Shopping malls become trendsetters<\/p>\n
Benny Sindhunata, BIRO data center<\/p>\n
Shopping malls and plazas in big cities particularly in
\nGreater Jakarta have played a significant role as trendsetters in
\nthe dynamic development of the country's retail industry.<\/p>\n
Their existence has allowed both buyers and sellers to be
\nengaged in mutually beneficial interaction.<\/p>\n
The latest survey of Business Intelligence Report (BIRO) has
\nfound that shopping centers are building an image as a place
\nwhere specific products are available.<\/p>\n
This trend is one of the conclusions made in BIRO's survey on
\nthe existence, problems and potential of the national retail
\nbusiness.<\/p>\n
The survey, titled: Prospects and Opportunities of the Retail
\nBusiness in Indonesia, conducted between Aug. 2001 and Oct. 2001,
\nevaluates two aspects, namely the retail businesspeople or mall
\nvendors and shopping mall owners on a national scale, in macro
\nand micro analyses.<\/p>\n
For Greater Jakarta, which includes Bogor, Tangerang and
\nBekasi, the analysis has been conducted on the basis of 14 malls
\nmeasuring a total of 807,700 square meters with 3,489 tenants.
\nSome conclusions of the survey are:
\n1. In terms of the tenants' businesses, fashion stores top the
\nlist of tenants with 770 outlets or 22.1 percent of the total
\nnumber of tenants, followed by restaurants (643 outlets or 18.4
\npercent), electronics stores (395 outlets or 11.3 percent) and
\nfootwear and accessories stores (271 outlets or 7.8 percent).
\n2. There is a trend in which some malls are oriented toward
\nspecializing in specific products or goods. This will eventually
\nresult in an image of the mall as a shopping center offering
\nspecific products. This trend is evident from the concentration
\nof tenants in malls and plazas.<\/p>\n
Fashion outlets, for example, account for 24.1 percent of the
\ntotal tenants in Mal Taman Anggrek, 32.8 percent in Plaza
\nSenayan, 33.2 percent in Plaza Indonesia and 44.8 percent in
\nPasaraya Blok M.<\/p>\n
On the other hand, computer and electronics vendors dominate
\nRoxy Mas, Mal Ambassador and Plaza Gajah Mada. In these shopping
\ncenters, computer and electronics outlets represent 50 percent,
\n34.3 percent and 39.1 percent of the total number of tenants,
\nrespectively.
\n3. In terms of number of tenants, Mal Taman Anggrek has the
\nbiggest number, with 490 outlets, followed by Megamal Pluit with
\n478 outlets, Mal Ciputra, 368, Mal Ambassador, 300 and Plaza
\nGajah Mada, 279.<\/p>\n
A large number of tenants has a positive impact on the
\nexistence of the mall as it can offer a richer variety of
\nproducts to consumers, especially if the mall is dominated by
\ncertain products.
\n4. Giant retailers play a very strategic role and, as anchor
\ntenants, have more bargaining power with mall owners. Take for
\nexample, Matahari department store. It occupies 19 percent of the
\ntotal shopping space in Mal Ciputra, 17.5 percent in Mal Taman
\nanggrek and 19 percent in Megamal Pluit.<\/p>\n
Likewise, Sogo occupies 36 percent of Plaza Indonesia shopping
\nspace, 35 percent of Plaza Senayan and 33 percent of Mal Kelapa
\nGading.<\/p>\n
Metro department store takes up 60 percent of the total
\nshopping space in Mal Pondok Indah and about 20 percent in Plaza
\nSenayan. Therefore, it stands to reason that developers usually
\nlook for giant retailers as their prospective anchor tenants
\nbefore building a shopping center.
\n5. By the year 2003, it is predicted that Greater Jakarta will
\nhave 19 new shopping centers with an additional shopping area of
\n852,000 sq m.<\/p>\n
Of this space, some 60 percent or 497,000 sq m will be
\nlocated in Central Jakarta and will comprise six projects. In
\nSouth Jakarta, there will be five projects measuring a total of
\n128,000 sq m and in Bogor, two projects to occupy 60,000 sq m.<\/p>\n
West Jakarta and Bekasi will each have two projects, measuring
\n53,500 sq m and 49,000 sq m respectively, while North Jakarta and
\nEast Jakarta will each have one project, measuring 55,000 sq m
\nand 10,000 sq m respectively.
\n6. The composition of the main shopping center owners is
\npredicted to change with the entry of Djarum Group, which will
\nsupply 210,000 sq m of new space, or nearly a quarter (24.6
\npercent) of the total new space available. In the future the "big
\nthree" controlling 60.3 percent of total space will comprise
\nDjarum (24.6 percent), Sinar Mas (20 percent or 175,000 sq m) and
\nAgung Sedayu (15.8 percent or 135,000 sq m).
\n7. In the long run, selling of space\/shop units on the basis of a
\nstrata title arrangement should be reason enough for caution for
\nmall owners, especially if the buyers are investors not
\nmerchants.<\/p>\n
If more investors than merchants buy the space, the impression
\nwill be that the malls are empty even though all the space has
\nbeen sold. Obviously, investors would not use the space they have
\nbought as they will wait for an opportune time to resell.<\/p>\n
Efforts must be made to ensure that the marketing of
\napartments on the basis of the strata title arrangement, as was
\ndone in Jakarta during the property business boom, does not
\nreoccur.<\/p>\n
From the above findings BIRO can draw several conclusions
\nabout the country's retail business;
\n1. The trend among shopping centers of selling specific products
\ncan have a positive impact, especially if it is supported by
\ninternal management policies to communicate that image to
\nconsumers.<\/p>\n
Each shopping center will have a certain dominant product
\nsegmentation without having to reject the presence of other
\nstrategic sectors. Malls have become pioneers in ensuring that
\nretailers shape the behavior and segmentation of consumers.
\n2. The plan for retailers' expansion to the regions in the
\ncontext of benefiting the wider regional autonomy must be
\nimmediately anticipated jointly by retailers and developers who
\nown shopping centers as both are strategic partners and work in
\nsynergy with one another.<\/p>\n
Every year, the trillions of rupiah that the public spend on
\nconsumer goods flows from Jakarta to the 360 regencies in the
\ncountry.
\n3. Competition in building both new medium-scale shopping centers
\nand mega projects should be seen more clearly in the light of the
\nongoing crisis.<\/p>\n
The likelihood of failure and bad debts is still looming
\nlarge. In this context, clear strategies and positioning of each
\nshopping center will be needed.
\n4. The expansion of foreign retailers, through both branding and
\ndirect investment is a real consequence of the global business
\nbattle. It explains why no special measures, except the
\ngovernment's policy to impose selective restrictions on a
\nnational scale, have been taken to prevent these foreign
\nretailers from operating.<\/p>\n
However, their expansion into the regions will give rise to
\ndifferent perceptions and policies among regional
\nadministrations. Each region will vie with the other to lure
\ninvestors by offering various facilities and adopt different
\nregulations.<\/p>\n
This, indeed, is one of the important points that must be
\ntaken into account, by both the central government and regional
\nadministrations, if these establishments wish to get rid of the
\nunfavorable impact brought about by the entry of modern
\nretailers, national or otherwise.<\/p>",
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