The rapid growth of e-commerce in Indonesia, especially during the pandemic, is placing increasing demands on its supply chain infrastructure. But the country’s logistics industry is highly fragmented, with companies usually relying on multiple distributors for one shipment, and many warehouses are still concentrated around major cities. Advotics wants to help with software to make the whole supply chain easier to track, and recently closed a $2.75 million funding round led by East Ventures.
Founded in 2016 by Boris Sanjaya, Hendi Chandi and Jeffry Tani, Advotics has now raised a total of $5.5 million and currently counts more than 70 clients, ranging from individual resellers to large corporations like ExxonMobil, Danone, Reckitt Benckiser, Sampoerna, Kalbe and Mulia Group.
According to research institution Statistics Indonesia, there are about 5 million small and medium-sized manufacturers in Indonesia. They use a supply chain with 15 million small to mid-sized distributors and about 288,000 large distribution companies. This fragmentation means higher expenses, with Report Linker estimating that logistics costs range between 25% to 30% of Indonesia’s gross domestic product.
To help make logistics more efficient for its clients, Advotics offers SaaS solutions to monitor almost their entire supply and logistics chain, from warehouse inventory to generating delivery routes for drivers. It includes a product digitalization feature that uses QR codes to track products and prevent counterfeiting, and tools for salespeople visiting retail stores, since that is still one of the most effective tools for manufacturers and importers to find customers.
The company’s new funding will be used to launch a online-to-offline system for SMEs and grow its sales team. The online-to-offline system will allow sellers to integrate inventory and sales from all of their channels, including brick-and-mortar, business-to-business and e-commerce.
Advotics is among several tech startups that are taking different approaches to tackle Indonesia’s logistics infrastructure. For example, Shipper wants to give sellers access to “Amazon-level logistics,” while Logisly is focused on digitizing truck shipments. Waresix recently acquired Trukita to connect businesses to shippers and truck shipment platform Kargo’s backers include Uber co-founder Travis Kalanick.
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