Mustika Ratu targets more markets abroad

Mustika Ratu targets more markets abroad

JAKARTA (JP): Publicly listed traditional cosmetics
manufacturer PT Mustika Ratu plans to enter new overseas markets
after penetrating the Netherlands and some Asian countries, one
of the company's senior executives said.

Company director of finance, Putri Kuswisnuwardani, told The
Jakarta Post here that her company would enter the United States,
Australia and the Commonwealth of Independent States (CIS -- the
former Soviet Union) later this year.

"As a big country, the U.S. has its own lifestyle which
nonetheless is quite similar across the states. I think we have a
fair chance of making inroads on their market within two or three
years," she said, adding that Mustika Ratu would also enter
Australia and Thailand.

But Europe seems too far away from Indonesia, she said.

Mustika Ratu has also signed an agreement with PT Comexindo, a
trading firm controlled by Hasjim Djojohadikusumo, to distribute
Mustika's products in some areas of the CIS, she said.

"Long before the general public talked about free markets or
global competition, we thought seriously about overseas
penetration."

Putri said that Mustika Ratu currently ran a number of
subsidiaries or partnerships to market its products in Malaysia,
Singapore, Brunei, the Philippines, Taiwan, South Korea, Japan,
the Middle East and the Netherlands.

"As our own market is being invaded by foreign goods we should
work harder to establish our products in international markets, "
she said.

Mustika Ratu, which was incorporated in 1978 floated some 25
percent of its shares on the Jakarta Stock Exchange in July,
1995. The company raised nearly Rp 70 billion from the offering.

Mustika Ratu produces more than 500 cosmetic products,
including face care, hair care and body care products. The firm
also processes more than 60 kinds of traditional herbs into
powders, pills, capsules, dried herbs and tea bags. Some of the
company's product names are Moor's Collection, Royal Heritage,
Mustika Ratu and Ananda.

The company won marketing awards from the Asian Institute of
Management in 1993 and 1996. Awards in several categories are
presented annually by the Manila-based institute.

Putri said Mustika Ratu had to be well prepared to enter
international market.

"We have to improve product quality, understand what our
products are and their market niche and how to handle marketing."

"For instance, our products are traditional products with
heritage formulas. Though there have not been any clinical trials
of traditional products, they have been well tested because they
have been used for hundreds of years with no side effects."

Domestically, Mustika ratu competes with dozens of local
producers. Its leading competitors are PT Martina Berto which
produces Sari Ayu cosmetics and natural health care products, PT
Ratu Ayu which makes Ratu Ayu cosmetics and PT Vitapharm, the
producer of Viva cosmetics.

"Overseas brands, including those illegally brought to
Indonesia, are also keen competitors," Putri said.

Putri said her company gained last year a 13.07 percent
increase in sales to Rp 104.32 billion from Rp 92.26 billion in
1995. Its net profit increased 18.73 percent to Rp 19.01 billion
from Rp 16.01 billion.

In 1995, the company's growth of sales and net profit
reached 39.13 percent and 113.75 percent, respectively.

Putri said Mustika Ratu planned a new manufacturing plant in
Cibitung, West Java, to double its capacity following increasing
demand.

Putri said domestic spending on cosmetic and personal care
products reached $1.5 billion in 1993 with an annual growth rate
of between 5 percent and 6 percent.

She said the new plant on 10-hectares would need an investment
of Rp 25 billion to Rp 35 billion. It is due to start production
in 1998. (icn)