabaya are often congested with cars and motorbikes due to the poor infrastructure. Additionally, the busiest port in Indonesia known as Tanjung Priok has a long queue of goods waiting to be cleared by the customs as the port lacks the infrastructure to meet the logistical demands of today’s day and age.

Tanjung Priok Port located in the capital city of Jakarta in Indonesia. The Port is considered to be outdated and inefficient

All in all, the cost of logistics is extremely expensive and inefficient. This has led to a higher cost of goods being sold as well as a whopping 25% of Indonesia’s Gross Domestic Product (GDP) being attributed to the logistics industry

The Startups Which Are Taking The Matter To Their Own Hands

Recognising the existing issues as well as the success of Uber’s concept, startups in Indonesia have sprouted, seeking to solve the complication. The first and largest startup in the field today is Kargo.co.id (Kargo), which is based in Jakarta. Founded in 2015, the online marketplace first rolled out a service for trucks on demand. They have partnered with many fleet operators and today, has over 400 different logistics companies offering more than 12 services on its online marketplace.

Kargo.co.id’s online marketplace for logistics is one of the few players seeking to disrupt the logistics industry

What Kargo seeks to provide is transparency and reliability by allowing customers to compare the prices and lead time based on their location and destination provided. Furthermore, Kargo equips its partners’ fleet with technological features like real time tracking to make it more convenient for customers.

In less than 2 years, and most recently, it rolled out its international parcel delivery, where individuals can send items from Indonesia to the rest of the world.

While the outcome of the efforts undertaken by Indonesian startups are still relatively unknown, this is merely the beginning of disruption in the Indonesian logistics industry. Time will tell if they would actually succeed in ‘Uberising’ the logistics industry.

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