Interested in Owning Your Own Alfamart? Here Are the Costs and Break-Even Details
Based on information from Alfamart’s official website, the company offers three partnership schemes: opening a new outlet, converting an existing shop into an Alfamart, or taking over a store that is already operational.
- New Outlet Franchise
This involves opening a new Alfamart based on a location proposed by the prospective franchisee. The stages include an initial presentation, location evaluation and approval, proposal presentation, cooperation agreement, and store opening. Alfamart provides shelf type options adjusted to the capital amount and building size owned by the prospective franchisee:
9-shelf outlet (30 m²): Rp300 million
18-shelf outlet (60 m²): Rp350 million
36-shelf outlet (80 m²): Rp450 million
45-shelf outlet (100 m²): Rp500 million
The capital includes a franchise fee of Rp45 million for five years, electrical installation, store equipment and air conditioning, cash register and retail information system, shop sign and pole sign, store permits, and promotion and preparation for the store opening. This investment estimate excludes property investment and may change according to conditions during the store opening process.
- Conversion Franchise
This scheme is intended for owners of local minimarkets or grocery stores who wish to develop their business into an Alfamart outlet. Alfamart offers two conveniences: the store’s merchandise can be recognised as initial stock for the Alfamart outlet, and existing shop shelves can be counted as a reduction in investment costs, provided they meet Alfamart’s standards. The stages include an initial presentation, first stock opname, cooperation agreement, second stock opname, and opening of the conversion store.
- Take Over Franchise
The final scheme involves purchasing an already operating Alfamart outlet at a predetermined package price. The capital required for a take over franchise starts from Rp800 million. This cost includes a franchise fee of Rp45 million for five years, location rent for five years, store equipment and air conditioning, cash register and retail information system, shop sign and pole sign, store agreement, and goodwill.
In addition to preparing the initial investment, prospective partners are also charged royalty fees calculated progressively based on the outlet’s net sales, excluding tax. The royalty rates are: 0% for net sales up to Rp150 million; 1% for net sales between Rp150,000,001 and Rp175 million; 2% for net sales between Rp175,000,001 and Rp200 million; 3% for net sales between Rp200,000,001 and Rp250 million; and 4% for net sales above Rp250 million.
Requirements to open an Alfamart outlet include being an Indonesian citizen with a business entity, having or planning to have a location with a sales area of at least 100 square metres, fulfilling local licensing requirements, and being willing to follow Alfamart’s operational systems and procedures.