Logistics Landscape in Indonesia

Sector Research
August 2020
Following the growth of ecommerce and globalization, logistics services
providers have evolved to offer more services and features

1PL 2PL 3PL 4PL 5PL

Retailers/Manufacturers Transporters Contract Logistics Service Providers aka Lead Management of Supply
Logistics Provider (LLP) Network
Goods producers that Asset-based companies that Companies that offers Non-asset companies that Total optimization of the
manage their own logistics offer a range of transport outsourced operations of manages supply chain logistics and supply chain
which include internally- services. Owns its own fleet of logistics, providing services management of enterprises, network by leveraging tech.
owned transport vehicles, transportations such as trucks, related to supply chain such as subsequently creating a Typically for for e-business, they
trailers, trucks, and/or ships, or airlines; out of which transportation, warehousing, completely customized solution consolidate 3PL requirements
warehouses. Typically have they also offer the lease. cross-docking, packaging, and becoming the single point of and negotiate bulk rates in
direct relationships with inventory management, and contact in all aspect of supply return, minimizing costs where
customers. freight forwarding. chain to the customers. possible.

Provides
Manages entire Aggregates
Producers outsourced
Provides supply chain demand into
independently operational
transport and/or process through bulk, shifting
transporting logistics
storage services subcontracted to supply
goods related to
parties network
supply chain

Source: Tera Logistics, HBS, WarehouseAnywhere

Confidential and Proprietary. Not for distribution

Traditional supply chain in Indonesia is typically comprised of multiple
layers prior to reaching retails and/or end customers
Delivery

Port Port Catalog and

Packing

Wholesale

Air/Sea Cargo

Retailers
Customers

Manufacturing Delivery Distributors Distributors Delivery Delivery

Land Freight Agents Corporates

First Mile Middle Mile Last Mile

First leg of supply chain journey, be
it from manufacturer transporting
finished goods to distributors or
retailers transporting their goods
from a warehouse.
Middle mile itself can be comprised of multiple layers going from main
distributors to sub-distributors to area distributors to wholesalers to sub-
wholesalers before reaching modern trade (groceries)/general trade (wet
market/warungs).
Distributor usually sells to wholesalers at 3 – 5% disc. from pricelist.
Typically the last step of the supply chain process,
the journey from retailers to end customers.
Following the growth of eCommerce, last mile
logistics have since expanded into its own
eCommerce/delivery logistics.

~15 – 30% Margin

Principal’s margin from ~8% Margin
manufacturing cost Principals sell at discount from ~3 – 5% Margin
selling price to distributors Distributors sell at discount from selling price to wholesalers
and wholesalers sell to retailers at selling price
~15 – 30% Margin
Retailers mark-up to customers
Source: ACV’s internal research, publicly sourced information

Confidential and Proprietary. Not for distribution

In the wake of eCommerce boom, last-mile logistics have expanded into
newer delivery service models to accommodate consumers demand
Conventional Delivery
Conventional delivery involves a central sorting hub where
goods are sorted, catalogued and packed before delivery
process. Despite being the most economical, conventional
delivery typically does not offer same-day shipping and is usually
inflexible in terms of scheduling. Usually have store fronts to
face its customers and processes are manual. ~20 – 50% Gross Margin

On-Demand, Point-to-Point Delivery

On-demand, point-to point delivery is a relatively new
model that offers instant (1-3 hours) or same-day (6-8
hours) intra-city courier services. Speed however comes at a
cost as point-to-point deliveries are amongst the most expensive
services and are limited in terms of distance. ~6 – 20% Gross Margin

Relay Delivery
Relay delivery offers same day intercity delivery with
algorithm optimized delivery. Despite not being as fast as
point-to-point delivery, prices are far more economical, and
packages can be sent farther distances. ~20 – 40% Gross Margin

Source: ACV’s internal research, publicly sourced information

Confidential and Proprietary. Not for distribution

The continuously evolving eCommerce landscape and ecosystem have resulted in
a surge of logistics/supply chain players to accommodate growth and demand
B2C

First Mile Last Mile

Source: ACV’s internal research, publicly sourced information B2B

Confidential and Proprietary. Not for distribution
Subsequently generating new business models that challenge or act as an
optimization to the existing incumbent logistics players
Description Customer Segment Business Model Companies

