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China is big business for Henkel
By Chen Weihua (chinadaily.com.cn)
Updated: 2009-02-27 20:05

German detergents, cosmetics and adhesives giant Henkel has not changed its strategy in China and the Asia-Pacific despite of the current global economic downturn, according to Jan-Dirk Auris, the company's Asia-Pacific president.

"Despite the crisis and its impact on certain industries, the fundamentals in China and the Asia-Pacific have not changed, therefore our strategy has not changed," Auris told China Daily in an exclusive interview on Friday.

The 41-year-old, who assumed his current post a year ago, said Henkel would continue to invest in China, a key market for the company, and strive to capture further market opportunities here.

China is big business for Henkel

The German company saw its sales in China jump 48 percent year-on-year in 2008 to 4.8 billion yuan, while global sales climbed 8.1 percent to 14.1 billion euros.

The acquisition of National Starch’s adhesives and electronic businesses last April was a result of Henkel's strong sales growth in China and globally, Auris said.

The deal gave Henkel a more balanced product portfolio because National Starch was a market leader in adhesives for consumer products, while industrial adhesives, such as those for automobile and steel sectors, have been affected by the global economic woes, according to Auris.

"Now we have a better product portfolio and better market penetration. And we expect to see more customers," said Auris, who has worked for Henkel for over 20 years.

He said that the firm had no acquisition plans for this year, but added that it was always looking at opportunities. Expressing cautious optimism about Henkel’s prospects in China this year, Auris said that the downturn offered dangers and opportunities.

Now is a good time for Henkel to expand its market share because customers that shut down some of their product lines now have more time to test Henkel's products.

"This will help boost Henkel's product innovation since launching new technology also takes time," said Auris, in Henkel's new Asia-Pacific headquarters and R&D center opened in 2007 in the Zhangjiang Hi-Tech Park of Shanghai's Pudong New Area.

Auris also believed the current crisis would help strengthen the company's global team.

"It is a good time to tell high-performing people from low-performing people because high-performing people don't panic, while low-performing people find an excuse and hide," he said.

While the current economic crisis has put pressure on Henkel's products, Auris said it was also a good time to restructure the firm’s product portfolio, focusing on those that are well received in the marketplace.

China is now one of the largest markets and manufacturing bases for Henkel.

The nation overtook France last year to become Henkel's third-largest adhesives market in the world, trailing only North America and Germany. About 40 percent of Henkel's adhesive sales in the Asia-Pacific come from China, while in overall business, China accounts for 30 percent of its trade in the region.

Auris said if the double-digit growth continues in China, it would only take another three and four years for China to overtake Germany.


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