The End of 7-Elevens.

[Vanhelsing]

With a plethora of other convenience store options available added to the ubiquitous "mom and pop" shops, I'm not sure many will be that affected.

JAKARTA -- Modern Internasional, the parent company of Indonesia's 7-Eleven franchise operator, on Thursday said it would close all of the unit's convenience stores by June 30 due to "limited resources to support operations."

The announcement comes less than a month after it announced that talks to sell the convenience store unit, Modern Sevel Indonesia, to an affiliate of Thai conglomerate Charoen Pokphand Group collapsed. Modern Internasional's share price remained at a near all-time low of 50 rupiah ($0.004) per share on Thursday with a market capitalization of 228 billion rupiah.

http://asia.nikkei.com/Business/Companies/Indonesia-s-7-Eleven-operator-to-shut-all-stores

 

[Euc-]

The one in my complex has been closed for a month or 3 now, barely saw anyone in there as their prices were not competitive compared to indo/alfamart 50 meters down either side.

 

[Anglian]

The three 7-11 in my area have been shut for many months now, two of the stores are still empty, one is another mini market

 

[William King]

A sad indication of the business environment in Indoensia.

 

[waarmstrong]

I am unsure of the meaning of "sad indication," KW. Is the reason 7-11 did not survive a function of the Indonesian commercial environment, or a measure of the business acumen of 7-11 management?

 

[Banana72]

"Limited Resource"?

The closed ones I've seen (about 3-4 of them in North jakarta) all have "Bisnis ini belum melunasi Pajak" (This business has an outstanding/unpaid tax) huge red banner on their doors.

 

[steveandpenny]

7-11 deserves to close down. The only reason they worked out in the states was that all the little mom and pop markets closed down in the states years ago.
7-11 stepped into a niche market and overcharged people for convenience. Both alfa mart and indomart are much bettered priced. Plus we still have mom and pop places everywhere.

 

[Davita]

According to Wiki there were only 166 branches of 7-11 in the whole of Indonesia. There are 560 in Singapore and over 9000 in Thailand
There are at least 5 Indos and Alphas (marts) within walking distance of my Bali house and the pub....and a new one opening this week.
I'm currently in Jakarta and noticed, in my building, they opened a new Japanese restaurant right next door to a Japanese restaurant.
I can never understand that logic of commerce in Indonesia.

 

[vocalneal]

I suspect that 166 stores is not enough to support the kind of infrastructure one needs to run a convenience store business. OR they were good at selling franchises but no good at running the infrastructure needed to support them, which is huge.

 

[dafluff]

7-11 deserves to close down. The only reason they worked out in the states was that all the little mom and pop markets closed down in the states years ago.
7-11 stepped into a niche market and overcharged people for convenience. Both alfa mart and indomart are much bettered priced. Plus we still have mom and pop places everywhere.

Exactly this. When the Indomarts and Alfamarts started opening everywhere, I avoided them thinking the prices would be the inflated prices that 7-11 charges for "convenience". But after a few purchases I realized that the prices at those mini-marts are very competitive to the bigger supermarkets, and occasionally they are cheaper.

 

[Anglian]

According to Wiki there were only 166 branches of 7-11 in the whole of Indonesia. There are 560 in Singapore and over 9000 in Thailand
There are at least 5 Indos and Alphas (marts) within walking distance of my Bali house and the pub....and a new one opening this week.
I'm currently in Jakarta and noticed, in my building, they opened a new Japanese restaurant right next door to a Japanese restaurant.
I can never understand that logic of commerce in Indonesia.

This is what I cannot figure out, we have mini marts Alfa marts, all next to each other, little shops selling similar stuff, in the kampung 5 shops all selling the same, coffee strips and soap etc, a new one has just opened, what business potential did they see, it's really strange, when I ask my wife she just says oh it's Indonesia

 

[William King]

I am unsure of the meaning of "sad indication," KW. Is the reason 7-11 did not survive a function of the Indonesian commercial environment, or a measure of the business acumen of 7-11 management?

They did not survive the politics of business interference here.

 

[waarmstrong]

They did not survive the politics of business interference here.

Still wonder why them and not others, their competitors.

 

[Anglian]

I don't think they surmounted some of Indonesian regulations required to start up a foreign business, I wasn't told specifically what regulations, perhaps they should have got better legal advice

 

[waarmstrong]

7-11 was around long enough to have weathered start-up issues. I don't think that did them in. The Globe suggested that the government limits placed on the sale of alcohol in convenience stores help to hasten their demise.

 

[William King]

7-11 was around long enough to have weathered start-up issues. I don't think that did them in. The Globe suggested that the government limits placed on the sale of alcohol in convenience stores help to hasten their demise.

Indeed, there was also a fuss about them serving food to be eaten on premises, and therefore needing a restaurant licence, not a store licence or some such. That probably did more damage than the booze issue. I think they also had some importation problems...