Polemik penutupan izin Alfamart dan Indomaret di NTB – Toko kelontong makin terpinggirkan

The closure of dozens of modern retail outlets, some operating for over a decade, in Central Lombok Regency, West Nusa Tenggara (NTB), has exposed a tangled web of licensing irregularities within the retail sector. This chaotic situation also brings renewed attention to the plight of traditional convenience stores amidst the relentless expansion of modern retail.

The primary reason cited for shutting down 25 Alfamart and Indomaret branches was their establishment within a one-kilometer radius of traditional markets, violating local regulations.

This decisive action has sparked protests from employees of these modern retail chains, who fear losing their jobs.

The central government, through the Ministry of Trade, also expressed regret over the closures.

Minister of Trade Budi Santoso questioned, “why is the regulation only happening now,” given that these dozens of modern retail outlets have been operational for a long time.

Several economic observers view this issue as indicative of “inconsistency” and “weak oversight” in retail licensing management by local governments.

According to these observers, the haphazard licensing system has allowed modern retail to proliferate widely, further “marginalizing” the fate of traditional convenience stores and markets.

Previously, the Indonesian Street Vendor Association (APKLI) reported a continuous decline in the number of traditional warungs (small shops) across Indonesia, estimating only about 3.9 million units remaining by the end of 2025.

In 2007, the number of warungs stood at 6.1 million units.

This significant reduction is strongly suspected to be a direct consequence of rapid modern retail expansion and increasingly lenient licensing policies.

“Many have been marginalized, pushed to the periphery. They are reluctant to live, but not yet ready to die,” remarked Hempri Suyarna, a researcher from the Center for People’s Studies at Gadjah Mada University (UGM), Yogyakarta, on Friday (29/05).

The revelation of this problem also underscores that Indonesia’s economic structure often fails to adequately protect small businesses, as noted by economic analysts.

What research findings illuminate this issue? And what solutions have observers proposed?

How do small shop owners cope with the aggressive expansion of modern retail into urban outskirts?

Government Inconsistency in Modern Retail Licensing

Hempri Suyarna, a researcher from the Center for People’s Studies at Gadjah Mada University (UGM), Yogyakarta, believes that the exposure of modern retail licensing issues in NTB serves as clear evidence of “inconsistency in local government regulations concerning networked modern stores.”

Suyarna also contends that the oversight function regarding modern retail expansion efforts across various regions “is not working.”

“If the government were serious about developing a people’s economic concept, a system that truly favors the grassroots economy, it should have been regulated from the start, not just now,” he told BBC News Indonesia on Friday (29/05).

In his observations, networked modern stores have become ubiquitous in numerous urban areas throughout Indonesia.

However, Suyarna notes that the government “seems to be feigning ignorance, inconsistent in its commitment to protecting the people’s economy.”

He argues that the case of dozens of modern retail outlets being shut down in NTB would not have occurred if local governments had been consistent from the outset in enforcing the various requirements for their permits.

“Aspects like zoning, the distance between modern stores and traditional markets, and the types of commodities that should be sold in modern markets are all crucial,” he emphasized.

Research by the Center for People’s Studies at Gadjah Mada University (UGM) indicates that these requirements are frequently violated due to a dysfunctional oversight system.

“Supervision [of licensing] from upstream to downstream is poorly controlled,” he stated.

His findings reveal instances where modern outlet owners “circumvent community permits.”

“They might call it socialization, but it’s treated as if it were actual permission,” Hempri explained.

This chaotic licensing system, according to him, enables modern retail to spread unchecked, further “marginalizing” the fate of traditional convenience stores and markets.

“Many are marginalized, pushed to the periphery. Reluctant to live, but not yet ready to die,” he reiterated.

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Previously, the Indonesian Street Vendor Association (APKLI) disclosed that the number of traditional warungs in Indonesia is “continuously shrinking.”

According to APKLI, by the end of 2025, there will be approximately 3.9 million units remaining.

APKLI Chairman Ali Mahsun confirmed that this figure represents a drastic decline from 6.1 million in 2007.

This means, Ali stated, that over 2.2 million traditional warungs have gone out of business due to the rapid expansion of modern retail and more relaxed licensing policies.

In late February 2026, Ali asserted that modern retail policies should not sacrifice the existence of people’s businesses.

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APKLI has proposed that the government regulation concerning the management of traditional markets, shopping centers, and modern stores be strengthened.

Contacted separately, political economic observer Ichsanuddin Noorsy stated that the recent enforcement action by the Central Lombok Regency Government in NTB was “wrong.”

“So, they are right about spatial planning, but they are wrong because once a permit has been granted, it cannot just be revoked. That’s not allowed. They are inconsistent,” Ichsanuddin told BBC News Indonesia on Friday (29/05).

