Nama :
Ponidah
Kelas :
4EA14
NPM :
15210348
Comparison of Retail Business Development in Indonesia
with Singapore
FOOD RETAIL
BUSINESS (GROCERY) VERY PROMISING
Hypermarkets experiencing unprecedented growth In 2010 the hypermarket
industry in Indonesia has grown very rapidly. Indonesian Retailers Association
(APRINDO) estimates, the total modern retail spending this year will reach Rp
100 trillion. A total of Rp 65 trillion is
spending the rest of food and non-food. Of the amount of the food
shopping, hypermarkets accounted for 35 percent, 35 percent and a mini
supermarket 30 percent. Food is a basic human needs,
inevitably requires us to shop for food and drink each day. This is the reason why the mini
market and the rapid growth of hypermarkets Kompas.Com).
The growth of food retail outlets in hypermarkets average 30% per year
and 7% per year supermarket and convenience store / mini market about 15%. In 2003, sales of modern food
retail sector is controlled by 60% of supermarkets, hypermarkets 20% and the
remaining 20% by the convenience store / mini market.
Food Retail
Development Potential (Grosery) in areas Product demand daily needs (consumer goods) is still a major
demand. Food products (groceries)
accounts for approximately 67% of the composition of sales of goods of retail
trade. As for non-food products,
clothing and footwear sales accounted for 30% of goods of retail trade,
followed by the sale of electronic goods by 12%, and sales of health and beauty
products by 11%. The potential development of
modern retail market in Indonesia is still relatively large population to total
population. The number of modern retail
stores per one million population of Indonesia is currently around 52, lower
than that of neighboring countries such as Malaysia 156 stores, 124 stores Thailand,
Singapore 281 stores, and 74 stores China. The number of modern retail
stores in Indonesia occupies only a very small portion (0.7%) compared to the
number of traditional shops per one million population of Indonesia reached
7,937 stores.
Format minimarket experienced
the highest growth, both in terms of the number of outlet stores and retail
trade share of product sales of fast moving consumer goods (FMCG). Number minimarket in Indonesia
in 2008 reached 10,607 stores with an average growth of 17.3% per year, the
highest compared to other modern retail formats, followed by hypermarkets with
an average growth of 16.9% per year. Meanwhile, the share of retail
trade mini for FMCG product sales increased significantly compared to other
formats, ie from 5% in 2003 to 16% in 2008.
PT Matahari
Putra Prima Tbk (MPP) has taken strategic initiatives to assess and analyze the
overall business activity, related to the company's plans to develop core
competencies in its hypermarket business. As the pioneer of compact
hypermarkets in Indonesia with its proven business model, will continue to
focus on the food retail business, through the expansion phase Hypermart to all
regions in Indonesia. In addition, the streamlined all
other non-core businesses / non-hypermarket business, to ensure that all
resources are optimized MPP 100%, to encourage business growth Hypermart. Indonesia is a big country and
has a growth potential of the most attractive markets globally among other
developing countries. The country with the fourth
largest population in the world with a rising middle class segment, which is
supported by the economy strong consumer base, increasing purchasing power and
generate strong annual economic growth. Until now, strong consumer-based
economy has encouraged the growth of the country's GDP and is predicted to
continue to grow at an average 5.6% per year until 2014, while GDP per capita
is expected to grow by 11.3% until 2014 and going beyond the limit of U.S. $
3,000 in 2012.
Growth areas in Indonesia also took place rapidly lately, both from the
economic sector, tourism and education. Wherein each of the developing
regions with the potential of each. Population growth and increased
tourism ekspartriat, causing an increase in the amount of imports. Major retailers such as
Carrefour Indonesia, Matahari Putra Prima Tbk, and Hero Supermarket managed to
increase sales of the brand, through the sale of private label products,
exciting promotional offers, and expansion into areas and markets are not yet
saturated.
Government
Role in the Management of Traditional and Modern Retail Market
The existence of a modern market
that includes mini markets, supermarkets, hypermarkets to be unavoidable. To be competitive, traditional
markets should be strengthened so that consumers do not switch. Head of Industry and Trade of
the Province of Central Java Ihwan Sudrajat argued that in Semarang City,
Wednesday (24/6). According to him, the modern
market has its own market segment as traditional markets, so that the choice
rests on the consumer.
We can not
restrict the modern market, since its founding was based on market demand. The thing to do is to protect
SMEs and traditional markets. It is the duty of the
government. Rules for the existence of a
modern market in the Presidential Decree No. 112 of 2008 on Management and
Development of Traditional Markets, Shopping, and Modern Stores. Stipulated in Article 5,
concerning the location of the modern market of all sizes, from the largest
hypermarkets to the smallest mini. In the rule mentioned,
hypermarkets are only allowed to be located on the main access roads,
supermarkets are not allowed in a residential neighborhood, and mini ramps
allowed to be in the neighborhoods in the city.
Meanwhile,
the strengthening of the traditional market, the market is done with the Setup
program. The trade sector received
funding amounting to Rp 335 billion stimulus used for revitalization and
renovation of traditional markets of Rp 215 billion and Rp 120 billion
warehousing. According to data obtained
headline of one of the board members, as many as 123 districts / cities in 11
provinces scheduled to receive stimulus allocation of Rp 215 billion market.
The Government has received at
least 600 proposals from 300 regions across Indonesia for traditional market
revitalization program. All proposals submitted to the
Ministry of Finance will discuss its implementation.
