Sarinah talks shop about expansion despite red tape

Sarinah talks shop about expansion despite red tape

JAKARTA (JP): Lone state-owned retail company PT Sarinah
plans to expand its business despite the tangled web of
bureaucracy and stiff competition from private retailers.

Company president Yustian Ismail said on Thursday that Sarinah
planned to open 35 new outlets across the country in the next
five years.

An outlet will open this month in Yogyakarta and another in
Bali in September, Yustian said during a news conference held in
conjunction with the commemoration of Sarinah's 37th anniversary.

"Although we cannot move as fast as private retail companies
in developing the business, we are trying to improve our
management so we can compete with other local or foreign retail
companies in the country," he said.

Yustian acknowledged that differences in vision and concept
between the government as the owner and the board of directors
who operated the retailer chain worked to hamper the company's
development.

The company, which is under the State Minister of the
Empowerment of State Enterprises, has encountered red tape in its
dealings with the minister's office, he added.

However, Yustian said that reform measures introduced last
year contributed to making the company more independent.

"Prior to the reforms, the board of management was asked to
develop the company, but they were not supported by the
government.

"It's just like asking them to run while their feet are
chained."

Operational director Imanu Widodo estimated that about 60
percent of the company's prospective buyers were foreigners.

The company's plan to open more outlets outside of the
country's economic center of Jakarta is based on predictions for
more autonomous and prosperous provinces in the future.

It is also considering opening outlets overseas, such as one
in New York, but Yustian said there were risks involved. "We have
to be very cautious before implementing the plan."

Sarinah, located on Jl. M.H. Thamrin, Central Jakarta, holds
significance as the country's first department store. Indonesia's
first president Sukarno, who proposed the idea for the store,
opened it in 1962.

The company's promotional efforts have included cooperation
with McDonald's and Hard Rock Cafe, which have operated
restaurants at the Thamrin site since 1992. The cooperation has
successfully boosted the number of visitors by more than 200
percent.

In conjunction with its anniversary, the department store is
awarding about 300 scholarships to students at six state schools
in the neighborhood. It also conducted employee blood drives.
(04)