Freight Forwarding and • Non-vessel operating common carrier, • Enterprises • Flat fee
Cross-border organizes shipments from • Individuals
producer/suppler to market/final point of
distribution
Freight Transport, Trucking • Connect shippers with transporters • Enterprises • % of transaction (GLV, GTV)
Marketplace, and • Tracking system, using algorithm to • Subscription
Transportation Management optimize delivery routes • Auxiliary fees
Services (TMS) • Service fees, e.g., invoice financing
Cold Chain Logistics • Temperature-controlled supply chain, • Food industries • Flat fee
i.e., low temp logistics and refrigerated • Enterprises
warehousing • Drugs and
pharmaceuticals
Fulfillment, Warehousing, • Connect owners and businesses • Enterprises • % of transaction
and Supply Chain • Provide dashboard to manage • SMEs • Subscription
warehouse • E-commerce sellers • Flat fee
• Cataloging, packing, and arrange • % of delivery fee
delivery with courier on behalf of shipper • Per bin, shelf, etc
3PL • Connect owners and businesses • Enterprises • Flat fee
• Provide dashboard to manage
warehouse
• Cataloging, packing, and arrange
delivery with courier on behalf of shipper
Courier, Express, Parcels, • Courier delivers item to customers’ door • SMEs • % of transaction
and Last-Mile Delivery • Courier deliver items utilizing parcel • E-commerce sellers • Flat fee
Services lockers • Individuals • One-time fee
• Customers drop off/pick up from • Subscription
hubs/collection point/agent
• Routed delivery, point-to-point Typically heavily subsidized
Source: ACV’s internal research, publicly sourced information

Confidential and Proprietary. Not for distribution

The growth of eCommerce, on the back of expanding middle class and
growing internet penetration, will continue to fuel logistics growth as well
Rising Middle Class Boosting Disposable Income At over 65% penetration, Indonesia is the 4th largest internet users globally
The Indonesian middle class has been a major driver of economic growth for the past decades and Along with it, rising internet and smartphone penetration have given the Indonesian population
now represents almost half of all household consumption in Indonesia. across different socioeconomic classes the access to online shops, marketplaces, social media
sellers, and mobile apps. Mobile internet usage is undergoing double-digit growth rates and
Personal Disposable Income in Indonesia currently stands over 60% penetration rate.
In US$B
5.4%
1,200.0

5.3% 5.6%

Internet Penetration in Indonesia

5.1% 5.4%

2015A – 2025F
5.0%
1,000.0

5.5% 5.2%

800.0

5.0%

600.0

4.6% 4.8%

822.3 933.7 1,045.4

4.6%

87.5%
400.0

642.6 702.4 735.7 77.9% 81.5% 84.7% 85.8%

73.8%
4.4%

200.0

64.8% 69.3%
54.8%
4.2%

- 4.0%

43.1% 51.3%
2016E 2017F 2018F 2019F 2020F 2021F
Personal disposable income Growth of real disposable income 2015A 2016A 2017A 2018A 2019A 2020E 2021F 2022F 2023F 2024F 2025F

Indonesia eCommerce has grown at over 80% CAGR in the past 5 years Logistic service has continued to achieve double digit growth
Indonesia eCommerce GMV has been experiencing tremendous growth since 2015 and is With a continuously growing e-commerce industry, delivery services (express and small parcels) in
forecasted to reach US$ 97B by 2025, implying 27% 2019E-2012F CAGR and contribute slightly Indonesia grew by 17% on a CAGR basis from 2013 – 2017 and is expected to grow further as the
over 40% to the total eCommerce GMV in the region. industry grows.

Indonesia eCommerce GMV Logistic Services CAGR, 2013 - 2017

US$B 17% 18%

14% 14%
11% 11% 12% 12%
10% 11%
7% 7% 8% 8% 6%
24
2 8 12
5 3PL Air & Sea Freight Express & Small Parcels
2015A 2016A 2017A 2018A 2019E
Indonesia Vietnam Thailand Malaysia Singapore
Source: worldbank, Indonesian logistics and forwarders association,

Confidential and Proprietary. Not for distribution

Despite its market potential, there are various factors that challenge the
logistic and supply chain sector in Indonesia
Weak transportation infrastructure and connectivity Resulting in 90% of logistics rely on land transportation
Given the geographic nature of Indonesia, multimodal transportation (land, rail, sea, and air) is Yet, lack of road network connectivity in Indonesia causes a longer lead time and an insufficient
needed to transport goods. However, lack of integrated infrastructure makes for costly delivery, supply chain and Indonesia’s proportion of paved road is relatively low which led to bottleneck in
especially for regions outside of Java as it isolated them from equal distribution of goods, resulting growth and higher logistics cost.
in high price of goods due to lack of availability.
Undeveloped Infrastructure (Unpaved Roads)
Logistics Performance Index Indonesia transportation services’ % of road network
Ranking out of 160 countries contribution to GDP, 2019

