Strategic Group of Indonesia Retail Industry

This research aims to produce a strategic group map of the retail industry in Indonesia at PT Sumber Alfaria Trijaya Tbk. A strategic group is a collection of companies in an industry with similarities in strategy implementation, the scope of operations, and the resources they use to win the competition. The research method used is the case study method, namely a series of scientific activities carried out in detail and depth to reveal an event and activity of an entity in order to gain in-depth knowledge about the event. This study explores strategic groups in the retail industry concerning the position of PT Sumber Alfaria Trijaya Tbk as one of the retail business players, including the supermarket and minimarket sub-sectors. The results of the study show a mapping of strategic groups in the retail industry in Indonesia using indicators of wide geographical coverage and the number of outlets owned by companies in the industry. The strategic group mapping of the Indonesian retail industry consists of sub-sectors: supermarkets and minimarkets (such as PT. Sumber Alfaria Trijaya Tbk), retail electronics (such as PT. Erajaya Swasembada Tbk); retail automotive (e.g., PT. Mitra Pinasthika Mustika Tbk); retail clothing and textiles (e.g., PT MapActivs Adiperkasa Tbk; and PT Mitra Adiperkasa Tbk).


INTRODUCTION
The Indonesian industry has experienced significant growth since the early 2000s, as evidenced by the proliferation of new outlets in diverse locations (Azlina, 2022)The retail sector encompasses a range of endeavors that entail the provision of goods or services for direct purchase or lease by end-users, primarily for personal or household consumption. Apart from selling, the retail industry encompasses a range of activities, including procurement, promotional campaigns, data management, and inventory control (Wardani, 2022). PT. Sumber Alfaria Trijaya Tbk is one of the leading retail companies in Indonesia, serving more than 4 million consumers daily at more than 13,000 locations with the assistance of more than 90,000 employees. The company is involved in the retail industry, specifically the minimarket sector, which has expanded significantly in recent decades (G. E. J. Nusale, 2020) The following is data on the number of Alfamart retail outlets in Indonesia from 2012-2021.

. Number of Alfamart outlets 2017-2021
Based on the above graph, it is evident that the number of Alfamart stores in Indonesia increases annually. In 2017 there were only 13,477 Alfamart stores, but that figure will increase to 16,492 in 2021. In the past five years, retail locations have increased by 112.5 percent. This performance can be linked to several financial performance indicators, as shown in Table 1.  The annual growth rate of PT Sumber Alfaria Trijaya Tbk is increasing. This performance is affected by a number of factors, including the expansion of new store openings from 2017 to 2021 (3,015 stores). From 2017 to 2021, the company's net income increased by 27.6%, from IDR 66 T in 2017 to IDR 84 T in 2021. Meanwhile, operational costs increased from 1.7% to 2.4% between 2017 and 2019 and decreased by 0.2% in 2020. It occurred due to the fact that the contribution of net sales to profit in 2019 was marginally more significant than its contribution to operating profit in 2020. This indicates that management's performance in generating profits for the company during 2019-2020 has declined. However, management's performance in generating profits for the company will increase by 1.1% in 2021 compared to the previous year. Based on the company's financial performance, the company faces the challenge of being required to maintain sustainable business performance and an increase in competitors entering the modern retail industry. Consequently, the retail industry is naturally characterized by high competition. To determine the level of competition companies confront, it is necessary to understand the mapping of strategic groups in Indonesia's retail industry. An application of strategic group is a number of companies or business units within a company that uses the same strategy in the same industry with the same resources (Rufaidah, 2013). Strategic group mapping is a very practical tool that allows companies to identify competitor groups with different comparative indicators to predict changes that may occur in the industry due to unexpected movements of competing companies or entire strategic groups (Pietrzak, 2015). Therefore, this study aims to establish a strategic group map of the retail industry in Indonesia by analyzing companies involved in the retail and distributor sub-sectors, including pharmaceuticals, food, supermarkets and minimarkets, clothing and textiles, retail automotive, and retail electronics. PT. Sumber Alfaria Trijaya Tbk is one of the organizations operating in the retail sector.
The main research questions of this research article are: How to map strategic groups in the retail industry in Indonesia, and how to map strategic groups in the retail industry in Indonesia? To answer this question, a case study research was conducted. First, the research theory is discussed, followed by analyzing the company's internal conditions based on financial performance. Then, cases related to strategic groups are discussed, followed by an analysis of the financial performance of competing companies and how the results of this case study generate information.

METHOD
In this study, researchers used the case study method, which is believed to be able to answer research questions because the case study method does not only focus on a single data source but can also focus on multiple data sources that are believed to be able to help answer research questions. In addition, the case study method can universally and systematically explain all aspects of an event (Kriyanto, 2020). Secondary data is derived from company annual reports, financial reports, news, prior research, the internet, and other sources.

