Retail
From The Report: Indonesia 2015
View in Online Reader

Home to a growing base of consumers, Indonesia has seen the rising purchasing power of its fast-expanding middle class drive the retail industry to new highs in recent years. Foreign and domestic retailers alike are investing heavily in new construction and expansion projects that will see traditional retail models increasingly supplanted by modern franchises and chains. Although retail could be set for a volatile year, with the rupiah’s depreciation expected to cut into purchasing power and increase pressure on retailers, lower inflation and rising wages should help offset this. The market remains highly attractive to foreign investors despite its stringent regulatory environment, and growth is expected in 2015 as a result of rising domestic consumption and e-commerce expansion. While retail space in Jakarta will remain limited in the medium term, rising rents will help spread industry growth across the nation. This will keep the sector robust and dynamic into 2016, as well as present lucrative opportunities to foreign and local investors.

This chapter contains an interview with Irwan Danny Mussry, President and CEO, Time International.

Articles from this Chapter

Overview

Consumer confidence boosting domestic consumption in Indonesia
OBG
plus

Home to a growing base of consumers, Indonesia has seen the rising purchasing power of its fast-expanding middle class drive the retail industry to new highs in recent years. Foreign and domestic retailers alike are investing heavily in new construction and expansion projects that will see traditional retail models increasingly supplanted by modern franchises and chains. Retail growth slowed somewhat in 2014, as rising fuel prices, inflation and the rupiah’s sharp depreciation eroded consumer…

Interview

Irwan Danny Mussry, President and CEO, Time International: Interview
OBG
plus

Interview:Irwan Danny Mussry How would you describe the current regulatory environment for the retail sector? IRWAN DANNY MUSSRY: I believe the most important thing is to have people in the regulatory bodies, at every level, who truly understand the importance and impact of this sector. The efforts to protect the domestic industries and boost local manufacturing are praiseworthy; however, these should be looked at more carefully when dealing with international brand retailing. Jakarta is…

Analysis

Chain links: Global retailers flock to the market in spite of stricter regulations
OBG
plus

Although Indonesia’s retail sector was officially added to the government’s negative investment list in April 2014, thereby prohibiting foreign ownership of smallscale enterprises, foreign investment in large-scale operations – particularly in the fast-moving consumer goods (FMCG) segment – has seen a sharp rise in recent years. Most recently, global equity investor Warburg Pincus announced plans to invest $125m in a joint venture to build shopping malls across several Indonesian cities.…

Analysis

Indonesia’s e-commerce sales rising
OBG
plus

E-commerce in Indonesia is expanding as retailers capitalise on a rising middle class, growing demand outside of Jakarta and a tech-savvy population embracing new sales and payment platforms. “It is important to start adopting social media as a stable part of our business strategy,” Henri Honoris, president-director of Modern Internasional, a retail operator and owner of the 7-Eleven franchise in Indonesia, told OBG. While challenges persist as a result of low banking and credit card penetration…