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Food Supplements in Indonesia: A Strategic Entry Report, 2000

Published by: Icon Group International, Inc.

Published: Oct. 11, 2000 - 189 Pages


Table of Contents


1 Introduction & Methodology
1.1 What does this report cover?
1.2 Evaluating Indonesia
1.3 Latent Demand and Accessibility in Indonesia


2 Food Supplements
2.1 Latent Demand and Accessibility: Background
2.2 Latent Demand: Aspects of Interest
2.2.1 Market Profile
2.2.2 Statistical Data
2.2.3 Best Sales Prospects
2.3 Accessibility: The Structure of Competition
2.3.1 Marketing Strategy
2.3.2 Local Production
2.3.3 Third Country Imports
2.3.4 U.S. Presence
2.3.5 End-User Analysis
2.4 Accessibility: Key Factors
2.4.1 Import Climate
2.4.2 Distribution Practices
2.4.3 Financing
2.5 key Contacts
2.5.1 Regulatory Body and Organization
2.5.2 Agents, Distributors and Importers
2.5.3 Trade Events


3 The Economics Of Latent Demand In Indonesia
3.1 Executive Summary
3.2 Economic Issues in Indonesia
3.2.1 Banks
3.2.2 Debt
3.2.3 Real Sector Recovery/Restructuring
3.2.4 Social Safety Net
3.2.5 Corruption Risks
3.2.6 Legal Reform
3.2.7 Regional Autonomy and Fiscal Equalization
3.2.8 Policy Outlook


4 Export Accessibility In Indonesia
4.1 Executive Summary
4.2 Exporting to Indonesia
4.2.1 Financing Strategies
4.2.2 Financing Export Strategies
4.2.3 Export Financing Options
4.2.4 Asian Development Bank
4.2.5 The World Bank
4.2.6 Trade Regulations and Standards
4.2.7 Trade Barrier Risks
4.2.8 Valuations on Imports
4.2.9 Licenses Required for Imports
4.2.10 Controls on Exports
4.2.11 Import Documentation Requirements
4.2.12 Free Trade Zones & Warehouses


5 Direct Investment Accessibility In Indonesia
5.1 Executive Summary: Infrastructure
5.2 Executive Summary: Natural Resources
5.3 Executive Summary: Industry
5.4 Direct Investment in Indonesia
5.4.1 Labeling Issues
5.4.2 Restrictions on Imports
5.4.3 Adherence to Free Trade Agreements
5.4.4 Attitudes Toward Foreign Direct Investment
5.4.5 Banking, Securities and Insurance
5.4.6 Privatization Plans
5.4.7 Currency Conversion and Transfer Risks
5.4.8 Expropriation Risks
5.4.9 Dispute Settlement Risks
5.4.10 Direct Investment Incentives and Requirements
5.4.11 Private Ownership Risks
5.4.12 Protecting Property
5.4.13 Patents
5.4.14 Trademarks
5.4.15 Copyright
5.4.16 New Technologies
5.4.17 Regulatory Corruption Risks
5.4.18 Capital Market Risks
5.4.19 Political Violence Risks
5.4.20 Key Bilateral Investment Agreements
5.4.21 The Local Labor Market
5.4.22 Trade Zones & Free Ports


6 Marketing & Distribution In Indonesia
6.1 Executive Summary
6.2 Marketing and Distribution in Indonesia
6.2.1 Distribution Channel Options
6.2.2 Representatives and Agents
6.2.3 Franchising Activities
6.2.4 Direct Marketing Options
6.2.5 Joint Venture and Licensing Options
6.2.6 Steps to Opening a Representative Office
6.2.7 Selling Strategies
6.2.8 Advertising Options
6.2.9 Pricing Issues
6.2.10 After Sales Service and Customer Support
6.2.11 Public Sector Marketing
6.2.12 Counter Trade Policy
6.2.13 Pertamina
6.2.14 PT. Freeport Indonesia
6.2.15 Regional "Growth Nodes"
6.2.16 Intellectual Property Risks
6.2.17 Hiring Local Counsel


