RETAILING in INDONESIA Prepared by : APRINDO, Jakarta 2015
MUNAS APRINDO
Presented by : Roy N Mandey - Chairman
Today’s presenter Roy Nicholas Mandey Roy N Mndey serves as Chairman Indonesian Merchant Association (APRINDO) and Associate Director of Multipolar Group based in Lippo Karawaci . He has more than 17 years of experience in marketing, sales, business development and loyalti rewards across the retail industries. Roy is one of the today’s leading experts on loyalty and rewards program for consumer, government and NGO. He is joined to several governmentorganization & private association such as : APPBI DPD Banten, HIPPI DKI, Lions Club & KADIN DKI,Indonesia.
Agenda Indonesia Market …Updated Retail trends, What’s Next Racing for Consumer
Global (push) Economic Crisis
Today’s reality Economy , slowing down Retail, decelerating Recovery, government spending and less instant strategic policy Retail Success, non linear
Today’s reality Going to medium to high Inflation Rupiah weakening Slower GDP growth Current Account Deficits Fluktuation prices : Food, Gas, Utility Poor people visibility
Today’s uncommon sense Flights & Travel for holiday are fully Street are still jammed IIMS score 5.8 Trillion sales Jakarta Great sales 12 Trillion sales Jakarta Fair 4 Trillion sales Indeks Pembanguan Manusia (IPM) : 50% up Indeks Kepercayaan Konsumen (IKK) : 118,3
Is Indonesia in Crisis ?
9
Survei Penjualan Eceran
SPE
Hasil SPE Periode Mei 2015
Indeks Penjualan Riil menurut Kategori
* Angka sementara ** Angka perkiraan
10
SPE
Hasil SPE Periode Mei 2015
Indeks Penjualan Riil menurut Kota
* Angka sementara ** Angka perkiraan
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SPE
Hasil SPE Periode Mei 2015
Survei Penjualan Eceran mengindikasikan penjualan konsumsi Rumah Tangga tumbuh melambat pada Juni 2015. Tercermin dari Indeks Penjualan Riil (IPR) Juni 2015 sebesar 182,2, tumbuh 18,5% (yoy), lebih rendah dibandingkan 19,8% (yoy) pada Mei 2015.
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SPE
Hasil SPE Periode Mei 2015
Penjualan retail pada Juni 2015 terutama didorong oleh tingginya kenaikan penjualan kelompok food, sedangkan kenaikan pada penjualan untuk non-food semakin terbatas.
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SPE
Hasil SPE Periode Mei 2015
Pertumbuhan tahunan penjualan riil per Sub-Kelompok Non Food...
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SPE
Hasil SPE Sebagai Indikator Pergerakan Konsumsi Swasta
Secara triwulanan, konsumsi swasta selama triwulan II-2015 diperkirakan membaik..... Indikasi membaiknya konsumsi rumah tangga pada triwulan II-2015 tercermin dari rata-rata pertumbuhan tahunan IPR triwulan II-2015 sebesar 20,5% (yoy), lebih tinggi dibandingkan 15,5% (yoy) pada triwulan sebelumnya. Kelompok food diperkirakan menjadi pendorong utama pertumbuhan konsumsi rumah tangga pada triwulan II-2015.
15
16
Negative short-term outlook USD/IDR Exchange Rate
Real GDP Growth (%) 14,000
7.0% 5.6% 5.2%5.2%
6.0% 5.0%
10,000
4.0%
8,000
3.0%
6,000
2.0%
4,000
1.0%
2,000
0.0%
11,788 10,423
12,000
12,200
•
We forecast economy growth to remain sluggish up to 2015 at 5.2%
•
Despite better inflation projection, weak rupiah and high interest rate outlook are still going to weigh down consumer sector for the next 2 years
-
Source: CEIC, UBS estimates
Source: Bloomberg, UBS estimates
Inflation YoY (%) 10.0% 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0%
Source: CEIC, UBS estimates
Interest Rate (%) 8.0% 7.0% 7.0% 6.5% 5.7%
6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0%
Source: CEIC, UBS estimates
7.5% 7.5% 7.3%
It has been a stable growth despite slow down GDP Growth
4,9
4,8 5,0 5,7 5,5 6,3 6.5 4,5 6,1 6,5 6,2 5,8 5,1 5,7 6,0 4,5 3,6
0,8
-13,1 98 99 20 01 02 03 O4 O5 06 07 08 O9 10 11 12 13 14 est 16 15 Source : BI and IMF 2014
Indonesia high inflation rate will go down to 4 – 5 % by end of 2015
11.0 8.6 8.8 8.4 8.3 8.3 8.3
8.4 8.4
8.2 7.8
4.5
4.6
Jan
3.8
4.3
2015
7.0 5.3
8.4 7.3 7.2 7.3
6.7
7.0
6.2
5.9 5.6 5.5 5.9 4.5
3.9
4.5 4.8
2013
Positive MEDIUM impact Source: BI & BPS
2014
Jan
Dec
Nov
Oct
Sept
Aug
Jul
Jun
May
Apr
Mar
Feb
Jan
Dec
Nov
Oct
Sep
Aug
Jul
Jun
May
Apr
Mar
Feb
2014
2013
2012
2011
2010
2009
2008
2.8
2015
Denial
Fundamental shift in consumer spending: Restraint is the new mantra
Uncertainty
Savings? Discretionary Spending?
