Tracking the jungle of Indonesian business info

JAKARTA (JP): Foreign businesses intending to enter the Indonesian market or seek local partners for joint ventures have often discovered how extremely difficult it is to get reliable information on local companies.

There are several main causes of the problems which are inherent in developing countries like Indonesia: The absence of full-fledged credit information agencies and a company registry office as well as the small number of publicly-listed companies that have to fulfill disclosure requirements.

Occasional media reports on alleged collusions between accountants and companies to manipulate financial reports only add to the apprehension that the system of business information in this country is still very much a jungle with numerous traps.

Several business data centers do have operations here. The biggest and most popular are the CIC Consulting Group, which has profiled almost all of the major industrial, trading and financial companies in the country, and Pusat Data Bisnis Indonesia (Indonesian Business Data Center).

But they have yet to gain the reputation that is acceptable to big international companies.

Several domestic banks have set up the credit rating agency PT Pefindo. But Pefindo only rates the credit worthiness of the companies which intend to float bonds.

But the need for business information on Indonesian companies has grown as quickly as the country's international trade. More and more foreign companies are interested in entering the domestic market or setting up joint ventures with local businesses.

"That is precisely the market need we want to meet," says Rustam Kocher, the chief representative of Dun & Bradstreet Information Services (DBIS) which recently opened an office in the Wisma Dharmala building here.

DBIS is a unit of the multinational Dun & Bradstreet Corporation, a provider of business information, software and services of the United States which last year posted total operating revenues of US$4.89 billion.

Kocher says around 9,000 Indonesian companies have been entered into the DBIS Worldbase data bank, which also has over 38 million individual company records and details.

Individual company records stored in the data base cover basic facts such as net worth, sales, types of operations, balance sheets, payment and banking history, subsidiaries/affiliates, branch networks, loans, debentures, shareholders, names of directors and the experience and background of key executives.

Information

Indonesian companies, he says, can also use the DBIS information service to assess potential customers overseas.

"We collect our information through trained business analysts, electronic on-line sources, bulk data loads and publicly available records," Kocher adds.

But all data are always subject to quality editing and reviews, he says.

According to him, data collection, processing and verification for the DBIS data bank can be done efficiently because the Dun & Bradstreet Corp. also has many other information-related divisions, including IMS International, Nielsen, Survey Research Group and Moody's Investors Service (rating agency), Dataquest, Pilot Software and the Gartner Group.

Dun & Bradstreet, he says, has offices in 31 countries and data-gathering capabilities spanning nearly 200 nations.

"Many companies also voluntarily and regularly file their corporate data to us either in light of applying for a credit rating or because they are fully aware of the benefits of being included in our data bank," Kocher says.

Moreover, he adds, many major global customers demand that their suppliers carry a DUNS (Data Universal Number System) number as a unique identifier for global linkages.

A DUNS number is a nine-digit code assigned by Dun & Bradstreet to each business entity in its information base.

Business information reports are delivered to customers either over a fax machine or on-line through a computer.

Kocher says customers usually use the DBIS information reports to make intelligent risk management decisions regarding their customers and suppliers.

Such management decisions may relate to approval of orders, setting of credit lines, evaluations of accounts, verification of vendors, identification of financial behavior patterns, assessing loan applications and insurance risks.

Wilson Nababan, Chairman of the CIC Consulting Group, however is not worried by Dun & Bradtsreet's operations here.

"The business of information services is not mainly a matter of technology but more of access to reliable sources of information. That is where our advantage lies," Wilson says.

Moreover, Wilson adds, in so far as the present system of information in Indonesia is concerned, the information business depends mainly on the capability to interpret, analyze and process data.

Its latest annual report put the operating revenue of the Dun & Bradstreet Corp. at US$4.89 billion with a net income of $629.5 million in 1994.

Users of the DBIS information system are charged fees at different rates, depending on the volume and types of information required. (vin)