Tue, 25 Feb 2003

Orders from local residents on upward trend

Ari Darmawan, Contributor, Jakarta

The word "moving" -- be it home, office or factory -- immediately conjures up a variety of images of all the trouble and hardship that you have to go through.

Perhaps moving within the same city poses less problems, but just imagine the hassle of moving to another city or country. Therefore, moving and relocation companies are highly appreciated.

Local companies offering such services began to be established, spurred by similar foreign companies with an international network, such as Global, Crown Pacific and Koll Ipac, mostly serving foreign companies that intended to place their experts in Indonesia.

"We provide our expatriate customers with information that is as complete as possible, so that they encounter fewer problems during their stay in Indonesia," said Lynnette Johnson, relocation division manager of Koll Ipac, a U.S.-based company.

The information they give is quite detailed, as it includes items such as suitable houses or apartments, the facilities of social activities (clubs etc.), schools for the children, sports centers, banks and their services, security systems, and how to find housemaids, drivers and security guards.

With more than six years of experience in the country, Koll Ipac currently serves a great number of clients, 50 percent of whom are American citizens, while the rest come from various European and Asian countries as well as Australia. Most work for oil and gas companies, banks, financial institutions, construction and cigarette companies as well as advertising agencies.

According to Lynnette, June and July are usually the peak season for relocation orders. "This is very much related to the school enrollment period. Obviously, expatriates who move to this country adjust the timing with the children's completion of exams in their home countries," she explained.

During the country's economic crisis in 1988 and 1999, Koll Ipac mostly served expatriates returning to their native countries. However, since 2000, quite a number have returned. The moving and relocation orders for January 2003 saw a steep rise, in comparison with the same month last year. "While we can't reveal the exact figures, we have certainly been much busier this year so far," Lynnette added.

Today, the trend of Indonesians making use of moving and relocation services is also on the rise, though relatively more slowly than in developed countries. Take Kusumo Widjaya, a Jakartan living in the Ciledug area, for example. He is planning to move to Batam island in the near future to take up a new job at an electronics company on the industrialized island.

To avoid all the hassle, he has decided to rely on the assistance of a moving company, which he found from an advertisement in one of the city's newspapers.

"But the cost of services offered by this foreign company was exorbitant, probably because it served foreigners. Later I found out that local companies operated in the same business and their rates were quite reasonable," said Kusumo.

Moving his entire family to Batam also meant moving almost all the contents of his house, such as beds, sofas, wardrobes, fridge, television, and so forth. He found that using the services of a moving company helped a great deal, as besides cutting down on all the hassle, everything was covered by insurance. "I couldn't have done it more cheaply, plus I'm not really familiar with the elaborate customs procedures and it would have affected my office hours as well," said the father of two.

Some courier companies tend to agree about the increase in relocation orders from locals. "In comparison with two years ago, today's orders come in almost on a daily basis," said chief executive officer of Tiki JNE Johari Zein, one of the local companies specializing in moving and relocation services. The lowest number of orders -- mostly house moving -- the company currently receives is between three and five per month.

Though the local segment is growing, albeit not at the expected rate, the largest market share still continues to be foreigners, used to such services in their home country for years.

The low interest of locals in these services is probably due to several factors.

The first seems to be cultural, meaning the closely knit and family-like relations within Indonesian communities. After announcing one's plan to move, quite often friends, neighbors and relatives would come over and lend a hand without expecting reward or payment. During the relocation of an office, one would also find the work was done together by both the directors and top executives, down to the office boys. Comparatively, again perhaps owing to their more individualistic character, scenes where friends and neighbors dropped in to help would tend to be rarer in Western societies.

Second is the cost, as moving companies cost more than moving on your own, because they charge for every step of the assignment, from surveys at the old and new locations, packing and transportation, to unpacking and rearranging furniture or equipment at your new address. Obviously, in the do-it-yourself mode, with the help of your relatives, neighbors and friends, the cost only consists of the rental fee of the truck and some food and beverages for the kind helpers.

Another factor, no less important, is lack of information on the part of locals regarding the availability of moving and relocation companies. The solution to this problem faced by such companies is actually quite simple. To enlarge the local market segment they should jointly promote their services to increase awareness of their services.

In other words, the key strategy is to educate the local segment on the benefits of using the services of moving and relocation companies to speed up its growth, though such education in the form of promotions and advertising campaigns would certainly imply huge costs and take a while to succeed.

Logically, once the local market segment is ripe, relocation companies will be rewarded with increased orders from locals. It would be strange indeed if orders from expatriates -- much smaller in number -- remained significantly larger than those from locals, who form the majority of the country's population. Attempts should be made to strike some kind of balance.