As most countries in Asia, Indonesia’s retail also relied on traditional-oriented market. However, in the recent years, Indonesia had a visible growth in modern retailing. The growth and trend in modern retailing was fueled by the rising middle class, higher consumer confidence, rising personal income and with the majority of its population being more conscious and inclined to imported brands.

Traditional markets still continue to dominate the retail sales at 83.25% and modern retailing accounting for the other 16.25% (supermarkets, hypermarkets and convenience stores) on 2015 according to the latest data by Euronomonitor. However, growth on the number of outlets for traditional market is comparatively low to the growth posed by modern retailing outlets. The growth in traditional market by 2015 accounted only to .2% while the modern retail channels had significant growth – supermarkets at 2%, hypermarkets at 7.70%, and convenience stores at 15.3% also on the same year.

Convenience Stores hold the largest sales among modern retailers accounting to 104.6 trillion IDR followed by Supermarkets with 66.2 trillion IDR and Hypermarkets with 42.9 trillion IDR, all in 2015.The three store formats posed continuous growth within the past years indicating that modern retail in Indonesia is a trend accepted more and more every year.

Though traditional markets had been the center of retail activities in Indonesia for years, big malls, supermarkets and convenience stores are quick to replace this retail channel as they show convenience as well as entertainment.

Modern Retail Expansion

Expansion of Indonesia’s modern retail started in 1999 when the government allowed Carrefour, a French retailer to expand its operations in the country. As of today, the company is locally owned and operated by Trans Retail under the name of Trans Mart with 92 branches nationwide. More modern retailers from different countries followed and made their entry in Indonesia – Lotte Mart from South Korea which has now 43 outlets, Hero from Hong Kong which has now 35 outlets and the latest entry is on 2015 with Aeon Supermarket from Japan. Local major retailers still prevail in the retail landscape. Most notable among the local major retailers are Alfa Midi with 1,022 outlets, Giant with 172 outlets, Lion Superindo with 136 outlets and Hypermart with 112 outlets. Some of the companies operate various store formats: hypermarkets, super markets and mini groceries.

Convenience Store are expanding rapidly in Indonesia every year. The introduction of 7/11 in 2009 paved way for more outlets to expand throughout the country. Indomaret is a local convenience store holding the most number of outlets nationwide. As of today, Indomaret operates13,099 stores. This is followed by Alfamart with 11,115 stores and the rapidly expanding Circle K which has now 500+ stores.

Supermarkets and convenience stores did not only grow but also developed. Top supermarket retailers have wide assortments of imported products that are readily available for locals and foreigners in Indonesia. One of the primary reason why foreign nationals won’t find it hard to shop in the country.

Besides the wide assortment, both local and imported products, supermarkets and hypermarkets also have in-house bakery and a food-to-go section, making every shopper’s need available in one roof.

Success of Convenience Store among modern retail channels

As stated in the data above, convenience store shows the largest growth among all the retail channels in the country. Approximately, there are 25,278 convenience store/minimarket outlets constituting to a 15.3% growth rate on the number of outlets in Indonesia (Euromonitor, 2015). The growth of convenience stores is a trend observed in other Asian countries as well. In the Philippines for example, the growth rate in convenience store outlets is at 20%. However, the real store count falls far behind compared to that of Indonesia as it only has approximately 3,687 outlets according to the same source. The success of convenience stores in Indonesia could be attributed to the fact that there’s a higher population density among its major cities, notably in Jakarta. Higher population density poses higher demand for convenience as most people would prefer to shop on mini groceries or convenience stores in every street corner than spend more time in the usual traffic jam and extra budget to pay for fare going to supermarkets or shopping centers.

Moreover, it is also worth noting that convenience store channel in Indonesia doesn’t only increase in number but also innovate. More than just a place where people can complete their basic purchases, a standard convenience store in Indonesia also serves as a place where people can transact different services such as bills payment and money remittance center. Their convenience stores are also equipped with ATM Machines inside where people can easily withdraw cash from their cards. Taking a “one-stop-shop” to a new level, most stores have wider dining areas where a free wifi can be accessed.

Promising potential in Indonesia’s E-Commerce

E-Commerce also has a very promising potential in Indonesia as it is the country with the most mobile internet subscription among its neighboring Asian countries. It has a 172% growth rate far from 121% of Cambodia. Philippines falls far behind at 42%. More and more people are relying on online stores to make their purchases as a greater part of Indonesia’s population are in their 30s and busy with daily work.

Another great development in the retail landscape of Indonesia is that modern retailing is not only concentrated in its capital city. Malls, supermarkets and convenience stores are spreading significantly throughout the East Java, North Sumatra and North Sulawesi as well.

The evident growth in Indonesia’s retail sector is characterized not just by high rise buildings of retail stores and the growing numbers of convenience stores in every street. It can also be reflected upon the consumer spending, consumer behavior and trend which relates to the population being more inclined on imported brands. As retail sales figures continue to soar high, Indonesia is a promising place for foreign investors. The modern retail sector in the country holds huge potential for consistent growth. Competition among retail channels will also encourage further expansion among major retailers. However, it is certain that modern retail will continue to prevail and will soon dominate the market share in Indonesia as the income of people increases along with the demand for convenience.

When people talk about convenience and quality of services, we can definitely give it to the Japanese people. They know the value of not just money, but also people’s time. That’s why convenience stores or “konbini” as what it is locally referred to definitely takes our definition of a “one-stop shop” to a whole new level.

More than 50,000 convenience stores can be found in Japan. Every street corner even to the most provincial places has convenience stores. It’s where people usually go to purchase their food or simply to have coffee and have a rest from the cold outside. There is a fierce competition among major convenience stores operators in Japan such as 7/11, Family Mart and Lawson. This competition enables them to come up with innovations and creations of products to make the experience truly convenient for their consumers.

Each store has a wide variety of ready to eat food. For most Japanese people who just wants to grab something to eat because of their busy schedule, convenience store is definitely the place where they go to. Besides the fact that it’s a fast purchase, ready to eat food in convenience stores doesn’t lack the quality and good taste other restaurants also offer. Though most foods offered are Japanese, there are also Western food like pasta and sandwiches that can be purchased. The store clerk will always offer to reheat the food.

Other items such as cold beverage, ice creams, packed biscuits and snacks, alcoholic beverage and other food items can be found in convenience stores. These products also change depending on the season.

Besides food items, personal care products, cosmetics, batteries and other basic necessities can also be bought inside the convenience stores. Books, manga series, newspapers, magazines, and umbrellas are also available.

It’s hard to hail a cab on some places in Japan, most especially outside city centers. That’s why most convenient stores in these areas have a phone that a person can use to call a cab. Aside from this, these convenience stores also have public restrooms that people can use.

ATM Machines can also be found inside the convenience stores. Besides the banks, people go to convenience stores to withdraw their money from their ATM Cards. Branches of 7/11 have ATM Machines where international ATMs such as visa and mastercard can be accepted and used to dispense Japanese yen.

Multi-copy machines can also be used inside the convenience stores. But instead of the typical photocopier, they can also be utilized to send fax mails, print digital pictures and print documents from flash drives.

Another innovative machine found on Japanese Convenience stores is what they call the Loppi Machines. These red-colored machines can be used to buy tickets on various events in Japan such as concerts, sports, theme parks or even travel services. Once the machine dispensed the ticket, it can be paid directly to the counters. Besides tickets, the multi-purpose machine can also be used to confirm purchases made online or simply for bills payment (i.e. utility bills, insurance bills, cellphone bills). Loppi Machines make payments very easy as it can be made in many convenience stores. However, some machines don’t have an English Interface making it hard for foreigners to operate. Despite this, one can always ask assistance from the store clerk and they would be more than willing to help.

Finally, as most public places in Japan, convenience stores also offer free wifi access for a limited number of hours. For people passing by who need a drink and a place to rest, specifically tourist who also need the internet for directions, the stores’ free wifi access is truly convenient.

Japanese convenience stores truly offer its consumers not just good quality of purchases but also a worthy shopping experience. It redefines “convenience” to a level where consumers will not just find it easy to shop, but also to transact on most day to day necessary services. These stores, despite their size and assortment, would really come in handy for people, Japanese and Foreigners alike.

If you’re looking for perfectly shaped and delicious cantaloupes, strawberries, apples, grapes, and other Japanese fruits, Sembikiya is the best place to look for them. But you might have to check your wallet first because fruits here are not as cheap as you thought.

Sembikiya Fruit Emporium located in Tokyo is Japan’s most expensive fruit parlor.  The parlor looks like a luxurious jewelry shop at first glance, until you see fruits displayed instead of diamonds and golds in their glass counters.

Being abundant in fruits, Japan considered it as a customary luxury gift through ages. Contrary to a regular supermarket, fruits sold in Sembikiya are usually bought as gifts.

