Pumping Local Brands
    Category: Healthcare By : Siti Aisyah Rachmawati Read : 1960 Date : Saturday, September 13, 2014 - 10:53:38

    Ardiles Rante for Forbes Indonesia

    When Ade Tarya Hidayat, now 62, lost his job in 1980 at Dutch medical device company Ahrend, he was inspired to start his own company. To do so, Ade relied on his customer networks to build his business, who became clients of his medical and scientific device trading company. That firm, PT Abadi Scientific, was started the same year and had just three staff, one of them being his wife.

    Today, Ade heads five separate companies, all included under the umbrella name of the AbadiNusa group, which together have a total turnover of approximately Rp 300 billion a year. All of them are privately held by Ade, who is a pioneer of Indonesia’s medical device industry. The five are PT AbadiNusa Usahasemesta, a scientific and medical equipment trading company, PT Renaltech Mitra Abadi, which produces hemodialysis supplies, PT Sutek Mitra Utama, which produces rubber resins, PT Technomed Asia, which produces medical soft bags and neuro-diagnostic components, and PT Sugih Instrumendo Abadi, which produces medical equipment. Ade also owns a 35% stake in PT Trimitra Garmedindo, a garment company that specializes in blood pressure cuffs and medical bags, run by his brother Gagan Sugandi.

    In the early days, Ade was content to import equipment. He then decided to move into manufacturing his own products after getting hit with rupiah devaluations, which made it more expensive for him to import medical devices into the country. The first product was a blood pressure meter and today Ade’s Sugih Instrumendo Abadi is Indonesia’s oldest and largest blood pressure meter manufacturer. He started first in 1990 by producing blood pressure meter components and in 1994 he moved into selling his own ABN brand of blood pressure meters. Monthly the company now produces 60,000 finished blood pressure meters and 90,000 blood pressure meter components that it supplies to blood pressure meter giants such as Riester, WA Baum and ADC. Annually, the company’s total export is around $6 million with its blood pressure components make up 88% of sales. The U.S. and Germany are its two biggest markets, taking up about 76% of the total exports while the rest are shipped to 20 other countries. Locally, Ade says that his firm has captured around 40% of the blood pressure meter market.

    To start the business, he bought 10,000 blood pressure meters from a Japanese company and then studied them. He chose to develop blood pressure meters because many of its components are from rubber, and Indonesia is a rubber producer, so he figured he would have a competitive advantage. Beside blood pressure meters, AbadiNusa also produces around 20,000 stethoscopes per month, which also use rubber tubes. Ade claims to have 10% market share for stethoscopes.

    He recalls how difficult it was for him to convince his first customers to buy ABN products. “At first, many doctors would immediately say no to me even before I explain about my product just because it is an Indonesian brand. So at that time, I just gave free samples to doctors that I met and then get back to them around three months later,” he says. “Most of them were surprised with the quality of the product and then after that decided to buy it.”