CUTLERY MARKET

Indonesia, the fourth most populous country in the world, has slowly recovered from the economic and financial crisis that hit the country since 1997. Signs of recovery have been registered with real GDP confirmed economic growth, the local currency rupiah appreciated strongly and inflation rate fallen. Overall economic and monetary conditions remain stable and within controlled parameters despite ongoing constraints to promoting higher levels of economic growth; the country plans to exit and end the IMF economic and financial rescue assistance extended since the beginning of the turmoil by the end of this year 2003.

Cutlery products such as knives, scissors, spoons, forks, skimmers and sugar tongs are products or tools, which are used practically every day and in our today’s modern life are indispensable. The consumers of cutlery products may be divided into private households and commercial establishments, such as hotels, cafés and restaurants, catering services and similar hospitality institutions. The majority of the Indonesian private households, although quite large in number (estimated in the region of around 40 million private households), are low income private households; only some 10 to 15% would be categorized as medium income households and less than 5% as high income private households. Consequently, the consumption pattern of such households is geared towards fulfillment of consumers’ basic necessities, e.g. food, clothing, housing and education. To the low income group, a cutlery product, although indispensable, is a simple tool to fulfill a certain function. The attitude would already be different in the next, higher private household categories, for which a cutlery product does not only have to fulfill a certain function, but the product must also be of a certain quality and design. Specifically for the hotels, cafés and restaurants establishments, product quality and product design are the most important and determining product elements for cutlery products to be purchased. With another word, design and quality elements are crucial for a cutlery product and this is exactly the field, in which the Indonesian cutlery manufacturers are still lacking. Cutlery products manufactured domestically for local consumption do not always fulfill the criteria.

The improvement in the overall economic condition will certainly bring a positive impact on the overall income of the private households and the consumption pattern as well and this in turn, will create a greater market demand for various products and services. The Indonesian market is, judging from its number of population, definitely a potential market, although improvements are needed to increase the purchasing power and, therefore, the disposable income of the private households. The service industries, hotels, cafés and restaurants, to a certain extent closely connected with the tourism industry, are definitely the other potential market area, which offer the absolute market opportunity for cutlery products with appropriate product quality and design.