Offshore to Indonesia: A Guide to Growth Beyond Singapore
Picture this: Your company has been doing splendid in the little red dot, but it’s time for an expansion. What’s the goal of your brand? To be the top destination for food supplies in Asia? How do you achieve that? The answer: offshore to Indonesia.
Offshoring usually means relocating certain business processes to another country, usually done so to cut down on costs in your home country. We have a fantastic team over the waters in Indonesia (Selamat Siang!), and it’s been amazing having a family away from home! But with mega offshoring countries like India, why in the world did we decide to make Indonesia our second home?
As mentioned previously, offshoring is the using of a third party from foreign countries to carry out business processes. Indonesia is not only known for its amazing mountains and food, but is also quickly becoming a hub for companies to offshore businesses. Known for their strength in people skills, Indonesia is an up-and-coming destination for offshore services. The main reasons why companies are offshoring to Indonesia include cost advantages as well a greater talent pool.
Due to a competitive labour force, Indonesia has been rapidly stepping up as one of the most effective and efficient locations for offshoring. In addition, Indonesia boasts less costly manufacturing processes, and office space. In short, operation costs are way lower than that of, let’s say Singapore.
Moreover, Indonesia is still a relatively new player in the offshoring industry as compared to countries such as India. Hence, hiring talents from Indonesia will be less expensive, helping you to save on hiring costs. No matter what stage your start-up is at, you’ll want to maximise your investments and resources while recruiting passionate individuals into your team.
Home to around 260 million people, Indonesia’s bustling population is a goldmine for talent. This enormous market is a great opportunity for you to invest, especially in their best product: their people. In cities such as Jakarta, millenials are getting competitive and hungry for success, and what more could you want than a team of passionate and motivated individuals?
Offshoring to Indonesia not only strengthens your company, but will also help you to understand the wants and needs of the Indonesian population. This will make expanding into the market a breeze!
That being said, offshoring to Indonesia doesn’t just happen with the nap of your fingers. There’s a whole lot of work to be done in order to get to the other side. Here’s three things you’ll most definitely need to kickstart your offshoring journey:
Nope, it isn’t the sort of entity you see in your nightmares. An Indonesian entity simply means a company that has been filed outside of the country where it originated from. On the other hand, an entity could also be seen as a company formed with the purpose of operating outside of the jurisdiction it was originally under.
This entity would be able to capitalise on certain laws that are not available in their home country. For example, tax savings, as well as better business opportunities. Different countries impose different amounts of tax on business, hence it might be wise to offshore to a country that’s more relaxed in the legal department. No company, no cash! That’s why having an Indonesian subsidiary would be the first step in kickstarting your offshoring venture.
As small startups, who wouldn’t want to sink their roots into the soil of Southeast Asia, before branching out to the world. Some Singaporean startups with business ventures in Indonesia include Shopee, Chope, Honestbee and of course, Glints (that’s us!).
I mean, duh? Everyone wants a cool office space. If you’re going to seduce a group of enthusiastic and determined individuals, you’re going to need a cool office space as bait. One hotspot to consider is Nongsa Digital Park, located in Batam!
Look into potential venues and spaces you can set up shop at. Whether it’s in a industrial area, or a swanky heritage shophouse, having a home away from home is essential for your employees. It’ll not only radiate professionalism, but also remind you that you now have another team to look out for. This team might be across the ocean, but they’re still family.
Ka-Ching! Don’t expect to offshore if you have a lack of capital. Just like anywhere else, you’ll need investors and capital to form a start-up and start offshoring to Indonesia. Despite the pretty picture we’ve painted for you above, this is the real world. Competitive salaries permeate the market in Indo and talents are extremely sought after.
It’s true that there’s huge amount of talent in Indo, but whether the talent comes to you is another story. Companies such as Go-Jek offer astronomical salaries (similar to Silicon Valley) just to pull in the best in the business. So if you’re thinking of exploding in Indonesia without a stellar hiring plan and salary structure, you should probably take a step back and reconsider.
There are a whole laundry list of things to take note of if you intend to offshore, but offshoring remains one of the best ways to cut down costs and gain global exposure. As a startup, offshoring to Indonesia will provide you with the talent and experience you wouldn’t have gotten otherwise in the constraints of your home country. That, we feel, will be a worthy investment for the future.
Want to start offshoring to Indonesia and help your business scale like never before? Want to expand your reach into the regional markets? Click here to check out TalentHub, our strategic offshoring solution!
