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Why 7-Eleven is closing in Indonesia

Established minimarkets prove the better of convenience store franchise

Parking attendants linger in front of a recently closed 7-Eleven in South Tangerang in suburban Jakarta. (Photo by Ardi Wirdana)

JAKARTA -- 7-Eleven convenience stores looked like a success in Indonesia when they began popping up in 2009. The stores stayed busy and local operator Modern Internasional began to gradually expand the chain's reach outward from Jakarta.

But come Friday, 7-Eleven's famous 24-hour operations will go to zero: Modern is closing its remaining 130 or so outlets after a 1 trillion rupiah ($75 million) deal to sell the chain to conglomerate Charoen Pokphand came undone in early June, just six weeks after it was first announced. Charoen Pokphand's CP All unit runs Thailand's 7-Eleven network, the world's second-largest after that of Japan, but it will not be adding Indonesia to its empire after all.

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