Indonesia’s personal care industry defies the global downturn mainly due to the improved economic conditions in the country. The Indonesian economic conditions continued to improve in 2011 with the GDP increasing by over 6% and the unemployment rate remaining at less than 7%.
The Rupiah strengthened against the US dollar, from an average of Rp9, 087/US$ in 2010 to an average of Rp8, 883/US$ in 2011. The overall beauty and personal care market posted a current value growth of 14% in 2011, versus 12% in 2010 and is estimated at Rp billion 27,971-retail values. The largest segments in the market are hair care, valued at Rp billion, 5,856, skin care – Rp billion 9,160, bath and shower – Rp billion 3,909, and colour cosmetics – Rp billion 2,551. One of the most exciting predictions for the market is for increases in the male grooming category. Men’s grooming products posted current value sales growth of 14% in 2011, up from 12% in 2010. Men’s skin care, which benefited from the most new launches, showed growth of 34% in current value terms in 2011. Some of the newer brands and variants of men’s toiletries launched included Olay Men Solutions and Gillette Series Skin Care, both manufactured by Procter & Gamble. Olay Men Solutions comes in a complete range of men’s skin care, from facial cleansers, facial moisturisers to toners and eye gel.
Manufacturing overview
Cosmetic manufacturers, both local and multinationals, total more than 700 companies. Of those 700 companies, 18 local cosmetic manufacturers and 12 multinational comprise the top 30 suppliers to the many consumers of the country. Leading this growth are the multinationals Unilever, P&G and L’Oréal, and the leading local players Martha Tilaar Group, Vitapharm PT and Mustika Ratu. Unilever Indonesia has opened a new skin care factory in Cikarang, West Java. The new factory, which has been built with an investment of IDR500 billion, is the newest addition to seven other factories owned by the company in the country. The new skin care factory manufactures products for the local market as well as for export to a number of countries in Asia including Singapore, Thailand, Malaysia, Philippines, Pakistan, India and Vietnam. L’Oréal built a new factory in Cikarang to manufacture hair care and skin care products in 2011 and Mandom allocated capital expenditure of Rp80 billion for production machinery maintenance. Local company, Martha Tilaar Group, allocated Rp135 billion to build a manufacturing plant in Cikarang and to revitalise production machinery, while Mustika Ratu invested Rp50 billion to upgrade its factory in Ciracas.
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