Kao, Jahwa in sales partnership
By Lu Nengneng |
00:00 UTC+8 November 26, 2011
|
Print Edition
Print Edition
KAO Corp, Japan's biggest daily-use chemicals producer, plans to tap into China's third and fourth-tier cities through sales partnership with cosmetics maker Shanghai Jahwa.
Kao, the maker of Biore soap and Asience shampoo, will leverage Jahwa's extensive sales network to extend its presence from 90 to 650 cities on Chinese mainland, the Tokyo-based company said in Shanghai yesterday after signing an agreement, without giving a timeframe.
Motoki Ozaki, president of Kao, said he expects the partnership to elevate the company's China sales from 10 billion yen (US$129 million) to 50 billion yen annually in the foreseeable future, and to 100 billion yen eventually.
The cooperation will start in 2012 and may go beyond dealership to joint consumer research in 2013 as Kao aims to develop tailor-made products for the Chinese market, Jahwa President Ge Wenyao said.
Kao will focus on beauty, health and home care, and said the overlap between the product portfolios of the two companies is unlikely to cause an interest conflict, considering the different segmented markets they target.
Ge said: "It is a good opportunity for Jahwa to explore those untapped markets and product categories without running too many risks."
The cooperation with Kao is a prelude to Jahwa's expansion in the high-end sector, which will be fully backed up by its new owner, Shanghai Pingpu Investment. The subsidiary of Ping An Insurance beat Hainan Airlines in the bidding to acquire Jahwa earlier this month.
Kao, the maker of Biore soap and Asience shampoo, will leverage Jahwa's extensive sales network to extend its presence from 90 to 650 cities on Chinese mainland, the Tokyo-based company said in Shanghai yesterday after signing an agreement, without giving a timeframe.
Motoki Ozaki, president of Kao, said he expects the partnership to elevate the company's China sales from 10 billion yen (US$129 million) to 50 billion yen annually in the foreseeable future, and to 100 billion yen eventually.
The cooperation will start in 2012 and may go beyond dealership to joint consumer research in 2013 as Kao aims to develop tailor-made products for the Chinese market, Jahwa President Ge Wenyao said.
Kao will focus on beauty, health and home care, and said the overlap between the product portfolios of the two companies is unlikely to cause an interest conflict, considering the different segmented markets they target.
Ge said: "It is a good opportunity for Jahwa to explore those untapped markets and product categories without running too many risks."
The cooperation with Kao is a prelude to Jahwa's expansion in the high-end sector, which will be fully backed up by its new owner, Shanghai Pingpu Investment. The subsidiary of Ping An Insurance beat Hainan Airlines in the bidding to acquire Jahwa earlier this month.
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