The market for the courier, express, and parcel business in Indonesia is expected to exhibit a CAGR of above 8% during the forecast period 2020-2025.
With the world’s fourth-largest population and excellent potential for growth, Indonesia is a key market in the global scenario. The Indonesian CEP market is at an infant stage with a lot of opportunities for the industry. With rapid regional as well as global economic integration, the local businesses are continually seeking logistics and courier services that can provide direct access to local and international markets.
The courier, express, and parcel (CEP) market in Indonesia is growing rapidly in line with the e-commerce sector of the country generating significant revenues for the industry. The rise in e-commerce business in recent years is increasing the business opportunities for shipping goods. The explosive growth of the country’s e-commerce is presenting opportunities, as well as challenges for online retailers and logistics players. While the growth of e-commerce is the major driver of the CEP business, the rising demand of perishables and the growth of the life sciences sector of the country also support the growth of the express delivery in the future.
The high logistics cost remains to be one of the challenges for the logistics sector as well as for the CEP market. Lack of proper infrastructure makes it difficult for delivering the parcels, especially for remote areas outside Java. Additionally, Indonesia being an archipelago makes it difficult for companies to deliver packages throughout the country. During the COVID-19 pandemic, local online courier services in Palembang are expanding at a fast pace. A number of the order shuttle businesses were flooded with orders because residents were reluctant to leave their homes.
Key Market Trends CEP Market is Growing In-line with Growing E-commerce
The growth of e-commerce has opened up opportunities for many logistics companies for providing delivery services. E-commerce is rapidly growing in the country driven by the growth of information and communication technology, rising middle-class population and smartphone penetration. For instance, JNE Express, one of the leading courier companies in the country has captured the big opportunity in an e-commerce business which accounts for almost 60-70% of its shipments. Digitization is also enabling the consumers to reach the global markets promoting cross-border e-commerce and driving the international CEP market.
Pos Indonesia plans to make a significant investment, especially in processing centers and storage capacity. Its storage capacity was around 40,000 square meter in November 2016, and the company is considering expanding to 500,000 square meters, by the end of 2020 supporting the growing demand for advanced storage spaces in the market.
With Indonesia’s eCommerce market standing at USD 21.0 billion in gross market value (GMV) in 2019, Indonesia is currently an eCommerce hotbed in Southeast Asia. This industry is seeing lots of investment and has great potential to continue being one of the biggest eCommerce economies in Southeast Asia. Additionally, the companies are optimistic about the government’s commitment toward improving infrastructure.
Growth in Manufacturing and Automotive Industry: an Opportunity for CEP Market
The growth in the manufacturing sector is expected to boost the demand for express delivery and logistics services. The express deliveries of industrial products are vital in avoiding stock shortages. The government has ambitious plans to propel the country into the top ten biggest economies in the world by 2030, with manufacturing at the heart of this goal. The main areas of production include textiles and garments, food and beverages (F&B), electronics, automotive, and chemicals, with the majority of manufacturers in this sector comprising of micro, small, or medium-sized enterprises.
The Indonesian automotive industry has become an important pillar of the country’s manufacturing sector, as many of the world’s well-known car corporations have re-opened manufacturing plants or expanded production capacity. Moreover, Indonesia experienced a remarkable transition as it evolved from being a merely export-oriented car production center into a major domestic car sales market due to rising per capita GDP.
The COVID-19 pandemic has made many manufacturing and automotive companies question their heavy reliance on China, while China’s trade war with the United States has also burdened the industries with additional tariffs. Indonesia has taken measures to take advantage of the situation, with the government establishing a special task force to attract businesses leaving China is expected to facilitate the growth of its logistics sector.
Competitive Landscape The Indonesian CEP market is dominated by long-established players, such as JNE Express, Pos Indonesia, and DHL. Other significant players in the market include TIKI, Pandu Logistics, Pahala Express, SAP Express, etc. Technology has become important for companies to increase their efficiency and to attract customers in this era of Industrial Revolution 4.0. For example, Pos Indonesia is conducting trials with robots to chat, that has no voice support. J&T Express is another example of a company that has expanded rapidly in the past three years. A lot of delivery companies that are online-based or employing high technology are entering the market offering faster delivery services and presenting strong competition to conventional players as well.
Given the growth trajectory of the CEP and warehousing market in the country, DHL Express, one of the leading global companies has invested USD 19 million in Indonesia to build the Jakarta Distribution Center (JDC) to support the logistics activities and gain a competitive advantage over the other players.
Reasons to Purchase this report: - The market estimate (ME) sheet in Excel format - 3 months of analyst support
Our reports have been used by over 10K customers, including:
The global 3PL market is estimated to reach more than USD 1.7 trillion by 2025, registering a CAGR of more than 8% over the forecast period, 2020 - 2025. The factors driving the growth are the increasing outsourcing of major transportation and logistics services and growing e-commerce penetration whereas the loss of control over the shipping...
The Japan Third-Party Logistics (3PL) market is expected to register a growth rate of over 5.8% during the forecast period of 2020-2025. Over time, Japan has made great developments in the supply chain space embracing digital technologies to transform a traditional. In recent years, the socioeconomic circumstances surrounding logistics changed...
The logistics automation market was valued at USD 52.19 billion in 2020 and is expected to be USD 104.23 billion in 2026, registering a CAGR of 12.42% during the forecast period (2021 - 2026). The emergence of the Industrial Internet of Things (IIoT) and the advent of a network of connected systems are helping industries perform a multitude...
155 pages •
By Euromonitor International
• Feb 2021
After a number of years of good value growth, retailing recorded a modest overall value decline during the Coronavirus (COVID-19) pandemic in 2020. The health crisis led to soaring unemployment rates in the country, with many businesses closing and a consequent steep reduction in consumer confidence and disposable incomes. Many Russians were...
The global homeshopping market was valued at USD 3,011.64 Billion in 2020 and is projected to grow at a CAGR of 16.92% during the forecast period (2021 - 2026). - The global market has seen major advances in e-commerce since COVID-19 started as a safer and more time-efficient shopping choice. The pandemic forced businesses and countries,...
149 pages •
By Euromonitor International
• Feb 2021
Due to the Coronavirus (COVID-19) pandemic, China experienced an unprecedented halt in economic activity in January and February 2020. The government imposed a series of measures to limit the spread of the virus, including store closures and restrictions on public movement, with most of the country under lockdown. Chinese retailing recorded...
195 pages •
By Asia Market Information & Development Company
• Feb 2021
China’s demand for Hearing Aids has grown at a fast pace in the past decade. In the next decade, both production and demand will continue to grow. The Chinese economy maintains a high speed growth which has been stimulated by the consecutive increases of industrial output, import & export, consumer consumption...
The Australia’s CEP market is expected to register a CAGR of 5.46% over the forecast period, 2019 – 2024. Australia’s parcel market is expected to grow to more than 1 billion parcels a year by 2021. The parcel delivery market is seeing an exponential growth backed by ease of shipping, delivery and tracking parcels domestic and internationally....
The E-Commerce market in Oman is rapidly increasing due to the increasing consumption rate and higher sales of smartphones in this region. However, the implementation of 4G and 5G technology for connectivity purpose is increasing the exposure of online shopping for customers. Therefore technological awareness among customers is expected to...
136 pages •
By Asia Market Information & Development Company
• Nov 2020
This study focuses on China’s rice market trends. In the two past decades, the market has been growing at a fast pace. The dramatic expansions of the manufacturing capabilities and rising consumer consumptions in China have transformed China’s society and economy. China is one of the world’s major producers for industrial...
You can change your Cookie Settings at any time but parts of our site will not function correctly without them.