He argued that the revocation of permits disrupts employment, which could ultimately lead to an increase in crime. “So, the Central Lombok Regional Government needs to be reminded of this,” he added.

What Happened in Central Lombok and the Ministry of Trade’s Response?

The Ministry of Trade does not deny the existence of licensing governance issues behind the closure of dozens of retail outlets in NTB.

During a working meeting with House Commission V on Tuesday (26/05), Minister of Trade Budi Santoso urged local governments to be transparent in their permitting processes.

“Licensing must be clearer, more transparent. Companies should not be allowed to operate if they are actually violating regulations, for example,” Budi Santoso emphasized.

Budi stated that zoning and regulatory arrangements must be finalized before business permits are issued.

For this reason, Budi questioned the Central Lombok Regency Government’s decision to only address the issue now.

“We also regret that these retail outlets have been operating for a long time, yet the regulation is only being enforced now,” he remarked.

Technical regulations, such as the distance between modern retail outlets and their proximity to traditional markets, fall under the authority of each local government, as stipulated in the Regional Spatial Plan (RTRW).

This allows for varying zoning rules across different regions. Nevertheless, Budi cautioned that these rules must be applied fairly and not disadvantage businesses that are already operational.

Regardless, Budi claimed, his ministry has been in communication with the local government.

The final outcome of the closure of these dozens of retail outlets remains unclear.

To date, the Central Lombok Regency Government has pledged to hold regular meetings with the Regional People’s Representative Council (DPRD) regarding the matter.

Central Lombok Regent Pathul Bahri also promised to summon the management of the modern retail businesses.

The objective is to formulate the best solution for the regional investment climate and the fate of the workers affected by the closures.

Pathul reaffirmed the reason for the closures.

“It is purely due to the enforcement of local regulations. It has nothing to do with the government’s program for the development of the Merah Putih Village Cooperatives intended by the central government,” Pathul Bahri stated on Tuesday (26/05).

He did not elaborate on why the regulations are only being enforced now.

A total of 25 franchised minimarket outlets, Alfamart and Indomaret, were closed by the Central Lombok Regency Government. They were deemed to have violated the minimum distance rule from traditional or community markets.

This decision prompted workers from these dozens of outlets to stage a protest on Wednesday (20/05) in front of the Central Lombok Regent’s Office, expressing their fear of job loss.

‘We hope for regulations that protect us’ – The Story of a Small Shop Owner in Sukabumi

Under a cloudy sky on a street corner in Citamiang, Sukabumi, West Java, stands a small convenience store named ‘Warung Ateu Mawar’.

Its location is not far from a modern retail chain.

That afternoon, Reni Sumarni (47)—the owner of this small shop—was busy tidying stacks of traditional snacks and tightly strung sachets of cold drinks hanging from her shop’s ceiling.

For the woman who has dedicated 15 years of her life to grassroots retail, her warung gadang—a local term for shops operating late into the night—is on the verge of dormancy.

Her business landscape is not only besieged by the classic competition from modern minimarkets but is now also shaken by the arrival of a new competitor: ‘warung Madura’—a term referring to convenience stores managed by migrants from Madura.

In facing competition, Reni finds herself caught between two colossal business models with different impacts on her business’s sustainability.

Reni acknowledges that the presence of a modern minimarket right next door has shifted the shopping habits of the upper-middle class, who seek convenience and a complete variety of products.

“People with a lot of money and a hedonistic lifestyle definitely go to minimarkets. And perhaps they have a complete selection there. But for the lower-middle class, they automatically look for it at a warung,” Reni told journalist Siti Fatimah, reporting for BBC News Indonesia from the location on Friday (29/05).

However, the impact is not entirely devastating because modern retail does not serve purchases of individual cigarettes or single items.

Reni even often takes advantage of minimarket promotions to stock her groceries if the prices prove cheaper than wholesale agents.

The most tangible threat, however, comes from the phenomenon of Warung Madura, which taps into the exact same market niche as local warungs.

Unlike air-conditioned retail chains with limited operating hours, Warung Madura operates non-stop, 24 hours a day.

They employ an aggressive price-cutting strategy that approaches wholesale prices.

“They drop prices. If we sell gas for Rp21,000, they dare to sell it for Rp20,000. We sell cigarettes for Rp30,000, they sell them for Rp29,000. Plus, they’re open 24 hours, saying they only close if doomsday comes,” Reni quipped, mimicking the slogan of her rival shop’s owners.

Reni, or Ateu as she is affectionately called, reminisces about her heyday a few years ago.

Starting with a phone credit counter in a rented room costing Rp300,000 per month, her business steadily grew, enabling her to rent a large shop-house and expand into groceries.

From the fruits of her labor in managing the warung’s capital, she successfully put her children through higher education; one is even preparing to pursue a master’s degree.

