Tag Archives: business profile

Interviews

Interview with Danone AQUA President Director, Charlie Capetti

Leave a comment

Bottled water company AQUA was founded in 1973 by the late Tirto Utomo. When Utomo passed away unexpectedly in 1993, his family was faced with a difficult decision regarding the business. They approached the multinational company Danone, who shared the same values and principles, and the merger was born in September 1998. We meet President Director of Danone AQUA, Charlie Capetti, a Dutch national who has been with Danone for 17 years, seven of which have been in Indonesia.

You’ve been with Danone for many years, from Sales Director in the Netherlands to President Director in Indonesia. Tell us what your role at AQUA Danone entails today.

My role in AQUA is to work with my team on the long-term sustainability and short-term ambitions of the company. We set out a vision for this company and work consistently with all people here to deliver that vision. I see it as my job to create conditions for our employees to thrive in AQUA and develop themselves professionally. There is not a single day that is the same.

Has your experience as a Lieutenant in the Royal Dutch Navy in 1990 had any impact on the way that you conduct business today?

After graduating from University I was an Economics teacher at the Royal Dutch Naval College. In those days in the Netherlands it was compulsory to serve your country.  I learned values like discipline, respect and not giving up when you want to achieve something; values I consider relevant for successful leadership.

Your water comes from 13 springs and 18 factories in Indonesia. What makes your water healthy? How is it processed?

We are very picky about the selection of our springs and follow a strict criteria regarding selection. We carry out scientific research looking at mineral content and other compositions that tell us if it meets the AQUA taste profile, which is influenced by the minerals. We look at the amount of water the natural area has without upsetting the water balance. Then we drill and see if we can find the water, and we check to see how much we can take. If the composition is not good, we stop.

We make sure our water is fresh, tasting good, and meeting health standards. We filter it, of course, with a complex filter system, and then apply Ultra Violet light which kills micro bacteria. You cannot drink the water when it’s on the line, but after a few hours it’s ready. The whole process is natural.

We will be opening factory number 19 in April in South Sumatra.

Danone AQUA is a publically-listed company. What are the projections for 2016?

We are the biggest water brand in terms of volume in the world; about ten times the size of Evian.

The growth of our business comes mainly from two factors: growth of the population (1.5 percent per annum) and growth of the middle class. Households will switch from boiling water to safer, packaged water. Moreover, modern trade grew rapidly, particularly in mini-markets which have helped us grow exponentially. Consequently, projected growth in the bottled water industry in Indonesia is around 10-12 percent per annum.

You have approximately 2 million sales points across Indonesia. How is distribution managed?

I think indeed this is one of our key strengths. We use 75 family-owned distributors who have been part of the business since the beginning. We have 220 depots that distribute into wholesalers that then go to the warung and the toko. 85 percent goes through this system, and the rest goes through mini-marts and supermarkets, done through our own distribution centres, of which we have 14 all over Indonesia. How the product flows is an incredible spider web.

We also have a unique distribution method called AQUA Home Service, or ‘AQUA Ladies’, where we currently empower over 7,000 women in Indonesia to sell AQUA from their homes. We select opinion-leaders and help them build a business selling drinking water, mainly by the gallon using delivery boys on motorbikes.

We have an ambition that everywhere in Indonesia you must be able to find AQUA.

Danone AQUA has 12,500 employees in Indonesia. How does your company ensure personal and professional development?

I don’t know where to start! We have very extensive training programmes for all levels, from operators to executives, leadership trainings and very specific functional, technical programmes. We ensure development of our people via four principles: 60 percent is on-the-job training, 10 percent classroom training, 10 percent online/digital training, and 20 percent through networking. As a result, many of our people are typically long-term employees for whom working at AQUA is a career instead of a job.

How do you help those who do not have access or means of accessing clean drinking water?

AQUA is committed to proactively contribute in this field through an ambitious WASH (Water Access Sanitation and Hygiene) programme aiming to improve the health of thousands of families around Indonesia. Water committees are formed and trained to design the facilities, monitor the works, and ensure proper management long-term. Three types of community groups are targeted: villages surrounding AQUA factories, and remote villages in NTT and NTB through our ‘1L for 10L’ initiative. Currently, the WASH programme has provided benefits to more than 130,000 people in 18 districts, and will continue to grow.

