Samsung eyes world's top spot but sees RI sales slowing
Fitri Wulandari, The Jakarta Post, Singapore
South Korean electronics maker Samsung seeks to overtake its Japanese competitors and lead the world market within a few years, but sales in Indonesia, one of its promising markets, have been waning due to a weaker demand for electronics.
Samsung Indonesia revised downwards this year's growth target to 15 percent from 25 percent. Growth was 80 percent last year.
"Sales will still be higher than last year but it likely won't meet our target for this year," Samsung Indonesia general manager Lee Khang Hyun told reporters on the sidelines of Samsung's Digital Roadshow promotional tour in Singapore.
He said Samsung was aiming for US$750 million in sales this year from $600 million in 2001 and $350 million in 2000.
He said the company had yet to find out what caused sales here to weaken, but he suspected that sagging domestic consumption might be the driving factor behind it.
The Electronics Industry Association (Gabel) said sales of electronics fell by some 26 percent in the months of July and August.
"It's nearing the end of the year but there's no sign that sales will pick up," said Lee.
He said the Bali bombing had also dampened the public's appetite for spending money, which economists tagged as weaker consumer confidence.
PT Samsung Electronics Indonesia produces a wide range of electronic goods, such as VCRs, CD-ROMs, DVD combos, television sets, refrigerators, cellular phones, air conditioners, computer monitors and washing machines.
The company contributes to about 10 percent of Indonesia's total export sales in electronics.
Despite the recent slump in the local market, Lee said that Samsung planned to increase its investment in Indonesia next year. However, he declined to provide any details.
Samsung said it wanted to strengthen its position in fast growing markets, some of which include countries in the Southeast Asian region.
"We intend to increase our market position whatever the macroeconomic situation will be, because we have competitive strength," Eric B. Kim, the executive vice president of the global marketing operation, said.
He voiced confidence that Samsung would beat its Japanese rivals, who have long held the dominating rank in the global electronics market, adding that it would be just a matter of time.
"We cannot predict when that will be happen, but we are taking the market share from the traditional players," Eric said.
His optimism was based on Samsung's continued growth amid a sluggish global economy.
The company said improved product competitiveness, a diversified income structure, an increased brand value, enhanced productivity and a strong emphasis on value-added products had contributed to Samsung's growth.
Eric claimed that innovations in digital convergence technology and a more aggressive global brand campaign had made Samsung the most innovative electronics maker.
Through digital convergence the company combines different electronics products into one, such as the refrigerator and the Internet in its latest product.
Samsung is now set to top last year's financial performance.
Its sales for the first nine months of this year have reached $24.23 billion, compared to $26.33 billion throughout all of last year.
Samsung products in No.1 positions in its global market share: DRAMs (27%), SRAMs (27%), TFT-LCDs (22%), CDMA handsets (26%), Computer Monitors (22%), VCRs (17%), Microwave ovens (23%).