From 0.34% 100%

99%76% 100%
99%77% 100%
99%77% 100%
99%78% 100%
99%81%
5346 4839 5444 2.47%
3532 41 in 2014 57% 51% 57% 52% 57% 52% 57% 52% 57% 53%
25 1.62%
5 7
0.32% 2011 2012 2013 2014 2015
ID VT TH MY SG IND
2014A 2018A Sea Land Air Indonesia Vietnam Thailand Malaysia Singapore

Riddled with inefficiencies and low utilization Subsequently, yielding high logistics cost
Lack of infrastructure development also led to inefficiencies and low utilization as majority of trucks Despite the ~3.0% decrease over the years, Indonesia’s logistics cost per GDP remains high and is
experience empty back-haul rate and almost every ship returning from remote areas. among the highest among its peers in Southeast Asia.

Truck Utilization Trucks Empty Backhaul Logistics Cost as % of GDP

‘000 km/year Per trip 27% 25%
Industry average 24%
21% 20%
20% 25% 16% 17%
14% 14% 14% 14% 13%
11% 9%
20% 25% 8% 8% 8% 8%
200
150 50 30% 40%
40% 50% ID VT TH MY SG IND CH US JP
Europe Thailand Indonesia
2014A 2018A
Source: ACV’s internal research, worldbank, Indonesian logistics and forwarders association, researchgate, and publicly sourced information

Confidential and Proprietary. Not for distribution

Nevertheless, strong private consumption growth, higher trade growth, as well as
infrastructure development should continue to drive Indonesia’s logistics sector forward
Indonesia total eCommerce is estimated to reach US$ 97B in 2025F, Modern trade is estimated to contribute at least 20% to total trade by 2020,

01/ benefiting from further penetration into tier 2-3 cities, and across all
product categories. China’s experience showed that eCommerce penetration
rises significantly when smartphone penetration reaches over 50%.
02/ implying a relatively significant growth over a decade. This, however, also
shows that 80% are still in general trade which provides an ample room
of opportunity for the likes of SMEs supply chain provider.

eCommerce GMV Modern Trade vs General Trade in Indonesia

Smartphone Penetration in
In US$B Indonesia
80%
96.7 63% 70% 76% 88.0% 83.0% 80.0%
56%
38% 44% Indonesia passed that
29%
23.5 threshold in 2018 - which was
12.0% 17.0% 20.0%
a key reason for the strong
growth in the couple years 2010A 2015A 2020F
2019A 2025F 2015A 2016A 2017A 2018A 2019A 2020E 2021F 2022F Modern Trade General Trade

The Government drafted an infrastructure budget of US$ 400M for 2020 - Interest in the sector has increased over the years as well, as FDI in the

03/ 2024 period, out of which 60% of the spending will go toward
transportation-related infrastructure. Gov’t commitment to improve the
infrastructure was reflected on the 2015 – 2019 Medium-Term
04/ transport, warehouse, and telco sector climbed up from being accounted
for the 13th largest portion of FDI in 1H16 to 2nd largest portion as of 1H19.

Development Plan (MDPT) as well.

Transportation, Warehouse, and Telecommunication FDI
1H16-1H19, in US$B
The Government’s plan to The Government allotted The MDPT includes road
build or set up 24 new a budget of IDR 447B for of construction for 2.59
ports which are expected the Maritime Highway 3,650km, 15 new
to increase cargo Program in 2018; and airports, 24 new seaports,
capacity from 8.8M 20- was estimated to increase and 3,258km long rail 0.91
footer equivalents unites by 10% in 2019. lines out of which, 0.38 0.42
(TEUs) in 2009 to 30M 1,099km will be urban
TEUs by 2020. lines.
1H16 1H17 1H18 1H19
Source: ACV’s internal research, GS, BKPM, Indonesian logistics and forwarders association, statista, and publicly sourced information

Confidential and Proprietary. Not for distribution

The Indonesian logistics market size is expected to reach US$ 275B in
2020, implying a 16.2% 2015A-2020F CAGR
• Based on CLSA report and according to research conducted by consulting firm Frost and Sullivan, the logistics market size is expected to reach US$ 275B this year,
a significant pick-up from US$ 130B in 2015, on the back of increasing demand from e-commerce channels.
• Meanwhile, according to a report by Ken Research, the Indonesian logistics market is expected to generate a CAGR of 7.9% in revenue to reach US$ 300.3B 2024.
This includes freight transport, freight forwarding, warehousing, courier, express and parcel (CEP), value added services and cold chain logistics segments.

