Strategic Adjustments in Retail Network

Director **Wiwiek Yusuf** explained that while some Indomaret outlets are indeed being shut down, this is balanced by new openings. He stated, “Certainly (some are closed), in the company there are those who are open, some are closed. If the closed one means the potential is lacking. But we also open it in other places.” This statement was made during an event in Jakarta on Tuesday, July 22, 2025.

The company remains committed to growth, with plans to launch approximately 1,000 new outlets across Indonesia by the end of the year. This expansion includes a strategic push into the eastern regions of the archipelago, a move that requires careful logistical planning.

Focus on Domestic Market, Eastward Expansion

**Wiwiek Yusuf** highlighted the company’s intention to establish these new stores nationwide. He noted, “Approximately (open outlets until the end of the year) a thousand shops. Throughout Indonesia. Our eastern region began (explore). We must set the logistics.”

However, Indomaret will not be entering the Padang market, a decision attributed to licensing issues. “Then like Padang, we have not entered either, but Aceh we have entered. If Padang is because it is more licensing. Indeed, if I look at the fair they can’t enter, you can’t enter all,” **Wiwiek** elaborated.

Currently, Indomaret’s expansion efforts are focused exclusively within Indonesia, with no immediate plans for international ventures. This contrasts with competitor Alfamart, which has already established a significant presence abroad.

Competitive Landscape and International Reach

In contrast, Alfamart, another major player in the Indonesian retail sector, has already expanded its footprint internationally. The company operates around 2,400 outlets in the Philippines and is actively exploring further expansion opportunities in Malaysia and Bangladesh. This highlights a broader trend in the Indonesian retail industry, with organizations like Aprindo (Indonesian Retail Entrepreneurs Association) facilitating not just goods export but also the establishment of retail branches overseas.

The Indonesian retail sector saw a 3.5% growth in sales in the first quarter of 2024, indicating a healthy domestic market while companies like Alfamart seek diversification through international expansion (Source: Indonesian Ministry of Trade, Q1 2024 Report).

Chinese Food Outlets Flood Indonesian Market

Local Businesses Face Intense Competition

Indonesian small and medium-sized enterprises (SMEs) are grappling with a significant increase in food and beverage (F&B) outlets originating from China. These new entrants are rapidly appearing across the archipelago, intensifying competition for local businesses.

A Lucrative Target Market

The vast Indonesian population and its consumer habits have made the country a prime target for Chinese businesses. According to Levita Ginting Supit, Chairman of the Indonesian Franchise & License Association, the nation’s large demographic is the primary driver behind this influx.

“Indeed, Indonesia is a target market for businesses in foreign countries. So now we are the target market for China. Why? Because Indonesia is a large country and population. That is the target market of F&B that enters Indonesia.”

—Levita Ginting Supit, Chairman of the Indonesian Franchise & License Association

Levita Ginting Supit further noted the Indonesian propensity for trying new culinary experiences. “Take a look at every time there is an F&B that enters new Indonesia from abroad, it must be immediately invaded, immediately crowded because Indonesian people always want to know every food from abroad that enters Indonesia. That is typical of the Indonesian people,” she explained.

Pricing and Trade Agreements Fuel Growth

The affordability of Chinese F&B options is a key draw for consumers, attributed to lower raw material costs. Bhima Yudhistira, Executive Director of the Center for Economic and Law Studies (Celios), highlighted the impact of favorable trade agreements.

He stated that low tariffs under the China-ASEAN Free Trade Area (CAFTA) and RCEP significantly reduce the cost of imported Chinese ingredients for F&B businesses operating in Indonesia. Additionally, lower operational expenses, including more economical rental spaces outside of major shopping centers, contribute to Indonesia’s appeal.

This surge in Chinese F&B presence is part of a broader trend. Research from Singapore’s Momentum Works indicates that over 6,100 Chinese F&B outlets entered the Southeast Asian market since 2022, with Indonesia and Vietnam accounting for approximately 4,000 of these establishments. This expansion is partly a response to a struggling domestic market in China, where over a million F&B businesses closed in 2024 due to oversupply and stagnant consumption.

The Indonesian market’s economic stability and relatively permissive regulatory environment present a compelling alternative for Chinese businesses seeking new growth avenues. For context, the global fast-food market is projected to reach $1.77 trillion by 2030, demonstrating the immense scale of opportunities in the sector (Grand View Research, 2024).

business expansion

Indomaret boss talking added 1,000 shops, said the reason for not entering Padang

Indomaret Details Outlet Closures Amid Expansion Plans

Retail Giant Opens 1,000 New Stores While Culling Underperforming Locations