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Indonesian Retail Outlets Overview

Carrefour has been successful in Indonesia by adapting its style and offerings to local needs and customs, as well as quickly adapting to the economic crisis of the late 1990s. In contrast, Walmart and JC Penney failed and withdrew from the Indonesian market in the late 1990s due to attempting to directly transfer their existing business models and importing too many products without optimizing store locations. The number of supermarkets in Indonesia has grown rapidly in the past 3-4 years and now stands at around 1,400, with the major players being Hero, Matahari, and Ramayana. Affluence and urbanization are driving the development of modern retail in Indonesia, with younger shoppers preferring supermarkets

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Chela M Simunyola
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66 views1 page

Indonesian Retail Outlets Overview

Carrefour has been successful in Indonesia by adapting its style and offerings to local needs and customs, as well as quickly adapting to the economic crisis of the late 1990s. In contrast, Walmart and JC Penney failed and withdrew from the Indonesian market in the late 1990s due to attempting to directly transfer their existing business models and importing too many products without optimizing store locations. The number of supermarkets in Indonesia has grown rapidly in the past 3-4 years and now stands at around 1,400, with the major players being Hero, Matahari, and Ramayana. Affluence and urbanization are driving the development of modern retail in Indonesia, with younger shoppers preferring supermarkets

Uploaded by

Chela M Simunyola
Copyright
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We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd

Chapter 3 Retail and food service

FOOD EXPORTERS GUI DE TO I NDONESI A


18
Image 3.4 Fruit display,
Hero supermarket,
Kemang
Winners and losers
Among the foreign companies, Carrefours success no doubt owes something to its French
technology and management systems but what stands out is how well it has adapted its style
and offering to address local needs and customs. It has also benefited from its quick
adaptation to the crisis situation of the late 1990s.
On the other hand, the local industry believes there are obvious reasons for the failure and
subsequent withdrawal from the market in the late 1990s of Wal Mart and J C Penney. These
included their attempts to transfer existing business models and product lines to Indonesia,
including a high proportion of imported products, and store locations that were less than optimal.
Supermarkets
The number of supermarkets has grown rapidly in the past 3 to 4 years and now stands at
around 1400 country wide. The biggest players in supermarkets are Hero, Matahari and
Ramayana (Table 3.4).
Table 3.4 Indonesia: major supermarket chains, 2001
Retail Name Ownership Outlets Locations
Hero Indonesian Hong Kong 83* Jakarta, Java, Bali, Sumatra, Kalimantan
Matahari Indonesian 61 Jakarta, Java, Bali, Sumatra, Kalimantan, Sulawesi, Ambon
Ramayana Indonesian 65 Jakarta, Java, Bali, Batam, Sumatra, Kalimantan
Super Indo Indonesian Belgium 34 Jakarta, Bogor, Tangerang, Bekasi, Bandung, Surabaya, Palembang,
Yogyakarta
Yogya Indonesian 33 Jakarta, West Java
Alfa Indonesian 29 Jakarta, Java, Bali, Medan, Makassar
Tops Dutch 24 Jakarta, Java
Gelael Indonesian 11 Jakarta, Jawa, Bali, Sumatra, Sulawesi, Batam
Nina Fair Price Indonesian, Singapore 5 Surabaya
Pantry Indonesian 5 Jakarta
Sinar Indonesian 5 Surabaya
Sogo Indonesian Japan 4 Jakarta, Surabaya
Tiara Dewata Indonesian 3 Bali
Tragia Indonesian 5 Bali
Source: United States Department of Agriculture Foreign Agricultural Service, Indonesia Retail Food
Sector Report, p. 8.
* 89 stores by mid 2003.
Affluence and urbanisation are two key underlying factors driving the development of modern
retail. Younger shoppers in particular prefer the modern retail experience, and a majority of
supermarket shoppers are female.
Supermarkets are busy after work, from 5 pm through till about 9 pm and on weekends.
Families often make a day of it on Saturdays or Sundays.
Before the crisis, up to half the product on supermarket shelves was imported. In todays
bigger supermarket sector, imports typically account for 510% of SKUs.
Supermarkets that cater to higher income residential areas with wealthy local and expatriate
customers tend to carry a higher percentage of imported products, stocking specialist brands
at higher prices. Conversely, the proportion of imported product sold tends be less in outlets
outside of the capital as well as in the less affluent areas of Jakarta where shoppers are more
price sensitive.

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