Indonesia Logistics Market Size Indonesia Logistics Market Revenue

In US$B In US$B

275
300
230 278
258
210 239
221
175
155
130

2015A 2016A 2017A 2018A 2019E 2020F 2020E 2021F 2022F 2023F 2024F

Logistics movement in Indonesia

Source: CLSA, Indonesia economic forum

Confidential and Proprietary. Not for distribution

Land transportation accounted for the largest market share in logistics
but the trucking sector, in particular, has been facing three major issues
Underutilization
Fragmentation • Utilization is also relatively low in Indonesia,
back-haul are often empty, especially in
• Small number of large fleets and a long regions outside of Java, Bali, and Sumatra
tail of small fleets and owner drivers. as an estimated 80% of GDP is concentrated in
• There are around 7 million trucks registered those three islands.
in Indonesia, out of which an estimated 10 – • As a comparison, Europe truck utilization is at
30% are owned by 3PL services. In addition, 200,000km/year, Thailand is at 150,000km/year,
90% of trucking companies have 100 while Indonesia is at 50,000km/year. Assuming
trucks or less and 75% have 20 trucks or 1km represents total full-utilization, Europe
less. would take 5 years, Thailand around 7-8 years,
• The longer tail of the operator, especially and Indonesia would take about 20 years.
owner-operators, typically have troubles Indonesia’s poor and unequal infrastructure, in
connecting to businesses that needed addition to truck regulations, also contributes to
shipping due to lack of network and this underutilization.
knowledge which subsequently limiting
them from growth. This fragmentation also
resulted in multiple layers of Inefficiencies
middlemen/brokers which extract value from
• Majority of transporters in Indonesia experience between 40.0 – 50.0% empty back-haul rate,
drivers and shippers as well.
mainly due to inefficiencies in the dispatching process which typically involve multiple
phone calls and negotiations between shippers, brokers, and transporters. This result
in reduced economic per truck (thus cannot scale fleet) and liquidity as well, subsequently
increasing dependency on brokers.
• Furthermore, poor predictability leads to poor SLA, i.e., trucks are often cannot be
tracked, missing cargo, and unpredictable loading/unloading time.

Confidential and Proprietary. Not for distribution

In response to this, a number of logistics startups started to tap into the
freight/trucking sector, leveraging technology to tackle these issues
• Typically serving B2B segment such as enterprises and/or SMEs, majority of these players serve their clients through marketplace platform, brokerage service, working capital
financing, and auxiliary services to generate additional revenue.
• The marketplace platform is utilized to aggregate supply and demand to eventually matched with the backhaul shipments coming from brokerage service. Some would start by
engaging with FMCG companies as they provide volumes, but margins are relatively low because of bad routes which spread the margins thinner.
• These companies offers working capital financing to generate actual revenue as it is often a challenge for transporters to operate, as shippers pay late and transporters need to pay
their drivers in cash for fuel, toll fees, salaries, etc.

Company

Year Founded Late-2018 2017 Late-2017 2019

Latest Funding Type Series A
Freight and trucking platform in
Indonesia that offers inter-city and
inter-island shipment via trucks
and/or container ships, connecting
Description
shippers and transporters alike.
% take-rate from marketplace and
Business Model brokerage services; % margin from
financing service
GMV US$ 1.2M as of May 2020;
Traction US$2.5M in February 2020, prior to
COVID-19 impact.
ACV, Tenaya, Sequoia, Amatil X,
Investors
Intudo, Zhen Fund, ATM Capital
Series A
Logistics platform for freight-
forwarding, warehouse, and land
transportation. Started as a
warehouse marketplace and
management system in 2018,
Waresix has since branched out
into providing logistics freight
services.
% commission on each transaction
from warehouse marketplace and
freight marketplace
N/A - monthly revenues grew by
over 30x in 2019, and is said to be
EBITDA positive.
EVG, Jungle Ventures, EV, MHV
Series A
Mobile and desktop-based truck
logistics service provider, B2B
matching cargo platform, that
connects shipper and transporter
% take-rate from marketplace,
SaaS, % margin from financing
services, group buy on autoparts
Generated total GMV of US$ 1.5M
in 2018, out of which over 50%
came from marketplace.
GGV, Jafco, ZWC, Insignia,
Skystar, Beenext, Fenox
Series A
Connects shippers and
transporters, digitizing cargo
transport by providing a
marketplace platform to provide
efficiency in truck search, orders,
billings, and payments.
% commission of order value; %
margin from financing services
Monthly GMV of US$ 474K as of
May 2020.
MHV, ACV, SeedPlus, Genesia

