RI still promising for air express firms

RI still promising for air express firms

By Sylvia Gratia MN

JAKARTA (JP): The world's major air express companies still
consider Indonesia a promising market for courier business
despite the country's worst ever economic crisis.

Mike Fitzpatrick, senior technical advisor at DHL Worldwide
Express' Indonesian affiliate PT Birotika Semesta/DHL, said the
rupiah's collapse against the U.S. dollar -- the major cause of
the economic turmoil -- had encouraged more exports from the
country.

"The increase in exports means more business opportunities for
air express companies," he said, adding that the cost-cutting
measures adopted by Indonesian companies to enable them to cope
with the crisis would make their operations more efficient.

As a result, he said, Indonesian goods would be even more
competitive in years to come and exports would increase.

Based on such a business picture, the future of the air
courier business in the country is unquestionably bright, he
said.

Fitzpatrick said DHL's service in the delivery of Indonesian
exports has increased by 40 percent since January.

Harsha E. Joesoef, president of Federal Express' (FedEx)
Indonesian affiliate PT Repex Perdana International, sharing
Fitzpatrick's view said that boosting exports was the only way to
lift the country out of the economic crisis.

"Exporters are enjoying a windfall because of the depreciation
of the rupiah. All companies are competing to export their
products now," Harsha told The Jakarta Post.

Fitzpatrick admitted the company also recorded a decline of 15
percent in the volume of document delivery and attributed this to
the fact that many companies in Indonesia had closed down.

"But we are an international company. And as most of our
revenue in Indonesia came from exports, the crisis has only had a
minimal impact on us," he said.

Competition

Harsha said that air express companies have to offer special
packages to enable them to compete in the country's tight market.

"Exporters are seeking the fastest and most reliable air
express service. We, Federal Express are ready to provide them
with such a service," he said, adding that FedEx currently
handles approximately 20 tons of freight every day.

DHL's Indonesian Manager, Soraya Rudianti said that to grow
and profit from the worldwide economy, business needed express
distribution.

"Today most wise business owners are using express
distribution not only for emergency shipments, but as part of
their daily delivery activities," she told the Post.

"We want to keep our image as the first in the business. The
first to pick up, to process and to deliver. For us, every second
counts."

In June DHL introduced the "USA First" service for Indonesian
exporters to deliver goods to the United States fast and cost
effectively. The service includes express pick-up, streamlined
customs clearance and secure delivery.

Earlier this month, the company launched a new service aimed
at facilitating growing business ties between Jakarta and the
Malaysian capital.

Under its Same Day Service, documents collected in the
Indonesian capital will receive same-day service to Kuala Lumpur.
Documents sent by DHL at 11:30 a.m will arrive in Kuala Lumpur
before 9:30 p.m the same day.

Fitzpatrick said that DHL would continue to improve its
service, to maintain its position as the market leader in
Indonesia and other Asian countries.

"We have a strong position in Indonesia. Our market share in
the country is currently 66 percent and over 50 percent in other
Asian countries," he said.

"We are continually improving our services and always looking
for new innovations. We are the first air express company to
offer same day service."

Birotika Semesta/DHL, which started operating in Indonesia in
1979, currently leads the domestic courier industry with a
network of 65 branch offices. It employs more than 800 people and
has 250 vehicles at its disposal.

FedEx, however, is very proud because it is the only air
express company which operates its own fleets while other air
express companies still rely on commercial airlines.

FedEx has operated direct flights to Jakarta five times a week
using Airbus A310 aircraft since April.

"The service will help our consumers conduct their businesses
faster and more efficiently. We are moving closer to fulfilling
our vision of developing an integrated distribution network, that
will allow customers to transport goods to virtually any
destination in the world within 24 to 48 hours," Joesoef said.

He said that using its own fleets has benefited FedEx in the
current economic crisis, because the company can take over the
cargo market left vacant by other airlines, many of whom have
reduced their flights.

"By using our own aircraft we can add cargo spaces for
Indonesian companies, provide jobs and value adding for local
freight forwarders and airlines," he said.

"Depending on commercial airlines is full of risk, especially
with delays."

He said FedEx fleets, like other foreign cargo companies are
only allowed to land in Jakarta's Soekarno-Hatta airport. The
shipments to other cities in Indonesia are made by local
airlines.

He added that using its own fleets has allowed the company to
take full control and full responsibility for its consumers'
goods.

DHL, however, still prefers to cooperate with commercial
airlines because the company has many more time choices for
shipments.

"Using commercial airlines allow us to be more flexible in
delivery as we have many more delivery choices for consumers'. It
is also more economical than using our own fleets," Soraya said.

Fitzpatrick said that DHL is considering further expansion of
the service to other Asian countries.

He said Bangkok would be next on the agenda because Thailand
is one of Indonesia's major partners.

"We are also looking to further extend the service to other
Asian countries. We have already provided overnight service to
Hong Kong, Tokyo and Osaka, and maybe in the future we can
provide same day service to these destinations."

Fitzpatrick said the company would invest about US$3 million
in the next two years to upgrade its existing facilities.

"We will improve our supporting facilities at Soekarno-Hatta
International Airport and open up new offices and improve our
technology."

"We make an effort to remain committed to our role as a trade
facilitator in good and bad times," Fitzpatrick said.

"Therefore, we are initially targeting market growth of 20
percent next year. We are also trying to increase our market
share to 70 percent," Soraya added.

Meanwhile, Harsha said that FedEx would launch a new service
next month which would allow its consumers to make transactions
via the Internet.

"The new service, called electronic commerce, will facilitate
Indonesian exporters, including operators in other cities in Java
and other parts of Indonesia, to promote their products to
international consumers, and allow buyers to purchase the goods
via the Internet," Harsha said.

PT Repex Perdana/FedEx, which started operating in Indonesia
in 1985, currently services over 40 destinations in Indonesia. It
employs more than 400 people and has at least 82 vehicles at its
disposal.