Effem enters RI candy market

Effem enters RI candy market

MEDAN (JP): PT Effem Indonesia, a subsidiary of U.S. based
global snack food and pet-food makers Mars Inc., said it had
earmarked a total of US$20 million in new investment this year to
manufacture various candies at its new plant in Medan, North
Sumatra.

Effem president Noel D. Janetski said the company expected to
be able to have a 1.5 percent share of the country's candy market
during the first year of the new plant's operation.

"We're confident that we'll be successful in running our new
business as we know Indonesia and its people well," Janetski said
in his speech at the inauguration ceremony of the new plant on
Thursday.

He hoped the candy manufacturing unit would be able to raise a
total of $5 million in sales next year.

But, in the course of a three-year period, it would be able to
book $10 million a year, he said.

Effem started its operation in 1996 by constructing a cocoa-
processing plant in Makassar, South Sulawesi, in which most of
the products are exported to other Mars subsidiaries worldwide.

The Makassar plant processes more than 15,000 tons of cocoa
beans a year.

Janetski said that the Medan candy plant would manufacture
around 30,000 tons of fruit-flavored candies per year, using the
single product "Starburst" during its initial production.

The company is scheduled to kickstart promotional activities
for 31 different types of fruit-flavored candies on Nov. 8 at the
Jakarta Convention Center.

"Popular boy bands Sheila on 7 and Gigi as well as MTV DJs
will help promote our new products," Hien Lane, Effem's marketing
manager said.

The country's candy market stands at $319 million in 2000 with
a wide range of products including chewy candy, jelly, hard candy
and lollipops. The market is dominated by popular brands like
Sugus, Relaxa, Hexos, Yupi.

Janetski said his company decided to acquire the candy plant
in Medan from a local candy-maker due to its strategic location,
both in terms of the domestic and international market.

Medan was near to Java, the center of the domestic market, but
it was also near to Malaysia, Singapore, Thailand and other Asian
countries as export destinations, he said.

Also present at the inauguration ceremony was Governor of
North Sumatra T. Rizal Nurdin.

Rizal welcomed Effem's new investments in Medan, saying that
the new plant was the 255th foreign direct investment project in
the province.

"Effem's investment will provide greater job opportunities for
the local people and also generate income for the province's
coffers," he said.

Rizal, however, warned that the company must take into account
the local social and cultural conditions when running its
business.

"Effem must keep up a good relationship with its employees by
providing fair and proper salaries. It must also place some
concern on environmental issues such as pollution and the use of
environmentally-friendly methods in its manufacturing process,"
he said. (dmr)