Sales pick up in Indonesia as economy recovers

As many economies in Asia react to the sluggish US economy, hopes are high for Indonesia. The Asian Development Bank predicted earlier that Indonesia's economic growth in 2008 would reach 6 percent, and that the momentum would continue into 2009, when the economy is predicted to grow by 6.2 percent. The bank, however, estimates the inflation rate in Indonesia will reach around 10.1 percent in 2008, which may dampen economic activity in the country.

It is no coincidence that the local jewellery market reflects the observations of the bank by revealing a rather vibrant demand for luxury items. PT Pranda SCL Indonesia, a 42-store chain retailer, recorded a sales increase of 15 percent, as consumers are more willing to spend. "Our business was more lucrative because we increased our price range, and consumers are able to afford it," said Johnny Salmon, managing director of the company. He foresees that high inflation will affect the incentive for customers to buy in the second half of the year, but he nonetheless believes that the right strategies always sort things out. "With focus on the right merchandise, to-the-point advertisements and suitable shop locations, we are confident of closing 2008 with a 20-percent jump in sales," Mr Salmon said.