Sukyatno, the man behind Es Teler

Sukyatno, the man behind Es Teler

By Edith Hartanto

JAKARTA (JP): Es teler is a household name in cities across
the archipelago for its unique combination of coconut, avocado,
jackfruit, syrup, milk and ice. But few locals are familiar with
Sukyatno Nugroho, the man who brings it from the street to
elegant shopping malls.

From humble beginnings in Pekalongan, Central Java, where he
was born, the 50-year-old businessman now owns the Es Teler 77
Group, as well as Mie Tek-Tek and Pasti Enak restaurants.

He manages 234 outlets -- 21 of which have opened since the
monetary crisis began -- in 22 provinces.

"I will continue to open more outlets in the months and years
to come," he said.

With his wife, Yenny Setia Widjaja, 46, he has spent about 16
years establishing the Es Teler 77 Group's empire and received
various awards -- including the Satya Lencana Pembangunan from
President Soeharto in 1995 and ASEAN Best Executive 1995/1996
from the ASEAN Program Consultant -- in the process.

And he is set to open Es Teler 77 outlets in Brunei and
Singapore, deals which are currently being negotiated.

Sukyatno is seemingly unfazed by the current money crisis as
The Jakarta Post discovered last week after sharing an es teler
with Sukyatno at his outlet in Mal Citraland.

Below is an excerpt from the interview.

Question: How did you start your business?

Answer: I started all of these with a small kiosk near Jl.
Gajah Mada, Central Jakarta, back in 1982, with a capital of Rp 1
million and five employees.

Every day I went to the market. I worked under the blazing sun
and got soaking wet when it rained and braved the floods. In the
beginning, I opened my outlets on sidewalks in front of buildings
or houses, and I was kicked out like an animal by the building
owners. But I used that experience to move forward. It gave me
inspiration to go on and be a tough and successful businessman.

In 1987 we started to open outlets using the franchise system
and in 1994 we decided to open in shopping malls. We cater to
people of all walks of life from low, middle and upper classes.

Q: What measures are you taking to survive and even manage to
keep your smile in this time of crisis?

A: Well, I've been involved in this business for 16 years now. I
have always believed that Indonesian products are the best choice
for creating good business. So I chose a product that was
essential for all people: food.

Of course, Indonesian food is loved by Indonesia's 200 million
residents. The second important thing is that I have a strong and
true partnership with all of my franchisees. I only have two
hands and two feet. I could not do all of these things by myself.

The third factor, and the most crucial, is that all of my
partners are small businesspeople with a capital of between Rp
100 and Rp 200 million so they don't suffer from high bank
interest and we're not affected by the bane of collusion or
corruption. The point is to create a strong partnership without
evicting small-scale businesses.

Q: What makes Es Teler 77 and your two other restaurants -- Mie
Tek-Tek and Pasti Enak -- different from other restaurants?

A: We're selling Indonesian food with a special taste ... don't
forget that what we developed here is actually a sidewalk food
that is being eaten by millions of Indonesians every day.

Mie tek-tek or es teler, for instance, are
a daily staple that we can find anywhere on the streets. It will
never stop having customers.

In the beginning of the economic crisis last year we gave a
discount to attract buyers... after that, people kept coming...
and I stopped the discount program. Ha ha.

Many of my colleagues asked me how could I survive with so
many outlets open in malls while many other restaurants closed
down due to a lack of customers and the high lease rates. I tell
you this... in the malls we only rent small spaces. So we don't
have to pay expensive rent. We designed it to be as simple as
possible. All of our outlets are very neat. The chairs, the
tables, are all designed to be as efficient as possible.

It is so efficient that if one of our customers says "I love
you", the customer at the next table could hear it. Ha ha.

Yes, we designed the outlets to become fast food and fast-
eating restaurants... so the flow of customers could proceed
smoothly, and this means more income to gain.

Q: How many brand names and outlets have you created?

