Waresix, a one-stop shop for Indonesian logistics, is raising money and growing fast

When Andree Susanto began a business distributing automotive lubricants in Indonesia around 2013, he discovered just how difficult it is to move products across the country. One needed to work within a fragmented logistics industry that often used manual systems and worked in silos. The system also lacked transparency, with distributors often lacking information on their goods’ exact location at any given point.

Plus, transporting goods across an archipelago with more than 14,000 islands meant negotiating with different transportation providers – by road, rail, air, and sea. If businesses wanted to avoid dealing with this fragmented network while also expanding geographically, they’d have to purchase their own fleet, which would require significant capital expenditure.

This experience led Susanto to found Waresix in 2017. He started the business together with Edwin (who has no last name), whom he met at the University of California, Berkeley, and is now the company’s chief financial officer.

Waresix’s long-term play is to become their clients’ main logistics partner, delivering an end-to-end solution. “As a freight movement business, at the end of the day we have to capture the whole aspect of the logistics system,” says Susanto.

“Now, multimodal transportation in Indonesia is a black box – you don’t know who you’re dealing with. We’re going to break the black box and create supply chain transparency.”

Just this week, Waresix completed a new funding round, which comes on the heels of two seed rounds held in 2018. Susanto says the fresh capital will be used to “to improve infrastructure, strengthen our network of warehouses, and expand our services to [include] ground transportation”.

Unique challenges in Indonesian logistics

The freight and logistics industry in Indonesia is expected to exceed US$150 billion by 2024. Logistics costs currently amount to around 25 percent of the country’s GDP, which is twice as much as the logistics costs in Malaysia as a percentage of GDP.

The industry lacks a holistic solution tailored to local problems, according to Susanto and Edwin. While there are plenty of startups around Asia that provide a supply chain platform, these solutions may be more suited for countries with large land masses, like India.

Logistics service providers “need to understand local knowledge and expertise. What works in the US or China might not be an efficient, viable solution in Indonesia,” says Susanto.

Edwin adds that to provide an end-to-end service solution in Indonesia, one needs to know how to deal with plenty of local vendors.

A big problem that distributors in the country face is the lack of digitalization for logistics documentation, such as proof of delivery (POD). In Indonesia, these documents tend to come in the form of printed paper, making them difficult to file, trace, and share. Paper PODs also tend to be open to dispute.

As such, Waresix aims to offer an integrated logistics solution that goes beyond transportation solutions, including services such as warehousing. That’s why the Waresix Operating System, a cloud software platform for domestic freight, was created. With this platform, Waresix provides clients with real-time visibility into inventory movements as well as a data analytics tool.

Aside from being a digital platform for coordinating and tracking shipments, Waresix partners with different multimodal transport operators around Indonesia to allow clients to book their services through one portal. The startup has also begun partnering with last-mile delivery companies such as Ninja Xpress, which is the name used by NinjaVan, a regional delivery service provider, in Indonesia.

Profitability and growth