What is Danone AQUA doing to reduce its impact on the environment, namely plastic waste, through your CSR project AQUA Lestari? Are there plans to go large-scale in these endeavours?

AQUA-HKVimageOur business model involves plastic, whether we like it or not. There are a lot of things we can do and have been doing. I made sure we stopped the plastic wrapper on the lid and now our bottles are 100 percent recyclable. I see huge opportunities for us to go further. The technology is there.

AQUA developed AQUA PEDULI (Plastics Waste Recycling Programme) in 1993 as a form of social responsibility to manage plastic waste. Since 2010, 600 scavengers from three cities – South Tangerang, Bandung, Denpasar – involved in our Scavengers Empowerment Programme (PEP) have been empowered to improve their quality of life through access to healthcare and increased recycling expertise.

In Tangerang, we collect 80-90 tonnes of plastic per month, which is crushed in machines and mainly exported to China for recycling. Every month this unit makes enough profit to pay the pemulung, cover costs, and make profits. This project is scalable and I’d like to see this replicated in other cities.

The World Health Organization (WHO) does not consider bottled water an improved or sustainable solution to water access in Indonesia, and other similar countries. What would you say to this?

As the pioneer of Indonesia’s bottled drinking water industry, AQUA continually sets the benchmark for the application of innovative technologies geared towards improving the production process and products. Packaging remains a challenge for the bottled water business, but somehow the impact on the environment is limited by high recycling rates.

We have four pillars in the AQUA Lestari programme: Environment and Water Protection, Green Company, Product Distribution and Community Involvement and Development. These pillars are realized by implementing various social and environmental programmes ranging from upstream (catchment area), middle (AQUA water source area) to downstream.

Do you think there will be a day when Indonesians will have access to clean and free drinking water? And if so, what will this mean for your industry?

Yes, of course. I come from a country where I can drink water from the tap; it’s a human right. We hope that Indonesians one day will also have that choice. Until then, we consider it our duty to make AQUA available as much as possible to provide as many Indonesians with a healthy hydration option.

What are the principles that Danone AQUA holds dearest to its heart?

At the heart of AQUA’s reason for being is a very simple goal: to make available – to as many people as possible – healthy, clean, and pure drinking water that is full of the natural goodness essential to long-term health. We want to do it in the most sustainable way; making sure that everybody in our ecosystem can benefit from AQUA. We make sure whatever we do, we make others part of our story.

 

Interviews, The Environment

Producing Durable Pallets from Recycled Plastic Waste

Leave a comment

Bali (and Indonesia) has received a lot of negative press in recent years with regards to plastic litter. This issue, we meet with PT Enviro Pallets, a manufacturer of nestled pallets made entirely from recycled plastic waste which would otherwise have ended up in landfills. We meet General Manager, Lars Armstrup, to find out more about where the innovative company sources their plastic waste, the manufacturing process, and the their environmentally-conscious values. 

Enviro Pallets was founded by Matthew Darby in New Zealand – when and for what reason was the plastic recycling plant opened in Bali?

We started in 2012, moving the equipment across from the previous factory in Christchurch, New Zealand.  In visits to Indonesia, Matthew saw a very significant plastic waste issue across the nation, and discussions with the National Investment Agency highlighted the added issues surrounding this in Bali. A strong local desire for solutions to help tackle the plastic waste problem, and to keep Bali Clean, ultimately led to the decision to set up our first Asian factory here.

What excited you about coming onboard?

Having worked for 30 years in logistics and industrial manufacturing in six different Asian countries, I am intimately aware of the challenges around raw-material requirements to keep supply chains moving, specifically the high demand for timber to produce pallets for the movement of finished products.

Global estimates state that more than 40 percent of the world’s sawn timber is used to produce wood pallets. Our unique Thermo Fusion™ technology allows us to use the recycled plastics others do not want, thus benefitting from a low raw-material cost, making our plastic pallets directly competitive with wood pallets, at the same price.

We truly believe we will introduce a real alternative to the use of wood, and the infinite re-use of plastics over and over again. Not only do we use 100 percent recycled plastic, but our products are also themselves 100 percent recyclable, enabling us to use the same plastic raw material multiple times.

Can you give us a brief explanation of the Thermo Fusion™ production process?

