Japan’s Kao Seeks to Double Vietnam Business as It Boosts Overseas Sales

Kao Corp., the largest maker of bath and shower products in Japan, is seeking to at least double the size of its Vietnamese business to ramp up overseas growth amid a shrinking population at home.

“I want to double and triple the business in Vietnam,” President Michitaka Sawada said in an interview on Nov. 28. The company may build a new factory in Southeast Asia (CMT) to strengthen the Vietnamese operations, he said, without specifying a timeframe or investment amount.

The market size for color cosmetics in Vietnam rose 22 percent to $37.7 million in 2011 and for hygiene products it climbed 19 percent to $242.1 million, according to researcher Euromonitor International. The size for bath and shower products gained 8.6 percent to $82.3 million.

Kao will invest about 10 billion yen ($121 million) to build its second factory in Indonesia to make detergent and sanitary products, it said in July. The company has also invested about 6 billion yen in a new plant in Anhui, China, to make baby diapers.

Kao entered Vietnam in 1996 when it first built a factory there, making products such as “Laurier” sanitary pads and “Biore” body soap. The Japanese consumer company had sales of 139 billion yen from Asia for the year ended March, or about 11 percent of total sales. Kao doesn’t disclose Vietnam sales.

Kao had a 1.2 percent share in Vietnam’s hygiene products market, while Kimberly-Clark tops the market with 37 percent, according to Euromonitor International. For bath and shower products, Kao had 0.7 percent share, while Unilever leads the market with 35 percent share.

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