JAKARTA, Indonesia -- 7-Eleven’s local operator in Indonesia has shuttered the last of its roughly 160 convenience-store locations in the country. Modern Internasional, which recently saw its bid to sell the business collapse, cited “limited resources” as the reason for the closures.
The move comes as the chain faced stiff competition from local, far-larger convenience chains Indomaret and Alfamart. That competition was made more intense following Indonesia’s 2015 ban on alcohol sales at minimarkets.
7-Eleven entered the market in 2009, positioning itself as a hang-out spot where guests could sit, dine and use free Wi-Fi. The inability to sell alcohol put a significant dent in this cafe-style positioning.
“The concept is interesting, but is it profitable?” Tutum Rahanta, deputy chairman of the Indonesian Retailers Association, told Reuters. “The crowd is created by people who just hang out, but those who want to shop and who can really generate profits don't go there.”
In April, Modern Internasional had entered into a deal to sell the business to Thai conglomerate Charoen Pokphand, but that deal ultimately fell through. Charoen Pokphand is 7-Eleven’s franchisee in Thailand.
Modern Internasional began closing dozens of its 161 units earlier this year. The company had roughly 120 in operation at the time the deal to sell the business collapsed.
Corporate parent Seven & i Holdings Co. Ltd. said it intends to find a new operator to restart the franchise in the Southeast Asian nation.
“Indonesia is an important country for us. This is not the end for 7-Eleven’s business,” a company spokesman told Reuters.
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