Indonesia Logistics and Warehousing Market Outlook to 2029

The report titled “Indonesia Logistics and Warehousing Market Outlook to 2029 - By Market Structure, By Segment, By End-User Industry, By Region.” provides a comprehensive analysis of the logistics and warehousing market in Indonesia. The report covers an overview and genesis of the industry, overall market size in terms of revenue, market segmentation; trends and developments, regulatory landscape, customer level profiling, issues and challenges, and comparative landscape including competition scenario, cross comparison, opportunities and bottlenecks, and company profiling of major players in the logistics and warehousing market. The report concludes with future market projections based on revenue, by market, service types, region, cause and effect relationship, and success case studies highlighting the major opportunities and cautions.

Indonesia Logistics and Warehousing Market Overview and Size

The Indonesia logistics and warehousing market reached a valuation of IDR 150 Trillion in 2023, driven by the growing demand for efficient supply chain solutions, rapid urbanization, and the expansion of e-commerce. The market is characterized by major players such as JNE Express, TIKI, DHL Supply Chain, Kuehne + Nagel, and Siba Surya. These companies are recognized for their extensive distribution networks, diverse service offerings, and customer-focused logistics solutions.

In 2023, DHL Supply Chain launched a new multi-client warehouse in Jakarta to enhance customer experience and streamline the logistics process for e-commerce and retail businesses. This initiative aims to tap into the growing digital market in Indonesia and provide a more convenient logistics solution. Jakarta and Surabaya are key markets due to their high population density and robust industrial infrastructure.

Market Size for Indonesia Logistics and Warehousing Industry on the Basis of Revenue in USD Billion, 2018-2024

Source: TraceData Research Analysis

What Factors are Leading to the Growth of Indonesia Logistics and Warehousing Market:

• Economic Growth: Indonesia's consistent GDP growth and increasing industrial activity have significantly boosted the demand for logistics and warehousing services. In 2023, the logistics sector accounted for approximately 8% of the country's GDP, driven by the need for efficient supply chain management to support various industries, including manufacturing, retail, and e-commerce.

• E-Commerce Boom: The rapid expansion of the e-commerce sector has been a major driver of the logistics and warehousing market. In 2023, online retail sales in Indonesia grew by 35%, creating a high demand for warehousing space and last-mile delivery services. This growth is particularly pronounced in urban areas where consumer demand for quick and reliable delivery services is increasing.

• Infrastructure Development: The Indonesian government's investment in infrastructure development, including the construction of new ports, highways, and industrial parks, has facilitated the growth of the logistics and warehousing market. In 2023, the government allocated IDR 400 Trillion for infrastructure projects aimed at improving connectivity and reducing logistics costs, thereby boosting the sector's overall efficiency.

Which Industry Challenges Have Impacted the Growth for Indonesia Logistics and Warehousing Market:

• Regulatory Complexity: Navigating Indonesia's complex regulatory environment, particularly in relation to customs and import/export procedures, poses significant challenges for logistics providers. In 2023, approximately 30% of logistics companies reported delays in shipments due to regulatory issues, which can increase operational costs and impact service levels.

• Infrastructure Bottlenecks: Despite ongoing infrastructure improvements, Indonesia still faces significant challenges related to its vast and diverse geography. Remote and underdeveloped regions experience limited access to quality logistics services, resulting in higher transportation costs and longer delivery times.

• Skilled Labor Shortage: The logistics and warehousing sector in Indonesia is facing a shortage of skilled labor, particularly in areas requiring specialized knowledge such as supply chain management and warehouse automation. In 2023, around 40% of logistics companies reported difficulties in recruiting qualified personnel, impacting their ability to scale operations and maintain service quality.

What are the Regulations and Initiatives which have Governed the Market:

• National Logistics System (Sislognas): The Indonesian government has implemented the Sislognas initiative to create an integrated national logistics system. This includes regulatory reforms aimed at improving logistics efficiency, reducing costs, and enhancing the overall competitiveness of the logistics sector. By 2023, these reforms contributed to a 5% reduction in logistics costs as a percentage of GDP.

• Investment Incentives for Logistics Facilities: To attract foreign and domestic investment in the logistics sector, the Indonesian government offers various incentives, including tax breaks and subsidies for the development of logistics facilities such as warehouses and distribution centers. In 2023, these incentives led to a 15% increase in the construction of new warehousing facilities across the country.

