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The Jakarta Post
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Consumers to shop less as fuel spending rises

  • The Jakarta Post

    The Jakarta Post

Jakarta | Thu, June 27, 2013 | 08:57 am

Consumers will cut back on shopping, eating out and savings but will maintain spending on necessities like food and health care and increase their energy budget following last week's 44 percent hike in fuel prices.

A survey by Kadence Indonesia, a UK-based market research agency, released Wednesday shows how Indonesians will adjust their spending.

According to the survey, which involved 500 respondents in Greater Jakarta, Surabaya, Medan, Balikpapan and Makassar, 35 percent said they would spend more on utilities such as water and electricity.

It also showed that 32 percent would spend more on fuel bills and only 18 percent said they would try to reduce costs by cutting back on consumption.

The spending adjustments will likely hit malls and entertainment places as half of the respondents said they would reduce spending on clothing and accessories and as many as 57 percent said they would eat-out less.

Many of those who smoke said they would also cut back, the survey said.

The survey, however, showed that people would allocate the same amount of money for food, personal care products, medical care, milk, and other necessities such as mobile phone top-ups.

"This indicates that consumers view these categories as staple goods. We predict that these categories will not be affected by the fuel hike," Kadence Indonesia managing director Vivek Thomas said.

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