Secretary of
the Directorate General of Domestic Trade Gunaryo in Business Competition
Supervisory Office said there were about USD 235 billion market revitalization
funds channeled through the Special Allocation Fund (DAK) and assistance funds
from the local government. Of proposals submitted to the
Department of Commerce, the type of revitalization manifold. "There are a total rehabilitation,
the bulge area, or renovation," he said. The fund for the revitalization
of traditional markets, according to Gunaryo from Rp 3 billion, depending on
the area and the magnitude of the case. "It is being discussed in
the Ministry of Finance," said Gunaryo.
Proposals rehabilitation of the
market, he said, must go through the approval of the Department of Public Works
building standards in related areas. Gunaryo added to the traditional
market revitalization program starting next year, the Government is committed
to increase the budget of local market development. Stimulus funds revitalization of
traditional markets this year disbursed through the Department of Commerce
through the Special Allocation Fund.
Traditional
market weakness that must be addressed:
1. Lack of good market
management causes the lid several traditional markets.
2. Less comfortably shop at
traditional markets, especially the issue of cleanliness.
3. Lack of capital for
traditional retailers to develop their businesses.
4. Prices are more expensive
than the prices for certain products in the modern market.
Modern retail business management strategy that is creative and
innovative
The retail businesses, both
modern and traditional, should further enhance the promotion. According to data from Nielsen
Research Institute Indonesia, during the first half of 2010, consumer spending
has not been too prioritizing money to buy food, drinks, and a variety of daily
needs. Middle-class consumers, actually
prefer shopping vehicle or electronics.
National retail sales growth during January to May reached 9 percent
compared with the same period in 2009. Figure is far behind other sectors. Growth in car sales topped the
highest rate of 73.5 percent. Similarly motorcycles by 35.2
percent. Home electronics sales also
increased 32.35 percent, while computers rose 30 percent.
He is
currently a shift in consumer attention in monthly spending budget. Especially the upper middle
class, still prefer shopping big ticket items (cars, motorcycles, electronics).
Indirectly, indicates our
society is getting established. As the development of technology, people's
lifestyles also change. Before any technology, when
there is spare time consumers can go to a shop or shopping. Once there is a phone with all
its sophistication, have little free time directly online. Recreation in cyberspace feels
more mengasikan, rather than going to traditional markets or supermarkets and
hypermarkets though. In 2009, total retail consumer spending for 56 categories
of products reached Rp 99, 653 trillion (notincluding eggs, chili, rice, and
some groceries). Meanwhile, on January to May
2010, the total money that has been accruing Rp 44.685 trillion. Nielsen
conducts research on public spending trends by way of face to face interviews
in Greater Jakarta, Bandung, Surabaya, Makassar, and Medan. Respondents were men and women
aged 15-65 years. A total of 1,781 interviewees
have more spending power than Rp 1.250 million per month. (Gen/c6/kim) Retailers repacking should be more
creative place to sell, then promote it more interesting. Based on the results of a survey
conducted by Nielsen, 19.8 percent of consumers revealed that nonfood factors
(comfort, packaging, promotion, etc) is a reason for them to come to a spot of
shopping. HR
management has a significant role in a retail business. Coordinate and motivate
employees in achieving the target. Until eventually forming a work
commitment, which could unite among employees, resulting in a competitive
advantage. Aspects of site selection in the
retail business was also very influential. The selection of retail
locations that allow businesses to grow, evaluate the strength of any trade
area selected. While the financial system, a
method of reflection does retail strategy concerning resource management
(capital, equipment, human resources, and etc.) in order to achieve optimal
performance. Similarly,
the food retail business is very promising. Judging from the rapid growth
annually. Plus, the market share of
Indonesia itself has been very promising, the state with the fourth largest
population in the world with an increasing segment of the middle class, the
economy is supported by a strong consumer base. But nevertheless, the success or
failure of a business depends heavily on management strategies and management. Everything is back to the
business people themselves.
Indonesia
Still Disadvantaged Retail Company with Singapore
Jakarta-Indonesia
has a range of retail and corporate franchise or franchising. Unfortunately the growth and
development of retail and franchise in Indonesia is still struggling in the
domestic market.
U.S. Country
Manager of Indonesia Louken Anthony said Danny paradigm patterns and franchise
retail business in Indonesia must change not only excel at the local level, but
can speak at a global level.
"Indonesia has the potential for tremendous retail growth.
Therefore the business is expected to not only excel in the local market but
excel in the global marketplace," he said during a discussion with the
theme Retail Trends 2013 in the WTC Building Jakarta, Monday (25/03/2013).
We have argued Indonesia has a flagship retail products ranging from
food, clothing, education and other leading products are selling well in the
domestic market. Unfortunately very few local
brands that succeed when taken abroad. Therefore, it will bring the
brand and retail business to go international in the near future. "What did the U.S.
Louken is committed to supporting retailers in Indonesia," he said.
Meanwhile in the same place, the CEO of the U.S. Louken Singapore Luke
Kim explained that retail from Indonesia regarded inferior to Singapore retail
developments in the global arena. For example, the current retail
product from Singapore BreadTalk is worldwide through its products.
"Compare this to Singapore, the country of origin of various retail
success and exist in the global market. Call it BreadTalk to Charles &
Keith. Though it was originally a retail small and medium enterprises in
Singapore but they successfully send orders via brand and products to consumers
in foreign countries, "he said.
