Diaper makers target Asia in challenge to P&G

November 20, 2013 Leave a comment

Diaper makers target Asia in challenge to P&G

JIJI

NOV 18, 2013

Japanese manufacturers of paper diapers for babies are boosting business in Asian economies outside Japan to attract demand from an expanding class of middle-income earners benefitting from economic growth. Unicharm Corp., the leading disposable diaper maker in Japan, and domestic rivals Kao Corp. and Daio Paper Corp. have seen sales grow in the region and anticipate a further demand.The Japanese firms are now competing well with global industry leader Procter & Gamble Co. of the United States and local makers that used to dominate the Asian market.

Unicharm, which operates in some 80 countries, is working to boost sales of its mainstay pull-up diapers.

The company took the top share in Indonesia by selling its products loose to make them easier to buy. It advanced to the second spot in China behind P&G on strong demand for less expensive products with simpler packaging and functions inland, where incomes are lower than in coastal areas.

Still, Unicharm is facing a fierce battle to lure middle- and high-income earners mainly in the coastal city of Shanghai.

Kimberly-Clark Corp., which has beefed up its lineup of high-end products, is trying to catch Unicharm, while Kao and Daio Paper have posted higher sales.

Kao’s Merries diapers are popular in China because they breathe well. Some products bought in Japan are being resold in China at higher prices.

Kao plans to launch a new plant in Yamagata Prefecture next spring to make up for supply shortages in Japan and abroad.

Daio Paper is scheduled to begin production in China this month to reinforce sales in the Shanghai area.

According to British research firm Euromonitor International, P&G took the biggest share, of 18.0 percent, in the Asian market for sanitary products in terms of sales in 2012, followed by Unicharm, with a 17.2 percent share.

Kao came in fifth place with 5.2 percent and Daio Paper ranked seventh with 2.4 percent.

Filed under Macro Trends

Unknown's avatarAbout bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

Leave a comment