Home Blog A Step-By-Step Guide for Warehousing Business in Indonesia Indonesia A Step-By-Step Guide for Warehousing Business in Indonesia InCorp Editorial Team 13 August 2019 4 reading time Table of Contents Warehouse Indonesia: Benefits for Foreign Investors How To Set Up Warehousing Business in Indonesia How Can Cekindo Help? Over the last few years, Indonesia’s logistics and warehouse industry have bolstered: a trend that is expected to continue on its upward trajectory. Jakarta, the country’s largest city, is a growing center for the warehouse industry with industrial parks abounding in the region. The rise of this industry, accompanied by the government’s implementation of Pasut Logistik Berikat (PLB), has resulted in a surge in demand for outsourced warehouse logistics, allowing more foreign businesses to extend their services. Warehouse Indonesia: Benefits for Foreign Investors A Growing Demand for Effective Warehousing System In Indonesia, e-commerce has grown to be an industry worth USD 25 billion. To ensure fast and cost-effective delivery of items bought online, distribution facilities, logistics hubs, and 3PL services have become critical. Several large FMCG (Fast Moving Consumer Goods) facilities have been created on a built-to-suit basis for big corporations. Another fast-growing Indonesian industry is pharmaceuticals. Temperature-sensitive transportation and storage assume great significance in this industry but the country’s cold chain logistics is still inadequate to meet the rising demand. This sets an ideal stage for multinational companies to offer specific chilled warehouse facilities. Moreover, the government is also contributing to the creation of logistics centers, a few of them are listed below: • In Cibitung, Bekasi, West Java, Kamadjaja Logistics established a site for food and beverage storage and delivery. • Toyota developed car storage and distribution facility in Cibitung. • Gerbang Teknologi Cikarang created a site for textiles in Cikarang, Bekasi, West Java. The primary purpose of these Bonded Logistics Centers is to increase available warehouse capacity while lowering logistics expenses. Warehouse Indonesia: Open to 100% Foreign Ownership Moreover, the foreigners investing in Indonesia have the option of forming companies with up to 100% ownership. Refer to the table below for sector-wise information: KBLI Sector Activities Foreign Ownership Partnership Requirements 52101 Warehousing and Storage Space Businesses that store items temporarily before shipping them to their final destination for business reasons. 100% No local partnership required 52102 Cold Storage The business of holding items that require refrigeration for a specific amount of time for a charge or on a contract basis before being sent to their final destination. Blast freezing warehouses are also included in this category. 100% No local partnership required 52103 Bounded warehousing activities or binding areas Businesses or activities that are part of the customs area but are granted special status by the government, such as being outside the customs area and administered by an entity in the form of a warehousing business, such as the Batam Island Industrial Area. 100% No local partnership required How To Set Up Warehousing Business in Indonesia Warehouse Classification in Indonesia Warehouses in Indonesia must come under one of the following classes, according to Government Regulation No. 29/2021 on Trading Activity: Classification Area Storage Capacity Class A Closed Warehouse 100 m² – 1.000 m² 360 mᶟ – 3.600 mᶟ Class B Closed Warehouse 1.000 m² – 2.500 m² 3.600 mᶟ – 9.000 mᶟ Class C Closed Warehouse >2.500 m² >9.000 mᶟ Class D Closed Warehouse No particular specifications – however, this type of warehouse must take the form of a tank or silo 762 mᶟ or 400 tons Open Warehouse At least 1.000 m² Not Specified Warehouse Requirements To receive a Registered Warehouse License or Tanda Daftar Gudang, business owners must register their warehouses with the appropriate mayors, regents, or governor (TDG). Warehouse owners must submit the following papers in order to receive such a license: Application letter Warehouse owner ID Building permit (Izin mendirikan bangunan) of the warehouse Documents containing information about: the type, location, and purpose of the warehouse, as well as the type of the goods stored in the warehouse. Indonesian business license for trading activities (Surat Izin Usaha Perdagangan, SIUP) Indonesian Tax Payers ID (Nomor Pokok Wajib Pajak, NPWP) Note: Because the TDG is issued by the local government, the criteria may differ from one location to the next. For further information, please contact our consultants. How Can Cekindo Help? While investing in Indonesia’s warehousing industry, Cekindo will provide you with a seamless company registration experience. Our experts can further assist you with the acquisition of business licenses with the least delay. Moreover, if you want in-depth information on the sectors to stay on top of legal compliances before investing in Indonesia, Cekindo’s legal consultant team can assist you to review your possible investments. Read Full Bio Daris Salam COO Indonesia at InCorp Indonesia With more than 10 years of expertise in accounting and finance, Daris Salam dedicates his knowledge to consistently improving the performance of InCorp Indonesia and maintaining clients and partnerships.