Glass Breakthrough
    Category: Entrepreneurs By : Renjani Puspo Sari Read : 1822 Date : Monday, July 08, 2013 - 00:27:35

    Ahmad Zamroni / Forbes Indonesia

    PT Schott Igar Glass is a subsidiary of German multinational glassmaker Schott, and its President Director Peter Barberich is optimistic that his company has a shot at being the leading maker in Indonesia of pharmaceutical glass products, such as vials, ampoules and droppers. He forecasts sales in Indonesia to rise 20% to 1.2 billion units this year. “Our policy is to base our business in the main Asian hubs: Japan, China, India and Indonesia. These four countries are the biggest markets in Asia,’’ says Peter.

    Schott isn't a new player here. It entered Indonesia in 1996 by establishing a joint venture with a subsidiary of pharmaceutical maker PT Kalbe Farma called PT Igar Jaya. A year later, Schott purchased Kalbe's 51% stake in the venture and consolidated the Indonesian company under Schott International. Within a few years, Schott moved all its production from Malaysia to Indonesia, to produce for the local market and to export as well. About 60% of its products are sold locally, while the rest is exported to about 20 markets in ASEAN, the Mideast, India and Pakistan.

    He explains moving production to Jakarta was the right strategy as costs are lower here and allows the company to keep pace with the rapid expansion of the Indonesian market. Currently, the company's capital expenditure is about $10 million. “For the moment, we are focused on raising capacity, instead of establishing a new manufacturing base,” says Peter. The Indonesian factory is located on 30,000 square meters in Bekasi, and has 70 production lines and employs more than 400.

    The market is growing above 20% in Southeast Asia, says Gunawan Setokusumo, regional sales director for Asia. In Indonesia, he says, new growth is being triggered by the pending launch of the national social security system (Sistem Jaminan Sosial Nasional or SJSN). The program will increase the demand of medicines, including drug packaging. For the local market, Schott currently is associated with 200 pharmaceutical companies linked to hospitals and clinics, a mix of local firms such as Biofarma and global players such as Roche, Aventis and Pharmacia. “Our customers are pharmaceutical companies,’’ says Peter.

    Gunawan says the healthcare market in Indonesia has a good future with the growing middle class having more income to spend on caring for themselves. “I would say Indonesia now is one of the most promising markets in Asia,” says Peter. He says Schott is now going to expand to other nearby countries, especially Australia and New Zealand.