Confidential and Proprietary. Not for distribution

Case Study: Blackbuck – India’s largest trucking platform
Blackbuck connects businesses with truck owners and freight operators in India. They also facilitate payments, insurance,
and financial services. The Company claims to be India’s largest trucking networking with over 15,00 clients which
include Amul, Coca-Cola, Reliance Industries and Tata Steel. As of today, Blackbuck has over 400,000 trucks on its
platform with presence in 2,000+ locations across India.
Founded in Apr 2015 | Based in India Products
Funding History • Freight platform: for shippers, the client app is used to place order through organized freight matching.
• Services platform: for truck owners, the fleet management application helps create and manage multiple trips, along
2015 with the ability to handle the associated AR/AP.
July – Series A • Also, has a simplified app for truck drivers to help them accept work and easily navigate to their destination using
Raised US$ 5M
Google Maps. The app helps to track the RFID tags (for seamless passage through tolls), fuel cards (to avoid fuel
December – Series B surcharges and to benefit from cash back), and cash cards (for other expenses such as warehouse charges and food)
Raised US$ 25M that are used by the truck drivers to use over a trip. These assets are distributed by regional BlackBuck POCs (points
of contact) to truck owners across 200+ locations. The central admin in the head office receives these assets in bulk
2017
and registers them in the application. Depending on the requests from different POCs, the admin assigns those assets
March – Series C and then tracks their inventory and flow.
Raised US$ 70M. Valuation US$ 180M
In 2019, BlackBuck has tied up with insurance company Acko to cover all the trucks on its network.
October – Venture Debt
Raised ~US$ 6M Business Model
• 15.0 – 20.0% commission on every transaction.
2018 • Additional revenue generated from other services, e.g., working capital financing and auxiliary services.
October – Undisclosed Round
Raised US$ 27M Financial Highlights (in US$M, unless otherwise stated) BlackBuck's Total Expense Breakdown
309.3 Other Administrative
2019 257.9 3% 5% Expenses
1% 1%
October – Series D 136.9 156.9 1% 2% Manpower Expenses
6% 4%
Raised US$ 150M. Valuation US$ 800M
2% 2% Bad Debts
November – Undisclosed Round
Raised US$ 7M in debt and equity (18.0) 86% 86% Employee Benefits
(49.7)
As of May 2020, Blackbuck has raised a total of US$ Finance Cost +
Operating Revenue Total Expenses Net Income (Loss) 2018 2019
297M in equity and debt financing Depreciation
2018
Source: ACV’s internal research, crunchbase, techcrunch, and publicly sourced information

Confidential and Proprietary. Not for distribution

Trucking platform comparable companies
Latest Fundraising
Company # of Total Funding
Pre-Money Est. Annualized Annualized GTV Investors
Name Rounds Amount Round Year Amount Raised
Valuation GTV Multiple
Indonesia
Series A 1Q19 US$ 28.0M US$ 8.5M US$ 4.8M 5.8x
Seed 1Q19 US$ 12.5M US$ 1.6M US$ 1.9M 6.5x GGV, Jafco, ZWC, Insignia, Skystar,
Ritase 2+ US$ 12.9M
Seed 3Q18 US$ 6.0M US$ 1.7M US$ 0.9M 6.2x Beenext, Fenox
Seed 2Q18 US$ 3.9M US$ 1.0M US$ 0.3M 13.4x
Logisly 2 US$ 7.3M Series A 2Q20 US$ 13.0M US$ 6.3M US$ 1.5M 8.7x MHV, SeedPlus, ACV, Genesia
Series A 1Q20 US$ 50M US$ 23.3M US$ 13.8M 3.6x ACV, Tenaya, Sequoia, Amatil X,
Kargo 2 US$ 23.3M
Seed II 1Q19 US$ 23M US$ 4M US$ 2.5M 9.1x Intudo, Zhen Fund, ATM Capital
Trukita 1 US$ 350K Seed 3Q18 <US$ 2.0M US$ 300M ~US$ 150K 12.0x Everhaus, Astra
Mean (Indo) 8.2x
Median (Indo) 7.6x
India
Series E 3Q19 US$ 885M US$ 70M N/A N/A
Rivigo 6 US$ 257M Warburg Pincus, SAIF Partners
Series D 1Q18 US$ 740M US$ 50M US$ 93.7M 7.9x
Series D 1Q19 US$ 800M US$ 150M US$ 127M 6.3x
Accel Partners, Sequoia, Flipkart,
BlackBuck 8 US$ 297M Series C 1Q17 US$ 180M US$ 70M US$ 80M 2.3x
Sands Capital, GS, B Capital
Series B 4Q15 US$ 140M US$ 25M US$ 10.9M 15.2x
United States
Capital G, Jeff Bezos, Y Combinator,
Convoy 5 US$ 668M Series D 3Q19 US$ 2.4B US$ 400M US$ 500M 4.8x
Fidelity, Bailie Gifford, G Squared
Mean (all) 7.8x
Median (all) 6.5x

