Food for Thought
Agung Bezharie takes traditional Indonesian warung high tech
By Ismira Lutfia Tisnadibrata
Sunday, August 26, 2018
Warung Pintar, which literally translates as smart kiosk, is a retail tech startup launched in November 2017 that was quick to grab a bite of the warung or street-stall market. It uses technology to revamp street-side kiosks in keeping with the rise of the Internet of Things (IoT), enabling warungs to adopt digitized operations, from bookkeeping, to stocktaking, financial transactions and e-commerce, or simply offering charging stations for mobile phones users.
Its CEO and co-founder, Agung Bezharie, is well known in Indonesia’s tech startup scene. AmCham Indonesia sat down with him to learn how the startup is a boon for the traditional warung system.
AmCham Indonesia: What are the latest developments in your startup?
Agung Bezharie: As of July, we have more than 250 kiosks in the Greater Jakarta area, and the number has been growing by more than 160 percent per month since the first quarter of 2018. This is a jump from 12 kiosks in operation during the first four months following our launch. We aim to set up 1,000 kiosks by the end of the year. Our startup has also secured $4 million in funding from investors such as East Ventures, Insignia Ventures Partners, SMDV, Triputra Group, Digital Garage and several others.
We also launched in June a corporate social responsibility (CSR) program in partnership with major brands and big corporations to bridge them in empowering micro and small entrepreneurs. The program is called High Impact CSR and we began in Ramadan in cooperation with state-owned bank BNI’s BNI Berbagi CSR program by launching 10,000 fast-breaking treats. A person with a coupon for a free treat could redeem it at one of our kiosks, which we call ‘partners.’ At the kiosk, the barcode on the coupon was scanned, from which we collected data on the type of goods or treats redeemed, and the prices and the quantity that the kiosks released per day.
In addition to giving our free fast-breaking treats, the program helped to boost kiosk turnover by more than Rp 2.5 million during the program. We also forged cooperation with charity groups such as Dompet Dhuafa and Rumah Yatim, through which we assisted their beneficiaries to set up our kiosks and help generate their own income.
Tell us how you came up with the idea to establish this startup?
Setting up a warung is always the top-of-mind idea when people think of starting their own business, and according to various data there are roughly up to two million warung in Indonesia out of which 50,000 are in Jakarta, with a daily turnover of about Rp 1.5 million. In most places, a warung also serves as a community center. This micro business has long been the backbone of our economy.
What do you want to achieve with this venture?
We are the first in this segment and we want to change the traditional warung experience into a digital one to make the business more effective and scalable. We also want to assist warung owners – the micro entrepreneurs – to develop their business by providing the technology. It will not take the real warung experience away, but it will make it more effective and efficient. In addition, the warung will have a competitive advantage for them with features such as LCD TV, free wifi, charging stations, stoves and dispensers, or mini refrigerators, provided in this concept.
How does this smart kiosk concept operate?
With capital ranging from Rp 38 million to Rp 54 million payable in installments, anyone can become our partner. It takes one or two weeks to set up a kiosk. A partner will get a prefabricated kiosk in bright yellow with black writing, equipped with the features I mentioned earlier, in addition to a surveillance camera and digital platform to operate the kiosk. We will make sure first that the plot of land where the kiosk will be set up has legal status, rented or owned. We will not set up the kiosk in an illegal spot.
We provide an online system to order the groceries, which also allows customers to make online transactions. We use technology from other East Ventures portfolio startups such as Moka POS for the cashier; Jurnal for bookkeeping and accounting; Kudo for selling tickets, mobile phone credit top-ups and other goods in the marketplace; Do-Cart for purchasing products and Waresix for stock distribution.
A partner can earn up to Rp 6 million per month, and we provide continuous support by providing training on how to make the most of this business, monitoring how the kiosk performs and rolling out programs to keep customers coming to the kiosk. We empower the kiosk owner to come up with initiative and customization based on their kiosk performance and location.
How did the public respond when you introduced this concept?
At first we only had two kiosks, but we continued to grow until now. We had 500 inquiries about the kiosks in just three weeks from all over Indonesia but so far we are available only within the Greater Jakarta area. We plan to be able to set up in other places in the country.
What has been the impact so far with warung owners adopting the concept?
Each kiosk affects the lives of at least five people, including the owner. Based on our social impact measurement, since our launch 73 percent of our partners that mostly come from the lower income group experience an increase in their income, 62 percent think their quality of life has improved and 94 percent benefit from the partnership. More than half of our partners are young, with 56 percent in their 30s and 25 percent are in their 20s. Combined with 13 percent who are in their 40s, a total of 81 percent of our partners are in the productive age.