Indonesia has notoriously high logistics costs. To help solve this, President Joko Widodo inaugurated 11 bonded logistics centers (PLB) last year as part of Indonesia’s second economic stimulus package. This move makes Indonesia more competitive, as it provides an alternative to similar storage services in Singapore or Malaysia. One beneficiary of the initiative is PT Kamadjaja Logistics, a family-owned and operated business, whose K-Log Park Cibitung facility in West Java was selected in March 2016 to become one of the 11 PLB. “This idea is worthwhile to try and execute, but we are also reviewing the benefits for us and our end-users,” says Ivy Kamadjaja, 44, deputy chief executive and chief marketing officer for her eponymous firm.
The company was founded by Ivy’s father, Hura Kamadjaja, in 1968 as UD Kamadjaja in Surabaya to do domestic sea freight forwarding. As the business grew, the company entered the fast-moving consumer goods industry (FMCG), building its first distribution center, a wooden warehouse, in Manado in 1986 for Unilever Indonesia’s goods. Since Surabaya is located at the eastern end of Java, it became a hub for shipping logistics to eastern Indonesia.
In 2003, Hura reorganized the company to enter the logistics sector. Kamadjaja Logistics has now grown into 12 distribution centers plus three branded Kamadjaja Logistics Parks (K-LOG Parks), the largest in Cibitung (18 hectares), plus another two in Medan and Surabaya (both five hectares), the latter also being a bonded logistics center. Ivy claims that the occupancy rate for Kamadjaja Logistics’ warehouses reaches 80%, while in Surabaya, it is often at overcapacity.
Kamadjaja Logistics remains focused on FMCG companies such as Unilever, Nestle, Frisian Flag and P&G. It offers end-to-end services, such as custom clearance, forwarding services such as international and domestic freight forwarding, to contract logistics and value added services such as repacking. For example, for Taro snacks, Kamadjaja Logistics brings the raw snacks from Jakarta to Medan, and fries the snacks in Medan to cut costs.
As Hura is now retired at 70, Ivy and her brother Ivan (now the CEO) are effectively running the firm. After graduating from University of Technology Sydney, she started working in 1996 in BCA bank in Jakarta. When riots broke out in 1998, Hura asked her and Ivan to come back to Surabaya immediately and not to return again to Jakarta. The siblings then started their career in logistics. “It was totally different. In the banking sector, I worked in a high-rise building. In logistics, I have to go to ports and follow the logistics operation,” says Ivy, which is familiar to her because she grew up around ports and warehouses.