• Based on the comparable companies above, the average annualized GMV multiple from all market is at 6.5x while Indonesia average is at 8.2x.
• Worth to note that Ritase was trading at ~6.0x annualized GMV multiple for the last three transaction rounds, which can be used as an indication for Indonesia market pricing.
• Conversation with BCapital provided that EV/GMV multiple of 1.0x – 3.0x is within normal range and over 4.0x is more on the higher side.
Source: ACV’s internal research, crunchbase, techcrunch, and publicly sourced information

Confidential and Proprietary. Not for distribution

Trucking public comparable companies
Financials, in US$M
Latest Asset Debt Revenue Gross Profit EBITDA Net Income
Company Latest EV
Market Cap FY18 FY19 FY18 FY19 FY18 FY19 FY18 FY19 FY18 FY19 FY18 FY19
C.H. Robinson Worldwide, Inc. 10,890 12,360 4,427 4,641 1,346 1,670 16,631 15,360 1,362 1,290 1,009 890 665 577
J.B. Hunt Transport Services, Inc. 13,180 14,440 5,092 5,470 1,149 1,295 8,615 9,165 1,461 1,636 1,110 1,234 490 501
XPO Logistics 7,330 14,260 12,676 14,128 4,203 7,510 17,435 16,648 2,540 2,666 1,570 1,630 393 382
Knight-Swift Transportation
7,470 8,240 7,912 8,417 929 890 5,344 4,884 869 754 965 981 419 309
Holdings Inc.
Schneider National, Inc. 4,450 4,160 3,331 3,660 411 443 4,977 4,747 1,460 1,351 675 613 269 147
Margins
Gross Profit Margin EBITDA Margin Net Income Margin
Company
FY2018A FY2019A FY2018A FY2019A FY2018A FY2019A
C.H. Robinson Worldwide, Inc. 8% 8% 6% 6% 4% 4%
J.B. Hunt Transport Services, Inc. 17% 18% 13% 13% 6% 5%
XPO Logistics 15% 16% 9% 10% 2% 2%
Knight-Swift Transportation Holdings Inc. 16% 15% 18% 20% 8% 6%
Schneider National, Inc. 29% 28% 14% 13% 5% 3%
Mean 17% 17% 12% 12% 5% 4%
Median 16% 16% 13% 13% 5% 4%
Valuation Multiple
EV/Total Revenue EV/EBITDA P/E P/BV
Company
FY2018A FY2019A FY2018A FY2019A FY2018A FY2019A FY2018A FY2019A
C.H. Robinson Worldwide, Inc. 0.80 0.78 12.25 12.56 19.10 17.96 7.80 6.71
J.B. Hunt Transport Services, Inc. 1.50 1.36 11.70 9.08 24.70 17.37 5.70 5.03
XPO Logistics 0.66 0.62 7.34 6.49 17.52 14.07 1.66 1.53
Knight-Swift Transportation Holdings Inc. 1.20 1.12 6.20 5.76 13.20 11.34 1.00 0.92
Schneider National, Inc. 0.80 0.72 5.70 5.26 1.80 1.61 1.80 1.61
Mean 0.85 0.78 8.15 7.42 19.21 10.53 2.56 2.20
Median 0.80 0.73 7.36 6.80 16.68 12.71 1.38 1.27
Source: CAPIQ

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Innovation in the logistics sector prompted by the rise of eCommerce and
its reliance on more efficient logistics
• Online orders by consumers remain the strongest driver for the Indonesian Courier, Express, and Parcel (CEP) market. It has been the fastest-growing segment and the trend is
expected to continue during the coming years. Indonesia now have more than a couple eCommerce and marketplace platforms with more than a dozen of logistics service
providers. Merchants often place their products on multiple platforms and as their business grow, demand for a more aggregate service increases as well.
• Companies like Shipper provide a full-stack logistics platform, leveraging tech to provide an end-to-end logistics solution to ensure efficiency and cost-effectiveness for corporate
and retail customers, through an aggregator model. This includes shipping and fulfillment services.
• Essentially a 4PL company, Shipper has started to move towards hybrid model, currently testing out their own fleet to be able to control margins and make additional earnings as
well.

