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The 800 Pound Gorilla Behind Bali’s Beach Warungs

September 5, 2011

Bali beach warungs are perfect places to unwind at the end of a long day of work. At least it is for those so afflicted. For me, they are perfect places to relax after a long day of, well, doing not much at all really. They don’t even have a permanent structure, just a few beach umbrellas, some plastic chairs, and if you’re lucky, a tiny rickety table on which to place your drink. Several large coolers packed with ice hold copious amounts of Bintang beer and a range of soft drinks for those whose beverage preferences run to the non-alcoholic.

Watching the passing parade of locals who flock to the water’s edge at sunset is always entertaining. Family groups are in abundance, energetic types play beach tennis, couples canoodle – ever so discreetly – and family dogs frolic joyously in the relative cool of the evening. There are plenty of tourists too, but for these denizens, the raucous excesses of night-time are yet to make their presence felt. All seem suffused with the afterglow of the day, the magic of Bali itself, and the humbling spectacle of this island’s  stunning sunset displays. On the beach, the last hour of the day is a time of reflection, both physical and metaphorical. I love it.

And so it was the other night, no doubt influenced by this tranquillity, I decided that a Bintang was too crass a beverage to spoil the mood. I asked for a Teh Botol –  a bottled sweet black tea invented and produced in Indonesia. It is hugely popular with the locals, partly because it is formulated for Indonesian tastes, and partly because many of the locals prefer a non-alcoholic drink.

But in response, the warung proprietor looked uncomfortable. The other family members who were there helping pointedly looked away. I thought that I had unwittingly broken some taboo, and in some ways, I was to realise later, I had.

“Sorry, no Teh Botol”, said my host apologetically. “But we have Coke, and Sprite and Fanta.” Now one of the things that some locals find uncomfortable about us bules is our disturbing tendency to be too direct, at least according to Indonesian mores. Not wishing to discourage this stereotype, I felt compelled to ask, “Why not? Surely all your local customers would buy it?”

“Yes, many people ask for it, but … we can not.” More shuffling ensued. Finally, after persistent questioning, the real reason emerged. “We are not allowed. Coca Cola won’t let us. If we sell Teh Botol, Coca Cola will not supply us with their products, so we will have no Coke, no Sprite, no Fanta. Tourists want these, so we have to obey.”

It turns out that the family-owned Indonesian company Sosro, which started bottling tea in the 1970s, has been giving powerful international brands, such as Coca Cola, a real run for their money in the battle for drinkers’ palates, winning 70% of the non-carbonated drinks market in Indonesia. Coca Cola’s own entry into this sector, the Frestea brand, has had less than stellar sales. Simply put, Sosro would seem to be an unwelcome competitor.

So my little warung, and thousands like it who want to sell a competitor’s product are seen as a threat to the mighty Coca Cola Amatil empire? Come on! Bully-boy tactics, whether they originate at a company’s head office, or are simply a misguided application of muscle by local distributors are still unconscionable. Beach-side warungs are subsistence operations which barely make enough to pay their expenses. The little extra money that they could make by selling Teh Botol to their local customers, many of whom don’t even want sugary sodas, could make the difference between survival and going out of business. Many locals survive on a monthly income of around one million rupiah. That’s $110 AUD, or $117 USD. Warungs fall into this category.

Last year, Coca Cola Amatil Ltd brought in revenues of just under four and a half billion dollars, and posted a net after tax profit before significant items of over $506 million. And yet they feel compelled to monster the little family warungs in Bali to prevent them from selling a few bottles of tea, on pain of having their supplies cut off? Unbelievable.

One would hope there is more to this story than what I have heard to date. One would hope that there are not just penalties, but also incentives provided to warung owners to selectively sell one company’s product exclusively. And I’m not talking about getting a cheap, Coke- branded cooler either. One would hope that a huge multi-national corporation would show a little social responsibility towards its impecunious vendors in Bali.

Is one hoping in vain? Or is this just normal practice in beverage marketing by the big boys?

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6 comments

  1. Hm, I normally enjoy your posts, but this is definitely not true. What beach are you going? At Pantai Doublesix, down all the way to Kuta and also further up at Crystal Palace, La Plancha and up to Dhyana Purah, it really is no problem to get Teh Botol from Sosro. It costs 5K Rupiah, a small Bintang costs 15K and Coke and other soft drinks are between 7-10K Rupiah. Maybe the certain stall owner you talk to bs’ed you about that Sosro Anomaly? 😉


    • Thanks for the input. It’s entirely possible that there is a bs factor in the stall owner’s account – after all, we have to remember where we are. There may well be a back story behind this that hasn’t yet come out. Nevertheless, several warung owners have independently given the same story. Maybe the pressure is coming from the local level rather than further up the food chain?

      Small businesses in Bali seem to have to juggle a number of conflicting demands from suppliers, local authorities and customers in order to survive, so it is not entirely inconceivable that the truth sometimes gets squeezed between them.


  2. I’m feeling strong enough about this to respond to your post but you’ve already said it all so well. Couldn’t agree more. It’s time us expats quit bullying the Balinese on their own island.


  3. This is terrible. Bloody multi-nationals, grrr.
    I hope you are able to do a little something to help the locals.
    Let me know if there’s anything I can do to help.


    • In fairness, it may not be the multinationals at fault – see other comments.
      But then again, it may be 😉


  4. Oh so true…. my friends with a little resto in the Philopines have the same problem,so I only drink another brand (and its not P*p*i either! I was going to come to live in Bali but I realise it ain’t so bad here after all… but i will still visit every year.



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