PT Tirtakencana Tatawarna (Tirta), which is a member of the PT Avia Avian Tbk (AVIA), is a company engaged in the sale and distribution of building materials and furniture. Avian Brands is an Indonesian paint giant company that has existed for more than 40 years and is the largest company for waterproofing, wood and metal paint. According to consulting firm Frost & Sullivan, it held more than 25 percent of the domestic market share in terms of sales last year.

Tirta’s distribution network is very wide and comprehensive and serves more than 98 cities and 38 provinces in Indonesia. Supported by 110 distribution centres spread throughout Indonesia, Tirta’s services include both traditional and modern channels. Currently, Tirta has warehouse facilities of more than 240,000 m2 and a delivery fleet of more than 650 units, as well as more than 3,500 salespeople.

Over the years, Tirta has consistently increased the number of distribution centres to provide the best and fastest service to all its customers. And this is where their challenges began.

Challenges faced in visibility and efficiency of delivery planning

Tirta’s operations team was planning to use the old system with manual planning done by drivers and without visibility or efficiency in delivery planning. Their major supply chain challenges were in the static planning of day-to-day logistical activities, delivery reattempts, multi-day, multi-trips, and multi-drop deliveries, and data visibility and reporting.

There was also a clear underutilisation of vehicles due to lack of insight on fleet allocation and high dependency on human intelligence to sort shipments. In addition to which, multiple on-ground constraints such as time slots for customers, traffic, and other road restrictions, increased the burdening point of contention with the manual delivery planning systems.

To solve these emerging challenges in manual delivery, Tirta recognised the importance of information technology systems, and decided to implement Locus Dynamic Route Optimisation in all its distribution processes.

Deploying smart systems for logistics operations through end-to-end automation and more

The company was looking for a smart system for their logistics operations, and partnered with Locus to increase operational efficiency and optimise their supply chain processes. Locus implemented Order Management, Route Planning and Control Tower, enabling end-to-end automation of the company’s distribution planning.

It did so by deploying:

• Optimised Route Planning: Locus’ proprietary geocoder enabled systematic planning of delivery routes, provided a single screen view of the distribution plans, and helped in defining crisp timelines for deliveries.

• Dynamic Shipment Allocation: Automated shipment allocation created the most profitable routes and assigned them to the right delivery agents beforehand.

• Machine Learning and Track & Trace: With proprietary machine learning algorithms, Locus learned from the on-ground execution and subsequently refined the future plans being generated.

• Tracking deliveries on a single platform: For proactive operation management, the solutions tackled the client’s major pain point with a hawk-eye view of on-ground operations for real-time tracking based on SLA breaches, battery levels, and customer interactions.

• Digitisation via app: Drivers used the LOTR mobile app to record the shipment statuses for better visibility and to keep it updated.

Driven by a proprietary geocoding engine and machine learning algorithms, Locus’ solutions enabled efficient planning of delivery routes and effective scheduling of orders.

In today’s fast-paced world, consumers have come to expect seamless and timely fulfilment that align with their specific preferences, and manual methods are unable to meet these expectations. So, we leveraged Locus’ intelligent dispatch management platform to maintain high levels of operational efficiency. With Locus, we were able to plan, execute, and streamline our entire supply chain, starting from managing customers, drivers, locations, and sellers, and acting as a machine learning platform for precise decision-making.Wahyu Kristi Wicaksono, Deputy Supply Chain Director, Tirta

Result: Tirta optimised route planning saving logistics costs by 1.6 billion IDR by 6 months rolled out in 45 hubs out of 106 hubs.

Through end-to-end process automation, there was a whopping 95 percent increase in service-level agreements or SLAs (Order to Delivery). Tirta achieved the same-day delivery service and fulfilled a lead time from 1.21 days to 0.98 days. The company also reduced delivery time by improving routes from 2.6 percent to 0.4 percent. In addition to building a control tower set up for real-time visibility and enabling intelligent alerts on order status tracking, Tirta also digitised the Proof of Delivery process and ended up with a single platform for end-to-end order status tracking.

Most of all, the company developed the ability to analyse data quickly and accurately, leading to more precise decision making.

At Locus, we believe in the power of technology to transform the logistics industry. As a market leader in paint and building materials in Indonesia, Avian Brands wished to increase operational efficiency and optimise their supply chain processes. Locus’ solutions enabled the efficient planning of delivery routes, the effective scheduling of orders and reattempts, and quickly solved blockers through end-to-end visibility. We’re proud of the results we’ve achieved together and are excited to continue pushing the boundaries of what’s possible in the logistics space.Nishith Rastogi, Founder & CEO, Locus

In an era of digital change, Indonesia’s logistics sector is being catalysed by the ongoing innovation in tech solutions to simplify operational overload. As the nation’s logistics market growth is expected to reach 42.1 billion IDR during the forecast period 0f 2023-2027, the distribution and logistics market is only growing and will require fast-paced digital fostering. Tirta’s case gives us an insight into how small and medium businesses, the majority stakeholders in the archipelago, can optimise their businesses and impact growth.