• Digitalization of Customs Procedures: The Indonesian government has made significant strides in digitalizing customs and trade procedures to streamline logistics operations. In 2023, the implementation of the National Single Window (NSW) for customs clearance reduced the average clearance time by 20%, improving the efficiency of import/export activities.

Indonesia Logistics and Warehousing Market Segmentation

By Services: The market is segmented by various logistics services, including transportation, warehousing, distribution, and value-added services. Transportation services, encompassing road, rail, air, and sea freight, hold the largest market share due to Indonesia's archipelagic geography and the need for multi-modal transportation solutions.

Freight Forwarding: Indonesia's F&B, FMCG, and industrial sectors have significantly contributed to the growth of the country's freight forwarding market, especially in international trade. With the expansion of road networks, freight by road has emerged as the most preferred mode of transportation, followed by air and sea freight. Indonesia's unique geography, with its many islands and remote regions, presents logistical challenges that are often best addressed by road transport. In terms of revenue, the Asia flow corridor has been identified as the largest source for Indonesia’s freight forwarding industry

Warehousing: Indonesia’s warehousing industry has experienced gradual growth due to the shortage of high-quality, modern warehouse facilities. Warehousing remains one of the key areas for further logistics development, requiring increased investment and technological advancement. The adoption of automation technologies and advanced inventory management systems is expected to fuel the growth of the warehousing market in Indonesia

CEP Market: CEP logistics market in Indonesia expanded at a positive CAGR from 2018 to 2023. As e-commerce grows, online shoppers are increasingly demanding faster delivery options and more convenient return processes. While many consumers still consider express delivery a premium service and prefer standard delivery, the rise of e-commerce is pushing demand for quicker logistics solutions. Several global players, including DHL, Aramex, and FedEx-TNT, have entered Indonesia’s CEP market, and future growth is expected to be driven by the continued expansion of e-commerce and the increasing demand for rapid delivery services.

Competitive Landscape in Indonesia Logistics and Warehousing Market

The Indonesia logistics and warehousing market is relatively fragmented, with a mix of local and international players operating in the space. However, the market is witnessing increasing consolidation, particularly with the rise of digital logistics platforms and third-party logistics (3PL) providers. Key players such as JNE Express, TIKI, DHL Supply Chain, Kuehne + Nagel, and Siba Surya dominate the market, offering a wide range of logistics services across various industries. The entrance of new firms and the expansion of e-commerce logistics platforms have diversified the market, providing businesses with more options for logistics solutions.

Freight Forwarding Companies

Warehousing Companies

CEP Companies

Some of the recent competitor trends and key information about competitors include:

• JNE Express: As one of the leading logistics companies in Indonesia, JNE Express handled over 500 million shipments in 2023, marking a 25% increase in volume compared to the previous year. The company's extensive network and investment in digital technologies have strengthened its position in the market, particularly in e-commerce logistics.

• TIKI: A pioneer in the Indonesian logistics industry, TIKI saw a 20% growth in its e-commerce delivery services in 2023. The company's focus on expanding its same-day and next-day delivery options has made it a preferred choice for online retailers across the country.

• DHL Supply Chain: Known for its comprehensive supply chain solutions, DHL Supply Chain reported a 30% growth in its warehousing operations in 2023. The company's strategic investments in multi-client warehouses in Jakarta and Surabaya have significantly boosted its service capacity, catering to the growing demand from the retail and FMCG sectors.

• Kuehne + Nagel: A global logistics provider, Kuehne + Nagel expanded its footprint in Indonesia by opening new distribution centers in key industrial zones. The company reported a 15% increase in revenue from its contract logistics services in 2023, driven by its ability to offer end-to-end supply chain solutions for multinational clients.

• Siba Surya: Specializing in road transportation, Siba Surya saw a 10% increase in its logistics revenue in 2023, particularly in the FMCG and manufacturing sectors. The company’s focus on fleet expansion and enhancing its inter-island logistics services has positioned it as a key player in the Indonesian market.

• Rise of Smart Warehousing: The integration of advanced technologies such as IoT, AI, and robotics in warehousing is expected to enhance operational efficiency and reduce costs. Smart warehousing solutions will enable real-time inventory tracking, predictive maintenance, and automated processes, providing a competitive edge to logistics providers.

