Positioned for Growth

Kimberly-Clark Softex taps Indonesia to win the Southeast Asia personal care market.

- Ulisari Eslita

According to the United Nations, 140 million babies are born every year. And the Asia Pacific contributed about 60% of newborn babies in the world, making the region the growth spot for baby care products. The demand for baby care products is the highest in this region and valued at $52.6 billion in 2019. The market is also projected to reach $68.3 billion by 2027 or grow by 4% annually. Baby diapers make a significant slice of the cake as parents have become more aware of health issues and the increasing numbers of working women in the region demand products that offer practicality. According to Allied Market Research, the baby diapers market is one of the least negatively impacted by the COVID-19 pandemic.

With over 270 million in population, Indonesia welcomes almost five million babies every year, according to the Statistics Indonesia (BPS). One of the companies that enjoy a good business from the high newborn figures is Kimberly-Clark Softex previously Softex Indonesia, the country's second-largest baby diapers manufacturer that produces Sweety and Happy Nappy diapers. According to research company Nielsen, in 2019, with annual sales of $420 million, Softex controlled 30% of the baby diapers market share in Indonesia. The largest baby diapers company in the country is Unicharm Indonesia that produces the brand MamyPoko. Although Softex's brand is often associated with feminine care products, Hendra Setiawan, CEO of Kimberly-Clark Softex, says baby diapers have been the company's main moneymaker for many years. Softex produces more than 200 million baby diapers each month, one-third of the market demand.

Baby diapers contribute 80% to Softex's top line, says Hendra, adding his expectation on future solid growth on the back of Indonesia's growing population.