Food and beverage in Surabaya is on the rise, transforming the city into a vibrant hub for the industry. With over 3 million people, it is the second-largest city in Indonesia, and its strategic location connects East Java to the rest of the country and the world.
The food and beverage (F&B) industry in Surabaya offers investors plenty of opportunities. From a rich culinary heritage to a vibrant modern dining scene, the city combines tradition and innovation, making it attractive for local and foreign investors.
This article will explain why food and beverage in Surabaya is a growing market—covering its diverse culinary landscape, supportive investment climate, and expanding consumer demand.
Why choose Surabaya for F&B investment?
Surabaya has achieved the second-largest investment realization among all cities and districts in Indonesia, totaling around IDR 29.22 trillion.
The Ministry of Investment/Indonesia Investment Coordinating Board (BKPM) awarded the city for this achievement, with 90% of the investment coming from domestic sources.
The award was given to the Mayor of Surabaya, Eri Cahyadi, who expressed gratitude that the investment would help create jobs and reduce unemployment and poverty in Surabaya.
The investment is expected to stimulate economic growth and support local small and medium-sized enterprises (UMKM).
Read more: The Growing Potential of Property Investment in Surabaya
Opening an F&B business in Surabaya
Opening a food and beverage business in Surabaya requires careful consideration and planning. Foreign investors must navigate various legal and regulatory requirements.
Entrepreneurs must obtain business and restaurant licenses, secure a suitable location, and comply with tax obligations for initial establishment.
In the process, restaurant owners must keep up with the latest trends in Surabaya’s food and beverage industry. However, prioritizing healthy and sustainable food choices should be one of the main priorities.
Besides that, investors are encouraged to utilize local ingredients and incorporate technology to enhance the customer experience.
Opening an F&B business in Surabaya can be rewarding, with the right strategies in place and a commitment to delivering exceptional quality and service.
The rising trend in the F&B industry in Surabaya
Surabaya has seen a rapid rise in the F&B industry and continues to welcome such growth. For example, the national electronic commerce company Blibli has partnered with the Indonesian Cafe and Restaurant Entrepreneurs Association (Apkrindo) in East Java to support the growth of cafes and restaurants in Surabaya.
According to Apkrindo’s data, this collaboration is based on the food and beverage industry’s 20% annual growth in Surabaya.
Blibli aims to strengthen its integrated omnichannel commerce ecosystem by adding the best cafes and restaurants with attractive offers for Surabaya customers.
This collaboration is also part of Blibli’s strategy to increase the number of local sellers in Surabaya. The company aims to add more than 250 food and beverage options that are guaranteed to be satisfying, affordable, and easy to access for customers in Surabaya.
With this collaboration, Apkrindo hopes to strengthen local F&B businesses after the official PPKM is lifted. The partnership also offers a unique opportunity for customers to enjoy the best culinary experiences at the best price, discounts, and rewards.
The growing number of foreign investors in Surabaya
Reports have shown an increasing interest in foreign investors in Surabaya. Several countries, including Singapore, the Netherlands, China, Japan, and Malaysia, have invested in Surabaya, with Singapore leading the way with an investment value of IDR 1.311 trillion.
Surabaya’s economic growth has also increased, with a 7.17% growth rate in the third quarter of 2022, higher than the 5.58% growth rate of the entire East Java province during the same period.
Surabaya’s potential for economic growth is attracting the attention of foreign investors, which could further enhance its economic development in the future.
Major F&B sectors in Surabaya: the latest trends
Many food and beverage businesses in Jawa Timur are gearing up for the upcoming Ramadan and Lebaran seasons in 2023 and devising strategies to optimize their revenue.
Moreover, several food and beverage establishments are reopening after enduring the impact of the pandemic, with some even inaugurating new branches during the early part of the year.
One of the growing trends in Surabaya’s food and beverage industry is the emergence of bars and lounges, which offer a different dining experience.
These establishments aim to provide a relaxed and comfortable atmosphere where patrons can unwind, enjoy music, and indulge in delectable drinks and finger foods.
The rising popularity of these bars and lounges is evident in the increasing number of Surabaya establishments catering to a diverse clientele.
Another noteworthy trend in Surabaya’s food and beverage industry is the use of locally sourced ingredients and the promotion of traditional Indonesian cuisine.
Many restaurants are showcasing the diversity of Indonesian cuisine by offering dishes that feature ingredients native to the region, adding an authentic touch to the dining experience.
Furthermore, as businesses look to maximize their earnings during crucial holiday periods like Ramadan and Lebaran, they seek consultants’ assistance to improve their tax management and implement effective revenue optimization strategies.
By doing so, they hope to attract more customers and enhance their profitability.
How to start a F&B business in Surabaya
1. Forming a company
When forming a company, it is essential to determine the type of legal entity of the company.
One possible course of action is establishing a domestic Limited Liability Company (“Local PT”) wholly owned by local entities. However, the appointment of foreign directors is permissible for managing the company’s operations.
Another type of company is a foreign investment company (“PT PMA”). It comprises foreign ownership; some business fields even permit complete foreign ownership.
Registering a PT PMA enables businesses to receive investment opportunities from foreign entities otherwise limited in registering a Local entity.
2. License and certification
To start a restaurant business in Indonesia, it is essential to obtain the necessary licenses and certifications in compliance with the country’s regulations. These include a business license to validate the restaurant’s commercial activities.
A restaurant license issued by the Ministry of Culture and Tourism, a working visa for foreign individuals who will work in the restaurant, an alcoholic beverage trading license to regulate the sale of alcohol, and permits from recording labels to play music without infringing copyright laws. It’s worth noting that even food trucks must obtain a restaurant license to operate within the bounds of the law.
Guide to Doing Business in Surabaya
Why should you register your business in Surabaya?
By obtaining these licenses and certifications, investors can ensure that their business complies with the law and avoids any legal issues in the future. In sum, Surabaya, like Jakarta, is rapidly evolving. The sector that has been of particular interest to investors is the food and beverage sector.
However, several things must be noted to set up such a company or legal entity, such as the business’s form and licensing requirements. InCorp Indonesia provides company registration services for those looking to exploit such an opportunity.
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Disclaimer
The information is provided by PT. Cekindo Business International (“InCorp Indonesia/ we”) for general purpose only and we make no representations or warranties of any kind.
We do not act as an authorized government or non-government provider for official documents and services, which is issued by the Government of the Republic of Indonesia or its appointed officials. We do not promote any official government document or services of the Government of the Republic of Indonesia, including but not limited to, business identifiers, health and welfare assistance programs and benefits, unclaimed tax rebate, electronic travel visa and authorization, passports in this website.
Verified by
Ales Cina
Consulting Manager at InCorp Indonesia
Aleš manages solution delivery at InCorp Indonesia, optimizing incorporation processes and client relationships. His experience in internal auditing, retail, and sales offers valuable global insights. Aleš, with a degree in Economics and Finance from the Czech Republic, helps clients navigate cross-border business challenges, focusing on cultural and legal insights.
