Journal of Economics and Business

ISSN 2615-3726 (Online)

ISSN 2621-5667 (Print)

Published: 12 May 2020

Developing Model of Logistics Costs in Indonesia’s Cement Projects: A Literature and Empirical Study Approach

Effnu Subiyanto, Hesty Prima Rini

Widya Mandala Surabaya Catholic University (Indonesia), University of Pembangunan Nasional "Veteran" East Java (Indonesia)

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10.31014/aior.1992.03.02.232

Pages: 697-718

Keywords: Foreign Logistics Costs, Domestic Manufacture, Domestic Logistics Costs, Total Costs of Investments, Cement Projects, Indonesia

Abstract

This research aims to disclose yearly Pandora boxes to determine precisely variable costs that drawing up of logistics model in Indonesia’s cement projects. It begins caused by difficulties to plan an effective projects at the stage of deployment of costs allocation at the preliminary phase. The research period taken was 2010 to 2018 of 8 cement projects in Indonesia by quarterly and had been tested with a statistical tool EVIEWS10.00 to develop robust model. This research employs literature study to assess model previously developed and then reconfirmed by empirical. The model developed is synthesized of 4 dependent variables accordingly defined as foreign logistics costs, domestic manufacture, domestic logistics costs, and total investment costs. Each adjusted R-squared that representing confidence level is consecutively 72.54%, 67.12%, 65.16% and 67.65% or bigger portions are in the model while smaller other in outside model. A 10-variable independent is a new novelty of developing logistics model for executing cement’s projects in Indonesia and a concerning significant findings that variable of foreign logistics costs took big portion of the model and therefore must be prior carefully anticipated. This research is giving contribution for planning projects carefully and precisely to avoid budget exceeded generally in every projects.

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