Dear Retailers and Manufacturers: Jastip Isn't The Problem

"It’s not fair they said, but this is business: where there is a gap, one will try to exploit it. If they blame us because foreign products are better, why don’t they make good ones too?

(Interview with a Jastip vendor specializing in fashion items from Thailand, commenting on backlash from local retailers and manufacturers)

Have you ever asked friends or family to buy small items for you while they travel abroad? If so, you have participated in the Jasa Titip (Jastip) system.

Jastip, often translated as "personal shopper," has become a significant alternative import route in Indonesia. This social-media driven business model, especially through the advent of live streaming, has drawn the ire of conventional merchants who see their market share eroded by cheaper foreign products. Despite the criticism, Jastip offers undeniable advantages over traditional import methods: convenience, flexibility, and often lower costs.

A 2017 survey (see Graph 1) identified fashion, electronics, and cosmetics as the most popular Jastip items: these items remain popular even today. Food has also been a staple, with past trends including Irvins’ salted egg snacks from Singapore, milk buns from Thailand, and Dubai’s pistachio chocolate bars.

Graph 1. Jastip survey result, grouped by gender (2017)

Source: Jakpat survey (2017), compiled by Adi Ahdiat in Databoks (2024)

The Push for Regulation

Retailers and manufacturers, particularly the Indonesian Retail Traders Association (APRINDO), have pushed for stricter Jastip regulations, arguing that vendors bypass customs duties, creating unfair competition (Hasiana, 2024; Catriana & Sukmana, 2024). The government’s response has been inconsistent. The Ministry of Trade (MoT) introduced Regulation 36/2023, tightening restrictions on hand-carried imports of luxury goods. However, under pressure from migrant workers, the MoT relaxed these rules with Regulation 7/2024, allowing travelers to carry unlimited goods as long as they comply with customs duties (Suwastoyo, 2024).

Even with regulations in place, Jastip vendors are adaptable enough to find legal workarounds. Enforcement of more draconian measures would be costly and impractical since customs officials cannot easily determine whether a traveler’s items are for personal use or resale (Al Hasan, 2024). Attempting to inspect every piece of luggage would be inefficient and ethically questionable.

The Root of the Issue

Rather than focusing on curbing Jastip, regulators must address the underlying issue: unmet consumer demand for diverse, high-quality, and competitively priced goods. If official retail channels fulfilled this demand, reliance on Jastip should naturally decline.

Restrictive import policies often fail to achieve their intended goal of boosting local industries. Instead, they drive consumers toward informal markets like Jastip. Import restrictions reduce product variety, increase costs, and can lower quality, deterring consumer interest (Takahashi, 2021; Francois et al., 2014). Moreover, Jastip fees—covering travel, storage, and shipping—raise costs, disproportionately affecting low-income consumers who have fewer alternatives (Revindo, Siregar, & Yuliana, 2024).

The assumption that restricting imports will strengthen domestic industries is flawed. Protectionist policies can lead to stagnation, as local manufacturers shielded from competition may lack incentives to innovate (Akcigit, Ates & Impullitti, 2018). Worse, they risk triggering retaliatory trade measures, limiting Indonesia’s access to global markets, which would in turn incentivize legally grey import routes such as Jastip.

A Better Approach

Regulators should reassess policies that hinder access to imported goods, particularly when viable local alternatives are unavailable. Rather than suppressing foreign products, a well-calibrated trade policy should ensure local industries improve by competing fairly. Instead of blanket restrictions like MoT 36/2023, policymakers should encourage a level playing field where businesses grow through innovation, not protectionism.

To reduce reliance on Jastip, both regulators as well as local manufacturers/retailers should focus on three key strategies:

1. Enhancing Competitiveness: Businesses must prioritize quality, pricing, logistics, and marketing. Competing with Jastip requires offering products that match or exceed imported alternatives in both value and accessibility.

2. Product Diversification: Rather than mirroring Jastip’s offerings at higher prices or lower quality, local manufacturers should identify market gaps and develop unique products. Expanding product lines and incorporating global standards can help retain customers.

3. Leveraging Digital Platforms: Jastip vendors thrive on social media and live-streaming sales. Local retailers should adopt similar tactics, using digital marketing, Key Opinion Leader (KOL) collaborations, and interactive online shopping experiences to compete effectively.

   
   

Ultimately, Indonesia must foster a resilient domestic market by facilitating commerce rather than restricting it. Instead of imposing restrictive policies that hinder trade, regulators should focus on creating an environment that encourages entrepreneurship, investment, and innovation. Sustainable growth depends on enabling competition, not eliminating it.