The fruit parlor started in 1834 as a small discount fruit shop owned by a Samurai called Benzo Ohshima. The business passed on for different generation in their family until it evolved into a more sophisticated and expensive fruit parlor. Despite the high prices of the fruits, Sembikiya Fruit Emporium is a booming business in Japan establishing different branches throughout the country. One of which, is their flagship branch in Nihonbashi Mistui Tower.

One common question asked: what makes the fruits so expensive?

For one obvious reason, the fruits sold in the place are impeccably tasty. The secret was on how they grow these fruits. The fruits in Sembikiya are cultivated in their specially-designed greenhouses located in Shizouka prefecture, the warmest place in Japan. These greenhouses control the temperature, using heaters during winter and air conditioning on summer season. Their fruits are also protected with a hat to make sure that they won’t be sunburned in heat, assuring its perfect shape, color and taste.

Each tree bears only one fruit to make sure that all the vitamins and nutrients will be received by the single fruit. All other fruits that will not pass their standards will be eliminated and picked out early on.

If someone is looking for something sweet besides fresh fruits, Sembikiya also offers other sweet products like fruit jams that were manufactured in their own factories.

Besides the amazing quality of their products, the store clerks also give their buyers an amazing experience. As an example, their store clerk will usually ask the day that the buyer intends to consume the fruit to make sure that the fruit picked would be at its best condition for the chosen date.

Sembikiya Fruit Emporium clearly depicts what the Japanese people had been known most notably for years: excellent quality of goods prepared with dedication and good accommodation for their customers.

In recent years, Filipinos` love for shopping has poured out to the online world as more and more Filipinos are starting to accept e-commerce. Their being one of the most active online users for online research and social media activities paved the way to the sudden hype of online store openings over the past few years. Online stores became the most convenient alternative to shopping.

EuroAsia Research Experts looked into the various factors about e-commerce in the Philippines such as the market trends, payment methods, e-commerce customers, main players, challenges and success stories, in order to learn more about the opportunities in this emerging industry.

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The substantial growth of the Philippine economy over recent years has significantly increased the purchasing power of the country’s Upper C-Class, making it the current demographic to watch closely.

The entire retail chain (manufacturers, suppliers, and distributors) has been reactive to this opportunity, upgrading product offerings with more premium items supported by strong commercial campaigning, notably including more and more investments in brand ambassadors.

Aside from enlarging their product ranges, retailers have also looked to improve on merchandising, with customer experience becoming increasingly important for younger generations of consumers.

The timing is crucial for both vendors and retailers, as this is a huge opportunity to gain market share in premium products, and a valuable push in sales and value margins moving forward. Organized retail chains are prime beneficiaries, as this is a chance to edge out their traditional (e.g. Sari-Sari stores) competition that won’t have the same capacity to improve in marketing.

All this, however, comes with obligatory considerations to ensure a profitable foray into the trend of Premiumisation. Here’s some food for thought:

1) When and where is it happening?

It is already evident in stores located in main cities, specifically in areas benefiting from a more premium market. The challenge lies in a balanced execution, something which many retailers are still having difficulty with. More on this below.

2) What is the impact on assortment and merchandising?

Listing new premium items should in no way destabilize the existing assortment structure suited to the market profile.

Some local retailers tend to sacrifice items categorized as basic necessities in order to accommodate a premium upgrade. This is a risky move in the still unpredictable Philippine market where consumers have shown a desire for premium products, and yet maintain a need for basic commodities and low prices. Listing and delisting products should be carefully addressed to take in consideration the number of SKUs and price segmentation expected for a given category.

Adaptation in merchandising is a challenge driven by market profile as well as the size of the store. Merchandising should reflect the proportion that the retailer has decided to allot to low, mid, and premium segments.

Finally, overspacing for premium items may have negative consequences on sales productivity and price image. Underspacing on the other hand may reduce the opportunity for the trend altogether. The trick is finding balance, balance, and more balance. Remember that the spirit of Premiumisation is one of complementing and not replacement.

3) How far are you willing to take it?

Alignment of your marketing initiatives with your vendor’s program is key. When people see products represented by celebrities on TV, they expect to find these at the forefront of the store.

Upon launching a premium product, try to feature it as much as you can in catalogues. Organizing in-store activities will surely reinforce its visibility, so seek out all opportunities your vendor can provide such as sampling, booths with promodizers, etc.

Forecasting sales with the vendor is also a must in order to replenish stocks in a timely manner.

At the end of the day, Premiumisation provides a unique opportunity for retailers and vendors to work hand in hand under the same interest of getting an uptick in sales value and margins. The biggest risk you can take is not taking the risk at all and missing the boat on this trend.