Profitable Indonesian logistics startup Ritase bags $8.5m

Ritase, an Indonesian logistics startup focused on the trucking sector, has secured US$8.5 million in series A funding. The round was led by Golden Gate Ventures, with Jafco Asia and ZWC Partners as participating investors.

Founded by Iman Kusnadi and David Samuel in 2017, Ritase lets enterprise clients find and work with trucking vendors to transport their goods across Indonesia. The company runs a software-as-a-service (SaaS) platform for transport management that’s used by both vendors and customers.

Ritase co-founder and CEO Iman Kusnadi (right) / Photo credit: Ritase

According to CEO Kusnadi, the company will use the funding to introduce more features like chatbots and dynamic pricing, and branch out into inter-island logistics. It also aims to expand regionally, with Singapore as a starting point.

Previously, the company raised a total of US$4.4 million in seed and pre-series A funding from Insignia Venture Partners, Beenext, Skystar Capital, and Mitsubishi, among other investors.

Cutting out the middleman

Kusnadi had spent 15 years in logistics when he noticed a gap in trucking.

“There was no technology to support [the sector], especially when you compare us to countries like China, where there’s a lot of trucking platforms available to support small and medium-sized enterprises,” he says.

There are many Indonesian trucking firms in varying sizes. The bigger ones may have several thousand trucks in their fleet, while the smaller ones may have just a hundred. Because it”s a capital-intensive business, according to Kusnadi, these companies generally don’t expand their fleets unless there’s guaranteed volume or return on that investment, such as a long-term contract.

Large companies like Ritase’s customers – Nestle, Unilever, and Lotte, to name a few – typically work with multiple trucking vendors. That’s because their shipment volumes tend to be dynamic – they may need 100 trucks one week, but only 50 the next, Kusnadi says.

When these companies work with multiple vendors, a key issue is tracking. Most of them use systems like SAP to manage their inventory and warehousing, but that stops the minute their shipments leave the warehouse. Each of their trucking vendors have different systems and processes, and as such they will need to be managed individually.

Thus, Ritase’s selling point is having one platform to manage all these vendors. Its platform has features like real-time shipment tracking, route optimization, digitized paperwork, as well as business intelligence like vendor and shipment reports.

Photo credit: Ritase

Ritase typically works with SME-sized trucking vendors. The startup helps these vendors connect with corporations, instead of relying on middlemen or brokers like they used to. This helps standardize pricing as well as make the entire process more transparent. In the past, many of these trucking vendors never even interacted directly with their customers, Kusnadi says.

Expanding into inter-island logistics