Forums and Chat for Indonesia's English-speaking community
Topic Options
Rate This Topic
#46866 - 07 Mar 07 02:18 Market traders demand job security
chewwyUK Offline
Pujangga

Registered: 14 Sep 06
Posts: 2392
Loc: Jakarta
I would like to get some opinions on this subject, as it is always a difficult balance to achieve. Over the years I have witnessed busy high streets in the UK filled with a variety of independent traders dwindle away to nothing. A big supermarket like Tesco moves in and kills all the small independent business owners.

What we are left with now are very bland high streets with the same “branded” shops no matter where you go. No character anywhere … really can be very sad to see.

What do you see happening in Jakarta over the next 10 years? What would you like to see happen? What do you prefer Modern or Traditional markets??

Market traders demand job security
The Jakarta Post, Jakarta

Traditional market traders once again expressed their disappointment in the city administration Wednesday for failing to "control" modern retailers and protect their businesses.

This time, the traders, joined in the Alliance of Trader Associations, urged the city administration to issue a gubernatorial decree on market regulations to rectify the existing 2002 city ordinance on modern retail restrictions.

"We expect the administration to make an instruction to stop the unfair and inappropriate expansion of modern retail stores, which is causing us to suffer losses," Susanto, a representative of the Association of Modern Market Suppliers, said Wednesday after meeting with the city administration.

The growing number of hypermarkets has been blamed for causing smaller retail outlets to go out of business, despite the existence of the ordinance that limits the size and number of modern stores in each municipality.

The alliance consists of eight associations: the Association of Cosmetics Industries, Association of Traditional Market Traders, Association of Food and Beverages Industries, National Meat Processors Association, Association of Modern Market Suppliers, Association of Electronic Industries, Association of Garment and Accessories Suppliers and Association of Salt Producers.

The alliance has agreed to help the administration revitalize 151 city traditional markets, as well as to establish a traditional market with a new concept called Pasar Kenanga.

"Pasar Kenanga will be more comfortable than your average traditional market, but we have yet to pick the location," said Putri Wardani of the Association of Cosmetics Industries, adding that Pasar Kenanga would be established at the site of one of the existing traditional markets.
She said the traders were still working on the concept.

In 2003, the Association of Modern Market Suppliers filed a complaint with the Business Competition Supervisory Commission (KPPU) against French giant retailer Carrefour, accusing it of unfair competition.

The giant retailer denied it had carried out an unfair business practice by applying a "minus margin" policy in its contracts with suppliers as previously declared by the KPPU, and later filed an appeal with the Supreme Court in 2005.

The alliance reported that traditional markets throughout the city had suffered financial losses of up to 75 percent, and some of the traders made less than Rp 50,000 daily.

"We've been in a difficult situation since many buyers chose to go to modern shopping centers instead of traditional markets," said Ngadiran, a representative of the Indonesian Traditional Market Traders Association.

In 2004, seven traditional markets in the city -- Blora, Cilincing, Cipinang Besar, Kramat Jaya, Muncang, Prumpung Tengah and Sinar Utara -- were closed down due to financial losses.

There are 13,450 traditional markets nationwide, with the total number of traders estimated at 12,625,000.

A 2003 survey by the Retail Measurement Service of AC Nielsen showed the number of traditional markets had decreased by 8 percent over two years, while the number of modern retailers had increased by more than 30 percent during the same period.

_________________________
Edited by Piss Salon
Edit Reason: taste

Top
#46869 - 07 Mar 07 02:42 Re: Market traders demand job security [Re: chewwyUK]
doremi Offline
Member+++

Registered: 17 Jan 07
Posts: 488
Loc: slouch couch
I think this situation (big businesses taking over and killing mom and pop stores) is happening in the United States as well. Many have accused WalMart of doing the same as Carrefour, killing small businesses, unfair competition, etc.

It will be sad to see traditional market model wither away and be replaced with standardized, big supermarket model: Same store set up, same merchandise offerings-boring -boring-boring.

I hope the novelty of going to Carrefour will wear off, but may be I am dreaming.
My impression about France, it has done a good job in preserving "the traditional market". Does anyone know why? does the government "push" for it to happen?







Top
#46899 - 07 Mar 07 07:16 Re: Market traders demand job security [Re: chewwyUK]
riccardo Offline
Pujangga

Registered: 12 Oct 05
Posts: 2195
Loc: Jakarta
Quoting: chewwyUK

A 2003 survey by the Retail Measurement Service of AC Nielsen showed the number of traditional markets had decreased by 8 percent over two years, while the number of modern retailers had increased by more than 30 percent during the same period.


