Aprindo urges imposition of retail zone restriction<\/p>\n
JAKARTA (JP): The Indonesian Retail and Merchants Association
\n(Aprindo) has called on the government to assist small retailers
\nby imposing a restriction against major retail chains in the
\ncountry.<\/p>\n
Aprindo chairman Steve Sondakh said the introduction of a
\nretail zone, which limits the size of a company's retail outlets
\nto specific business areas, was an appropriate measure to protect
\nsmall retailers.<\/p>\n
Steve, a Hero supermarket executive, said a large retailer
\nshould not, for example, be allowed to open a retail outlet
\nmeasuring more 2,500 square meters in the heart of the city.<\/p>\n
He said retail chains larger than 5,000 square meters should
\nonly be allowed to operate in outlying areas.<\/p>\n
He said retailers of medium size properties ranging between
\n2,500 square meters and 5,000 square meters should be allowed to
\noperate 15 kilometers from the center of a city.<\/p>\n
\"This retail zone restriction policy should have been applied
\nhere a long time ago as it has been for years in Europe and the
\nUnited States,\" he said.<\/p>\n
He said that currently there was no adequate regulation on
\nretail business zoning arrangements.<\/p>\n
\"The zoning policy is necessary to help the government create
\na level playing field among local players as well as between
\nlocal and foreign retailers.\"<\/p>\n
He denied that the proposal would serve as a business shield
\nto protect local retail chains from the aggressive expansion of
\nforeign retailers.<\/p>\n
\"It is simply aimed at protecting the existing retailers,
\nespecially the small ones and traditional markets, so that they
\nshould not have to compete head-to-head with giant retailers in
\ntheir neighborhoods.\"<\/p>\n
Aprindo has been criticizing a government decision to allow
\nforeign hypermarket operators to open their spacious outlets in
\nthe heart of Jakarta.<\/p>\n
These giant new stores have caused a down turn in business for
\nmedium-size and small retailers already in the areas, said
\nAprindo executive director Kustarjono Prodjolalito.<\/p>\n
\"We're not against open competition. But there has been uneven
\ncompetition, resulting in about a 5 percent to 10 percent drop in
\nrevenues of medium and small retailers surrounding the
\nhypermarkets. (They have) lost their regular customers to the
\nhypermarkets, which sell more complete items at prices they claim
\nare cheapest,\" he said.<\/p>\n
Despite the fact that Indonesia is struggling through its
\nworst economic crisis in decades, Jakartans have had the
\nopportunity to shop at several new foreign franchise stores.<\/p>\n
Their recent arrival followed the signing last year of a
\nletter of intent between the government and the International
\nMonetary Fund, which required the country to lift its
\nrestrictions on foreign investment in the retail and wholesale
\nmarkets.<\/p>\n
Prominent among the newcomers are the French supermarket
\nchains Carrefour and Continent. Operating as hypermarkets since
\nlast year, they offer a wide variety of products, ranging from
\ngroceries to clothes and household appliances.<\/p>\n
Steve said the government should consider the proposal if it
\nwas serious about enabling existing local retail businesses to
\ncontinue operating in the open and free trade era.<\/p>\n
He said supermarkets and other medium size retail chains were
\nonly expecting about 2 percent growth in 1999 and 2000. He said
\nthey would be unable to compete with the hypermarkets, which are
\npredicting growth of more than 10 percent. (cst)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/aprindo-urges-imposition-of-retail-zone-restriction-1447893297",
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