Business-to-business in Indonesia will outpace global growth as the economy expands and household consumption rises.
We here by share this information in hope of informing you about this exciting opportunity and extending invitation to seize the opportunity together.
PT. Surya Data Infokreasi is an IT based consulting company which founded in 2011, with niche market of ERP for Apparel Retail / Garment industry in Indonesia.
The business-to-business (B2B) segment in Indonesia will expand from US$458mn in 2013 to US$705mn in 2018, at a CAGR of 9.0% — the fastest rate of growth for this segment in any country in the Asia Pacific region, and well ahead of the 3.4% CAGR projected globally.
During the forecast period, B2B spending will benefit from Indonesia’s large population and expected CAGR of 11.8% in nominal GDP.
Total business information is the largest segment of Indonesia’s B2B market, accounting for 53% of total B2B revenue in 2013. It is set to grow at a CAGR of 10.6% over the forecast period, reaching US$405mn in 2018, fueled by a rise of 5% compounded annually in household consumption. According to ESOMAR, 52% of market research focuses on the FMCG sector.
“SMEs collectively represent over 99% of the total number of businesses in Indonesia, 97% of employment and 57% of the annual GDP of Indonesia.”
SMEs are the dominant form of business organizations in Indonesia and plays an important role in the Indonesian economy. SMEs collectively represent over 99% of the total number of businesses in Indonesia, 97% of employment and 57% of the annual GDP of Indonesia.
Indonesian SME can be divided into few categories based on the level of Technology Utilization:
Offline (36%): without broadband access, without computer or smartphone and did not have any website.
Basic (37%): Have broadband access, have digital equipment such as computer or smartphone and static online presence.
Intermediate (18%): Directly involved in social media trough the combination of website, integrated with social media site, live chat, or customer thread within website.
Advanced (9%): have great connectivity, integrated social media, and e-commerce capabilities.
However these lucrative opportunities come with diverse, and intertwined market where who we know matter more than what we know. Vanilla ERP solution from abroad will not fit by default, and there is not many Indonesian company providing such solution.
That’s why SURYADATA established. Over 6 years, we able to gain traction, and we currently plan to expand into ERP with model of SAAS.
High Failure Rate during Implementation of [foreign?] ERP
In Indonesia, the usage of the ERP system among SMEs are not common which implies a large untapped market for ERP.
The ERP system will play pivotal role in aiding SMEs to retain agility within transactions and eventually empowering SMEs to gain competitive advantages and grow.
Indonesia offer lucrative market. But it is also a diverse, and intertwined market where who we know matter more than what we know.
In order to function under such condition, experience and reputation in handling business situations are required since there’s a lot unwritten rules and customs.
AFRAID OF BPR
BPR is rarely taken by Indonesian companies. It is suspected that BPR will:
1. Create radical changes – lead to the reduction of employees.
2. Employees will have to learn completely new things and this will lead to the declining in the overall productivity.
Instead, The Goal is to Appoint Local Partner
We’ve observed Indonesia have unique and early stages market for ERP solution, which creates problem of high failure rate during implementation of [foreign?] ERP. The solution is appointing local partner who have extensive network. That’s exactly what SURYADATA are.