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Jakarta Post

Japanese businesses thrive in Indonesia

The country’s large youth population has been the key to the success of Japanese retail and services businesses operating in Indonesia

Mariel Grazella (The Jakarta Post)
Jakarta
Wed, November 20, 2013

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Japanese businesses thrive in Indonesia

T

he country'€™s large youth population has been the key to the success of Japanese retail and services businesses operating in Indonesia.

Gen Tamatsuka, director and CEO of Japan-based Lawson Co. Ltd., said that besides China, Indonesia and Thailand were the major markets for the convenience store operator in Asia.

Lawson runs nearly 400 stores in China. In Southeast Asia, the convenience store has opened 18 outlets in Thailand and 63 in Indonesia.

'€œLawson'€™s sales in Indonesia have been growing by 20 percent annually,'€ he said at a gathering organized by the Japan External Trade Organization (JETRO).

In Indonesia, Lawson has given domestic retail store operator
PT Midi Utama Indonesia (MIDI) the right to use and sub-franchise the Lawson brand.

Tamatsuka added that Lawson had so far concentrated its business in Jakarta and its surrounding areas because of its large, growing urban population of approximately 20 million.

These demographics are radically different from those in Japan, where the number of families with four to five members will shrink to 20 percent in the next decade, he said.

'€œAt the same time, in Japan the number of households with people above 65 years old has increased from 6 million to 16 million,'€ he added.

JETRO director for service industry division, Hironobu Kitagawa, said that Jakarta had become the fourth most attractive country for investment by Japanese companies in the service sector.

'€œTwo years ago, Jakarta was not even in the top ten,'€ he said.

Kunio Ichinose, CEO of Japan-based Pepper Food Service, said that its Indonesian business had posted the highest growth of its Southeast Asia operations.

In Indonesia, Pepper Food Service operates Pepper Lunch restaurants with domestic food company Boga Group.

'€œOur business in Indonesia grew by approximately 130 percent compared to last year,'€ he said.

Metrox Group CEO, Freddie Beh, said that the appeal of Japanese retail concepts to domestic consumers was the driving force behind the success of Japanese brands.

Metrox is a retailer who has license over international brands such as Yohji Yamamoto and Superdry.

He said Japan had become synonymous with trendiness and quality, prompting the retailer to bring in up to 20 Japanese brands for its concept store, Tokyo Playground Market, opening this year.

'€œThe store will showcase Japanese brands and fashion culture such as photo booths and desserts,'€ he said.

He added that the popularity of Japanese style had led the company to launch Wakai, its in-house brand of Japanese-inspired footwear.

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