Typical lazy journalism... AC Nielsen has 2004, 2005 and 2006 figures available -- I wrote the darn report!

Nonetheless, Chew the trends are similar, and to answer your question, Indonesian consumers' FIRST PRIORITY is best price -- period. (which explains why Adam Air is still in biz)

In numerous surveys nationwide, rich folk and poor folk all agreed on that... whoever offers the best price gets their business, no ifs ands or buts

2nd priority for over 70% of Indonesian urbanites (from the 9 largest cities) was shopping at a "modern" retail store.

Nationwide, 68% of the people still shop at traditional markets, but in Jakarta, it's the other way around now. 60% of Jakarta consumers shop in modern places and 40% at traditional markets.

To put that into perspective, Jakarta IS 32% of the entire Indonesian market in terms of money changing hands.

Bottom line is, at least in Jakarta, the traditional markets are dying fast and they're not able to change with the times. It would be good if that Pasar Kenanga experiment works, but they still gotta have the best prices. If not, it dies. The reason why the mom and pop Chinese shophouses -- which sell electric wiring supplies, "blue" DVDs or herbal medicine or other "specialty things" -- are still doing very well BECAUSE they monitor prices all over the city and keep theirs the lowest. They also sell stuff that hypermarkets don't deal with.

It's the traditional Pasars (the smelly, dirty 'wet markets') with local ladies selling tomatoes who are getting wiped out. They have to buy from a series of middlemen at prices that already exceed the likes of Carrefour or IndoMaret minimart.... AND Carrefour and the minimarts sell cleaner, better lower-priced tomatoes.
_________________________
Just here proffering my pearls to swine, my throat to wolves and my trousers to the flagpole.

Top
#46919 - 07 Mar 07 22:51 Re: Market traders demand job security [Re: riccardo]
doremi Offline
Member+++

Registered: 17 Jan 07
Posts: 488
Loc: slouch couch
I agree with Riccardo that these 'pasar' will eventually go away if they sell the same things as Carrefour, since owners can't compete with this giant on costs or just don't have the muscle to negotiate with the middlemen.

Price, in general,is not the only way to win customers or compete with this giant; there is that non-price factor such as quality, one-of-a- kind merchandise, etc.


Top
#46920 - 07 Mar 07 23:23 Re: Market traders demand job security [Re: doremi]
riccardo Offline
Pujangga

Registered: 12 Oct 05
Posts: 2195
Loc: Jakarta
Quoting: nwgirl

Price, in general,is not the only way to win customers or compete with this giant; there is that non-price factor such as quality, one-of-a- kind merchandise, etc.


You are correct in general, that is what the conventional wisdom in marketing tells us. However, numerous scientific surveys in Indonesia make it very clear that over 90% of Indonesian consumers regard PRICE as their overwhelming first priority.

Another thing, at least for me, and other middle-class people here is that these pasar can be extremely nasty places for certain groups of people, such as foreigners or other minority groups or girls. In Tunis, the capital of Tunisia, they have this wonderfully exotic bazaar (the same word that pasar comes from) and it is very customer-friendly and fascinating. It's clean enough and there are no thugs, pickpockets or loitering youths yelling obscenities at women or foreigners. Thailand's and Cambodia's traditional markets are great too, not as clean or exotic as Tunisia, but still very good prices and very customer friendly, regardless of what someone looks like or which ethnic group they come from.

If the local pasar chiefs or police or govt would just decide to tackle those problems it would help a lot. The thugs/rent-seekers also drive up the price of renting kiosks and other little things that unnecessarily take away profit from the traders and push the prices up...

_________________________
Just here proffering my pearls to swine, my throat to wolves and my trousers to the flagpole.

Top
#46961 - 08 Mar 07 04:06 Re: Market traders demand job security [Re: riccardo]
chewwyUK Offline
Pujangga

Registered: 14 Sep 06
Posts: 2392
Loc: Jakarta
I like going to the traditional markets .. Unfortunately I spend most of my money at carrefour as 99% of the people who work at traditional markets ask a stupid price as soon as they see my white face. I dont mind paying a little more than local people but i hate people trying to rip me off because my skin colour is white!

