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Indonesia, the world’s largest archipelago, offers tremendous resources. However, it is often difficult for foreign investors to find or contact Indonesian suppliers.
In this article, we will bring out the most common barriers foreign companies face when looking for suppliers in Indonesia and explain how to overcome these obstacles.
We will also list the requirements you need to fulfill to export goods out of Indonesia.
Challenging to find Indonesian suppliers online
The first roadblock of your supplier search in Indonesia can already emerge when you discover that it is quite hard to find Indonesian suppliers online.
The majority of Indonesian companies are still at the infant stage when it comes to the Internet. Even if the company does have a website, it may be with outdated (contact) information, or it may not be found from Google easily.
Insufficient or old information on their websites
Businesses in Indonesia do not put a lot of emphasis on making themselves visible online or keeping the already existing information updated. If you find a site of a supplier that seems to match your criteria, the chances are that the information on it is incomplete or outdated.
Pay attention to the time the website was created and the information added. If possible, it also helps to check the information from other sources as well.
Not easy to get a reply
Even if you manage to get the contact information of the vendor you are interested in, the odds are that you won’t get a response after submitting your inquiry. Unfortunately, most Indonesian businesses are not eager to reply to emails, especially from senders they don’t yet know.
It is partly a technical issue – they don’t have proper lead management systems in place – and partly a matter of trust. Indonesians are generally very cautious with people they don’t know well and thus are likely to assume that you are not serious.
Communication via email can work well but only if you have already been in contact before. We recommend that instead of sending cold emails, try to reach the supplier via phone or better yet, aim for a face-to-face meeting.
If you are not able to frequently travel to Indonesia yourself, Emerhub can act as your local representative. We can arrange and conduct meetings with suppliers you have already selected or search for suppliers on your behalf.
Lack of English skills
Other difficulties that are common to arise are all sorts of communication issues – from lack of knowledge regarding the local culture to language barriers from both sides.
Foreign investors are used to getting things done using English. Most Indonesians, however, don’t speak much of it, especially outside of the big cities. For this reason, we strongly recommend involving a local advisor when doing business in Indonesia. This way you will avoid any linguistic ambiguities from occurring.
A local partner will also help you understand the local business culture better by interpreting the unwritten habits of doing business in Indonesia.
Don’t assume that ‘Yes, Boss’ means that you have a deal
The term ‘Yes, Boss’ is a widespread and somewhat automatic expression in the Indonesian way of communication. Don’t take it at face value when discussing business and make sure you always reconfirm everything before you celebrate a deal too early.
There is no doubt that the Western way of doing business differs from Indonesian business customs quite a lot. To provide some more insights, we have further described the topic in our previous article about the diverse business culture of Indonesia.
Another frequent issue is the poor quality of the products. Foreign investors often find that the products they ordered don’t comply with their quality requirements and they are forced to revoke their orders.
It is also not uncommon that even if the first shipment is compliant, the subsequent ones may not keep up with the standards.
Such hassles can be avoided by conducting frequent quality control. In the end, you get what you demand.
Easier than finding suppliers in Indonesia on your own
The process of using our supplier search service is quite simple and straightforward. All you need to do is provide us with details about the product you are looking for, and we will handle the rest.
The time frame from contacting us to sealing the deal depends on the complexity of the product you are looking for and how easy it is to contact the suppliers. In general, it takes 3-6 weeks to find suppliers that match your criteria.
Fill in this form to start the supplier search in Indonesia:
Find quality partners in Indonesia
Indonesia can be a complex market, especially for newcomers. Emerhub has nearly ten years of experience during which we have worked with hundreds of foreign and local companies all over Indonesia.
Some of the types of suppliers foreign companies are often interested in Indonesia:
- wood pellets
- coconut charcoal
- palm oil or palm fiber suppliers
- plastic products
- adhesive glue and other chemicals for the garment industry
- tea or coffee producers
- A4 paper suppliers
- cocoa butter
- oleic acid
It has allowed us to build a broad network and gain knowledge of where to look for reliable local partners and how to cooperate with them successfully. We collect offers from multiple sources and can later advise you on choosing the proposal with the most optimal price.
Exporting goods from Indonesia is generally easier than importing goods into Indonesia since you don’t need to acquire separate licenses for exporting.
However, the prerequisite for both is to have a company in Indonesia. If you don’t have a company here but want to export from or import to Indonesia, Emerhub can assist you with both of the processes.
For exporting, we can provide a consignee who will clear your goods for export as well as freight the products to their country of destination.
We can also assist you with the document side of the process even if you don’t need the full service and would like to arrange the freight of the goods yourself.
Export duty in Indonesia
Note that certain goods are also subject to export duty:
- leather and wood
- cocoa seeds
- oil palms, crude palm oil, and its derivatives
- processed metallic mineral goods
The exact percentage of export duty depends on the product’s HS code and varies from 3-25%. For any specific cases, contact us for more information.
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