Jakarta, Indonesia – Alfamart, the ubiquitous Indonesian minimarket chain, is expanding its reach through a franchising model, offering entrepreneurs a pathway into the country’s dynamic retail sector. The company, a joint venture between SM Group and Indonesia’s Alfamart, presents a range of franchise options tailored to different investment levels and business goals.
Franchise Options: A Tiered Approach
Alfamart currently outlines three primary franchise schemes: opening a new store, converting an existing local minimarket or convenience store, and taking over an existing Alfamart outlet. Each option carries distinct investment requirements and operational considerations.
1. New Store Franchise
This involves establishing a completely new Alfamart location, with the franchisee responsible for sourcing the site. The process involves initial presentation, location evaluation and approval, proposal presentation, a cooperation agreement, and finally, store opening. Alfamart offers different store sizes, categorized by rack count, to accommodate varying capital investments:
- 9-rack store (30 sqm): IDR 300 million (approximately USD 18,500 as of February 22, 2026)
- 18-rack store (60 sqm): IDR 350 million (approximately USD 21,600)
- 36-rack store (80 sqm): IDR 450 million (approximately USD 27,900)
- 45-rack store (100 sqm): IDR 500 million (approximately USD 31,000)
This investment covers a franchise fee of IDR 45 million (approximately USD 2,790) for a five-year term, along with installation costs for electricity, air conditioning, cashier systems, shop signage, pole signs, and initial permits. It also includes promotional and pre-opening expenses. Notably, the investment figures exclude the cost of the property itself and are subject to change based on prevailing market conditions.
2. New Store – Conversion Franchise
This scheme targets owners of existing local minimarkets or convenience stores seeking to upgrade and benefit from the Alfamart brand. Alfamart offers two key advantages: recognizing existing inventory as initial stock for the franchised store and potentially crediting the value of existing racks towards the investment cost, provided they meet Alfamart’s standards. The process mirrors the new store franchise, beginning with an initial presentation and stock assessment.
3. Take-Over Franchise
This option allows entrepreneurs to acquire an already operational Alfamart store. The investment typically starts around IDR 800 million (approximately USD 49,600) and includes the franchise fee, a five-year lease on the location, equipment, cashier systems, signage, and goodwill. The process involves an initial presentation, a purchase agreement, transfer of permits, a cooperation agreement, and the final handover of the store.
Royalty Structure
Alfamart franchisees are subject to a royalty fee calculated as a percentage of net sales, increasing progressively with sales volume. The royalty is calculated on net sales and is exclusive of taxes:
- Net sales of IDR 0 to IDR 150 million: 0% royalty
- Net sales of IDR 150.001 to IDR 175 million: 1% royalty
- Net sales of IDR 175.001 to IDR 200 million: 2% royalty
- Net sales of IDR 200.001 to IDR 250 million: 3% royalty
- Net sales above IDR 250.001: 4% royalty
Franchise Requirements
Potential franchisees must meet several criteria, including a demonstrated interest in the minimarket industry, Indonesian citizenship with a registered business entity (CV, PT, Cooperative, or Foundation), and ownership or access to a suitable location with a minimum sales area of 100 square meters (excluding storage and administrative space), totaling approximately 150-250 square meters overall. They must also secure all necessary permits, including neighborhood permits, domicile permits, business licenses (SIUP), business identification numbers (TDP/NIB), tax identification numbers (NPWP), and other location-specific requirements. Finally, franchisees must commit to adhering to Alfamart’s established systems and procedures.
Alfamart’s franchising model provides a structured pathway for entrepreneurs to enter the Indonesian retail market, leveraging the brand’s established network, supply chain, and marketing support. The tiered franchise options cater to diverse investment capabilities, while the royalty structure aligns incentives between the franchisor and franchisee. However, prospective franchisees should carefully evaluate the investment requirements, ongoing royalty obligations, and operational commitments before entering into a franchise agreement.
