Cover Story / December 2019

Wood Shopping Made Easy

By: Elsid Arendra Not so long ago, Perhutani customers were used to the idea of purchasing something from the state-owned wood producer must be complicated. Much bureaucracy and long processes consume their time and money. Dishonest brokers were thriving, manipulating each step in the purchasing processes to extract economic rent from both the company and customers.  Now everything has changed.  Perhutani is transforming itself into an Industry 4.0+ company. It recognizes consumers, especially millennials, in recent years have grown to favor the convenience of online shopping. They buy all things from consumer goods such as coffee, tea, diapers, to phone credit and electronic gadgets through various e-commerce websites.   Now, Perhutani made sure that they can also buy their woodworking supplies, like wood planks, turpentine, and resin online. Perhutani has launched an e-commerce application on the Play Store that allows the purchase of all Perhutani products as easy as playing social media or playing games on a smartphone. You can also visit the Perhutani’s e-commerce website through common internet browsers.   Logs with Barcodes Perhutani’s entry into the online trade business is in line with the government’s commitment to boost the sector. With an online sales system, consumers no longer have to go down to Perhutani’s forest or log yards (TPK) to buy woods. That saves time.  On its website, Perhutani peddled records of woods produced from company-owned forests throughout Java. The Perhutani online shop sells various types of wood logs ranging from the best selling teak and mahogany to more specialized ones like beechwood, acacia, rosewood, sengon (Albizia chinensis), pine, mahogany and Java palisandre.   Also, the online shop sells forest products like copal, varnish, gum rosin, eucalyptus oil, and honey. There you can also find wood decking, flooring, veneers, and plywood from Perhutani mills, as well as several tour packages in the company’s managed forests. All Perhutani’s wood logs are now equipped with barcodes to facilitate the online transaction, logistics, and transportation processes.  GlobeAsia visited the Perhutani log yard in Banjar, West Java to meet Otong Juhana, the head of the Perhutani Banjar TPK. As a log-yard master, Otong is responsible for receiving wood coming from two working areas in the Banjar district.  “On average, we receive around 7,500 to 12,000 cubic meters [of timbers] per year. While this year’s production target is 10,000 cubic meters, the production has reached 11,128 cubic meters up to October,” said Otong. All timber harvested from these areas has obtained a Forest Stewardship Council (FSC) certificate, a European sustainability standard that has become a reference for the world’s timber market. The standard requires timber plantations not to cut down the entire forest under their management. Overseas buyers, especially Europeans, often demand the certificate to accompany all woods that they buy, so timber traders or exporters must meet these requirements. Apart from satisfying export demand, companies following this standard often see improvement in their cost efficiency, with their expense comes down by 20​​-30 percent.  “Most of the wood we received comes from the North Banjar area, which is dominated by, up to 80 percent, teak. Although our teak is not as good as teak in Central Java, many buyers buy it for the needs of the wood industry and exports.  These woods have been subject to various quality tests and certifications from the forests managed by Perhutani. When they are cut, the logs are separated based on quality. A paper is affixed with a barcode to facilitate the sorting and logistics process,” said Otong, who has been at Perhutani since 1987. Barcodes on wood produced by Perhutani make it easy to sort the wood based on quality and species.  This barcode also shows that this wood is legal and certified wood. “With this barcode-labeled wood, security during the logistics process is guaranteed so that buyers feel comfortable. The barcode also prevents hijack during trucking. The hijacked timber will be difficult to sell because no one will buy paperless wood and also easy to track and find. This is one of the benefits of the barcode and online system from Perhutani,” Otong, who will retire next year, explained. A New Way to Shop Wood Timber buyer seeking to buy from the Perhutani website needs to register, either as a retail purchaser, contract purchaser, or bidder in the premium auction. Individual buyers will be required to fill the data at the time of registration, such as full name, email, date of birth, telephone number, ID card number, and tax identification number (NPWP).  Individual buyers must upload the photos of their ID cards and NPWP to Perhutani’s online timber purchasing system. If the registration data is incomplete, then the the member account cannot be validated. Buyers who have successfully registered will receive a username and password notification via email or SMS. For data security, buyers are advised to make periodic password changes and maintain password confidentiality. Perhutani will validate all data and documents provided by the buyers. “Even though customers can buy timber online on Perhutani’s website, many of our partners still come to the log yard. They want to see the wood first hand and chose the exact logs they are going to purchase,” Otong said.  “They usually use the website to determine the amount of wood, wood type, and quality level that will be purchased,” Otong said. “Purchased timber can be transported at the earliest one day after the transaction date by first registering the transport plan to the head of the TPK. Then the buyer or customer brings and shows proof of payment to the TPK where the wood is originated. I, as the Head of the TPK, validate proof of payment based on incoming email notifications. After that, I print proof of the original receipt. The buyer or customer will receive a travel permit and timber legal document issued by the Issuing Officer. The buyer can take the goods after all the documents are complete except the tax invoice. Timber loading and transport costs are on buyers and those applied in each TPK,” Otong said. With an online purchasing system, payment is also secure. Payment can be made in two ways, using are Telkom 021 and Virtual Account (VA). Telkom Payment 021, specifically for personal account transactions with transactions under Rp 100 million. Virtual account applies on personal accounts with sales above Rp 100 million and for corporate accounts with any amount of purchase. Buyers who are still unsure whether to buy wood in Perhutani must be in large quantities need not be in doubt anymore. Perhutani serves purchases in a small batch to an unlimited amount of timber.  The company carries out sales under lot system. One lot can contain between 0.2 and 3 meter cubic of wood. The system certainly facilitates small businesses and hobbyists, who often only need small amounts of timber. For users who are unfamiliar with wood quality, TokoPerhutani.com presents a channel that informs the specifications of the wood sold at the website. These cover the timber’s length, level of wood quality, diameter, to the level of defects. That way, buyers can estimate the budget needed to purchase wood with the required level of quality.