Fear
Acceptance Tough but moderating conditions: Free fall is over
Fatal combination for killing consumption • USD strengthening beyond Rp 14,000,• Raw food materials price increase • Utilities price increase (Oil, LPG, Electricity, Water etc) • Over taxing to consumer (meterai, utility, big tickets etc) • Over regulation to retail industry (banned products, expansion
of retail stores, etc) • Over regulation to manufacturing industry (Labels , SNI etc) • Forbidden to sell alcoholic drink below 5% at retailer (minimarket) • Limitation for retail trading based on street or zone
Negative sales growth • Auto mobile • Electronics • Property • Phone reload • Computer • Fashion retail • Entertainment
Source : Association, Clubs
Is retail honeymoon over ? Average Past 10 yrs Modern trade Value growth
Volume growth
2015
15%-18%
10%-12%
11-13%
0%-3%
30%
12%
Key MT players Value growth Traditional trade Value growth
6-9%
-5% - 5%
GROWTH IN 2015 IS STILL LOW Indonesia Key Accounts | Growth Reporter | YTD week 7 2015
26.3 20.7 9.2
15.5
24.0 18.0 14.7
11.5
10.8
9.3
2014
Q1 2014
Q2 2014
Unit Value Change
Source : Nielsen Scan Track
16.2
13.7
5.8
5.7
4.5
12.1
10.5
9.2
Q3 2014
Q4 2014
1st 7 weeks 2015
Volume Change
Nominal Growth
W/E 13/01/13 W/E 03/02/13 W/E 24/02/13 W/E 17/03/13 W/E 07/04/13 W/E 28/04/13 W/E 19/05/13 W/E 09/06/13 W/E 30/06/13 W/E 21/07/13 W/E 11/08/13 W/E 01/09/13 W/E 22/09/13 W/E 13/10/13 W/E 03/11/13 W/E 24/11/13 W/E 15/12/13 W/E 05/01/14 W/E 26/01/14 W/E 16/02/14 W/E 09/03/14 W/E 30/03/14 W/E 20/04/14 W/E 11/05/14 W/E 01/06/14 W/E 22/06/14 W/E 13/07/14 W/E 03/08/14 W/E 24/08/14 W/E 14/09/14 W/E 05/10/14 W/E 26/10/14 W/E 16/11/14 W/E 07/12/14 W/E 28/12/14 W/E 18/01/15 W/E 08/02/15
Growth is going into flat pattern Key Accounts
3,000.0
2,500.0
2,000.0
1,500.0
1,000.0
KA Sales In Billion
500.0
0.0
2009 slowdown 4.5% will repeat ?
5,7 4,5
4,8
5,0
02
03
O4
6,3
6,1
6,1
6.5
6,2
5,5
?
5,8 5,1
4,5
5,7
3,6
01
O5
06
07
08
O9
10
11
Economy Roadmap Creating quality three million job per annum
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13
14
15
Higher BI Rate > slower economy
It’s a PITSTOP time
Investment remains positive, Asian countries are major ones
Indonesia is still favorite investment destination
Investment is one key driver for Indonesia economy Contribution to nominal GDP Investment
Source: BPS
33.16
Consumer goods companies invest in capacity expansion
Largest factory in the world USD 100 million
Largest factory in Asia USD 100 million
Fashion Retail Investment
Fundamental is still healthy
34
Rising investment Foreign Domestic Investment (FDI)
Breakdown of FDI
USD bn
-40% 2005 2006 2007 2008 2009 2010 2011 2012
Primary
Rise of FDI and domestic investment have been the main contributors of recent economic growth
•
FDI/domestic investment recorded 5%/4% CAGRs over the past 10 years
•
More than half has been invested in manufacturing which will lead to higher employment and sustainable purchasing power
secondary
Source: BKPM
Source: BKPM (Indonesia Investment Coordinating Board)
Domestic Investment
Breakdown of Domestic Investment
300 250 200 150 100 50
Primary
Domestic investment
Source: BKPM
Secondary
Q213
Q412
Q212
Q411
Q211
Q410
-
Q210
2005 2006 2007 2008 2009 2010 2011 2012
Rp trn 350
Q409
100% 80% 60% 40% 20% 0% -20% -40% -60%
Q408
Rp trn 100 90 80 70 60 50 40 30 20 10 0
Source: BKPM
•
YoY change
Q209
FDI
Q213
-
Q412
-20%
Q212
0%
5
Q411
20%
10
Q211
40%
15
Q410
60%
20
Q210
80%
Q409
25
USD mn 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0
Q209
100%
Q408
30
Indonesia after China (outside KLM) 2000-2007
From 10.5% From 7.1% Source : OECD,2013
Indonesian position and projection, GDP per capita hit USD 5000 by early 2015 High income
Upper middle income
Lower middle income
Loweincome
Improved Infrastructure will change Indonesia
Ready to ACCELERATE
Emerging market account for more than 70% of global economic growth by 2025
Source: McKInsey
By 2025 will be USD 30 Trillion (from 12 Trillion today)
38% By 2017 emerging Asia will account for one-quarter of the global consumer products market and generate 38% of total consumer products growth.
Source: EY
69%
Executives believe that emerging markets will be the main engine of growth and profits for their firm over the next three years.
Indonesia NEXT
Integrasi 12 Sektor Bisnis dalam MEA/AEC • Free Investment • Free Capitals • Free Skill Labour • Free of Goods • Free of Services
Integrasi 12 Sektor Bisnis dalam MEA/AEC • Wood based product & Automotives • Healthcare & e-Asean • Rubber based product & Textile • Agro based product & Fisheries • Electronics • Travel & Tourism • Logistics
Harapan Retailer untuk penetrasi Market MEA • 1. Peran pemerintah dalam melakukan fungsi FASILITATOR • 2. Kemudahan Regulasi Perdagangan Luar Negeri • 3. Informasi Market di Luar Negeri
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