In 2015 a trade regulation (Trade Regulation No. 06/M-DAG/PER/1/2015) came into force across Indonesia prohibiting the sale of alcoholic beverages at minimarkets, convenience stores and kiosks – locations that provided a substantial percentage of off premises beer and ready to drink sales.
Surabaya is reported to be next in line with a city wide ban on the sale of all alcohol products with more than 10% alcohol content.
Now in the shifting sands of legislation and regulation Jakarta appears to be making the move to again allow sales of beer at minimarkets.
The ebb and flow of laws creates a palpable sense of caution for international alcohol exporters. The uncertainty presents a new set of challenges for those already in the market as well as those looking to include Indonesia as part of their Asian export market strategy.
Coupled with the restrictions on alcohol advertising and sponsorships, brand building for new alcohol labels in Indonesia is something that leaves the existing brands in a dominant position, though it certainly isn’t a market that hasn’t seen new players make strong in roads, and with such a large and youthful population (more than 250 million people) and a growing economy there are real opportunities for international brands.
For a new market entrant the primary consideration is to identify strong and focused distribution partners for each of the regions of Indonesia to be sold into. Coupled with this is a strong marketing and brand building campaign – one that stays on the right side of advertising restrictions. Working with a marketing and advertising partner with an understanding of the widely varied cultures across the archipelago can certainly assist with this process.
With as many people, cultures, languages and laws, Indonesia shouldn’t be treated as a single export market. A country this big won’t fit into a one-size-fits-all approach and is a recipe for wasted investment.