Internet allows Cirebon furniture firm to taste success

The Jakarta Post, Jakarta

The World Wide Web offers immense marketing opportunities for businesses of any industry and size, in any location, as it allows them to transcend traditional market boundaries.

But in a country like Indonesia, where Internet penetration is still low, selling a product through the Internet is probably the last route any enterprise would dare to take.

Taking a risk, however, has proved worthwhile for Tonton Taufik, a 34-year-old civil engineering graduate living in Cirebon, West Java.

PT Rattanland Furniture, which he established in his town in 1999, has turned into one of the most successful companies in the country thanks to the power of the Internet.

Rattanland, which exports almost all of its rattan furniture to over 40 countries worldwide, banked sales of up to US$1.42 million in 2006 despite the slowdown in the country's furniture industry that year.

The company's sales grew by between 20 and 50 percent per annum over the past five years -- a stunning performance that led it to win a 2007 Primaniyarta Award, the government's highest recognition for export performance.

This scent of success was far from Tonton's senses when he first started business eight years ago. Like many of his school mates, he went to Jakarta to find a job following graduation. But it was not easy at the time to find a good job in the big city. Unemployed and frustrated, he decided to return to his hometown Cirebon.

"Soon after, I attended a workshop on marketing by management guru Rhenald Kasali, who just happened to be in town, and then a course at the Indonesian Export Training Center in Jakarta on establishing business networks online and a Web site-design workshop in Bandung," the father of two said.

Tonton then tried his luck in the rattan furniture industry with nothing more than a desktop computer, a printer and a dial-up modem, which he bought after selling several personal items and borrowing money from friends, which he eventually paid back after making his first sale. He spent a full week, day and night, to set up his first Web site.

"I remember first hosting my company's homepage on a free Web hosting Web site: 'welcome.to/rattanland', before finally purchasing my own domain name for $70, which at that time I felt was quite expensive," he said.

He began his business by selling rattan furnitures produced by small furniture shops in the town, known as the center of the rattan furniture in the country.

"At that time I didn't have the money to purchase a furniture workshop nor hire woodcraftsmen. I also didn't know how to deal with export documents, so I passed the first order to another furniture company and collected a commission," Tonton said.

He continued to serve as a middleman between international buyers and rattan furniture manufacturers for several years until he finally purchased a 9,000 square meter plot of land and built his own workshop in 2004, which now employs 100 skilled woodcraftsmen.

About a year into the business, in 2000, Tonton hit a crossroad. His company faced a damage claim worth Rp 75 million, an amount beyond the capacity of his startup to pay.

"I tried to keep smiling and feel upbeat about the business, despite having this massive debt creeping from behind. It was a very difficult time; I really had considered giving my business up altogether," he said.

But he persevered and kept on marketing his products online until a buyer from Canada placed a significant order, the profits of which soon covered his debts.

Tonton also had his share of being cheated by buyers in payment arrangements. Learning from his mistakes, he later required interested buyers to make a down payment before the furniture was delivered.

Soon after Tonton completed his company's Web site, his only competition in business took place on the net, as he competed with other rattan furniture companies worldwide on major search engines like Google, Yahoo and MSN.

"Do you know that 85 percent of buyers come from search engines like Google? That is what I learned from a CNN news report and I have kept that information in mind ever since," he said. "The trick to advertising online is to get as many visitors or potential customers on your Web site as possible. So I had to come up with as many keywords as I could to define www.rattanland.com and in turn boost my site's hyperlink popularity on pages containing search results."

In addition to search engines, Tonton also registered his company's homepage on several trade leads like AliBaba.com and TradeWorld, which he says did wonders for his business, with noticeable growth performance taking place between 2002 and 2006.

"From 2002, the company's year-on-year sales grew by 50 percent up until 2005. The growth rate has since slowed down to 15-20 percent, but this is largely due to a shortage of raw rattan caused by illegal smuggling abroad," he said.

One of the primary advantages of marketing products online, he added, was that it had allowed his company to serve the global market with little in the way of advertising costs, especially when compared to the fees for participating in trade exhibitions.

Tonton said he had only once participated in a trade exhibition in Jakarta, back in 2002, and the result was quite disappointing. His customers still mostly came from the Internet.

His buyers mainly come from the European continent, with Spain being the largest market. His company has also penetrated North and Latin America, as well as East Asia and Oceania.

He added that buyers commence their orders by emailing him for quotes after perusing his Web site which is accessible to English, German, Dutch and Spanish speakers and displays the images of more than 1,000 furniture items his company is able to manufacture.

Tonton's ambition is to turn Rattanland into a household brand worldwide and to help Indonesia become a country that is able to export finished high-quality products, shifting its current reputation as a raw material exporter.

At present, he exports about 20 containers a month and says he confident that in the next few months this will increase to 30 containers.-