Retail
From The Report: Indonesia 2013
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To say there has been a retail boom in Indonesia is an understatement. The people of the country have, over the course of a few years, become consummate shoppers staying up to date with the latest trends and spending freely. Indonesia’s economy has always been driven by the consumer, but now it is being taken to the next level as people now have more money to spend. Retail sales are likely to remain strong for the next year at least, partly on the back of the introduction of the minimum wage. As the sector develops, shopping is expected to become more convenient, with new brands entering the market.
This chapter contains an interview with Henri Honoris, President Director, Modern Putra.

Articles from this Chapter

Overview

Taking it to the next level: Purchasing power and consumer spending are on the rise
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To say that there has been a retail boom in Indonesia is an understatement. The people of the country have over the course of a few years become consummate shoppers, staying up to date with the latest trends and eagerly spending. Indonesia’s economy has always been driven by the consumer, but now it is being taken to the next level as the people of the now have more money to spend. But to simply say that Indonesia is catching up does not do justice to the current trend. This is not a matter…

Analysis

Modern versus traditional: A rapid proliferation of new outlets is reshaping local retail
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Modern retail seems to be an obvious development in Indonesia with the quick proliferation of minimarkets, convenience stores and hypermarkets. The country is crowded, so it makes sense to have numerous small, highly efficient shops nearby so driving is not necessary. It has a large, relatively poor population, so big, efficient retailers providing goods at low cost or in bulk are beneficial. And Indonesians are quickly becoming richer, demanding outlets that are fast and convenient. Indeed,…

Interview

Henri Honoris, President Director, Modern Putra: Interview
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Interview: Henri Honoris How can retailers capitalise on changing consumer preferences and increasing brand awareness? HENRI HONORIS: As GDP continues to grow, Indonesian consumers have experienced a change driven by an urban middle-income segment that is gaining traction and influence. Approximately 50% of the population of Jakarta is between the ages of 13 and 30. This is a very influential segment of the population with particular tastes; they use Facebook and Twitter, go to shopping malls,…

Analysis

The luxury market: The ups and downs of growing demand for high-end retail
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The retail market in Indonesia has always had a strong luxury component. It is a country with many elites and super-wealthy, and global brands have been there to cater to them. What is happening now is altogether different and potentially more promising. The lower-upper and the upper-middle sections of the wealth spectrum are growing as the country quickly advances, while the middle class is becoming increasingly brand conscious. The result has been a boom at the high end that is both broad…

Analysis

Mobile consolidation: Expanding industry and new regulations mobilise the market
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The electronics retail market in Indonesia is crowded. Many players, raging from well established public companies in the fanciest of malls to no-name kiosks in disorderly low-end shopping centres vie for handset, tablet and accessory sales. The market is highly competitive and rapidly consolidating. Weaker players are being marginalised and will be bought, go out of business or survive as specialist shops. Similar to how most fragmented markets evolve, the electronics retail sector in Indonesia…

Analysis

Spreading the franchise: Regulating and protecting the market
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In line with the recent trend toward nationalism and protectionism, the Indonesian government issued new regulations for franchises in 2012. Like other efforts to defend the country’s economic interests, it is fairly balanced and pragmatic. The policy works to encourage more local participation and limit dominance by any single foreign country or firm by setting limits to expansion. In fact, the new regulations can be viewed as little more than an extension of existing principles. Not surprisingly,…