Jakarta, CNBC Indonesia – Tanah Abang was once the largest shopping center in Asia, especially for the fashion category. However, the center’s popularity has recently faded due to intense competition with e-commerce.
Search CNBC Indonesia Research Some time ago we discovered several facts about what happened at the Tanah Abang market after the Tiktop Shop closed. Currently, the e-commerce service in the TikTok social media application has resumed operations in collaboration with Tokopedia.
CNBC Indonesia Research starting from the first floor of Block A, entering from the main door, we observed quite a number of visitors, going back and forth carrying shopping and some were seen leaving while waiting for vehicles.
However, after going around the first floor from Blocks A, B, to C, the crowd of visitors was more pronounced at the entrance, the more you went inside it still looked quiet, as did the ground floor, then the second, third, fourth and fifth floors.
The busy time for visitors was observed at around 10.00 – 11.00 WIB, then starting at 13.00 WIB it was seen that several shops were closing.
A number of sellers stated to CNBC Indonesia that after the Tiktok Shop closed there had been an increase in visitors, but for those who bought the same as before, there had not been a significant increase.
“If people come, it’s not bad, there’s an increase, but if you just buy normally, you don’t see much of an increase,” said Jule, one of the Tanah Abang clothes shop employees.
One of the shop owners, Jordi, also said that the effect of the Tiktok Shop has not yet been felt in sales, but those who visit the shop have started to come alive. He also stated that in the future technology will become more advanced, so the store’s strategy must also be willing to enter e-commerce.
“So far there has been no effect on sales, but in the future technology will continue to advance, whether we like it or not, we have to follow suit, but for those who often shop here, we will still have an offline shop,” said Jordi.
Tanah Abang Traders Join E-commerce
Searching several shops in Tanah Abang, the majority already have e-commerce and social media accounts such as Shopee, Tokopedia, Instagram, Tiktok, and others. This shows that sellers in Tanah Abang, although it was widely heard that they wanted to close e-commerce, are in fact following developments and selling online.
However, there are indeed a number of problems that are difficult to face, namely the risk of price competition with e-commerce which is very unreasonable. Some sellers regret that e-commerce prices are very cheap, even though their production alone is on average more expensive than that.
Unhealthy E-commerce Competition, Thin Margins
CNBC Indonesia Research asked for prices for various types of clothing which we judged to be similar to those in several e-commerce sites. The findings show that most people in Tanah Abang provide cheap prices for wholesale purchases, but there are still cheaper prices sold on e-commerce.
For example, there are brocade kebayas and batik skirts which are sold for Rp. 160,000 per set, then you will be given a discount of Rp. 145,000 if you want to buy at least three. It turns out that after searching on e-commerce with the same model, there are ones being sold for IDR 130,000 or even cheaper.
Others, there are plisket skirts priced at Rp20,000 for a minimum purchase of 6 pcs in Tanah Abang, but in e-commerce there are many that sell below that price and you can buy from 1 pcs only.
Consumers tend to be price sensitive, so it is not surprising that the first choice will fall on buying online, because it is cheaper, there are often discounts on shipping costs, and it is also more flexible.
However, there are also visitors who state that they prefer to buy directly because they can touch the material/fabric directly, then they can know more about the appropriate size, and they can better adjust it to expectations.
But the main problem lies in the cheaper prices, the margins that sellers can set are thinner. Most buyers are also resellers, if the aim is to buy clothes for resale then margins or profits can be further eroded.
We believe that this unfair price competition factor occurs because there are distribution problems where producers can easily enter e-commerce and sell their products directly without having to go through distributors or resellers.
This condition means that producers can sell cheaper, while resellers have difficulty determining prices because their margins are thin, but if the prices are not the same or cheaper than those of producers, their products will become less attractive in the eyes of consumers.
Extortion is rampant in Tanah Abang Parking Lot
The next problem that makes it quiet also comes from parking which is reportedly a lot of illegal fees by various individuals. CNBC Indonesia collected several netizens’ complaints on various social media platforms stating that parking prices are unreasonable, cars can be up to 50 thousand, motorbikes 20 thousand, and etc.
One account called Milestone
Another was Andreas Natawijaya who made a status on Facebook saying “Try to go to a place that is currently viral (t*nah ab*ng market). When you first want to park, try to enter. The portal turns out there is a person inside who is pulling the parking lot (charged 35 thousand, no. Bargaining) even though you have already paid for the official parking, you also use a ticket.”
Apart from the problems of e-commerce and unreasonable prices, this parking problem should be the first to be resolved. The reason is that when just parking makes it uncomfortable for consumers to go to Tanah Abang, of course this quiet problem will drag on.
Apart from that, cooperation between business actors and the management of the wholesale center is needed so that the facilities there can run more effectively and efficiently, which is hoped will bring convenience to customers shopping in Tanah Abang.
(fab/fab)
[Gambas:Video CNBC]
2023-12-25 23:45:00
#Revealing #Tanah #Abangs #Flaws #Buyers #Run
