Manufacturing News

Kimberly-Clark stands up to low-cost private label competition

Kimberly-Clark
Australia’s Kleenex brand has resisted competition from cheap private label
brands in supermarkets, which have eroded value in the category.

Managing director of Australasia Robbert Rietbroek told Fairfax that $1 boxes of tissues had decreased
value in the category, but had not affected Kleenex, which has a 56 per cent
market share. The importance of pharmacy sales had also increased for the
company.

More
than 70 per cent of overall sales for Kimberley-Clark, which are worth over $1
billion annually, are created through the two major supermarket retailers. It
leads categories including nappies, nappy pants and incontinence
products.

Rietbroek
said the nappy pants and incontinence product markets were expected to grow
rapidly in the future.

Kimberly-Clark
recently announced a $20 million upgrade to its Millicent plant, aiming at
increasing its capacity to make Kleenex as well as productivity.

The
managing director said the high dollar had benefited the company’s global
purchasing of raw materials, but Australia remained an expensive country to
manufacture in.

“It’s the cost of
labour, cost of energy and also cost of distribution,” he told Fairfax.

Leave a Reply

Send this to a friend