Company

Year Founded Late-2016 Late-2015 Early 2014

Latest Funding Type Series A Seed Corporate Round

Full-stack logistics platform, aggregating Full-stack logistics provider, mostly on Full-stack logistics provider, delivery,
Description 2PLs to enable cost-efficiencies demand warehousing, cross-border

eCommerce merchants and platforms, eCommerce merchants, corporates, F&B eCommerce merchants
Target Market SMEs, corporates

Business Model Hybrid 4PL On-demand delivery, with own fleet 3PL, own fleet and fulfillment center

US$ 17.2M in annualized gross revenue US$ 4.8M in annualized gross revenue as of US$ 177.7M in annualized gross revenue
Traction as of March 2020 July 2019 as of March 2020
15% gross margin without subsidies 17% blended margin 48% gross margin without subsidies

Investors ACV, Naspers, YC, Floodgate, Insignia Seedplus Kejora, Barito Technology

Latest Pre-Money Valuation US$ 50M US$ 18M US$ 400M

Implied EV/Annualized Rev Multiple 2.89x 3.75x 2.25x

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Case Study: Cainiao – connecting Alibaba’s entire ecommerce value
chain
Cainiao is a logistics company in China majorly owned by Alibaba Group that leverages technology to build China Smart
Logistic Network (CSN), in order to drive efficiency in China’s logistics industry by connecting eCommerce companies with
players along the logistics chain to enable end-to-end solutions. Its goal is to ensure delivery across China within 24 hours
and across the globe within 72 hours. 3Q19 revenue was reported at US$ 680M.
Founded in May 2013 | Based in China
China Smart Logistic Network
Funding History • Express delivery: use the internet and big data to enhance the overall speed and service level of the logistics industry
and at the same time maintain order in the market and prevent courier companies from entering price wars;
2016 • Warehousing and distribution: use distribution hubs to decrease shipping rates and achieve next-day delivery;
Series A – 1st external funding • Cross-border logistics: build a global network to achieve synchronized international logistics information. As of 2016,
Raised US$ 1.5B est.
Cainiao Network already has overseas warehouses in seven countries;
At US$ 7.7B valuation
• Rural area logistics: build the capability to cover second-tier logistics in counties and villages country-wide by relying
on Alibaba Group’s Rural Taobao initiative; and
• Pickup stations: tens of thousands of pickup stations all over the country to cover last-mile delivery.

Alibaba’s ecommerce ecosystem • From the existing business segments of

Alibaba, through Taobao/Tmall, Alipay/Yue
2019 Bao, and Ant Financial, the company has had
Corporate Round
full control of the business flow, information
Raised US$ 3.3B flow and capital flow in eCommerce.
At US$ 24B valuation est. • Cainiao allows Alibaba to fully control the
entire ecommerce value chain, all the way
from businesses to consumers.
• As of 2016, they have 128 warehouses and
Investors 180,000 express delivery stations in China,
• 63% Alibaba • SF offering same day delivery in seven Chinese
• Intime group • STO.cn cities and next day delivery in a further 90.
• Fosun Group • YundaEx • Its global fulfilment centres (GFCs) is said to
• FORCHN • ZTO shortened the timeline for overseas delivery
• Yintai from two weeks to five days.
Source: ecommerceIQ, alizila

Confidential and Proprietary. Not for distribution

As parcel delivery grows in line with eCommerce, the market still faces
pain points which current logistics players have yet to solve
Late arrival of shipments

01/ One of the big issues in Indonesia’s last mile delivery is the inability to accurately pinpoint recipients’ addresses, which is caused by the lack of standardized
address formatting; directly affecting couriers and resulting in them having difficulty and unable to find delivery locations.

Lost and damaged goods in transit

02/ Conventional delivery model players have a high franchise dependency as they need franchisees to operate store-front branches for parcel drop-offs, sorting and
delivery to warehouses and other parcel destinations. There is a lack of quality control as to how these parcels are handled, delivered and sorted by franchisees out
of which any mistakes made could result in the lateness, loss and damaged of parcels.