RESULTS AND DISCUSSION
In this study, the mapping of strategic groups in the Indonesian retail industry followed the phases outlined by (Meilich, 2019).which are: first, identifying the industry under study, which consisted of a number of companies offering retail products and services; and second, identifying the strategic groups within the industry. Identifying characteristics that may differ between corporations is the second step. Third, strategic grouping of companies based on predetermined criteria. The mapping results from the first to the third stage are presented in Table  2. In addition, the fourth stage of mapping strategic groups involves mapping in two dimensions (horizontal and vertical axis). Interpretation and analysis of strategic group mapping results are the final steps. a strategic group exists if the performance of a firm in a group is a function of the features of the group after controlling for the characteristics of the firm and the industry (Murthi, 2013). One needs to look for measurable variables that have the potential to distinguish between firms and collections of firms in the industry. It is important to consider the granularity and number of strategic groups. Since the map is a tool to (literally) see more clearly the strategic landscape, having too many strategic groups (i.e. high granularity) would clutter the map. strategic interactions depend on expectations about rivals' decisions. Hence, a variety of combinations of collective and competitive actions can coexist (Mas-Ruiz, 2005). Table 2 displays information regarding the retail industry's net income. This information serves as the foundation for delineating strategic groups within the industry. The different positions of strategic groups in any sector result in differences in efficiency of group members (McGee & Thomas, 1986). What makes firms, competing in an industry, differ from one another is their competitive strategy, which enables them to react to their environment and to achieve their goals. The competitive strategy that will be pursued is directed by the firms' main strengths and weaknesses. Therefore, it could be inferred that firms which follow similar strategies are likely to have similar strengths and weaknesses. That assumption allows us to cluster the firms in an industry into specific groups, the strategic groups. The strategic groups map is helpful in answering crucial questions such as: how is competition conducted, what are consequences of different types of strategic behaviors, what is the dynamic of competition within industry, and how do players change (Pruett, 1994). (Mascarenhas, 1989) suggest that the emphasis in determining strategic groups should be placed on other factors than on strategy. Despite the disagreement and the debate about the formation of strategic groups, it is interesting to see what is their usefulness, and how can we take advantage of it.
According to (Porter, 1985) the strategic group is an analytical device designed to aid in structural analysis. It is an intermediate frame of reference between looking at the industry as a whole and considering each firm separately. Grouping firms into strategic groups one can examine and analyze the group's structure, appraise its attractiveness, and assess the competition both within the group and between groups. A strategic groups map is a useful visualization tool for capturing the essence of the competitive landscape in an industryissues like the extent of competition between and among strategic groups, mobility barriers, available niches, positioning and industry dynamics. A meaningful strategic groups map exhibits graphic excellence, consisting of "complex ideas communicated with clarity, precision, and efficiency" (Tufte, 1983). Furthermore, based on the performance of each company in the Indonesian retail industry, strategic group mapping can be carried out, where the horizontal axis uses indicators of geographical coverage of the company's product marketing into three categories: local, national, and international. Based on geographic coverage area, local area coverage can refer to a limited geographical area at the city, district, or provincial level, and national area coverage area refers to the entire territory of a country. International coverage area refers to the area outside the country of origin of an entity or organization. The vertical axis employs a metric of the number of outlets possessed by each enterprise, predicated on the sub-sector industry categorization, utilizing the average formula as a benchmark for determining the vertical axis.
x ̅=mean X1,X2= Number of industrial outlets n = the number of industries in the sub-sector  E. The low number of outlets with international geographical coverage is only found in Hero companies such as Supermart and Minimarket companies which cannot be perceived as a company that is ready to compete in several aspects even though it has a wide service network. However, it is still difficult for consumers to find due to the low number of outlets. Similar companies, such as PT Bintang Oto Global Tbk and PT Industry and Trade Bintraco Dharma Tbk, which are in the automotive retail sub-sector, are able to compete with the same retail in providing service network support to consumers around the world with a high number of outlets.

CONCLUSION
PT. Sumber Alfaria Trijaya Tbk is a business in the supermarket and minimarket subsector. This strategic group mapping results use the horizontal axis as the geographic coverage area and the vertical axis as the number of outlets. The high number of outlets with continental geographical coverage includes PT Sumber Alfaria Trijaya Tbk as the Supermarkets and minimarkets Sub-Sector, PT Erajaya Swasembada Tbk as the Electronics Retail Sub-Sector, and Mitra Pinasthika Mustika Tbk as the automotive-retail Sub-Sector, with a different retail capital. The mapping demonstrates that the company operates in a competitive environment. PT MapActive Adiperkasa Tbk and PT Mitra Adiperkasa Tbk are in the same apparel and textile retail subsector with many outlets, so they must adopt an agile, competitive strategy going forward.
The concept of strategic groups is one of the tools in strategic management that can be used to map competitors' strategies and determine alternative strategies to counteract competition in an industry. The strategic group map can show an industry's success rate consisting of smaller industrial sub-structures. The company's position in different sub-industries provides an essential picture in determining the strategy that can be used to compete.
Although this study has limitations, they do not lessen the advantages offered by the findings. Indicators that can be used for further research are various alternatives, such as market share, types of services, and funding facilities. Utilizing the internal quantitative data of a company can enhance the comprehensiveness of strategic group mapping, yielding a more visually appealing variation of results. The findings of the strategic group mapping analysis conducted in the Indonesian retail sector, utilizing the parameters of marketing area coverage and outlet quantity, offer a depiction of the degree of intense competition encountered by each company operating within the industry.