Erajaya Swasembada widens net in SE Asia

Indonesian listed cellphone distributor Erajaya Swasembada is expanding in neighbouring countries, with four outlets in Singapore and five more planned for Malaysia, where it has 26 stores.

It also hoped to establish itself in some other countries, reports the Jakarta Post, but CEO Hasan Aula has not yet revealed further details.

In Singapore, Erajaya partners with telecommunications company M1, while in Malaysia it works with Apple product distributor CG Computers, which it acquired in 2014, the year it entered the market.
An International Data Corporation (IDC) Indonesia report says about 29.3 million smartphones were shipped to the country last year, making it the largest smartphone market in Southeast Asia.

Erajaya corporate secretary Djatmiko “Koko” Wardoyo says mobile phone sales in Malaysia and Singapore are trickier as phones are usually sold under a contract system directly with a telecommunications company. In Indonesia it is more flexible as consumers buy cellphones and switch operators at will.

Erajaya’s expansion in the Southeast Asia market is budgeted within the firm’s Rp100 billion (US$7.5 million) capital expenditure reserves. The budget is also being used to open and renovate stores in Indonesia.

Hasan says that up to now, Rp12.9 billion has been disbursed and new stores set up – Erafonemegastores in Jakarta, stores in Bandar Lampung, Lampung province, and Pontianak, West Kalimantan, as well as the Urban Republic store in the Kota Kasablanka mall in Jakarta. The Urban Republic store not only sells handphones and accessories, but also products related to the Internet of Things, including drones.

In its first quarter this year, Erajaya had Rp4.85 trillion in sales, a 22.72 per cent increase from Rp3.95 trillion in the matching quarter last year. It sold 2.9 million phones, 19 per cent up from 2435 units in the corresponding quarter of last year, and its net profit of Rp59.85 billion was a 19.74 per cent drop because of rising rental, marketing and salary costs.

By year’s end, Erajaya plans to have opened 40 outlets under the Erafone, Switch, iBox, Samsung and Urban Republic brands to add to its 576 outlets, 78 distribution points and 34,000 third-party sellers throughout Indonesia.

Koko says more than 80 per cent of sales in Indonesia are of smartphones.

You have 7 articles remaining. Unlock 15 free articles a month, it’s free.