Local yuppies bid sad goodbye to free spending ways

By Reiner Simanjuntak

JAKARTA (JP): In its destructive wake, the monetary crisis has also ripped asunder the material lifestyles of many young urban professionals here.

Those who make it their business to follow trends and fashions say the sharp fall of the local currency against the U.S. dollar has eaten away at yuppies' disposable income in the now-ravaged rupiah.

"The crisis has made them more careful in spending their money," confirmed Lenni Tedja, advertising and promotion manager of PT Mahagaya Perdana, a local distributor of imported fashion and accessories for men and women, like Aigner, BOSS Hugo Boss, Prada, Escada, Alfred Dunhill, Laurel, and Omega.

Hugo Boss local brand manager F.X. Khrisna Moran said the 40 percent to 50 percent average increase in the prices of the products had cut into customers' spending on suits -- the most popular selling item -- neckties, shirts and other accessories.

"We used to sell one or two suits a day, and now it's probably only one a month," he said. Suits range in price from Rp 5 million (about US$625) to Rp 10 million.

A far cry from pre-crisis days, he said, when those with cash thought little about spending on their favorite attire.

He said his brand suits were especially favored by bankers and lawyers because of the company's image and cut of the clothes.

When the economy was still booming, the yuppies could easily part with their money after having lunch in one of the luxurious malls in Jakarta where Hugo Boss outlets are located, store manager Golda Pradeksa said.

The downward trend is also shared by Italian-brand Prada, favorite attire of the wealthy, especially for their distinctive shoes and bags.

"Local yuppies come to our stores just for window shopping nowadays," said Prada local brand manager Williarty Aliwarga.

Only Japanese tourists and expatriates are reaching into their pocketbooks, she added, because foreign exchange could offset Prada's average 35 percent to 50 percent local price increase.

The story is a bit different with Aigner devotees. While purchases by locals dropped sharply in January, they started to climb up in the following month, local brand manager Lucie Palilingan said.

"Perhaps this buying is from yuppies who have made huge profits either from foreign exchange speculation or their dollar- based income."

She conceded there were differences from the boom days of free spending, before the economy went bust.

"They are buying more sales products rather than full-price ones."

Sales volume of on-sale products jumped by 70 percent, while sales of other products dropped by 40 percent.

Another trend is for purchases of fashion products rather than accessories like leather belts or wallets.

In the days before carte blanche spending became blanching at prices, consumers would snap up four or five kinds of leather belts to match their pants and shirts.

"Perhaps, they can now live with only one belt," she said. The sales of Aigner belts have dropped by 40 percent, but sales on fashion products like suits and shirts jumped from 5 percent to 15 percent.

Cafe

The crisis has also affected spending for nighttime entertainment.

Paulus Panggabean, general manager of Fashion Cafe, said many people still flocked to the nightspot, but they were more choosy in their spending. "Some have even turned from imported beer to a local one."

The number of visitors dropped by about 10 percent, especially in February and March. "But they are now coming again," he said.

On a weekday, there are about 400 visitors to Fashion Cafe, and the number reaches between 600 and 800 on the weekend.

While visitors formerly spent an average of Rp 60,000 on each visit, it is now between Rp 45,000 and Rp 50,000.

Shanti Shamdasani, marketing manager of News Cafe, said average spending per person per visit has dropped from Rp 100,000 to about Rp 50,000.

"They would formerly order drinks every 30 minutes during the pre-crisis period, but now they try to hold onto their first glass for one to two hours."

Formerly, Shanti said, the yuppies, after a hard day at the office, would linger over dinner at the cafe until 10 p.m., and then order drinks to sip as they listened to the live band until the early hours of the morning.

This was the trend on weeknights through Thursday, and the cafe would be particularly crowded on Fridays and Saturdays.

"But now they tend to come here just for a drink and the music," she said, pointing out people would have their dinner at the office or home to save money.

She said that although costs of basic raw materials had increased by an average of 40 percent, the cafe only raised its price by an average of 20 percent to keep its local customers whose purchasing power had been slashed.

"We also want to compromise for our steady customers," she said, adding that the cafe's market target was young executives with monthly income above Rp 2 million.

Despite the crisis, Shanti said more local customers were coming in.

She observed that many of them came to the cafe in the evening to escape a stressful day of trying to clinch a business deal or land a job.

"Even during a crisis, people need entertainment."

Shanti said most foreign expatriates were spending more on drinks as their purchasing power had soared due to the rising value of U.S. dollar-based incomes.

"(Before) they would usually have five bottles of beer, and now it has doubled," she said.