Es Teller 77 becomes icon of local franchise business

The Jakarta Post, Jakarta

The Es Teler 77 franchise has been setting benchmarks for Indonesian franchisees and their businesses since its creation.

The business's founder calls himself Mister Teler (Drunken Man), but no drunkenness is involved in the running of his 25-year-old company, which has been a pioneer in the franchising of traditional Indonesian foods.

"If needed, I am willing to work 76 hours a day for this business," said Mister Teler Hoo Tjio Kiat, also known as Sukyatno Nugroho.

Sukyatno, 59, is the chief commissioner of the business he began so many years ago with Rp 1 million (US$109.97) he collected with his wife her parents. With this capital he began selling Es Teler 77, a traditional Indonesian drink containing coconuts, avocados, jackfruits, syrup and milk from a small roadside tent near Duta Merlin shopping center in Central Jakarta.

The police would occasionally raid his roadside tent, though now he no longer has this problem as most of his outlets are located inside shopping centers. The business now operates under the name PT Top Food Indonesia.

Sukyatno's business, which also retails meatball and noodle soup in addition to Es Teler 77, grew rapidly after he decided to transform it into a franchise in 1987.

At present, the business has more than 180 outlets in 22 provinces throughout the archipelago, plus four outlets in Singapore and three in Australia.

"I have achieved so much because I always begin my work with goodwill (in cooperating with franchisees and business partners), hard work and creativity - as well as help from God," he said.

"I believe my biggest assets are the thousands of employees and hundreds of partners, including their families and friends, who have been loyal to me all these years," Sukyatno said. Es Teler 77 has over 1,200 employees across the country.

"Nationwide, the number of Es Teler 77 outlets will hopefully increase by between 15 and 20 this year, depending on the opening of new shopping centers," Andrew Nugroho, Top Food Indonesia's director for business development, told The Jakarta Post on Tuesday. Andrew is Sukyatno's son.

Last year, the company opened 29 new franchise outlets across Indonesia, most of which were not on Java.

"Each of our outlets serves an average of 500 people per day and each visitor spends at least Rp 20,000," he said. "Our profit margin was around 25 percent to 30 percent of our takings last year," he added.

"As a franchiser, I push myself to always be innovative and creative in adapting to developing situations," Sukyatno said. Being innovative does not only require concentrating on the food Es Teler 77 sells, but also the atmosphere, service and kitchen efficiency, he said.

Es Teler 77's marketing manager, Antonius W, said the company was currently trying to attract more teenage customers. A new product tag-line, "Makin gaul aje" (getting cooler than ever), has been created and interior decorations and layouts have been altered in many outlets. These moves are tailored toward adult women, who make up between 75 percent and 80 percent of Es Teler's customers.

New menu items such as pecel ayam, soto ayam, kwetiau goreng, nasi goreng ikan asin and nasi goreng sambal terasi were now available, Antonius said.

Sukyatno said his company would soon build an eight-storey office in West Jakarta, where it would conduct training, research and development.

Indeed, Es Teler 77 is a local franchiser that has achieved significantly, said Indonesian Franchise Association chairman Anang Sukandar.

Around 50 local franchises now exist nationwide, with half of these operating in the food services sector. Franchisees also deal in the education, laundry service and beautician sectors. Comparatively, 250 foreign franchises currently operate in Indonesia.

There are opportunities for 300 more local businesses to develop themselves through franchising, Anang said.

"Unfortunately, the government does not fully support local franchises, even though the Indonesian Franchise Association was established 15 years ago," he said.

"Our government has yet to see the potential local franchises have in lifting the nation's economy and creating employment opportunities for many people," he added.

The government should replicate initiatives undertaken in neighboring countries such as Singapore, Australia and Malaysia, Anang said.

The Malaysian government provided loans with an annual interest rate of 6 percent, which was half of the market interest rate, he said.

Despite this, Sukyatno, who studied at senior high school for only three months, said franchisees must go forward with confidence and never fear the obstacles ahead. (07)
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