Pest Analysis and Value Chain Analysis

PEST Analysis and Value Chain Analysis


Number of words i
Declaration ii
Content iii
Section I Introduction 1
Section II PEST Analysis 4
Section III Value Chain Analysis 8
Section IV Conclusion 12
References 13

I.1 Industry Overview
Based on WHO Report on Global Tobacco Epidemic 2008, Indonesia is the world’s third largest country in terms of tobacco consumption in the world. Tobacco consumption growing rapidly in developing countries such as Indonesia. Indonesia has a unique market because the majority of smokers in Indonesia (92%) use kreteks, which are traditional cigarettes made from tobacco, clove buds and flavoring sauces and are either hand – rolled or machine – rolled into conventional cigarette form ( Tobacco Industry Profile – Indonesia, 2009). According to data from Ministry of Health of Indonesia, Indonesia has the highest number of growth smokers in the world in 2004 (Info Dokter, 2011).

Figure 1.1 : Countries with the largest number of smoker in the world, 2008. (In Million)
Cigarette market share in Indonesia dominated by three local firms. In 2008, the first rank is Hanjaya Mandala Sampoerna (29.5%), Gudang Garam at the second (22.1%), and the third is Djarum (18%) (TCSC – IAKMI Fact Sheet, 2008). On the other hand, There are international brands such as British American Tobacco who also serious competitors which product is favoured by large people in Indonesia.
I.2 Hanjaya Mandala Sampoerna Tbk Profile
PT. Hanjaya Mandala Sampoerna Tbk (HM Sampoerna) is one of the leading cigarette manufacturer in Indonesia. HM Sampoerna is an affiliate of PT Philip Morris Indonesia and part of Philip Morris International   (HM Sampoerna Profile, 2011). Their vission is to provide the best smoking experience for adult smokers in Indonesia. The company produces...