Can Glodok maintain sales supremacy for electronics?

By Imanuddin and Ivy Susanti

JAKARTA (JP): It is no exaggeration to say Glodok in West Jakarta is the trading hub for electronic items not only for Jakarta, but the nation.

With daily trading value of not less than Rp 50 billion (US$11.2 million), the subdistrict is undoubtedly the busiest and most liquid trading site in the city.

It was established as a residential area in 1740, mostly for Indonesians of Chinese descent, and European and Chinese- influenced architecture still predominates.

Glodok was developed as a business center in the early 1950s. In line with the rapid development of electronic technology and increasing demand for electronics, it shifted into a trading center for this sector in the early 1980s.

There are several blocks of buildings, including the Harco Glodok, Glodok Makmur, Glodok Jaya, Glodok Plaza and Orion Plaza, which sell electronics.

But business is not always brisk. Others whose core business is nonelectronic products are attempting to muscle into the sector by opening sales centers in other areas.

Property developers have been influenced by the development. They have opened integrated electronics sales centers with complete facilities available for visitors' comfort.

These electronics centers have been established in nearby Mangga Dua, West Jakarta, and in Central Jakarta.

One of the newcomers opened in the Jakarta International Trade Center. Another operates an electronics sales department at the Pasar Pagi Mangga Dua, which is located across from the trade center.

The Harco Superstore is also in Mangga Dua.

Meanwhile, the operator of the Bendungan Hilir market in Central Jakarta realigned its function from a general purpose to electronics-oriented center.

Shop owners at the Glodok electronics centers could not ignore the challenge from the new competitors because the latter provide a comprehensive array of electronics, a draw for the public.

Some owners admitted their sales had declined by about 20 percent in recent years, especially since the Harco Superstore started operating in April 1994.

But price still reigns as the dominant factor in getting people into the stores.

"Many of our customers, who had turned to other electronic centers, returned here just because the prices of our electronic goods are reasonable," said Sharno Gousen, who sells computer equipment in Orion Plaza.

People intending to shop in Glodok should first have mastered the general "formula" on how to get the goods at cheap prices.

This includes good bargaining skills, conducting informal market research on the exact prices of the goods they want to buy or by asking a friend who has a close relationship with the sellers to do the bargaining.

This formula can enable someone to get a 29-inch Sony TV set for Rp 100,000 to Rp 200,000 less than in other shopping centers.

But pleasing product displays are not a priority at the Glodok shopping complex.

Some owners pile their goods haphazardly inside their shops, while others stack them so high that they block customers' views of the stock.

"We have to stack our goods inside our stores because we do not have enough space to store them," Sharno said.

The size of each shop in Glodok varies from 12 square meters to 60 square meters, said a maintenance official at the Orion Plaza.

The shopfronts and interiors sometimes appear dimly lit as some owners appear not to care about the value of illuminating their wares.

"However, people still come to my shop to buy televisions, laser disc players and other entertainment electronic goods," said Budi, a shop owner in Glodok Jaya.

Budi's shop is not only unattractive inside, but also difficult to reach as it is situated in the back of the building.

Sharno said he did not pursue a huge profit margin for every product sold.

"I prefer to have a rapid flow of my goods sold than keep them long in storage while awaiting buyers to buy expensive merchandise," he said.

He said he sometimes sold the goods at no profit.

"I have to do that because I need cash to continue my business," he said.

"However, people never believe me when I tell them that I got no profit at all."

Budi also revealed his strategy in selling cheap electronic goods.

"I get the electronic goods directly from the source (the producer)," he said.

A shop owner at Glodok Makmur said he managed to sell quality electronic products at cheaper prices because he paid lower building maintenance and operational fees than tenants in other electronic centers.

"I have checked with other electronic centers that Glodok charges the cheapest building maintenance fees from its tenants," the shopowner, who asked for anonymity, said.

He said Glodok's supremacy in the sector goes along with its image as a complete electronic center with a large variety of goods available.

"Glodok's image as a cheap and complete electronic center in the city contributes to our supremacy," he said.