Glodok retailers worried about low demand during school vacation

Zakki Hakim, The Jakarta Post, Jakarta

Even though prices have dropped as the rupiah has gained on the dollar, demand for electronic goods remains low because people are preparing for the school holiday, according to retailers at Harco Plaza in Glodok, West Jakarta.

"With the school break coming, I guess families plan to spend more money traveling rather than on electronic goods," Paulus, a retailer at the shopping center, told The Jakarta Post last weekend.

He said that even though the U.S. dollar had fallen to a 33- month low of 8,175 against the rupiah, prices had not had a similarly dramatic fall and demand had failed to increase.

Also, he said, imported Chinese electronic goods filled almost half of the shelves of the stores in the shopping center, and their prices were not affected by the weakening U.S. dollar.

Sidiq, a father of two, was at Harco Plaza with his family to buy a DVD player. He said he had been told that prices had dropped because of the weakening dollar, which was why he decided to buy a DVD player now.

"However, prices have not gone down too much, but because we are already here we are going to buy one anyway, when we find one at the right price," he said.

As the Post observed, prices of electronic goods such as VCD players, televisions and radios have fallen by an average of 7 percent recently.

The price of a Chinese-made VCD player has decreased from Rp 240,000 (approximately US$29.36) to Rp 220,000 over the last month, while the price of a Samsung VCD player has gone down from Rp 440,000 to Rp 420,000.

A 21-inch flat screen Sony Trinitron television set now costs Rp 2.3 million from Rp 2.5 million, while the price of a Toshiba television set has decreased from Rp 2.6 million to Rp 2.4 million.

The prices of personal computers (PCs) seem to have been most affected by the weakening dollar.

A brandless PC with an Intel Pentium IV processor now costs Rp 3.1 million, while last month it cost about Rp 3.5 million.

Johannes, a computer retailer, said now was the right time to buy, because there were rumors that on Monday the dollar would begin to regain its strength.

However, he was pessimistic that business would improve any time soon, with families spending their money on vacations during the school break.