Russians enjoy Indonesia’s coffee
RUSSIA is famous for its vodka and many other local varieties of alcohol, with its people regarded as among the highest consumers of alcohol in the world. When it comes to coffee, however, many Russians enjoy an Indonesian product – Torabika Cappuccino.
Following its success with the instant coffee product in Russia, publicly listed food company PT Mayora Indah is expanding into other Eastern European countries.
Mayora’s international group country head Hartono Gunawan said he was optimistic the product would be just as well received in the rest of Eastern Europe.
The company exported 1,000 containers of Torabika Cappuccino to Russia last year, a 30 per cent sales growth from 2017. “Russia has the ninth biggest population and was ranked 11th for GDP [in 2017] in the world. We see Russia as a very important mixed-coffee market,” Hartono said.
Hartono said the company had begun exporting to 10 Commonwealth of Independent States (CIS) countries and had set its sights on Southeast Europe this year.
“We plan to export 2,000 containers of food products worth around $40 million to Russia this year, especially as there will be a new biscuit product and a new variant of instant coffee to be exported,” Mayora president director Andre Sukendra Atmadja told reporters at a press briefing at Mayora’s headquarters in West Jakarta recently.
Andre said there was a possibility the company could set up a factory in Russia after sales reached $100 million.
“It is very likely we will build a factory in Russia, but we need to reach a certain economy of scale first. Although we have sent 1,000 containers, it is still too small to warrant a factory. Only once the economy of scale reaches $100 million would it be feasible to build a factory there,” he said.
The company has booked a significant increase in exports, which contributed 50 per cent of the company’s revenue last year.
Factories in Indonesia
The company currently operates 24 factories in Indonesia and five factories abroad, which, according to Mayora global marketing director Ricky Afrianto, was sufficient to meet demand.
Despite the stagnant growth of the fast-moving consumer goods (FMCG) sector, Mayora is upbeat it can book 15 per cent sales growth.
Ricky expressed optimism the company could see at least 15 per cent sales growth this year and believed the presidential and legislative elections in April this year could also boost the economy and in turn boost people’s buying power.
“We offer affordable products that are needed by people of all backgrounds. The political climate will hopefully not disrupt the FMCG industry,” he said.
Mayora sells its various products, such as Kopiko coffee candy, Kopiko instant coffee, Vietnam butter cookies, Energen breakfast cereal and wafers and Beng Beng and Malkist crackers to more than 100 countries, with Asean and Middle Eastern countries its biggest international markets.
Mayora’s total revenue rose by 16 per cent to 35 trillion rupiah ($2.481 billion) last year, despite overall stagnant growth in the FMCG sector.
“The FMCG industry has indeed been stagnant for the last two years. However, we are lucky that we have seen an overall growth of 16 per cent. It has been difficult for some categories, but they still saw growth nonetheless,” Ricky said.
The growth was seen in all eight of its product categories, Ricky said, and was most notable in its beverage line, such as Teh Pucuk Harum bottled tea, which was Indonesia’s leading product in the ready-to-drink tea segment in 2014, as well as bottled water brand Le Minerale.