Current last mile players are having difficulty solving these pain points as the problems itself stem from manual, inefficient internal delivery processes
and outdated technology.

Shift in consumers preference and consumption behavior also resulted in demand for faster deliveries. New players
leverage technologies and gig economy to fulfill that demand while trying to tackle the pain points.

Indonesia Delivery Services Daily Volume, 2018A – 2023F Conventional Point-to-Point Relay
in million parcels per day 10.5

8.4
6.7
5.3
4.2 4.5
3.7
3.1
2.1
1.5
1.0
0.3

2018 2019F 2020F 2021F 2022F 2023F 1-5 days Instant Same-day
Same-day Delivery Services Other Delivery Services

Confidential and Proprietary. Not for distribution

Further detailed comparison in current last—mile delivery services
offered in Indonesia
Delivery Type Conventional Delivery On-Demand, Point-to-Point Delivery Relay Delivery
Operations Store front; sorting center; hub and spoke Point to point App pick-up; packaging service; relay feeder
Strengths Cheap Short sprints Customer centric; reliable; high value
Limitations Speed and inflexible Expensive and limited to distance; inconsistent service Fixed setup at inception

Service & Coverage Next day Instant/same-day intracity; 1-3 days intercity powered Same-day intercity
by third party.
Sorting Manual and centralized N/A Algorithm; smart locker
Pricing Model By weight By distance By size
Convenience
Operating Hours Store front hours Weekdays, 8am – 3pm Daily, 6am – 10pm
Schedule Pick-up/Delivery N/A N/A Available
Self-Collect N/A N/A Available
Packaging Service N/A N/A Available
Guaranteed Pick Up N/A Cancellable Available
Guaranteed Time Delivery N/A N/A Available
Reliability
Progress Notifications N/A N/A Available
e-Proof: in-app photo and N/A N/A Available
signature
Maximum Insurance 14-days processing; 10x shipping fee IDR 10mn App-based; 1-day processing; IDR 10mn
Scalability
Combined Pick-up N/A N/A Available
Scalability Storefront presence Linear 1:1 Exponential network effects; economic of scale
Courier on-boarding Documentation check; Documentation check 12% psychographic recruitment filter;
On-the-job training 3-day training;
Daily orientation;
Silver hero program
Costing Full-time employee Crowdsource per km Partner courier per shipment
Staffing None Accepted or cancelled Assigned
Coverage Franchised agents Random Dedicated by area; Location knowledge;
Source: ACV’s internal research, publicly sourced information

Confidential and Proprietary. Not for distribution

Comparison in SLA and services of instant/same-day delivery model
• In order to understand the competitive advantage and offerings between the newer model of last-mile logistics players that offer pick-up services, we conducted
several tests which resulted as follows.

Intracity (Jakarta and Greater Jakarta area) Intercity

Paxel Go-Send Grab Delivery Paxel Go-Send Grab Delivery

Area Area
Pick-up West Jakarta West Jakarta West Jakarta Pick-up West Jakarta West Jakarta West Jakarta
Destination Tangerang, Bogor Tangerang West Jakarta Destination Bandung, Surabaya Bandung Bandung
SLA SLA
Instant (1-2hrs); Instant (1-2hrs); Delivery Same day (10hrs) Same day (10hrs) 1-3 days
Delivery Same day (6-8hrs)
Same day (6-8hrs) Same day (6-8hrs) Pick-up Yes Yes Yes
Pick-up Yes Yes Yes Pick-up time 2 hours window 2 hours window 2 hours window
Pick-up time 2 hours window within 5-10mins within 5-10mins Pricing
Pricing ASP IDR 35K IDR 20K IDR 15K
ASP IDR 18K IDR 29K IDR 32.5K Average Distance 590km 175km 175km
Average Distance 22km 10km 11km Average Weight 1 kg 1kg 1kg
by length, no max. Model by size, 5kg max by length, 15kg max by length and weight
Model by size, 5kg max by length, 15kg max Cashless Option Yes Yes No
weight specified
Result
Cashless Option Yes Yes Yes
Number of Orders 3 1 1
Result Delivered 3 1 1
Number of Orders 3 3 4 On-time 2 1 1
Delivered 3 3 4 Late 1 0 0
Fulfilled SLA 100% 100% 100% Fulfilled SLA 67% 100% 100%

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