Mon, 15 Nov 2010

TEMPO Interactive, Jakarta:The head of the Electronic Entrepreneurs Association, Ali Soebroto Oentaryo, said that in general, the strengthening of the rupiah, tend to disrupt electronic goods sales. It creates a dilemma for electronic dealers because consumer wants prices to drop, but the suppliers refuse to do it.

“The consumers want prices to drop because they notice that the dollar has weakened,” said Ali last week. Even though the rupiah is stronger, dealers can maintain their price while offering promotional programs, such as providing gifts.

This statement was given in response to the complaints of Roy Santoso, managing director PT Electronic City Indonesia, that this year sales target will not be met because of the rupiah’s rise in value. As a consequence, imported products are sold at 5-6 percent cheaper. Even though sales volume had gone up by two digits, the value had dropped.

The strengthening of the rupiah began since early in the year when it was traded at Rp 9.400 per US$. About the same time in 2009, the value surpassed Rp 10.000. The rupiah became stronger at the end of September, to around Rp 8.900 to the US dollar. Analysts predict that until the end of the year, the exchange rate will not go beyond Rp. 9000.