Photo for illustrative purposes only. Carrefour logo in Finestrat, Spain, on June 12, 2019. Veja / Shutterstock.com

Halal Industry

Carrefour Indonesia to open new outlets in partnership with national mosque council


JAKARTA - Major retailer Trans Retail Indonesia will open Carrefour supermarkets in up to 300 mosque districts starting this year in partnership with the Indonesia Mosque Council (Dewan Masjid Indonesia, DMI), Satria Hamid the company’s vice president for corporate communications told Salaam Gateway.

Trans Retail Indonesia, part of the CT Corp group, is currently working with the national mosque body to select districts for the new supermarkets in cities such as Jakarta, Sukabumi, Bandung, Bekasi, and Depok, as well as in provincial centers such as Riau, Padang, Lombok, and Makassar.

“We have signed a memorandum of understanding with DMI and we agreed on three points: boost human capital skills in retail management, grow the number of entrepreneurs from mosque districts, and increase the purchasing power of this captive market,” said Hamid.

The two parties will split revenues 50:50.            

DMI will provide the retail infrastructure and operations for the new supermarkets and Trans Retail will act as products supplier. The retailer will also help boost DMI’s retail management skills mainly through providing technical assistance for purchasing, distribution, merchandise displays, and safety and hygiene.

DMI will build the supermarkets from both brownfield and greenfield sites. It estimates the cost of building each supermarket to be from 50 million Indonesian rupiah ($3,465) to 500 million rupiah.

It will finance all development using Islamic social finance funds such as sadaqah and awqaf and is also open to the possibility of bank financing or microfinancing.

DMI brings in around 3.5 million Indonesian rupiah a month from sadaqah, or charitable donations.

Hamid said Trans Retail can refer mosque managers to banks should they require financing, using the MoU as collateral, or by using funds from Shariah-compliant institutions such as microfinancer Baitul Maal Wa Tamwil (BMT).

Trans Retail Indonesia will invest a “relatively small” amount into the partnership, said Hamid.

It will invest between 50 million Indonesian rupiah and 500 million rupiah depending on the size of each supermarket. The outlets will range between 10 square meters and 250 square meters.

For its part, the company’s capital investment will be channeled into products (50 percent), operational costs (30 percent), and salaries (20 percent).

Hamid said Trans Retail will allow customer demand to dictate if the supermarkets in the mosque districts will carry only halal-certified products. According to him, Carrefour supermarkets have in the past withdrawn a halal-certified noodle product for lack of demand, while a halal-certified brand of mineral water, Al Qodiri Barokah, was able to compete with bigger names such as Aqua Danone.

“I think customer awareness about halal products is better nowadays. They have even started to look for non-F&B halal goods such as detergents,” said Hamid.

The Carrefour supermarkets in the mosque districts will compete with other major retailers such as Alfamaret, run by nationwide convenience store chain Sumber Alfaria Trijaya.

The Carrefour outlets will provide different facilities to be more competitive, such as co-working spaces to attract the younger demographic and loyalty programs that offer discounts. 

Trans Retail Indonesia’s parent company CT Corp is owned by tycoon Chairul Tandjung. Trans Retail currently runs 112 Carrefour hypermarkets and supermarkets across Indonesia under the umbrella of four brands: Carrefour, Transmart Carrefour, Transmart, and Groserindo Carrefour.

CT Corp acquired 100 percent of PT Carrefour Indonesia, a subsidiary of Carrefour France, for $750 million at the end of 2012. 

($1 = 14,428.97 Indonesian rupiah)

(Reporting by Yosi Winosa; Editing by Emmy Abdul Alim emmy.alim@thomsonreuters.com)

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Retail
Supermarket