Home Retailing Convenience Store Alfamart to open 100-200 stores in ASEAN, to set up distribution centre...

Alfamart to open 100-200 stores in ASEAN, to set up distribution centre in the Philippines first

Alfamart announced on 19 May 2014 it plans to open 100-200 outlets in ASEAN (excluding the Philippines) and open another 1,200 stores in Indonesia in 2014. Capex allocation for 2014 ranges from IDR 1.8 trillion (USD 157 million) to IDR 2 trillion, up from IDR 800 billion in 2013.

What about the Philippines? The company said it will be a joint venture with Alfamart being a minority shareholder, said PT Sumber Alfaria Trijaya managing director Hans Prawira. The name of the local joint venture partner was not disclosed. One of the most interesting things revealed by Prawira is negotiation has not reached the final stage. The company will first set up a distribution centre before opening the retail outlets.

 “Belum itu, kan masih perjanjian awal, belum final business plannya. Tapi memang bangun pusat distribusi terlebih dahulu, karena sebelum bangun toko ritel kita harus bangun distribusi dulu,” papar Hans.Link [The business plan is not yet final. Will establish the distribution centre first because you need to set up the distribution  before you can  have the retail outlets, said Hans]

The joint venture process is expected to be completed in 2014. Alfamart aims to start operation in the Philippines within 2014. The stores will be leased.

Another intersting thing about the announcement is the plan to open 100-200 outlets in ASEAN (excluding the Philippines). Which other countries will Alfamart enter apart from the Philippines, a country with strong similarities with Indonesia. Malaysia and Singapore are out of the question as Malaysia already has a very strong minimart scene with KK Mart and 99Speedmart, while Singapore, a island state, is more suitable for convenience store.

What Alfamart has in mind would be a place where the traffic is still dominated by pedestrians and motorcycles. The place also has to have terrible traffic jam and there is still a lack of modern proximity stores. 

Vietnam fits the bill. 

However, the layout of the Alfamart store in Vietnam will have to adapt to the long and narrow lot. It would be interesting to see if Alfamart is able to modify its store to fit the unique condition in Vietnam where there will be no spacious parking in front of the outlet.



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