I still feel its important to preserve this side of indonesian life and hope the traditional markets can sort themselves out and survive.
_________________________
Edited by Piss Salon
Edit Reason: taste

Top
#46971 - 08 Mar 07 06:38 Re: Market traders demand job security [Re: chewwyUK]
Orang Kanada Offline
Member*

Registered: 30 Sep 06
Posts: 621
Loc: Jakarta
Personaly, I feel like I have no choices going to Carrefour, D-best and so. I have to go where there's a price tag (like Chewwy said about the the skin color) and 'coz it's the only way I can use a credit card. What it is about credit cards Indonesian don't get? You can pay your taxi ride with a Visa in Singapore but not a TV in Jakarta...

(Why I wanna use credit card? The exchange rates are better than any banks, ATM or so...)
_________________________
Spiderpig, spiderpig...

Top
#46972 - 08 Mar 07 06:39 Re: Market traders demand job security [Re: Orang Kanada]
Orang Kanada Offline
Member*

Registered: 30 Sep 06
Posts: 621
Loc: Jakarta
BTW guys, interesting thread, without politic, religion, love, penis or emoticons... what a relief...
_________________________
Spiderpig, spiderpig...

Top
#47004 - 08 Mar 07 09:06 Re: Market traders demand job security [Re: Orang Kanada]
riccardo Offline
Pujangga

Registered: 12 Oct 05
Posts: 2195
Loc: Jakarta
Quoting: Orang Kanada
What it is about credit cards Indonesian don't get? You can pay your taxi ride with a Visa in Singapore but not a TV in Jakarta...



Off topic a bit, but the traditional markets could learn something from this forward-thinking, which makes things a bit more customer-friendly.

The Bluebird Taxi group now has a voucher system. You get a book of vouchers and just write in the price when you take a ride. They send you a bill at the end of the month, which you can pay by credit card. No cash exchanged between you and driver, no hassles about change and just one easy monthly payment. I drive my own car or else I'd do it. It also is good because it keeps a record of your trip if there was any hassle.
_________________________
Just here proffering my pearls to swine, my throat to wolves and my trousers to the flagpole.

Top
#47043 - 08 Mar 07 23:44 Re: Market traders demand job security [Re: riccardo]
chewwyUK Offline
Pujangga

Registered: 14 Sep 06
Posts: 2392
Loc: Jakarta
I use those vouchers for my office rick -- it's the only way companies can get proof of taxi cost! I have to say that a lot of companies could learn a lot from Blue Bird Group. They have been successful because of the QUALITY of their service. That is the reason they are every bodies number one choice.

I have been to a lot of places and have to say the Blue Birds are one of the best in the world. Worst taxi drivers anywhere have to be in Sydney - every time you get in a cab there you have to navigate the taxi driver with a map he gives you!!!

_________________________
Edited by Piss Salon
Edit Reason: taste

Top
#47044 - 08 Mar 07 23:44 Re: Market traders demand job security [Re: riccardo]
doremi Offline
Member+++

Registered: 17 Jan 07
Posts: 488
Loc: slouch couch
off subject here,

OK's question about credit card usage in Indonesia, why can’t you buy tv with your c/c?

Most small merchants don’t want to sign up with banks and paying the extra fees for taking credit card payments. If these merchants take your credit cards they will pass on the 3-4 % transaction fee to their customers. This happen to me every year on my visit to the beautiful Indonesia; the ATM withdrawals are charged 1% fee by the local bank (where the withdrawal is made).

The second reason I think is because only small percentage of Indo people have credit cards, they prefer to use cash just like my mother. I can’t convince her to have one, she said ‘well I have money, why should I have a credit card, nonsense!’

Cash – cash - cash, you need it when you use public restroom, when you buy TV from engko (Chinese merchant) in Glodok area, yeah even if carrying loads of cash is a bit unnerving.


Top
#47046 - 08 Mar 07 23:52 Re: Market traders demand job security [Re: doremi]
chewwyUK Offline
Pujangga

Registered: 14 Sep 06
Posts: 2392
Loc: Jakarta
You have touched on a topic that really gets to me ... adding 4% credit card charges to purchases made with a credit card. Something I have never experienced anywhere else in the world. It drives me insane!!

NW i think you will find that attitudes to credit cards are changing in Indonesia. Especially in the growing middle classes! I work with a lot of banks and they are all reporting big growth in this area.

_________________________
Edited by Piss Salon
Edit Reason: taste

Top
#47047 - 09 Mar 07 00:01 Re: Market traders demand job security [Re: chewwyUK]
doremi Offline
Member+++

Registered: 17 Jan 07
Posts: 488
Loc: slouch couch
Not only the fee gets me mad but also 4% poorer...The merchants are missing lot of opportunities by not accepting credit cards; revenues will be doubled with the use of credit cards.

Top


Moderator:  kenyeung, NetCop