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Detergent industry growing amid sharp competition.

Detergent detergent (dētûr`jənt, dĭ–), substance that aids in the removal of dirt. Detergents act mainly on the oily films that trap dirt particles.  has been used widely as a cleaning agent and growing from year to year in the country. Detergent is still unrivaled with no cheaper, more efficient and safer substitute to challenge its position.

Demand for detergent in the country grows with the growing populations. The country's production capacity for detergent, therefore, has expanded especially with the growing number of players in the industry in Indonesia.

Imports are small and hardly pose a threat to the domestic industry. Imports are insignificant compared to the domestic production.

Competition among the producers in the country, however, is sharp. The producers are seeking to grab a larger share of the market by adopting strategies --cheaper prices, more attractive appearance of packaging in addition to maintaining good quality.

Powder detergent gaining popularity

Detergent is an ingredient of cleaning agent. Detergent products consist of powder detergent, liquid and cream detergent. In the beginning, the most popular product of detergent was in the form of cream, but later detergent in the form of bar was preferred more by the consumers, but now powder detergent has the largest market size. See the following table.

Production capacity

The country's detergent production capacity grew slightly over the years until 2009. In 2009, the production capacity was recorded at 771,330 tons per year or an increase of 8.6% from the previous year.

The production capacity grows to follow the trend of demand on the domestic market as most of the production is disposed dis·pose  
v. dis·posed, dis·pos·ing, dis·pos·es

v.tr.
1. To place or set in a particular order; arrange.

2.
 of on the domestic market.

The production capacity of Total Chemindo Loka is 24,000 tons per year. This company was acquired by the Salim Group The Salim Group is Indonesia's big­gest conglomerate with assets including Indofood Sukses Mamur, the world's largest instant noodle producer, and Bogasari, a larg­e flour-milling operation [1]. The group was founded by Sudono Salim.  in 2005.

Player in detergent industry

There are not many big players in detergent industry in Indonesia. Producers categorized cat·e·go·rize  
tr.v. cat·e·go·rized, cat·e·go·riz·ing, cat·e·go·riz·es
To put into a category or categories; classify.



cat
 as big players are those having production capacity of more than 2,000 tons per month or 24,000 tons a year. Big players have popular brands with distributors among big and small retailers.

Among the big players in the detergent industry include PT Wings Surya Surabaya (Wings), PT Unilever Tbk (Unilever), PT Kao Indonesia, PT Sinar Antjol, PT Total Chemindo Loka, PT Birina Multidaya, and PT Jayabaya Raya. Medium and small players are generally producers with marketing coverage limited to certain areas.

Wings have a number of products of detergent including Wings, Ekonomi, Daia, and So Klin. The detergent products of PT Unilever Indonesia PT Unilever Indonesia Tbk was established in Indonesia on December 5, 1933 as Zeepfabrieken N.V., a subsidiary of Lever Brothers which initially operated a soap factory at Angke, Jakarta. The name was changed to Unilever Indonesia on July 22, 1980.  Tbk include Rinso, Surf, and Omo.

Other producers include PT Kao Indonesia with brands of Attack and Dino, PT Sinar Antjol with the brand of B-29, PT Total Chemindo Loka with the brand of Total, and PT Jayabaya Raya with the brand of Suroboyo.

Wings Group operates an integrated industry as it has production facility for alkyl alkyl /al·kyl/ (al´k'l) the monovalent radical formed when an aliphatic hydrocarbon loses one hydrogen atom.

al·kyl
n.
 benzene benzene (bĕn`zēn, bĕnzēn`), colorless, flammable, toxic liquid with a pleasant aromatic odor. It boils at 80.1°C; and solidifies at 5.5°C;. Benzene is a hydrocarbon, with formula C6H6.  the basic material of detergent under PT Unggul Indah Cahaya.

The Wings Group was a member of the consortium that acquired Ecogreen Oleochemical Oleochemicals are chemicals derived from biological oils or fats. They are analogous to petrochemicals which are chemicals derived from petroleum. The hydrolysis or alcoholysis of oils or fats form the basis of the oleochemical industry. . Ecogreen is a producer oleochemicals including natural fatty alcohol fatty alcohol
n.
Any of various alcohols derived from plant or animal oils and fats and used in plastics and pharmaceuticals.
, which is also used as basic material for detergent and toiletries toi·let·ry  
n. pl. toi·let·ries
An article, such as toothpaste or a hairbrush, used in personal grooming or dressing.

toiletries nplartículos mpl de aseo (=
 with a production capacity of 100,000 metric tons/year.

Production increasing

The country's production of detergent has increase din DIN - Deutsche Institut fuer Normung. The German standardisation body, a member of ISO.  the past several years. The domestic consumption of detergent grows to follow the trend of the population growth.

The domestic consumption of detergent has been supplied mainly by local producers. Imports are relatively small and insignificant.

The production in 2005-2009 averaged 681,575 tons per year. And from 200 to 2009, the production grew 2.1% a year.

Countries of destination

The country's detergent industry is oriented o·ri·ent  
n.
1. Orient The countries of Asia, especially of eastern Asia.

2.
a. The luster characteristic of a pearl of high quality.

b. A pearl having exceptional luster.

3.
 more too domestic market. Exports are only 1% of the country's total production of detergent in 2009.

Exports have tended to decline in he past several years. The largest annual exports were 41,929 tons in 2005. Since then exports have continued to decline down to only 8,188 tons in 2006 and down again to 2,268 tons in 2009.

The export value also shrank shrank  
v.
A past tense of shrink.


shrank
Verb

a past tense of shrink

shrank shrink
 over that period excepting in 2008 when the export value rose 12.9% to US$7,930,000 though exports rose 5.2% in volume to 6,454 tons.

Sharp competition in export market and strong foothold foot·hold  
n.
1. A place providing support for the foot in climbing or standing.

2. A firm or secure position that provides a base for further advancement.


foothold
Noun

1.
 on the domestic market are the reasons for the producers to remain oriented to domestic market. The players began business in this industry as small traditional enterprises before they grew with experience to become modern companies.

Some producers, however, have been aggressive in expanding market abroad such as Sinar Antjol and Wings with exports to African countries.

The main export commodity of Wings is detergent with the brand of SoKlin. Its main export destinations are Nigeria (25%), the Philippines (18%), Congo (12%), Angola (8%), Ghana (6%), Japan (4%), Malaysia (4%), Madagascar (2%), Thailand (3%) and Cameroon (3%) and a number of other countries in Asia, Africa, Europe and the Pacific region. In Nigeria, Mauritania, Mali Mozambique and Angola, SoKlin dominate 75% of detergent markets.

Meanwhile, Sinar Antjol built its first factory abroad in 1994. The company built its factory in the Light Industrial Area of Ghana. The factory produces detergent and soap. In 2002, the company opened its second factory abroad in Ethiopia, producing soap and detergent.

Imports not significant

The country's imports of detergent are relatively small. In 2009, imports were only 0.5% of the country's production of detergent.

Detergent imports grew only in 2006 when imports rose 33.1% to 10,564 tons. In the following years imports declined sharply. Increase in import value was recorded in 2008 when imports rose 7.5% to US$5,704,000. See the following table.

Consumption

In 2009, the domestic consumption of detergent grew 2.5% to 738,365 tons. The annual growth was the lowest compared with the previous years. The highest growth of 8.6% was recorded in 2006 when consumption totaled 643,064 tons. See the following table.

Market share

Aggressively and intensiveness of marketing and promotion including advertisements will determine success in marketing of detergent in Indonesia. Wings have won the market domination domination

the relationship between animals and humans in which little consideration is given to the rights of the animals. The prevailing sentiment is one of proprietary domination.
 partly caused by the factors. The Wings Group is estimated to have a 60% share of the market, with Unilever having a 30% share. The remaining 10% is split by other producers including Kao Indonesia, Sinar Antjol, Total Chemindo Loka, etc.

In 2011, the domestic market of detergent was estimated to grow 6% with value at Rp9.54 trillion One thousand times one billion, which is 1, followed by 12 zeros, or 10 to the 12th power. See space/time.

(mathematics) trillion - In Britain, France, and Germany, 10^18 or a million cubed.

In the USA and Canada, 10^12.
. In 2010, the market value was Rp 9 trillion. See the following table.

Distribution

Efficiency in distribution also determines success in the marketing of detergent, which is categorized as fast moving consumer goods “CPG” redirects here. For other uses, see CPG (disambiguation).
Fast Moving Consumer Goods (FMCG), also known as Consumer Packaged Goods (CPG), are products that have a quick turnover and relatively low cost.
 (FMCG FMCG Fast Moving Consumer Goods ) and generally last not more than one month. Detergent may lose its quality if kept too long in store. Efficiency in distribution, therefore, is important

Generally distribution of detergent is handled by the producers themselves. Wings' distribution system runs from factories to wholesalers and to retailers. Unilever has 370 independent distributors. It has distribution center with warehouses, depots and other facilities. Sinar Antjol has 90 distributors in 32 provinces of the country

Advertisement and promotion key to success in marketing

Advertisements are especially determinant determinant, a polynomial expression that is inherent in the entries of a square matrix. The size n of the square matrix, as determined from the number of entries in any row or column, is called the order of the determinant.  in the success of marketing for consumer goods consumer goods

Any tangible commodity purchased by households to satisfy their wants and needs. Consumer goods may be durable or nondurable. Durable goods (e.g., autos, furniture, and appliances) have a significant life span, often defined as three years or more, and
 especially those that could not last long. Advertisements are used also to introduce new products. The strategy in advertising for new products is below the line to be followed with above the line advertisements.

The system is used mainly by new producers like Birina Multidaya, to introduce its product of cream detergent with the brand of Bucream. Below the line strategy is used by marketing the product in suburban areas and when the products have been distributed widely promotion is continued with open advertisement.

Promotion is launched in a number of strategies such as by offering prizes. The prizes are generally crockery such as plates or glasses needed by households.

Wings are known to always offer prizes to attract buyers for its new products.

Competition tight

Competition in the market of detergent is sharp marked with producers began to undercut undercut,
n 1. the portion of a tooth that lies between its height of contour and the gingivae, only if that portion is of less circumference than the height of contour.
2.
 each other in prices. Producers have to continue to think of ways to survive amid the sharp competition. Some producers seek to differentiate products to attract buyers and win the competition.

In the beginning the detergent production was dominated by cream and bars when the technology was not yet as advanced as at present. Later, however, powder detergent took the domination started by Unilever with the brand of Rinso in the 1970s; Rinso was very popular that all detergent products including those of other brands were identified as Rinso.

At that time Unilever dominated the market of powder detergent. Bar detergent and cream detergent, however, remained popular until the end of 1980s.

By the end of the 1980s, the popularity of powder detergent increased. Other detergent producers also have produced powder detergent.

In 1990, the Wings Group began to produce powder detergent with the brand of So Klin that grew to become a powerful rival of Rinso in the market. Kao Indonesia also came up with a product of powder detergent, Attack, aimed at premium segment of the market.

The regional monetary crisis in 1998 rendered a big blow to the market. The purchasing power Purchasing Power

1. The value of a currency expressed in terms of the amount of goods or services that one unit of money can buy. Purchasing power is important because, all else being equal, inflation decreases the amount of goods or services you'd be able to purchase.

2.
 of the people was weakened resulting in falling demand including for detergent. Producers were forced to come up with new products which were lower in prices.

Wings launched such products with the brand of Daia, followed by Unilever with its Surf. Both Daia and Surf are cheaper in price.

Other producers also were forced to follow such as Sinar Antjol which came up with a new detergent product, WOW (1) (World Organization of Webmasters, Folsom, CA, www.joinwow.org) A membership organization for professionals who are involved with creating and maintaining Web sites. WOW also provides certification via testing centers throughout the U.S. , which is a variant variant /var·i·ant/ (var´e-ant)
1. something that differs in some characteristic from the class to which it belongs.

2. exhibiting such variation.


var·i·ant
adj.
 of its B-29. Total Chemindo Loka which already long focused on lower segment of the market launched new product of powder detergent, Total Harum.

The types of products are growing in variety with the growing number of producers as they are continuing to seek an effective strategy to win the market. After all were busy in the production of powder detergent some producers want to appear differently to win the market. They began to produce liquid detergent Noun 1. liquid detergent - a detergent in liquid form
detergent - a cleansing agent that differs from soap but can also emulsify oils and hold dirt in suspension
, which is also enthusiastically welcome by the market. Powder detergent, however, is expected to remain the most popular.

Some producers claimed their products have certain ingredients that make their products more effective and softer.

Packaging is also a factor to attract consumers. In the beginning producers packed their detergent generally in 1,000 gram sachet sa·chet  
n.
A small packet of perfumed powder used to scent clothes, as in trunks or closets.



[French, from Old French, diminutive of sac, bag, from Latin saccus; see sack
, but later they also produce in larger sachets.

PT Kao Indonesia hoped to gain from niche market A niche market also known as a target market is a focused, targetable portion (subset) of a market sector.

By definition, then, a business that focuses on a niche market is addressing a need for a product or service that is not being addressed by mainstream providers.
 by producing detergent especially for batik batik (bətēk`), method of decorating fabrics practiced for centuries by the natives of Indonesia. It consists of applying a design to the surface of the cloth by using melted wax.  textile. Unilever followed by producing detergents specially for used by washing machines. Unilever even more serious in seeking to boost sales in niche market producing detergent specially for used in washing machines. It has introduced two types of such detergent for use in washing machine with upper shutters and side shutters. The detergent products are different in specialty for each type of washing machines Electrolux, Toshiba, Panasonic, Samsung, Sanyo and Sharp.

Detergent in bulk

In urban areas business in laundry Laundry can be:
  • items of clothing and other textiles that require washing
  • the act of washing clothing and textiles
  • the room of a house in which this is done
History of laundry
Before industrialization
 service has expanded that requires supply of detergent than a laundry shop needs much larger supply of detergent than a household. Laundry shop, therefore, could buy detergent in bulk in larger quantity in cheaper price per kg.

Products with brands will not be used by laundry shop as the cost would be higher. Producers have also competed to win the market of detergent in bulk

Prospects of detergent industry

The detergent industry has grown even before the country gained independence. Until now local products are quite competitive facing imported products.

The local producers have succeeded in keeping the loyalty of their consumers. The market is expanding especially with the growing population. The market is estimated to grow 6%-7% a year. The market demand is forecast to grow also with the improvement of the economy and purchasing power of the consumers in general.

Meanwhile, producers are seeking to strengthen integration of heir operations from the upstream From the consumer to the provider. See downstream.

(networking) upstream - Fewer network hops away from a backbone or hub. For example, a small ISP that connects to the Internet through a larger ISP that has their own connection to the backbone is downstream from the larger
 to downstream From the provider to the customer. Downloading files and Web pages from the Internet is the downstream side. The upstream is from the customer to the provider (requesting a Web page, sending e-mail, etc.).  sectors to improve efficiency and strengthen competitiveness.
Table-1
Products of detergent in Indonesia

                                                               Size of
Producers         Brand      Sub brand         Type           packaging

PT  Wings Surya   Daia       Putih             Powder             2
Surabaya
                             Lemon             Powder             2

                             Bunga             Powder             2

                  Ekonomi    Anti Noda         Cream              4
                  (Cream)

                  Wings      Biru              Cream              4
                  (Cream)

                  So Klin    Higinis           Powder             3

                             Pro               Powder             2

                             So Klin           Powder             2
                             Deterjen
                             Softener

                  Extra                                           1
                  Aktif
                  (bar)

Unilever, Tbk     Rinso      Anti Noda         Powder,            3
                                               Liquid

                             Rinso Liquid      Liquid

                             Rinso Thousand    Powder
                             Lilies Molto

                             Rinso Color       Powder
                             and Care

                             Matic (Rinso      Powder             1
                             Matic Top Load
                             for upper cup
                             washing
                             machine, Rinso
                             Matic Front
                             Load for front
                             cup washing
                             machine )

                  Surf       Clean Fresh,                         2
                             Lime Fresh

Sinar Antjol      B-29       B-29 Express                         1
                             Powder
                             Detergent

                             B-29 Powder                          2
                             Detergent

                             (Rose, Blue                          7
                             Fantastic
                             Orchid/ yellow,
                             Classy
                             Jasmine/blue
                             and Exotic
                             Lemon/green.)

                             Fantastic         Cream              2
                             Orchid
                             (yellow),
                             Classy Jasmine
                             (blue) and an
                             Exotic Lemon
                             (green).

                             B-29 cream Up     Cup, Layer
                             (yellow, blue)    Cup 6

                             B-29 Big Top      Big Top,           3
                                               Standing Big
                                               Top

                             B-29 Milky Box                       1

                             B-29 Ember                           3

                             B-29 TR (bread                       2
                             plate)

                             B-29 TA (water                       2
                             container)

                             B-29 Refill                          3

                             B-29 TK (cake
                             plate)

                             B-29 TN (rice
                             plate)

                             B-29 PASS
                             Sachet

                             B-29 PASS Cup

                             B29 Powder
                             Detergent with
                             Softener

                             B29 Powder
                             Detergent Fresh
                             Lime

                             B29 Powder
                             Detergent
                             Classy Jasmine

                             B29 Fruity

                             B29 Powder
                             Softener

                  WoW        WoW Powder        Powder            12
                             Detergent
                             (Oxygen Power,
                             Fresh Lime)

Kao Indonesia     Attack     Easy Regular      Powder             5

                             Easy Romantic     Powder             2
                             Flowers

                             Attack Clean      Powder             4
                             Maximizer

                             Attack Color      Powder             4

                             Attack plus       Powder             4
                             Softener

                             Attack Auto       Powder             2
                             Double Clean

                             Auto Smooth       Powder             2
                             Care

                             Attack Batik      Powder             1
                             Cleaner

Total Chemindo    Total      Total Putih       Powder             2
Loka
                             Total Harum       Powder
                             Softener
                             (Lemon, Bunga)

                  Bu Cream   Superklin         Powder             2

                             Anti Kuman        Powder             2

Birina            Bucream    --                Cream              2
Multidaya

Source: Data Consult

Table-2
Indonesia's production capacity for detergent, 2005-2009

Year       Production (tons)   Growth (%)

2005                710,250           --
2006                710,250            0
2007                710,250            0
2008                710,250            0
2009                771,330          8,6

Source: Industry ministry

Table-3
Indonesia's production of detergent, 2005--2009

                  Production
Year                (tons)      Growth (%)

2005                628,125
2006                640,688           2.0
2007                679,903           6.1
2008                721,982           6.2
2009                737,178           2.1
Average growth                        4.1

Sources: Industry ministry, Data Consult

Table-4
Indonesia's detergent exports and value, 2005-2009

                                    Value     Growth
Year       Volume    Growth (%)   (US$ 000)    (%)

2005       41,929                   30,494
2006        8,188        -80.5       8,203    -73.1
2007        6,805        -16.9       7,024    -14.4
2008        6,454         -5.2       7,930     12.9
2009        2,268        -64.9       2,626    -66.9

Sources: Industry ministry, Data Consult

Table-5
Imports of detergent in volume and value, 2005-2009

Year       Volume    Growth      Value     Growth
           (tons)              (US$ 000)

2005        7,939        --      5,978         --
2006       10,564      33.1      7,690       28.6
2007        6,989     -33.8      5,305      -31.0
2008        5,084     -27.3      5,704        7.5
2009        3,455     -32.0      2,939      -48.5

Sources: Industry ministry, Data Consult

Table-6
Indonesia's consumption of detergent, 2005--2009

Year   Production   Exports   Imports   Consumption   Growth (%)

2005    628,125     41,929     7,939      594,135
2006    640,688      8,188    10,564      643,064        8.2
2007    679,903      6,805     6,989      680,087        5.8
2008    721,982      6,454     5,084      720,612        6.0
2009    737,178      2,268     3,455      738,365        2.5

Sources: Industry ministry, Data Consult

Table-7
Estimated market of detergent in Indonesia
                                                     Market share
Players                            Brand                 (%)

Wings Surya              So Klin, Daia, Wings,            60
                         Ekonomi

Unilever                 Rinso, Surf                      30

Kao Indonesia, Sinar     Attack, B-29, Total, etc.        10
Antjol, Total Chemindo
Loka, and other

Total                    --                              100

Sources: Data Consult
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Title Annotation:INDUSTRY
Publication:Indonesian Commercial Newsletter
Geographic Code:9INDO
Date:Sep 1, 2011
Words:2595
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