Consumers, especially those with average or low income, are very aware of prices and the economic situation. Loyalty to a brand and recognition of its name are enhancing elements. Customer follow-up and the quality of after-sales service count.
Consumer Profile and Purchasing Power
Consumption is an enhancing act, assimilated to modernity and the riches of the western lifestyle. The purchasing power of the majority of the inhabitants being low, consumption essentially turns around food products and other basic goods.
Consumers Associations
YKLI, Indonesian consumer association Konsumen Mediakonsumen, Communication and information media for Indonesian consumers
Consumer goods were originally sold on traditional markets which could be categorized in different sectors like wholesalers and retailers. With modern markets, most manufacturing companies do not distribute their products themselves as this is too expensive; they call on companies specialized in distribution, which, in turn, use traditional channels.
Doing business in Indonesia means going through a wide spectrum of agents, distributors or economic intermediaries. It may be difficult to find a distributor for storage, as expenses linked to warehousing are rather crippling.
Market Shares
Although traditional markets are still dominant in Indonesia, modern retail shops, such as hypermarkets, are rapidly becoming more popular, especially in urban areas. Hypermarkets enjoyed the fastest growth rate in 2005: their number rose by 55% and their area by 51%. In spite of the rapid growth of modern retail shops, the "other" retailers of grocery products (small traditional stalls, itinerant merchants and other small retailers) represent 95% of all retailers and almost 56% of sales.
The country is a member of the APEC, ASEAN, AFTA and the ASEAN - China Free Trade Area. The country have signed a trade agreement with 21 other countries in the São Paulo Round of the Global System of Trade Preferences among Developing Countries (GSTP).
Non Tariff Barriers
It is strictly prohibited to import certain products: books, magazines, brochures and newspapers written in Chinese, in Indonesian or in a local language (except for scientific reasons) as well as cassettes, video cassettes and films for personal use. Import licenses are required for medicines, psychotropic substances, explosives, arms, fireworks, films and videos, telecommunications equipment, color photocopiers, unregistered foods and drinks, some pesticides (DDT, EDB, Pentachlorophenols). These licenses are issued after consultation with the competent Ministry (Agriculture, Health, Commerce and Industry).
Customs Duties and Taxes on Imports
9.5% (2006)
Customs Classification
To classify imports and exports, Indonesia uses the Harmonized System of nomenclature and codification of goods. To honor its commitments to the WTO and respond to the imperatives of domestic politics, the government has implemented two types of policy over the last few years which have had a considerable effect on the level and the structure of duties. These policies are linked to a program of duty reduction between 1996 and 2003, and to a program of tariff harmonization between 2004 and 2010.
Import Procedures
Documents required for import are: a waybill which must show the transport costs; a commercial invoice containing information, amongst others, about the buyer and the seller, the date of dispatch, the nature and the price of the goods, their origin, transport and insurance costs; an insurance certificate, which must usually be produced when the goods are insured outside Indonesia or if they must be put in a bonded warehouse; and a certificate of origin, in the case of drugs or medicines.
Importing Samples
Commercial samples must be sent directly to the importer.
Concerning goods transport, the sea route is used most. 69% of imports pass through the two main ports which are Tanjung Priok (Jakarta) and Tanjung Perak (Surabaya)
The mining industry, energy production (oil, gas and electricity), the textile industry, automobile industry, forestry (plywood, rubber, palm oil).
Business Directories
Multi-sector Directories
Directory of Companies, Exporters and Importers - Website of the Ministry of Industry of the Republic of Indonesia. DIS (Digital Information Services) - Directory of Indonesian companies, classified by activity. Export Import Indonesia - Export-Import-Indonesia.com is developed for all exporters and importers around the world. The directory is not just for Indonesian companies, but also for foreign companies interested in doing business with Indonesian buyers or suppliers. Indonesia Business Channel - B2B global directory of companies. Trade with Indonesia - Search products, companies and trade leads. Yellow pages - Find a business in Indonesia. Zipleaf - Business directory for several countries in the world.
Indonesia: Selling and Buying
