CONSUMER PROBLEMS IN INDONESIA

BUYERS BEWARE – YOU’RE ON YOUR OWN AND IT’S YOUR FAULT
© Duncan Graham 2006

If there’s a consumers’ tenacity award in Indonesia it should go to Anny R Gultom and German Tambunan.

Using the 1999 Consumer Protection Law and other legislation the Jakarta couple hung onto their ideals for six years. Now they’ve won Rp 60 million (US $6,400) compensation for their vehicle stolen from a shopping mall car park.

Elsewhere in the world such an event would have little news value. But not in Indonesia where aggrieved consumers need to be tough, determined and prepared for the long haul. Duncan Graham reports:

It was just another weekend of minor domestic disasters.

A tap split in the bathroom showering walls and ceiling. A visitor noted the LPG gas cylinder pipe to the stove was not pressure-rated – risking rupture and explosion. And a front door panel had shrunk exposing a long and ugly split in the timber.

All these items were just a few weeks old, bought new as part of a home renovation in Malang. The upshot: Unproductive verbal brawls and more spending.

What recourses do consumers have against flawed products, dangerous devices and shoddy work? In theory – lots. In practice – little.

The law backs Indonesian buyers – but that support is poorly equipped, ill prepared and seemingly in little mood to challenge recalcitrant retailers.

Change is unlikely until buyers exercise their purse-power and boycott shops that don’t exchange dud goods or refund consumers’ cash.

That’s the situation in many other countries, and not just because it’s on the statutes. Smart retailers who exercise strict quality controls over their wholesale suppliers know that cheerfully attending to customers’ genuine gripes wins new trade.

That’s already happening with the big multinationals like Carrefour. Corporate affairs director Irawan Kadarman said the company gives refunds or exchange within 15 days of purchase. Conditions apply; the company’s policy is posted at their stores’ information desk.

Smaller shops are unlikely to adopt such modern practices till customers shed their shame to complain – an awkward ask in a culture that shies from confrontation.

“The Javanese term is nerimo which means just accepting whatever the provider gives us,” said Indah Suksmaningsih, chairperson of the Indonesian Consumers’ Organisation (YLKI) and a former microbiologist.

“The laws and regulations put the consumer into a nerimo position. For example the standard contract provided by a water company in Yogya states that if the quality of water doesn’t meet the required standards no claim is allowed.

“ Their attitude is ‘we provide, you accept’. The paradigm is shifting and people are starting to demand quality. Compared to Vietnam and Cambodia consumers’ rights here rank a little higher. But we’re way below those in Malaysia and Singapore.

“In this country there are a lot of shoddy goods on the market and people care more about price than quality. The fact is they’d like quality and safety but they’re powerless to pay.

“That’s why I don’t accept the ‘freedom of choice’ argument – many shoppers in Indonesia just don’t have a choice because of poverty.”

The YLKI (motto – A Voice for the Voiceless) is an advocacy and lobby group with 22 staff. It gets about five per cent of its money from local government, the rest from overseas donors like the Ford Foundation and the Asia Foundation. It also works closely with Australian consumer groups.

“We don’t want to get too much money from the government or they’ll try to dictate to us,” Indah said. “The government style is not to get involved in problems – to say, right or wrong it’s our country.”

(sidebar)

TAKE YOUR PICK
There are four consumers’ organisations in Surabaya – and they’re underwhelmed with work.

Take the Consumers’ Protection Institute (YLPK) which concerns itself with complaints against Telkom, the banks, public transport and public services. It looks a heavy load, but the YLPK’s annual report shows only 107 complaints for last year.

The positive news is that’s a significant jump from 2004 when only 31 people were sufficiently aroused to report their concerns. Most involve transport.

“The public transport system is in a bad way,” said YLPK head Mohamed Said Sutomo. “People protest about lack of safety, unclean busses and failure to keep to advertised schedules.

“It’s very difficult to get improvements in this sector, though we’ve had successes elsewhere – particularly with Telkom and the banks. Indonesians are still afraid to complain – they fear the power of big business and don’t know they have rights.”

Although there’s no queue of distressed complainants outside the YLPK office the seven staff are busy lecturing to school and university students on consumers’ rights and chasing up issues on their own initiative, Sutomo said.

When visited by The Jakarta Post Sutomo was trying to get action against a pyramid scheme, also known as multi-level marketing.

In this case village people were being coaxed to buy and sell mobile phone subscriptions to their friends and relatives and earn big commissions after they’ve bought a franchise. Or so said the salesmen preaching to the gullible.

“This sort of marketing is illegal,” said Sutomo. “You can’t even get mobile phone services in the villages where these companies have been touting for business. I’ve already found one victim who claims to have lost Rp 1.5 million (US $180).”

WHO KNOWS WERE TO GO?

