Bill Hunt, CEO, National Detergents Co. shares his vision for the company and views on the GCC’s FMCG market. Mayank Singh reports
You joined The National Detergent Company (NDC) towards the end of August. Can you share your vision for the company?
The National Detergent Company has long been a manufacturing company with a couple of brands. We want to shift philosophically, into a brand company that is also into manufacturing. In future, NDC will not limit itself to only products that we manufacture. We are committed to our current manufacturing facilities, but we are also open to contract manufacturing and the modern day brand model. In consonance with this model some of the most valuable company’s in the world like Apple, Coca-Cola, PepsiCo and McDonalds, outsource their manufacturing or have some sort of an alternative arrangement for it, while they focus on meeting customer needs with new and better products, market research and improved customer interaction. As a Consumer Packaged Goods (CPG) company we use the terminology – customer and consumer. The customer for us is the retailer and the consumer is the end user of the product. We are focusing on the end consumer to see what we can do for them.
Are there any specific plans on how you are going to achieve these goals?
We are open to other Omani companies manufacturing products for us. We have a strong inclination to have manufacturing of our brands being done in Oman, but it can be through a manufacturing partner. Secondly, we are looking at ways in which we can improve the way we interact with our customers, which by definition is the retailer. To enhance this, we are connecting our information systems with that of our retailers. This will improve the ease of ordering, order fulfillment and assure 99 per cent availability of our products on shelf. Any consumer coming to a store will find our products, in every size variant. We are trying to put Bahar as a product at an arm’s reach from desire. If you want it, you can find it. This is also a great benefit to our retailers as it ensures that they never miss a sale.
What measures are being taken to achieve better connectedness with consumers and customers?
We are investing in information technology to directly connect our ERP systems with customer orders. In this way retailers can directly place orders to NDC without human intervention. The first step to achieve this was to upgrade our ERP system, and this has been done. Now we are beginning our engagement with retailers. NDC is working with the IT departments of our retailers in an endeavour to connect our systems directly with theirs. Our focus is both on our consumers and our retail customer partners.
Please give us an overview of NDC’s product portfolio and its best-selling brands?
We are going to stick to our philosophy that our products are the top performing products in the region, despite the fact that our competitors are large multinational companies. It is clear that Bahar as a product performs at a higher level than competitive products as it is based on a more robust chemical formula. Bahar’s cleaning power is better and we will continue to maintain that, in addition we want to extend our range from our traditional power brand which is Bahar powder to include Bahar liquid. We introduced Bahar liquid in the fourth quarter of 2018 and are looking at extending it to the entire laundry category. This includes liquid laundry, fabric enhancers, fabric softeners and laundry boosters. This can be in the form of liquid bleach or powdered bleach.
What is the current production capacity of NDC and are you planning to upgrade production in the near future?
We expect that in the next 36 months our production capacity will remain the same, but our production utilisation will grow from under 50 per cent to full utilisation. Currently we are operating at a 50 per cent utilisation.
How much of NDC’s production is sold domestically and how much of it is exported? Which are your largest export markets?
A majority of our products are sold in the GCC region. It’s our intent to focus on the GCC market, as we feel that in these markets we have what I would call ‘a right to win.’ Compared to this when we ship to faraway places like India, Pakistan and North Africa, we do not enjoy any competitive advantage, over anyone who is already producing on that continent. In the GCC, we are one of the few Arab owned, operated and with 100 per cent of our production being done in the region. We feel committed to our customers, consumers and employees in the GCC. Moreover, we understand the specific needs of our customers here and provide them with unmatched products, services and solutions. Our primary markets are the six GCC countries.
What kind of competition do you face in the GCC market?
We compete against large multinational players like Henkel, Unilever, Procter & Gamble Company (P&G) and then we have what we call the local heroes, which are GCC country based local brands. As a Consumer Packaged Goods (CPG) company, it’s normal to operate in an atmosphere with intense competition. As a company we don’t shy away from competition, but accept the challenge and look at providing a better product, service and to really focus on innovation, through a greater commitment to R&D.
Can you share your thoughts on Oman and the GCC’s FMCG market?
The GCC market is a developing market by any measure, whereas Europe and the USA have a much higher percentage of modern trade. In these evolved markets a large proportion of sales go through modern trade compared to the traditional trade of small independent retailers. We are seeing a transition from traditional trade to a higher concentration of modern trade in the GCC. Hypermarkets have the biggest impact in terms of modern trade they are evolving quickly in Oman and the region.
The growth of modern trade means that the way we do business will change as modern trade is more technology savvy. As mentioned, connectedness of our ERP systems with our retailers will increase efficiency and product movement. When it comes to modern trade 99 per cent availability on the shelf space is not a desired outcome but a required outcome. The modern trade is very demanding and we are well positioned to stand up to that challenge.
Have you noticed a shift in consumer preferences and consumption patterns in the region?
Our products are widely accepted and used in the GCC. We are seeing a shift towards our products and an intrinsic growth of three to four per cent per annum which is in line with the growth in population and employment. On a global basis we find that there is a shift from powder to liquids, however in the GCC market and even in the North African market this move from powder to liquids is far slower. Secondly, there is a shift from bar soaps to liquid hand soaps worldwide. However in the GCC region bar soap sales are strong, consistent and growing. The preferences of consumers in the region are largely similar though there are differences in the retail make-up of the different countries. For example, Kuwait is highly focused on co-op retailing and these co-op stores are approaching the kind of scale that hypermarkets and the modern trade. While there are differences in terms of our customers, the preferences of the end user is very consistent across the region.
Can you share some details of your professional background?
I come from a family of chemists and chemical engineers and received my first patent on a chemical product when I was 19 years old. At that time I was working as a bench chemist in the Revlon Group and developed products for Hay fever. I have spent my entire career in the chemical, manufacturing and branding industry. I worked with Dow Chemicals, GE plastics which is now SABIC and Bitumen Oil Refineries Australia Limited (BORAL). In Dubai, I enjoyed running Soap & Chemicals Industrial & Trading Company.