Ajinomoto: to Enter Bread Market in Indonesia

Tokyo / JP. (aci) Ajinomoto Company Incorporated has decided to enter the bread market in Indonesia. In July 2015, Ajinomoto Company and its consolidated subsidiaries Ajinomoto SEA Regional Headquarters Company Limited and Ajinomoto Bakery Company Limited will establish PT Ajinomoto Bakery Indonesia (ABI), which will develop, manufacture and market frozen bread dough and frozen bakery products in Indonesia, with domestic sales scheduled to start in August 2016. ABI will aim for net sales of 193.5 billion IDR (approximately 1.8 billion JPY) in fiscal 2020. Through this initiative, Ajinomoto Company will accelerate the expansion of its consumer foods business in Indonesia while aiming to make a greater contribution to the country´s well-being.

The population of Indonesia was approximately 250 million in 2013, and is projected to reach approximately 270 million in 2020. GDP per capita in Indonesia is USD 3’500, and the economic growth rate averaged approximately six percent annually from 2010 to 2014, with continuing economic growth forecast (source: Ministry of Foreign Affairs data, 2014).

With economic growth, dietary culture is diversifying and the consumption of bread is spreading rapidly. The bread market in Indonesia was 4.6 trillion IDR (approximately 43.2 billion JPY) in 2013, having compound annual growth rate of 13 percent from 2008 to 2013 (source: Euromonitor International, 2013).

The new company ABI will develop and manufacture high-value-added frozen bread that is not yet widespread in the growing Indonesian bread market and has not been produced in the country to date. Products manufactured by ABI will be sold mainly in the Jakarta metropolitan area by PT Ajinomoto Sales Indonesia, which has powerful sales capabilities. The main purchasers are expected to be from the middle class, which is growing as a proportion of the population.

Ajinomoto Company has a long business history in Indonesia, having established PT Ajinomoto Indonesia in 1969 to launch umami seasoning «Aji-No-Moto». The company built a business foundation with the unique sales method of visiting individual vendors to sell small single-use packets of «Aji-No-Moto» that could be bought with just a coin. Since then, the company has acquired loyal customers and expanded its business with the rollout of «Masako» flavour seasoning, «Sajiku» menu-specific seasoning for various Indonesian dishes, «Saori» liquid seasoning and «Mayumi» mayonnaise.

In its FY 2014 to 2016 Medium-Term Management Plan, the Ajinomoto Group positions Indonesia as one of its «Five Stars» (core countries in ASEAN and Latin America) and a major growth driver. The Ajinomoto Group will achieve rapid growth with the aim of tripling net sales in the consumer foods business in Indonesia by fiscal 2020, compared with fiscal 2012.

The Ajinomoto Group aims to be a genuine global specialty company that contributes to well-being through providing more delicious, higher-quality products adapted to the food cultures and customs of each country.

Overview of the New Company

  • PT Ajinomoto Bakery Indonesia
    • Location: Jakarta, Republic of Indonesia
    • Establishment: July 2015 (scheduled)
    • Representative: Kaoru Kurashima, President Director (currently President Director of PT Ajinomoto Indonesia)
    • Number of employees: Approximately 50 (scheduled)
    • Business description: Development, manufacture and marketing of frozen bread (frozen bread dough and frozen bakery products)
    • Capital: 180 billion IDR (approximately 1.7 billion JPY)
    • Equity ownership: Ajinomoto SEA Regional Headquarters Company Limited 70 percent, Ajinomoto Company Inc. 25 percent, Ajinomoto Bakery Company Limited five percent
    • Start of sales: August 2016 (scheduled)
    • Sales target: 193.5 billion IDR (approximately 1.8 billion JPY) in fiscal 2020

Reference

  • Ajinomoto SEA Regional Headquarters Company Limited
    • Location: Bangkok, Kingdom of Thailand
    • Established: December 2014
    • Representative: Etsuhiro Takato, President
    • Number of employees: Approximately 25
    • Business description: Administration of consumer foods businesses and corporations in the Southeast Asia and South Asia regions
    • Capital: THB 30 million
    • Equity ownership: Ajinomoto Company Inc. 100 percent
  • Ajinomoto Bakery Company Limited
    • Location: Chuo-ku, Tokyo, Japan
    • Established: December 1993
    • Representative: Yoshitaka Kumagai, President
    • Number of employees: Approximately 110
    • Business description: Development, manufacture and sale of frozen bread dough and frozen bakery products
    • Capital: 400 million JPY
    • Equity ownership: Ajinomoto Company Inc. 100 percent
  • PT Ajinomoto Sales Indonesia
    • Location: Jakarta, Republic of Indonesia
    • Established: January 1994
    • Representative: Shinichi Matsumoto, President Director
    • Number of employees: Approximately 1’700
    • Business description: Sale of umami seasoning «Aji-No-Moto», flavour seasonings, menu-specific seasonings, liquid seasonings and mayonnaise products manufactured by PT Ajinomoto Indonesia
    • Capital: USD 250 thousand
    • Equity ownership: PT Ajinomoto Indonesia 80 percent, Ajinomoto Company Inc. 20 percent

About Ajinomoto Company

Ajinomoto Company is a global manufacturer of high-quality seasonings, processed foods, beverages, amino acids, pharmaceuticals and specialty chemicals. For many decades Ajinomoto Company has contributed to food culture and human health through wide-ranging application of amino acid technologies. Today, the company is becoming increasingly involved with solutions for improved food resources, human health and global sustainability. Founded in 1909 and now operating in 26 countries and regions, Ajinomoto Company had net sales of 1’006.6 billion JPY (9.17 billion USD) in fiscal 2014.