“Back then, from nine at night until three in the morning alone, I could pocket an turnover of Rp1.5 million to Rp1.8 million,” Reni recalled.

However, the tide has turned dramatically. Now, earning Rp500,000 from morning till night is extremely difficult.

“Now my spirit has fallen, I’m mentally affected too. So I become lazy, sometimes opening in the afternoon, sometimes not,” she expressed resignedly.

This complicated situation is exacerbated by the strong supply chains of minimarkets and Warung Madura, both operating as organized corporations and communities.

Reni laments the lack of solidarity among local residents in protecting their own neighborhood’s economic ecosystem.

Currently, Warung Ateu Mawar relies only on its remaining loyal customers and financial support from her husband to keep the household running.

She chooses to persevere as best she can to pass the time, hoping for regulations or collective awareness that can save the fate of traditional warungs from extinction in their own land.

‘We cannot compete with large supermarkets’ – The Cry of a Small Shop Owner in Padang

In West Sumatra, even without major retail chains like Indomaret and Alfamidi, small shop owners still struggle to compete with powerful local retail stores in the region.

Yanti (55), interviewed by journalist Halbert Caniago reporting for BBC Indonesia on Friday (29/05), stated that recently, her convenience store has found it difficult to attract customers.

“But I’m not sure if it’s because of the supermarket or because purchasing power has decreased. But it’s definitely very different from usual,” she mentioned.

According to the woman who started her convenience store business in 2011, the large retail outlet, located just tens of meters from her shop, targets a different type of customer.

“It’s possible their target market is people who buy in large quantities. While I only rely on passersby and local residents nearby, and they don’t buy much,” she said.

Yanti doesn’t entirely attribute the supermarket’s presence to her declining sales over the past few years. Instead, she leans towards the general economic downturn.

“It could be because people’s purchasing power has decreased. That’s why fewer people pass by and shop here lately,” she stated.

However, a different perspective was offered by a convenience store owner in Koto Tangah District, Padang City, whose shop is also just tens of meters from a large supermarket in the area.

“Before, there were several warungs like mine here. But one by one they closed because they couldn’t compete with that supermarket,” said the man, who wished to remain anonymous.

According to the middle-aged man, his shop, now on the verge of bankruptcy, used to be bustling and well-stocked.

“Since that supermarket appeared, distributors no longer want to unload goods at small shops around here. Some sales representatives even ask us to buy goods from that supermarket,” he explained.

He believes that even without Alfamidi and Indomaret in West Sumatra, local businesses alone are already making it difficult for small traders.

“In my opinion, they are even crueler than those chains. I’ve managed to survive until now because I still do other jobs like being a motorcycle taxi driver and raising chickens behind this shop,” he said.

The absence of Alfamidi and Indomaret in West Sumatra was confirmed by the Head of the Industry and Trade Office of West Sumatra Province, Novrial, who stated that this policy has been in place for a long time.

“That has indeed been going on for a long time,” he said.

According to him, there is no formal written regulation prohibiting Indomaret or Alfamidi from operating in West Sumatra to date.

The Head of the Cooperatives and Small and Medium Enterprises (MSMEs) Office of West Sumatra, Endrizal, stated some time ago that the ban on large retail chains from outside West Sumatra was based on a mutual agreement.

“There is no official regulation, but it’s a collective agreement made to protect MSME owners in West Sumatra,” he affirmed.

What’s the Solution? ‘Involve the Local Community,’ Say Observers

Political economic observer Ichsanuddin Noorsy suggests that additional requirements are needed to manage the presence of giant retail outlets in various regions.

Beyond spatial planning (zoning), opening and closing hours, and the distance between outlets and traditional markets, Ichsanuddin proposes “rights for the surrounding community” of these outlets.

“That means there should be ownership in that area,” Ichsanuddin told BBC News Indonesia on Friday (29/05).

This ownership could take the form of cooperatives at the sub-district level, he added.

“What’s the point? Money will circulate within that area, for the benefit of that area, and then it will grow,” he explained.

Another solution? “You involve local people as labor,” he stated.

Fourth, he continued, these giant retail chains should involve the small shops or convenience stores in their vicinity.

“There are small retailers like Warung Madura, or other small retailers. The giant retailers will supply Warung Madura and others. That way, there’s a share of profits,” Ichsanuddin elaborated.

“The fifth, and this is interesting, they should contribute a regional redistribution tax that isn’t overly burdensome,” he revealed.

“Why? Because the presence of modern retail already shares many things, so the regional tax retribution doesn’t burden them. But it is returned to the community in the form of various jobs,” he said.

“So, indeed, there might be a reduction in local tax spending or retribution, but the region gains those four benefits,” Ichsanuddin added.

Journalists Siti Fatimah in Sukabumi, West Java, and Halbert Chaniago in Padang, West Sumatra, contributed to this report.

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