It was a big investment when Fibertex in Denmark chose to expand the production of Personal Care products to Malaysia even though the market was not very big. However, the small town company from the North of Denmark did well, and now the success seems to be lasting forever. CEO of Fibertex Personal Care Mikael Staal Axelsen welcomes the success and the new production line but at the same time he says that both have come as a pleasant surprise.
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A developing market
Fibertex started its production in Malaysia in 2003 and after struggling to have an impact on the Asian market for a while, things started to change. The hygiene industry thrived as the Asian population got wealthier and accustomed to the convenience of disposable diapers rather than using the same ones again and again. All of a sudden, the need, for Fibertex’ products, was enormous:
”In the Western world, these products are already a part of everyday life, and the same thing is now happening in Asia. Disposable diapers are winning territory in people’s homes, and not even an economic crisis can change that,” says Mikael Staal Axelsen.
For Fibertex, that meant the company had to expand business with a new production line after only two years of operation in Malaysia. It was necessary in order to keep up with the increasing demand of non-wovens textiles.
”We were always convinced that expanding production to Malaysia was a good investment,” Mikael Staal Axelsen explains, “but that we would achieve this kind of success took us by surprise – a good one, however.”
Won over Japan
And the streak of successes went on. With the factory in Malaysia, Fibertex hoped to make a breakthrough and become a significant player in Asia – including on the Japanese market. That, however, was easier said than done and according to Mikael Staal Axelsen, many companies have tried their luck in Japan only to feel unwanted and walking away empty handed.
Fibertex also experienced the ugly side of Japan, but still they kept pushing.
”It wasn’t always easy,” Mikael Staal Axelsen says, ”but we wanted in so whenever they knocked us down we got back up and tried again.
In the end, the small town business made it in and today Fibertex is the largest non-Japanese supplier of nonwovens textiles for the Japanese market, which has created great respect and recognition of the company by other players in the industry.
Expanding once again
With such feathers in their cap, Fibertex has a strong foundation for future activities and investments. That is why the next step for Fibertex Malaysia is to further expand the business in order to keep up with the development that will probably happen in the usage of different hygiene products within the next decade.
It is the second time in seven years that the company increases its capacity in order to deal with the increasing demand but also to ensure steady growth in the market that appears to keep expanding.
In 2010, 40 billion disposable diapers will be used in Asia alone, but by 2020 that number is expected to double.
Mikael Staal Axelsen explains that the dream for Fibertex Malaysia always has been to be able to get two production lines up and running, but with the coming expansion, Fibertex has surpassed its own dreams by adding a third line to the production. Fibertex Personal Care in Denmark and Malaysia will with the new line, in total, have six lines for the production of nonwovens textiles for the hygiene industry, and that puts the company in a good position internationally.
”With the new line, we will have a joint capacity of 100.000 tons, which is about 8-9 percent of the world market,” Mikael Staal Axelsen says and adds that the company has focused and succeeded mainly in the European and Asian markets.
”The development of Fibertex strengthens our corporate profile. The more capacity we have, the more products we are able to produce and develop. Our success also allows us to make more investments. We have more options,” he says.
With the new line, the project that has been Fibertex Malaysia since 2003 becomes an investment of almost 460 million Ringgit.
Recognition and respect
The quickly achieved success has stirred sensation within the hygiene industry and because of the good results, the small Danish company has suddenly become an icon of status in the market.
”It’s amazing. Fibertex has within a very short period of time achieved a high status in the market and we have accomplished some very good results. Fibertex has become a benchmark company in Malaysia.”
Danish culture and modesty
But how did a small company from the Danish province make that break and become so successful at an international level?
Mikael Staal Axelsen has an idea:
”Even though our production consists of a mainly local work force, the management of Fibertex Malaysia will remain Danish. The combination of Danish culture and the values we have here and the very multi-ethnic Malaysian culture is very good. The way we work according to the laws and treat our staff has resulted in some very capable and motivated workers and they fully measure up to our Danish operation.”
The fact that the company has preserved its Danish roots is exactly one of the reasons behind the success.
”We have a brand, an image with our clients, which is based on Danish culture and Danish values. That’s why we want to make sure that Fibertex stays Fibertex.”
According to Mikael Staal Axelsen, it is especially the Danish modesty that helps Danish companies to do well abroad.
”In Denmark, we have a long tradition of always seeking compromise,” he says. “We have to because as a small country like Denmark, we can’t afford to be arrogant with the rest of the world.”
The brand based on Danish values seems to go down well with the clients. For the second year in a row, Fibertex has received Procter&Gamble’s prestigious award for best supplier, which is awarded to 55 out the organization’s 80.000 suppliers.
”The project of Fibertex Malaysia has surpassed all of our expectations,” Mikael Staal Axelsen concludes with pride.
”It really has been a fairytale in every possible way!”