Difficult Time of Retail Business, Rise of Online Business?
Difficult Time of Retail Business, Rise of Online Business?
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JAKARTA - Fall season of retail industry of Homeland began to arrive. One by one the retail industry practitioners closed outlets. A number of retail industry names that are familiar in the ears of society is now no longer exists.
Marking the end of this year, Lotus Department Store and Debenhams which had flown in the domestic market managed under of PT Mitra Adi Perkasa (MAP) Tbk immediately closed the existing outlets.
The collapse of the retail industry invites serious debate. Retail industry players pointed to the weakening purchasing power of the people so that the business sector is on the brink of collapse. But the government dismissed allegations that people's purchasing power is currently sluggish.
There is also a linking it as the impact of widespread online transactions as one form of shifting patterns of public spending. But online businessmen also defend themselves that the growth of online transactions is quite large, but its market share is still too small when compared with the retail market for this country with 250 million inhabitants.
The debate surrounding the causes of the falling retail industry is continuing to heat up, but there has been no agreement on what causes. Retail industry actors insist that this is due to the decreasing purchasing power of the people, but the government is guided by the data of economic development showing the normal purchasing power of the people. In fact, actually, the weakening of the retail industry occurs globally.
Now the debate over the causes of the falling retail industry should not waste energy. The question to be answered is how the government ensures the right step in anticipating the collapse of the retail industry.
Whatever the reason, the government should not be negligent with the phenomenon of the collapse of the retail industry because it is directly related to the needs of public consumption.
Throughout the second quarter of 2017 the retail industry under heavy pressure alias turnover continues to fall freely. It is customary every Lebaran retail business always reap a big profit, but for the condition of Id Fitr 2017 and then really pathetic.
Retailers under the Association of Indonesian Retailers (Aprindo) only make up 25 percent of the total annual turnover. Compare with Id Fitr 2016 which still reaches 40 percent of total annual turnover. Retail sales are also weakening impact on the decrease in occupancy rate of shopping centers because retailers delay expansion.
In contrast, online business players reject the notion that the development and growth of e-commerce in the country has dimmed conventional retail business. Online transactions in Indonesia, as disclosed Chief Executive Officer (CEO) Tokopedia William Tanujaya, only 1 percent of the total retail transactions today.
In the future, William predicts online store businesses and offline stores will need each other through collaboration in their business processes or in other words online stores and offline stores will not kill each other but need each other.
Then why is the retail industry still falling out? It is interesting to observe the views of Vice Chairman of the Chamber of Commerce and Industry (Kadin) of Jakarta, Sarman Simanjorang. According to him there are four things that affect the domestic retail industry lately.
First, the competition between shopping centers is very tight. Every growth of new residential areas and offices to industrial areas is always coupled with shopping centers. Second, online shopping has an effect even though the portion is still small. Third, the entry of illegal goods is also one of the disturbing factors. Fourthly, there is a slow growth in the retail sector.
Talk about the slow growth of retail deposits is not only happening in Indonesia. Singapore is known as a shopping paradise is now faded charm. The neighboring country has substantial per capita retail space in Asia.
From Jones Lang Lasalle (JLL) publication, Singapore has 11.6 square feet or 1.08 square meters of retail per capita, bigger than Bangkok and Hong Kong, but there is a high vacancy rate of 8.4 percent in July. Now, shopping centers in Singapore are also dimming.
The closure of a number of retail outlets marking the end of this year is a warning for the government to take immediate strategic steps to save the national retail industry before it's too late.
Marking the end of this year, Lotus Department Store and Debenhams which had flown in the domestic market managed under of PT Mitra Adi Perkasa (MAP) Tbk immediately closed the existing outlets.
The collapse of the retail industry invites serious debate. Retail industry players pointed to the weakening purchasing power of the people so that the business sector is on the brink of collapse. But the government dismissed allegations that people's purchasing power is currently sluggish.
There is also a linking it as the impact of widespread online transactions as one form of shifting patterns of public spending. But online businessmen also defend themselves that the growth of online transactions is quite large, but its market share is still too small when compared with the retail market for this country with 250 million inhabitants.
The debate surrounding the causes of the falling retail industry is continuing to heat up, but there has been no agreement on what causes. Retail industry actors insist that this is due to the decreasing purchasing power of the people, but the government is guided by the data of economic development showing the normal purchasing power of the people. In fact, actually, the weakening of the retail industry occurs globally.
Now the debate over the causes of the falling retail industry should not waste energy. The question to be answered is how the government ensures the right step in anticipating the collapse of the retail industry.
Whatever the reason, the government should not be negligent with the phenomenon of the collapse of the retail industry because it is directly related to the needs of public consumption.
Throughout the second quarter of 2017 the retail industry under heavy pressure alias turnover continues to fall freely. It is customary every Lebaran retail business always reap a big profit, but for the condition of Id Fitr 2017 and then really pathetic.
Retailers under the Association of Indonesian Retailers (Aprindo) only make up 25 percent of the total annual turnover. Compare with Id Fitr 2016 which still reaches 40 percent of total annual turnover. Retail sales are also weakening impact on the decrease in occupancy rate of shopping centers because retailers delay expansion.
In contrast, online business players reject the notion that the development and growth of e-commerce in the country has dimmed conventional retail business. Online transactions in Indonesia, as disclosed Chief Executive Officer (CEO) Tokopedia William Tanujaya, only 1 percent of the total retail transactions today.
In the future, William predicts online store businesses and offline stores will need each other through collaboration in their business processes or in other words online stores and offline stores will not kill each other but need each other.
Then why is the retail industry still falling out? It is interesting to observe the views of Vice Chairman of the Chamber of Commerce and Industry (Kadin) of Jakarta, Sarman Simanjorang. According to him there are four things that affect the domestic retail industry lately.
First, the competition between shopping centers is very tight. Every growth of new residential areas and offices to industrial areas is always coupled with shopping centers. Second, online shopping has an effect even though the portion is still small. Third, the entry of illegal goods is also one of the disturbing factors. Fourthly, there is a slow growth in the retail sector.
Talk about the slow growth of retail deposits is not only happening in Indonesia. Singapore is known as a shopping paradise is now faded charm. The neighboring country has substantial per capita retail space in Asia.
From Jones Lang Lasalle (JLL) publication, Singapore has 11.6 square feet or 1.08 square meters of retail per capita, bigger than Bangkok and Hong Kong, but there is a high vacancy rate of 8.4 percent in July. Now, shopping centers in Singapore are also dimming.
The closure of a number of retail outlets marking the end of this year is a warning for the government to take immediate strategic steps to save the national retail industry before it's too late.
(rnz)
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