With 60,000 stores across the world, 7-Eleven is the undisputed King of Convenience stores.
Except in one place.
7-Eleven could only survive 8 years in the Indonesian market, despite retail stores being one of the highest growth sectors in the Indonesian economy.
Let’s explore 7-Eleven’s meteoric rise and fall in Indonesia…
The 7-Eleven chain first landed on Indonesian shores in 2009. Traditionally, it was a place to buy cigarettes, snacks, and slushies.
While the Indonesian 7-Eleven provided all of that, it became a social hub all of its own.
Popular with 18-25 year-olds, it was a one-stop-shop for free Wi-Fi, socializing and – crucially – cheap alcohol.
This lead to the rapid growth of 7-Eleven in Jakarta and surrounding cities.
2010 – 21 Stores
2012 – 100 Stores
2014 – 190 Stores
Sales peaked this year, with $78.2 million revenue.
There was one problem. Competition in the sector was huge.
In 2007, 3 years before 7-Eleven entered Indonesia, there were already 12,000 retail stores across the archipelago. By 2016, there were 40,000.
Mini markets were the fastest growing segment in the sector.
Alphamart Had 10,000 Stores = 38% Market Share
Indomaret Had 15,000 Stores = 47% Market Share
7-Eleven Had 190 Stores = 0.7% Market Share
The downfall of 7 Eleven in Indonesia can be pinpointed in 2015, with the government banning the sale of alcohol in mini-marts.
This exercise was taken in order to “protect Indonesia’s youth” – the exact target market 7-Eleven’s growth relied on.
Just 2 years after the ban, 7-Eleven closed all it’s stores.
Watch CNBC’s informative investigation on the decline of 7-Eleven in Indonesia: