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Detergent industry growing amid sharp competition.

Detergent 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 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 in 2005.

Player in detergent industry

There are not many big players in detergent industry in Indonesia. Producers categorized 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 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 benzene the basic material of detergent under PT Unggul Indah Cahaya.

The Wings Group was a member of the consortium that acquired Ecogreen Oleochemical. Ecogreen is a producer oleochemicals including natural fatty alcohol, which is also used as basic material for detergent and toiletries with a production capacity of 100,000 metric tons/year.

Production increasing

The country's production of detergent has increase din 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 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 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 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.


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 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. In 2010, the market value was Rp 9 trillion. See the following table.


Efficiency in distribution also determines success in the marketing of detergent, which is categorized as fast moving consumer goods (FMCG) 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 in the success of marketing for consumer goods 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 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 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, which is a variant 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, 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, but later they also produce in larger sachets.

PT Kao Indonesia hoped to gain from niche market by producing detergent especially for batik 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 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 to downstream sectors to improve efficiency and strengthen competitiveness.
Products of detergent in Indonesia

 Size of
Producers Brand Sub brand Type packaging

PT Wings Surya Daia Putih Powder 2
 Lemon Powder 2

 Bunga Powder 2

 Ekonomi Anti Noda Cream 4

 Wings Biru Cream 4

 So Klin Higinis Powder 3

 Pro Powder 2

 So Klin Powder 2

 Extra 1

Unilever, Tbk Rinso Anti Noda Powder, 3

 Rinso Liquid Liquid

 Rinso Thousand Powder
 Lilies Molto

 Rinso Color Powder
 and Care

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

 Surf Clean Fresh, 2
 Lime Fresh

Sinar Antjol B-29 B-29 Express 1

 B-29 Powder 2

 (Rose, Blue 7
 Orchid/ yellow,
 and Exotic

 Fantastic Cream 2
 Classy Jasmine
 (blue) and an
 Exotic Lemon

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

 B-29 Big Top Big Top, 3
 Standing Big

 B-29 Milky Box 1

 B-29 Ember 3

 B-29 TR (bread 2

 B-29 TA (water 2

 B-29 Refill 3

 B-29 TK (cake

 B-29 TN (rice

 B-29 PASS

 B-29 PASS Cup

 B29 Powder
 Detergent with

 B29 Powder
 Detergent Fresh

 B29 Powder
 Classy Jasmine

 B29 Fruity

 B29 Powder

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

Kao Indonesia Attack Easy Regular Powder 5

 Easy Romantic Powder 2

 Attack Clean Powder 4

 Attack Color Powder 4

 Attack plus Powder 4

 Attack Auto Powder 2
 Double Clean

 Auto Smooth Powder 2

 Attack Batik Powder 1

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

 Bu Cream Superklin Powder 2

 Anti Kuman Powder 2

Birina Bucream -- Cream 2

Source: Data Consult

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

Indonesia's production of detergent, 2005--2009

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

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

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

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

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

Wings Surya So Klin, Daia, Wings, 60

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
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