As of the third quarter of 2023, traditional trade held the highest market share of 69 percent in the fast-moving consumer goods (FMCG) sector in Indonesia. Mini markets followed with 16 percent market share in the FMCG sector. Traditional trade has been an important part of many Indonesians’ lives. It is a familiar sight in Indonesian neighborhoods, and a place for bargaining and purchasing various consumer products.
The benefits of traditional trade
Traditional trade, which encompasses traditional markets, “warung” or small kiosks, and other family-run establishments, has been preferred by Indonesian consumers due to its accessibility. This has been a great alternative for them as logistics have proven to be challenging in a country where its 270 million people are spread out in thousands of islands. Although traditional trade has its benefits, it has struggled to compete with its modern competitors in terms of convenience. This problem was also amplified in some areas of the country due to the decreasing amount of people living in rural areas. As the value of retail sales from convenience stores continues to increase, these modern alternatives will continue to gain a foothold across Indonesia.
The market outlook
The market share of mini-markets for FMCG in Indonesia has decreased by two percent since the third quarter of 2020. Though still dwarfed by that of traditional markets, the same could not be said about their popularity. However, Indonesians may still trust and support traditional trade more due to its consistent pricing strategies. Unlike traditional retail, modern trade channels such as hypermarkets and supermarkets follow the loss leader strategy by selling some items at a loss to gain more by selling other products at a more expensive price.
Leading sales channels of fast-moving consumer goods (FMCG) in Indonesia as of 3rd quarter 2023, by market share
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Kantar Worldpanel. (November 30, 2023). Leading sales channels of fast-moving consumer goods (FMCG) in Indonesia as of 3rd quarter 2023, by market share [Graph]. In Statista. Retrieved October 05, 2024, from https://www.statista.com/statistics/1204130/indonesia-leading-fmcg-channels-by-market-share/
Kantar Worldpanel. "Leading sales channels of fast-moving consumer goods (FMCG) in Indonesia as of 3rd quarter 2023, by market share." Chart. November 30, 2023. Statista. Accessed October 05, 2024. https://www.statista.com/statistics/1204130/indonesia-leading-fmcg-channels-by-market-share/
Kantar Worldpanel. (2023). Leading sales channels of fast-moving consumer goods (FMCG) in Indonesia as of 3rd quarter 2023, by market share. Statista. Statista Inc.. Accessed: October 05, 2024. https://www.statista.com/statistics/1204130/indonesia-leading-fmcg-channels-by-market-share/
Kantar Worldpanel. "Leading Sales Channels of Fast-moving Consumer Goods (Fmcg) in Indonesia as of 3rd Quarter 2023, by Market Share." Statista, Statista Inc., 30 Nov 2023, https://www.statista.com/statistics/1204130/indonesia-leading-fmcg-channels-by-market-share/
Kantar Worldpanel, Leading sales channels of fast-moving consumer goods (FMCG) in Indonesia as of 3rd quarter 2023, by market share Statista, https://www.statista.com/statistics/1204130/indonesia-leading-fmcg-channels-by-market-share/ (last visited October 05, 2024)
Leading sales channels of fast-moving consumer goods (FMCG) in Indonesia as of 3rd quarter 2023, by market share [Graph], Kantar Worldpanel, November 30, 2023. [Online]. Available: https://www.statista.com/statistics/1204130/indonesia-leading-fmcg-channels-by-market-share/