Indonesia

Indonesia

Renewed lockdowns exacerbate performance for grocery retailers
Jakarta’s renewed social-distancing measures are widening the performance divergence between mini-markets and supermarkets. Research firm, FitchRatings estimates the revenue and profitability of large-format retailers, such as supermarkets and hypermarkets to deteriorate in 2020 while mini-market operators with store locations closer to residential areas will remain relatively resilient. The latest movement restrictions dissuade customers from travelling longer distances, lowering foot traffic and making it difficult for large-format retailers to compete. Expansions of mini marts will also allow them to increase their bargaining power with suppliers in terms of purchasing in larger volume.