A: Currently we have three brand names. The first, established in
1982, is Es Teler 77 which serves es teler, noodles and dumplings
as the main items on the menu.

We currently have 199 Es Teler 77 outlets in 22 provinces in
Indonesia. The second, Mie Tek-Tek, was established only a year
and a half ago, and now there are already 31 outlets in the
country. It serves mie tek-tek and fried rice as the main items.
Last, but not least, Pasti Enak, which opened only six months
ago, now has four outlets. It specializes in seafood, barbecued
chicken, kredok (traditional salad) and sayur asem (traditional
sweet and sour soup).

During the economic crisis alone, since last August, we've
opened 21 outlets in many places including Batam, Padang,
Bengkulu, Bandung, Semarang and Pekan Baru. Once, we could open
three outlets in one day in different provinces.

All I think about now is how I can manage to keep all of the
3,000 employees and help many others who lost their jobs during
the economic turmoil.

Currently we're negotiating the opening of our first outlets
overseas, which will be in Brunei and Singapore.

Q: How do you deal with competition, especially the mushrooming
number of foreign franchise restaurants?

A: As you know here we're developing an Indonesian food
businesses. We sell the food at reasonable prices for everyone.
If people could buy es teler at sidewalk kiosks for Rp 1,000 to
Rp 2,000... we sell it for Rp 3,500 in most of our outlets in
shopping malls. Mie tek-tek's street price is about Rp 1,000 to
Rp 3,000... we sell it for between Rp 4,000 to Rp 5,000.

I think that is our advantage compared to local franchisees
for other foreign franchises here. Currently, the price at
several restaurants such as McDonald's, Kentucky and Wendy's,
have sharply increased from about Rp 2,000 up to Rp 5,000...
their packet prices have also jumped by more than 100 percent.
Moreover, they have to pay the franchise fees in dollars. The
franchise fees for Es Teler 77, Mie Tek-Tek and Pasti Enak are
paid in rupiah.

Q: What do you think about the crisis?

A: Well, I feel so lucky because most of my friends could not
make it through this troubled time. Facing this tough time, all I
can think about is how to survive, how to cope with the crisis. I
can't wait for the analysts to predict and plan on how to surpass
this crisis. I tell you this, there are no economic theories that
can work in such a turbulent time. To survive we have to use the
'drunken master theory', that is we have to adapt and make the
best of the situation.

I'm tired of listening to economic plans, CBS (Currency Board
System)... all of which I cannot understand. The most important
thing for me is to keep my business alive and keep jobs for
thousands of workers, from fruit farmers to suppliers, and we're
contributing a lot to the region's tax revenues. I think people
need fast economic recovery and this kind of business matches
people's needs. People need a better economic condition, they are
tired of promises.

There are people who used to laugh at my business. They called
me conservative, old fashioned but in this time of crisis,
everything turns upside down. And finally, a local product like
this is the one which eventually survives and even grows stronger
and stronger all the time.

Q: Have any of the outlets closed down because of bankruptcy?

A: Of course. Along the way there were one or two of our outlets
that were closed down, such as the one in Jembatan Lima, West
Jakarta. The usual reason was because we had to compete with
sidewalk vendors who offered cheaper prices. We could have
lowered our price but I don't have the heart to do that because
it's the same as killing small business. We are better off moving
somewhere else.

Q: What are your other goals and dreams?

A: If I could, I would open my franchise on the moon but
currently I really want to be awarded a doctoral decree...
sounds crazy, doesn't it? I didn't even finish junior high
school. But there are tycoons who did not finish elementary
school but they can get honorary doctoral decrees. I've been
giving lectures all over the country.

It's just a simple dream, though...

Q: What if people get bored with, for instance, Es Teler 77
outlets?

A: There were times that economic analysts feared that these
kinds of franchises would collapse but now, after 16 years, it
turns out that we're grow stronger and bigger. So I don't worry
about that.