Everything You Need to Know: Opening Your Own Alfamart Franchise

Alfamart is a well-known convenience store franchise in Indonesia, offering opportunities for individuals interested in starting their own franchise. Here’s a detailed breakdown of the investment needed and the types of franchise partnerships available:

Key Points:

• Dare to challenge yourself to open an Alfamart franchise ?
• 9-rack store (30 m²): IDR 300 million to 45-rack store (100 m²): IDR 500 million
• This investment estimate excludes property investment and may change based on conditions at the time of store opening

Courtesy Source:www.cnbcindonesia.com

Courtesy Photo Source: alfamart.co.id/

1. Types of Alfamart Franchise Cooperation

According to the company's official website, there are three types of franchise cooperation with Alfamart:

1.1 New Store Franchise

This option involves opening a new Alfamart store based on a location proposal from the prospective franchisee. The steps to open a new Alfamart franchise include:

• Initial presentation
• Location evaluation and approval
• Proposal presentation
• Franchise agreement
• Store opening

Alfamart offers different rack types based on the investment size and store area:

• 9-rack store (30 m²): IDR 300 million
• 18-rack store (60 m²): IDR 350 million
• 36-rack store (80 m²): IDR 450 million
• 45-rack store (100 m²): IDR 500 million

This investment covers:

• Franchise fee of IDR 45 million for 5 years
• Electrical installation
• Store equipment and air conditioning
• Cash register and retail information system
• Shop sign and pole sign
• Store permits
• Promotion and store opening preparations

Note that this investment estimate excludes property investment and may change based on conditions at the time of store opening.

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1.2 New Store Franchise - Conversion

This option is for owners of local minimarts or small grocery stores who wish to expand their business. Alfamart offers two main benefits for those participating in this program:

• Recognition of existing stock as inventory for the new Alfamart franchise
• Use of existing racks as a reduction in investment costs (racks must meet Alfamart's standards)

The steps for this cooperation include:

• Initial presentation
• Stock take 1
• Franchise agreement
• Stock take 2
• Conversion store opening

Courtesy Photo Source: Austin Distel on Unsplash

1.3 Store Takeover Franchise

This option involves purchasing an existing operational Alfamart store at a set "package" price. The required investment for a store takeover starts from IDR 800 million.

This investment includes:

• Franchise fee of IDR 45 million for 5 years
• Lease for 5 years
• Store equipment and air conditioning (AC)
• Cash register and retail information system
• Shop sign and pole sign
• Franchise agreement
• Goodwill

The steps for this franchise type are:

• Initial presentation
• Purchase agreement
• Permit transfer
• Franchise agreement
• Takeover

2. Alfamart Royalty Fees

Franchisees are subject to royalties based on net store sales, excluding taxes:

• Net sales IDR 0 to IDR 150,000,000: 0% royalty
• Net sales IDR 150,000,001 to IDR 175,000,000: 1% royalty
• Net sales IDR 175,000,001 to IDR 200,000,000: 2% royalty
• Net sales IDR 200,000,001 to IDR 250,000,000: 3% royalty
• Net sales above IDR 250,000,001: 4% royalty

3. Requirements to Open an Alfamart Store

Anyone interested in opening an Alfamart store through a franchise must meet the following criteria:

1. Interest in the minimarket industry
2. Indonesian citizen with a business entity (CV, PT, Cooperative, or Foundation)
3. Own or acquire a business location with a minimum sales area of 100 m² (excluding warehouse and administrative space), with a total land area of approximately 150 m² to 250 m²
4. Meet permit requirements such as Neighbor's Permit, Domicile Permit, SIUP, TDP/NIB, NPWP, NPPKP, STPW, IUTM (varies by region)
5. Agree to follow Alfamart’s systems and procedures