• Expansion of Cold Chain Logistics: With the growing demand for temperature-sensitive goods, particularly in the pharmaceutical and food industries, the cold chain logistics segment is expected to witness significant growth. This trend is supported by investments in refrigerated transportation and cold storage facilities.

• Growth of E-commerce Logistics: The e-commerce sector will continue to drive demand for logistics and warehousing services, particularly in urban areas. The focus will be on enhancing last-mile delivery services, optimizing delivery routes, and expanding warehousing capacity to meet the increasing consumer demand for fast and reliable deliveries.

• Sustainability Initiatives: There is a rising trend towards sustainable practices within the logistics and warehousing sector, including the use of eco-friendly transportation methods, green warehouses, and efforts to reduce carbon emissions. These practices are becoming increasingly important as companies and consumers prioritize environmental responsibility.

What Lies Ahead for Indonesia Logistics and Warehousing Market?

The Indonesia logistics and warehousing market is projected to grow steadily by 2029, exhibiting a respectable CAGR during the forecast period. This growth is expected to be fueled by economic expansion, increasing e-commerce penetration, and continued investment in infrastructure.

Future Outlook and Projections for Indonesia Logistics and Warehousing Market on the Basis of Revenues in USD Billion, 2024-2029

Source: TraceData Research Analysis

Indonesia Logistics and Warehousing Market Segmentation

Freight Forwarding Market

• By Mode of Transportation 

• Road Freight (Fleets, Volume, FTK, Price/ton/km and Revenue)
• Sea Freight (Fleets, Volume, Average Distance, Price/ton/km and Revenue)
• Air Freight (Volume, Average Distance, Price/ton/km and Revenue)
• By Road transportation
• Less than Truck load (Revenue and Volume)
• Full truck load (Revenue and Volume)
• By End Users (Revenues)
• Food & Beverages
• Textiles and Footwear 
• Chemicals
• Pharmaceuticals and Medical consumables
• Electronics
• Others include agricultural products, frozen meat and more

Warehousing Market

• By Business Model (Revenue, Price/sqm, warehousing space, Occupancy rate)

• Industrial/Retail

• CFS/ICD

• Cold Storage 

• Agriculture

• By Industrial warehouses (Revenues)

• Grade A 

• Grade B

• Grade C and others 

• By End Users (Revenues)

• Food & Beverages

• Textiles and Footwear 

• Chemicals

• Pharmaceuticals and Medical consumables

• Electronics

• Others include agricultural products, frozen meat and more

CEP Market

• By Channel

• 3PL Players

• E-Commerce Merchants

• By Type of Shipments

• Domestic Shipments

• International Shipments

• By Area of Delivery

• Intercity

• Intracity

• By Mode

• Air Shipments

• Ground Shipments

• By Delivery Period

• Same Day Delivery

• 1-2 Day Delivery

• 3-4 Day Delivery

• More than 4 Day Delivery

• By Type of Products

• Consumer Electronics & Media

• Fashion & Accessories

• Foods & Personal Care

• Home Care & Furniture

• Toys & Baby Products

• Others (Video Games, Digital Music, Pet Care, Home Gardening, etc.)

Players Mentioned in the Report (Freight):

• Samudera Indonesia

• Agility Logistics Indonesia

• DB Schenker Indonesia

• Kuehne + Nagel Indonesia

• Bolloré Logistics Indonesia

• DHL Global Forwarding

• Maersk Indonesia

Players Mentioned in the Report (Warehousing):

• Mega Integrated Logistics

• Kerry Logistics

• Kiat Ananda Cold Storage

• PT Kamadjaja Logistics

• Nippon Express Indonesia

• DHL Supply Chain Indonesia

• PT Wahana Prestasi Logistik

Players Mentioned in the Report (CEP):

• JNE (Jalur Nugraha Ekakurir)

• Pos Indonesia

• TIKI (Titipan Kilat)

• SiCepat Express

• J&T Express

• Ninja Van Indonesia

• GO-SEND (GoJek)

• SAP Express

Key Target Audience:

• Logistics Service Providers

• E-commerce Companies

• Manufacturers

• Retail Chains

• Pharmaceutical Companies

• FMCG Companies

• Government Regulatory Bodies

• Investment Firms

• Industry Associations

• Research and Development Institutions

Time Period:

• Historical Period: 2018-2023

• Base Year: 2024

• Forecast Period: 2024-2029