The regular use of Letters to the Editor column by consumers angry about poor services shows many turn to the media because they don’t know who else can help.

Big companies seem to respond with alacrity when they read disparaging comments about their business in a newspaper. But does it always need public shaming to provoke a response?

Here’s an indicator of the problems facing the public: Two weeks of persistent phone calls, e-mails and faxes to the management of Hero supermarkets and Matahari department stores failed to prise out their policies concerning consumer complaints.

Under the 1999 Consumers’ Rights law every district in Indonesia (there are more than 430) should have a consumer’s dispute resolution centre (BPSK). However so far just 15 have been established across the archipelago; activists say only five are really effective.

The Surabaya BPSK has nine staff and a five-member secretariat. Last year it handled 18 complaints.

The BPSK publishes four boring consumer advice pamphlets with a Jakarta telephone number to seek advice. It prints 1,000 copies of each pamphlet every year and hands these out at workshops and universities in a city pushing one million households. It doesn’t run courses in schools.

“Our budget is Rp 90 million a year and that’s clearly not enough,” said deputy head Edison Siregar. “Before authority was decentralised to the provinces I got Rp 1 a month. Now I’m paid Rp 500,000.

“Although the law was passed in 1999 nothing happened in Surabaya till 2003. We’d like to publicise our presence better but need money. I agree the language and presentation in the brochures isn’t appropriate for people with limited education.”

The law gives Indonesians the right to:

· Safety, security and comfort
· Choose
· Access to clear, honest and non-misleading information
· Be heard

Many shops carry signs warning customers that goods cannot be returned. This is illegal, according to YLKI Chair Indah Suksmaningsih.

“However these signs have become so prevalent for so long that it’s almost accepted practice,” she said.

“People prefer just to keep quiet. Even if shoppers complain to the police about this practice they’ll be ignored.”

There’s a multitude of NGOs trying to help – maybe too many. Consumers don’t have time to call multiple numbers, cruise the suburbs and write letters. Ideally there’d be a one-stop shop for all disputes and with a toll-free number. This could be listed on the inside cover of the telephone directory along with other public services.

The counter argument to state control of goods and services is the promotion of competition and a reliance on market mechanisms. These are supposed to force manufacturers to offer better quality goods and provide comprehensive information to attract customers.

This is the Singapore way. It seems to work there because shoppers are generally better educated, more discriminating and not afraid to exercise a sharp tongue.

However in Indonesia the line between advertising claims and product facts seems to be blurred. Will your skin actually whiten when smeared with this cream containing dimethicone and a soup of other chemicals? If so by how much – and how can that be measured? Don’t expect an answer anytime soon.

YLKI publishes a monthly magazine Warta Konsumen but only 2,500 copies are printed. Indonesia has nothing like the Australian journal Choice which tests and evaluates products like washing machines and kitchen appliances.

However improvements can be seen in the sale of goods like milk powders where the packaging lists content details. Astute shoppers check for sugars and fats knowing these are factors in heart disease, but some lists are so complex only chemists can decipher. What is folic acid (found in some breakfast cereals) and is it good for me? Is 15 per cent too little or too much?

This is the sort of information progressive teachers include in classes on science and biology. Running a healthy home is the most important job their students will ever undertake – and preparation is vital.

Being a smart shopper also means being skilled in spotting humbugs: ‘Assist in curing’ is not the same as curing. Nor is ‘aids digestion’ necessarily an answer to indigestion.

A few companies have customer help lines so buyers with a problem can call for advice. These initiatives have been driven by the demands of overseas countries: Indonesian exporters have to comply with their packaging codes and quality controls so apply these to local sales. The good side of globalisation.

Indah’s advice to shoppers was blunt: “Exercise your rights! Be brave enough to speak out and persist when you think your position is right. That way you’ll also be helping other consumers who face similar problems.”

She added that consumers must play fair, keep receipts and be honest about the product’s flaws. Dropping a DVD player is your fault – selling one that doesn’t work is theirs.

And the message to manufacturers and retailers? “Be responsible! Treat your customers with respect. Listen to their complaints – by addressing them correctly you’ll do better business.”

CONSUMERS’ CHOICE

Consumer advocates urge disgruntled shoppers to follow these steps:

· Keep receipts and all packing.
· Check retailer’s policy on exchange before you buy.
· Be quick. Many shops will not exchange wrong sizes after two days.
· Be reasonable. No shop will accept the return of worn underwear.
· Approach the store manager politely and explain the problem.
· If dissatisfied ask to see a senior staffer. Stay cool
· If your complaint is still rejected get the correct names and titles of the staff.
· Pursue through a BPSK (021) 385 8187or appropriate NGO. Contact YLKI on (021) 798 1858.

(First published in The Jakarta Post 19 June 2006)









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