Lulu’s $300 Million Expansion Plan in Indonesia

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The Lulu Group announced their plans to expand in Indonesia with initial investments of $300 million that will see the emergence of fifteen hypermarkets in the next two years. Currently operating 117 stores across the GCC countries, such as Egypt, India, and Yemen, this venture in the South Asian island nation will eventually see $500 million being invested in Indonesia over the next five years.

It has been reported that the first phase of the plan will see a hypermarket and a central logistics and warehouse system operating in Jakarta prior to the end of 2015. By the end of 2017, cities, such as Solo, Surabaya, Bandung, Yogyakarta, and Semarang will also see the doors of a Lulu hypermarket opening in their city.

Lulu, owned by Indian businessman Yusuffali, said that it wants to bring its halal only hypermarket concept to Indonesia, which is the world’s most populated Muslim country and is in the process of generating over 5000 jobs in the country.

Indonesia is not the only South East Asian market Lulu has targeted. Back in 2014, Lulu entered the Malaysian market with plans to build ten hypermarkets and gain 20% of the market share in Malaysia.

Speaking in an event hosted in Khalidiyah Mall, Abu Dhabi, in honour of Joko Widodo, the Indonesian President who was on a five day visit, Mr. Yusuffali was quoted to have said that the commencement of a halal hypermarket concept in Indonesia is an encouraging sign of receiving a larger market share there.

“We also plan to set up contract farming to ensure a continuous supply of high-quality products and to support the Indonesian agricultural sector,” Mr Yusuffali quoted.

Regional Director at Colliers International, Stuart Gissing, meanwhile, said that Lulu is currently expanding at a rapid rate and their hypermarket concept continues to be a success in different foreign locations. He also mentioned that Lulu has a deep understanding of the local demographic and tends to build their business model with keeping the local communities in mind.

Lulu continues to expand in India too, where they have their main operations taking place in the state of Kerala, from where Mr Yusuffali, ranked on the first position on the Forbes’ list of richest Indian in the Arab World last year, hails.

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