Enseval expects 20% growth in 2004 despite election uncertainty<\/p>\n
PT Enseval Putera Megatrading is a leading distributor of
\nhealth products and consumer goods. The company has four
\ndivisions, that is pharmacy, consumer goods (cosmetics, health
\nfood and drinks), medical devices and raw materials for medicines
\nand consumer goods, with the pharmacy division contributing most
\nof the company's revenue. Enseval's president director Budi
\nDharma Wreksoatmodjo accompanied by managing director Teddy Iman
\nSoewahjo talks with The Jakarta Post's Fitri Wulandari on the
\ncompany's strategy and outlook for 2004.<\/p>\n
Question: How did the company perform in 2003?
\nAnswer: In 2003, our business grew by 20.5 percent. We expected
\nhigher growth, but there was a slight correction on consumers'
\npurchasing power in the second semester of the year so that we
\ndidn't grow as we had expected.<\/p>\n
In 2002, we grew by more than 40 percent because we received
\nnew suppliers, which boosted our sales. Most of the products in
\n2002 were leading products such as Extra Joss, milk products from
\nthe Sustagen Group and products from Sara Lee.<\/p>\n
But the 20.5 percent growth was above average because many
\nsimilar companies could not reach double digit net sales.<\/p>\n
Our net sales for 2003 was Rp 3.75 trillion (US$443 million)
\nand net profit was Rp 160 billion.<\/p>\n
Has your company had progress with its debt restructuring?
\nWe owe a total of $30 million to international and local banks,
\nnamely Royal Bank of Scotland, Summitomo-Mitsubishi, Mitzuho,
\nIndosuez and Lippo Bank. We have submitted proposals to repay the
\nloans in five years instead of seven years. And we are now
\nawaiting their answer.<\/p>\n
How will the current macroeconomic stability affect your
\nbusiness?
\nBusiness in health-related products and consumer goods is a bit
\nlow because consumers' purchasing power is weakening. But we hope
\nto get a multiplier effect in the consumer goods sector from
\nlower interest rates. Lower interest rate would prompt people to
\nreinvest in new businesses, which would create employment. From
\nthe employment created we would expect more purchasing power to
\nfollow.<\/p>\n
How does the company survive competition?
\nCompared to other companies, we can survive because we have
\nstrong infrastructure. This supports our commitment to our
\ncustomers. We have two kinds of customers: suppliers and buyers,
\nor outlets who buy products supplied to us. We try to deliver
\nproducts entrusted to us by our suppliers as close as possible to
\nthe buyers.<\/p>\n
We have 40 branches across Indonesia and 1,468 delivery
\nvehicles. Each branch has its own warehouse and delivery
\nvehicles.<\/p>\n
But most important to our customer service is information
\ntechnology. In 2002, we invested some Rp 15 billion in hardware
\nand software to support our information technology
\ninfrastructure. With IT support, customers can track sales and
\ninventory of their products in every area in Indonesia.<\/p>\n
It also help us dispatch within 24 hours medicines, for
\nexample, to hospitals, clinics or outlets that run out of stock.
\nIn some areas, products can be delivered within four hours.
\nCustomer satisfaction is our focus.<\/p>\n
How many suppliers do you have?
\nAbout 70 suppliers, from small to big suppliers. We are
\ndistributors for leading products such as L'Oreal, which is one
\nof the largest cosmetics producers, and other products such as
\nSustagen and Morinaga. We got new suppliers in 2003, but in terms
\nof sales they are not too significant.<\/p>\n
Of the number, 70 percent are international suppliers such as
\nMead Jhonson and L'oreal. The remaining are locals. But local
\nsuppliers dominate sales in terms of volume as their products are
\nmarket leaders, such as Extra Joss and Procold.<\/p>\n
We offer an opportunity for potential local suppliers to
\nbenefit from our infrastructure, which has helped make many
\nproducts successful.<\/p>\n
Do you prefer certain suppliers to others?
\nBasically, we welcome any supplier, whether international or
\nlocal, to work together with us. But we prefer aggressive
\nsuppliers who use our infrastructure to make their product more
\nsuccessful. In short, we prefer suppliers who have commitment to
\nmarket their products in Indonesia.<\/p>\n
Additionally, we distribute products that can improve the
\nquality of life.<\/p>\n
Brand is also part of our consideration. But famous brands are
\nusually unable to expand to become more successful.<\/p>\n
What is your outlook for 2004?
\nWe anticipate business growth of between 15 to 20 percent in 2004
\nand net sales of Rp 4.5 trillion. It is a conservative projection
\nin anticipation of various events this year, including the
\ngeneral election. Under these circumstances, business would
\nnormally have the brakes on for a while, but the impact won't be
\nthat significant because most of our products are prime ones.
\nThese products are only used by people on the top level of
\nsociety who are relatively not vulnerable to any (social and
\npolitical) upheaval.<\/p>",
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