We take mixed plastics, shred it and subsequently subject it to heat and pressure, mechanically binding the polymers of the different types of plastics. This results in a malleable plastic substance that under very high pressure is formed into the finished product of a pallet.

The uniqueness of our equipment is that we are able to use mixed plastics of all types in one combined process. This is different to what normally happens in the recycling of plastics. Normally, polymers must be segregated, to for example only contain PET or only HDPE, which is then converted to granules and mixed with virgin plastics for injection moulding processes.

 Plastic at PT Enviro PalletsHow many tonnes of plastic do you process a day?

We just started our second production line, and with that we can now process more than 600 MTS of plastic per month – most of which would have gone to landfills.

How do you collect the plastic waste used to make your pallets?

We work with recyclers in Bali, who supply steady volumes of plastic to us. We have recently established programmes with the Bali Government’s departments of Sanitation, Gardening and the Environment, allowing us to work directly with the island’s nine regencies and their sub-districts. Two of these are now our active suppliers of recycled plastics, and we continue to engage with the remaining, expecting to have covered all during 2016. Supplies also come from schools and brand retail shops, where we engage with them on campus and in-store to facilitate their efforts to reduce, reuse and recycle.

How much do you pay per kilogram of plastic waste that people bring to you?

First of all, we want clean and dry plastic. Clean means free from non-plastic material such as cardboard, paper, glass, aluminium foil, etc. We can deal with varying degrees of these in the process, but we run the most efficient when these are not present. But for the plastic types themselves we do not distinguish between the different kinds of polymers, as we readily mix them all together in our process.

Our pricing starts at Rp.1,200 per kg of plastic and increases with the cleanliness and dryness of plastic that we receive. Being willing to pay for something that people normally throw away is having a positive impact in the communities that we work with.

 Besides the fact that they’re created from plastic waste, what else makes your pallets special?

There are literally hundreds of different pallet sizes and functionalities in use around the world – our process allows us to produce all of them. Plastic is stronger than wood, and therefore gives a better performance over time compared to wood. Even though our pallets will eventually break, the difference with wood is that a damaged wooden pallet has very limited use at the end of its short life. Wood pallets are either burnt (for energy), grinded up (for mulching purposes), or in the vast majority of cases disposed of to rot. Because our process uses 100 percent recycled plastic, we simply take back the damaged pallets, grind them up and run them through our production process again, to be reborn as new pallets.

Please tell us about your expansion plans, especially to Indonesia’s capital, Jakarta.

We have significant ambitions both on a national and global basis. We do expect to expand into Java and beyond in the very near future.

Bye Bye Plastic Bags have been given a MoU by the provincial government in Bali to stop giving away free plastic bags in 2016 and ban plastic bags altogether by 2018. How will this affect production at your plant?

Melati and Isabel, who founded Bye Bye Plastic Bags, are such an inspiration – amazing girls. I met with them recently and banning plastic bags is definitely the way to go. I believe other cities around Indonesia are working on similar schemes. Unfortunately, the global production of plastic continues to rise at about four percent annually, and the sad fact is that even if all plastic bags were banned, it would still only make a small reduction in the total plastic output. There is so much new plastic being made every day.

We cannot function as a world without plastic, but through what we do, we believe we help to move us to a point of ‘no new plastic being put into the world’, as we can infinitely recycle the same plastics again and again, even though they are all mixed.

Lars Armstrup, General Manager of PT Enviro Pallets, Bali
Lars Armstrup, General Manager of PT Enviro Pallets, Bali

As the General Manager of a business that actively contributes towards a cleaner world, you must be extremely passionate about what you do. What work ethics that you hold dear to your heart would you like to see other business owners embody?

I love what we do. Few people are given the opportunity to head up an enterprise that truly holds the potential to change a segment of the world, and in this respect our team and I are very fortunate. I am not sure that I am necessarily any different from other business leaders, however I am fuelled by passion – because I believe that is the only way to achieve excellence.

My work ethics are a real sense of purpose, strong determination and focus, which allow you to work through the unavoidable challenges and road blocks that are always present in business. Ultimately though, ‘Deliver The Promise’. What we promise to our customers, all my colleagues, our suppliers and communities is vital, as that is the only way in which we can achieve long-term sustainability both on the environmental front and for ourselves as a business.

Thank you, Lars. To get in touch, email:  marketing@enviropallets.com