Bali, Indonesia, has emerged as an attractive destination for foreign investors looking to launch businesses in various sectors, including large-scale vegetable trade.
With its favorable climate, strategic location, and supportive government policies, Bali offers numerous opportunities for launching a successful vegetable wholesale and distribution company.
This blog post will guide you through the process of setting up a Foreign Direct Investment (FDI) firm in Bali, specifically focusing on the KBLI code 46313, which encompasses the wholesale trade of vegetables for final consumption, such as spinach, water spinach, cabbage, and other vegetables.
We will explore the key steps, regulations, and benefits of launching a vegetable export business in this beautiful Indonesian island.
Overview
The business category under KBLI Code 46313 includes large-scale trade of vegetables for final consumption.
This covers a variety of vegetables such as spinach, water spinach, cabbage, and other vegetables.
Companies operating under this category typically source vegetables from farmers or importers and distribute them to retailers, markets, or directly to large consumers like restaurants and institutions.
Legal Basis
The legal framework for wholesale vegetable trading is outlined in the “Peraturan Menteri Perdagangan Republik Indonesia Nomor 26 Tahun 2021.”
This regulation provides the legal parameters and guidelines that must be adhered to by businesses engaged in the wholesale trading of vegetables.
Type of License
According to “Peraturan BKPM Nomor 4 Tahun 2021” Article 12, there is an exemption from the minimum investment requirements for Foreign Direct Investments (FDI).
Specifically, for the wholesale trade sector, the total investment must exceed IDR 10 billion, excluding land and building costs.
This implies a lower barrier for entry in terms of financial requirements for foreign investors in this sector.
Coverage of Service
The service coverage for businesses under this KBLI code includes the procurement, storage, and distribution of various types of vegetables.
These businesses play a critical role in ensuring the availability of fresh vegetables to consumers through various retail outlets and institutional buyers.
Business Scale, Land Area, and Risk Level
The sector of wholesale vegetable trading falls under large-scale business operations due to the significant volume of transactions and capital involved.
Regulations do not specify a minimum land area for these businesses, providing flexibility in operational setup based on individual company needs and logistics requirements.
The risk associated with this type of business is categorized as low.
Despite this, businesses must manage inherent risks such as perishability and supply chain efficiency to ensure the delivery of fresh, quality vegetables to their customers.
Authorities Granting Licenses
The primary authority responsible for granting licenses in this sector is the Investment Coordinating Board (BKPM) of Indonesia.
Licensing authority can also be exercised by the Minister or Head of the relevant agency, ensuring that businesses comply with the necessary legal and operational standards.
Requirements and Obligations for Business Licensing
For wholesale vegetable trading under KBLI Code 46313, while specific licensing requirements are not detailed, businesses are typically expected to complete standard procedures such as obtaining a business registration and a tax identification number.
The obligations for licensed entities in this sector are substantial.
Businesses must maintain a permanent and correctly addressed business and warehouse location, submit annual distribution reports to the central government, adhere to health, safety, and environmental standards (K3L), and secure formal agreements with producers, suppliers, or importers.
These agreements should be documented and should detail the transactions of goods distributed.
Frequently Asked Questions
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What vegetables are typically involved in the wholesale trade under KBLI Code 46313?
The wholesale trade under this KBLI code involves a variety of vegetables such as spinach, water spinach, cabbage, and other vegetables commonly consumed.
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What are the primary steps to start a vegetable wholesale business in Bali as a foreign investor?
Starting a vegetable wholesale business in Bali involves registering the business with local authorities, meeting the minimum investment threshold of IDR 10 billion excluding land and building costs, securing a location for operations, and establishing connections with local vegetable suppliers.
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What operational challenges might a large-scale vegetable trading business face in Bali?
Key challenges include managing perishability and maintaining supply chain efficiency to ensure the delivery of fresh and quality vegetables to various markets and consumers.
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How significant is the role of vegetable wholesale businesses in Bali's economy?
Vegetable wholesale businesses play a critical role in Bali's economy by ensuring the availability of fresh produce to local markets, retailers, and large consumers such as restaurants and institutions, contributing to food security and economic stability.
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What are the typical distribution channels for a vegetable wholesale business in Bali?
Distribution channels include direct sales to retailers, local markets, and institutional buyers. Some businesses may also engage in export, depending on their operational capacity and business model.
Contact Us for Vegetable Export Business in Bali, Indonesia.
