(Yicai) July 3 -- With its massive motorcycle market, Indonesia was a natural choice for Ofero to start operations, but there were many challenges to overcome before it could actually achieve success, according to the local general manager of the Indonesia-based electric e-bike firm founded by the Chinese entrepreneur Wang Dong.

Electric bikes were a new segment in Indonesia when Ofero was founded in 2022, Wang Chao told Yicai in a recent interview. The market boasts 150 million gasoline motorcycles that could be refueled in minutes and run for more than 300 kilometers. "There was no point to compete head-on," he noted.

Instead, Ofero targeted consumers who needed transportation for only short rides and could not afford expensive gasoline motorcycles: mothers and students. In addition to being cheaper, e-bikes do not bear fuel costs, license plates, or the about CNY1,000 (USD147) registration fee, making them an attractive alternative.

Once the company identified the target customers, it had to establish a sales network. But Wang Chao soon realized that it was much harder than in the phone industry where he worked before, because for e-bikes, dealers had to handle sales, repairs, and after-sales services themselves. And most of them were either unable or unwilling to take on that investment.

Reaching out to dealers, Wang Chao's team shifted the metrics for dealers’ assessment to how many products they could sell, not stock up. Faster sales kept dealers' cash flow healthier and gave them more incentives to sell.

"Almost all our dealers in Indonesia are local," Wang Chao noted. "They have been doing business in the area for over a decade and have deep local networks," he explained. "Consumers trust the dealers, so whatever product they sell, it's easier for customers to accept."

Online traffic generation was also handed to individual stores. Each of them runs its own livestream business instead of leaving it to a central marketing team because the team is good at product launches and brand promotion, but does not know each store's inventory or local customer preferences, Wang Chao explained.

Moreover, Indonesia's payment and delivery infrastructure isn't fully integrated yet, so viewers often are unable to complete purchases directly from a livestream. Individual store livestreaming functions more as traffic generation, with dealers following up to convert viewers into buyers offline, rather than driving instant online sales.

"Indonesian consumers need to ride a vehicle before they decide to buy it," Wang Chao said. Ofero holds 1,500 to 2,000 events a year, including test-rides at Indonesia's popular Car Free Day gatherings and on-campus events for students.

"The conversion rate was low at first because people needed time to learn about and understand the product," he noted. "But over time, they come around to try the bikes." Then, through regular surveys, Ofero's product and marketing teams learned more in-depth customer needs, such as the preference for larger storage space to carry backpacks and groceries.

Other improvements to Ofero's product lineup include the launch of a dual-lithium battery model with a range of 120 to 130 km in 2024. "The lithium battery is convenient, as you can take it out and charge it at the office or at home," Wang Chao pointed out. "It's also cheaper, saving 70 percent to 80 percent of costs."

This helped get more customers, who had previously stuck to entry-level models, to upgrade to mid-to-premium models.

Besides overcoming the challenges related to sales channels, marketing, and product, it focuses on management. More than 95 percent of the firm's staff are locals, but their work culture is much different than that of Chinese workers.

Chinese managers tend to expect employees to draw broader lessons from a single example, taking the initiative and acting more independently, Wang Chao said. However, Indonesian workers are more used to direct, single-task instructions, and will not act on their own unless they are explicitly asked to.

As a result, Wang Chao decided to break down assignments into smaller, much more detailed tasks, with specific deadlines, numbers, and checkpoints. "It's harder to execute at first with this model, but once it's in place, execution becomes very stable." The same logic was applied in Ofero's factories.

In January, Ofero relocated to Semarang, Indonesia's electric two-wheeler supply chain hub, and built its factory there. It split the assembly into 12 separate job stations, with one worker per station, rather than having a single person handle two or three tasks.

This allowed the production cycle to be shortened to about 40 seconds per entry-level model and one minute per mid-tier model, matching the efficiency of Chinese factories.

For Wang Chao, 19 years in Indonesia have not made the country easier to operate in. He is convinced that what determines whether a company survives is not price or speed but its willingness to keep rebuilding its distribution, products, and operations around local market feedback.

Learning from the success in Indonesia, Ofero took the playbook to more than a dozen markets across Southeast Asia, Latin America, and Africa, focusing on in-depth studies of local markets and customer needs. For example, in Colombia, where most customers live in apartment buildings unsuited to charging heavy lead-acid batteries, the company immediately introduced removable lithium batteries.

Ofero's founder Wang Dong told Yicai in a previous interview that going global does not necessarily have to start from the Chinese market, which is very competitive and hard to succeed in. "Instead, going global can begin directly overseas."

Ofero has raised tens of millions of US dollars from investors, including NewTrails Capital, Saize Investment Capital, and Transsion Holdings, Africa's largest phone maker.

Editor: Futura Costaglione