7 Human Resource Assessment In Indonesia
7.1 Executive Summary
7.2 Human Resources in Indonesia
7.2.1 Unionization in Indonesia
7.2.2 Collective Bargaining in Indonesia
7.2.3 Workweek and Minimum Wages in Indonesia
7.2.4 Forced Labor in Indonesia
7.2.5 Working Ages and Child Labor in Indonesia


8 Political Risk Assessment In Indonesia
8.1 Executive Summary: Government
8.2 Executive Summary: Military Organization
8.3 Democracy in Indonesia
8.4 Political Issues in Indonesia
8.4.1 The Political Situation
8.4.2 Politics and the Business Environment


9 Legal Risk Assessment In Indonesia
9.1 Executive Summary
9.2 Legal Issues in Indonesia
9.2.1 Privacy, Search and Seizure
9.2.2 Trial Justice in Indonesia
9.2.3 Excessive Punishment in Indonesia


10 Cultural And Demographic Risks In Indonesia
10.1 Executive Summary
10.2 Cultural Issues in Indonesia
10.2.1 Racial, Ethnic and Discrimination Issues in Indonesia
10.2.2 Women's Rights and Gender Issues in Indonesia
10.2.3 Religion in Indonesia
10.2.4 Fundamental Human Rights in Indonesia


11 Historical Background
11.1 Social and Political History
11.1.1 Overview of Key Historical Events
11.1.2 Political and Governmental History
11.1.3 Economic History
11.1.4 Historical International Relations
11.1.5 The Role of the Military
11.2 Business Customs in Indonesia
11.2.1 Transportation
11.2.2 Language
11.2.3 Telecommunications
11.2.4 Express Delivery & Airlines
11.2.5 Housing

Abstract

This report puts executives and strategic planners on the fast track. The first chapter describes the study's methodology. The second chapter gives an overview of how to strategically access the market, mid-term forecasts of latent demand and accessibility benchmarks. The remaining nine chapters are not industry specific, but instead discuss economic fundamentals, marketing & distribution options, export and direct investment options, and full risk assessments (political, cultural, legal, human resources). Combined, the information provided in this market study is a "one-stop" shop for the strategic planner. Ample statistical benchmarks and comparative graphs are given.

Excerpt: The primary audience for this report is managers involved with the highest levels of the strategic planning process, and consultants who help their clients with this task. The user will not only benefit from the hundreds of hours that went into the methodology and its application, but also from its alternative perspective on strategic planning in Indonesia. This report helps executives evaluate strategic investment and entry alternatives in Indonesia. In order to evaluate Indonesia, Icon Group International, Inc. draws on a methodology developed by Professor Philip Parker at INSEAD in Fontainebleau, France. The methodology decomposes a country's strategic potential along two key dimensions: (1) latent demand, and (2) accessibility. A country may have very high latent demand, yet have low accessibility, making it a less attractive market than many smaller potential countries having higher levels of accessibility. This report provides a strategic profile of Indonesia along these lines. Throughout the discussion, literally hundreds of statistics on Indonesia are benchmarked against regional and global averages. The reader can thus quickly understand where Indonesia fits into the regional and global perspective. The report first investigates the economic fundamentals affecting Indonesia. These fundamentals are the source for Indonesia's latent demand. Then, the subsequent chapters detail Indonesia's accessibility. This evaluation covers a number of entry alternatives, including export strategies, and local direct investment strategies. If a firm decides to have a local presence in Indonesia, this requires a strategic understanding of local business conditions. The conditions investigated in this report include local marketing (advertising, distribution, pricing issues) and entry strategies (opening an office, joint venturing, etc.), as well as human resources management (labor laws, costs, regulations). Because local presence can increase exposure, the report next assesses a number of factors affecting business risks in Indonesia (again, benchmarked against regional and global averages). These include: political risks, legal risks, cultural/demographic risks. Risks can only be evaluated within a historical context; history, alas, often repeats itself. The final chapters summarize Indonesia's economic, political and social history. In doing so, the reader has a full appreciation of history's role in shaping Indonesia's current potential.



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