_5mins_14Oct09_Hariolf_336.jpg "Hariolf Kottmann, CEO of Clariant") |
| Hariolf Kottmann, CEO of Clariant |
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_5mins_14Oct09_Francois_336.jpg "Dr Francois Bleger, GM ,Clariant Special Chemicals (Zhenjiang)") |
| Dr Francois Bleger, GM ,Clariant Special Chemicals (Zhenjiang) |
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Clariant, a specialty chemical developer and producer, unveiled a surfactants production facility in Zhenjiang, East China this September. At the opening ceremony, Hariolf Kottmann, CEO of Clariant and Dr Francois Bleger, general manager of Clariant Special Chemicals (Zhenjiang) told AdsaleATA.com the company’s strategies in China.
ATA: AdsaleATA.com
ATA: Clariant regards China a big potential market. Is there any quantitative target for the company’s development in the country?
Mr Kottmann: China market is significant for the future development of Clariant.
Clariant’s management team decided to shift in part the production capacity from Europe and North America to China years ago. The decision was made for two reasons. The shift is a response to the relocation of production by some of Clariant’s customers. Major international apparel brands have their products manufactured in China. Second, the domestic demand of China is growing rapidly along with the country’s fast-growing economy. We also would like to boost our growth in this dynamic market.
Although quantitative targets are not available, I can tell you that Clariant has invested US$100 million in China in the past 18 months.
This is a huge investment for a company like Clariant. The global sales reached 8 billion CHF (or RMB 48 billion) in 2008. Of which, 45% came from the market of Europe, 30% from North America and a quarter from the Asian region. About 4% was contributed from China. Yet, as said earlier, the China market is promising and Clariant will continue its direction and policy in its market development.
ATA: The newly launched facility at Zhenjiang city of Jiangsu province provides surfactant products for various industries. Could you tell me more about its cross-divisional positioning?
Mr Kottmann: With regard to the positioning, Dr Bleger and I will explain in two aspects.
In a broader sense, a chemical production line usually manufactures a singe type of chemical products. However, our equipment suppliers hope that some of our products can share the same equipment in production, which leads to a substantial improvement in equipment utilization and production efficiency. Multiple products are thus made from various raw materials in the Zhenjiang factory.
Dr Bleger: Product-wise, in addition to surfactants, Clariant produces a variety of chemical products including amino acids and polymer in Zhenjiang. The key objective is to enter different target segments such as textiles, oil, mining and homecare.
ATA: A number of foreign enterprises have set up the production facility in mid-tier cities in East China and research and development (R&D) centers and regional headquarters in Shanghai. Is there any plan for Clariant to move the regional headquarters to Shanghai, and will it establish a R&D center in Shanghai?
Mr Kottmann: Historically, predecessors of Clariant, namely two well-established chemical producers Sandoz (Switzerland) and Hoechst (Germany), made a right decision to set up a regional headquarter in Hong Kong to serve the Asian region. In 2010, we will set up another four operation centers in the region situated in Japan, China, India and the ASEAN respectively.
We pay more attention to the real value when it comes to research and development. A R&D center differs from a product application center that focuses on customer services. A product application center hence stay in proximity to the production facility and customers. Clariant has built several production application centers in China for this purpose. On the other hand, a R&D center in real sense is not that simple. We have currently a number of product R&D centers across Europe and will build a new one in Shanghai, but not in the near term. Infrastructure is vital to establish a R&D center, which is not fully available in the city at the moment. Such a center (in Shanghai) will be more possible after 2010.
ATA: The year of 2009 is quite a difficult year for many businesses, and it is especially true for chemical suppliers. Costs of textile chemicals have risen up sharply. How does Clariant cope with the challenge to meet the current market needs?
Mr Kottmann: First of all, it has been difficult for a European firm engaging in the textile and relevant industries. Fast growths in Asia such as China, India and Malaysia have brought pressure to textile enterprises in Europe. Those who did not relocate their production to Asia (due to lower costs) have found it even more challenging to survive now.
A full range of high-performance textile chemical products are provided by Clariant, along with application solutions, globally-covered technical support and sales network. By integrating these advantages, Clariant is in a strategically competitive position in the global textile industry.
ATA: Internally, Clariant has rolled out a restructuring program. How is it going?
Mr Kottmann: A restructuring program has been implemented at Clariant focusing on cash generation, cost reduction and product portfolio. In the years to come, we will constantly optimize our organization structure. The previous business units were streamlined to 10 for better management and control. It also allows us to provide better services for customers.
(Original Chinese story can be found at AdsaleCTA.com)
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