BMJ: Riding the Crest in Indonesia

Source from:  Tobacco Asia  06/25/2013

The mood at BMJ is one of confidence in the future. At a time when many of the major players in the tobacco industry are exercising caution and others talk of volatility in global markets that seems unlikely to subside in the coming years, BMJ has gone ahead with major investments that display a different and more positive mindset.

BMJ (or to give it its full name, PT Bukit Muria Jaya) of Indonesia is one of Asia's most prominent producers of speciality papers and packaging. Founded in 1989 to meet the specialist needs of companies globally, the company is based at Karawang, West Java, not far from the capital Jakarta, and is moving with the times. In this country of nearly 240 million people (and perhaps more importantly on this island – Java – of 120 million), that means positive economic growth - the World Bank forecasts 6.2% growth for the Indonesian economy and the International Labor Organization (ILO) recently [April 2013] praised the country's strong focus on the development of economic infrastructure to address constraints to growth as well as robust household consumption and growing investment.

The ILO said that "conditions can still be favourable [in spite of the fragile global trading conditions] as long as Indonesia continues to focus on the development of economic infrastructure, linkages with domestic and international markets and macroeconomic stability to provide a supportive environment for economic growth."

Investing in the future

Indonesia remains the world's fourth largest market for cigarettes, with its characteristic hand-rolled kretek sticks continuing in popularity among local smokers, and as a partner of choice of many of the leading players in the industry, BMJ today is building on strong foundations and increasing levels of service to become a truly global player rather than solely a regional supplier, as BMJ's chief executive officer George Hendrata explained to us recently.
Confirming that the business outlook for Indonesia is "very positive," he said: "Now we at BMJ are investing substantially for the future, to increase output and quality and reduce costs."

Very solid evidence of this policy is due to be officially unveiled in June, 2013 in the form of a new and highly technologically advanced paper mill, the company's third. Hendrata says this mill will add 30,000 tons per year to BMJ's production capacity of speciality papers, the overwhelming majority of which is destined for the tobacco industry. The mill represents an investment of "between US$50 and 100 million and has taken 22 months to construct and commission."

PM3, as the new high tech low cost paper machine paper machine will be known, "provides ground-breaking operational quality and performance efficiency - energy and water usage per ton of paper produced are greatly reduced and fibre loss associated with paper production is minimized.  This allows paper to be produced at a lower cost with far less impact on the environment."

Global supply base

BMJ, said Hendrata, is now "no longer merely regional but global in its supply base. We want to move to a new level and deepen our relationship with our customers around the world. We are nowadays working better together to reduce waste and increase cost-effectiveness and our policy of greater engagement with our customers is bearing fruit already. We want to extend this policy."

Hendrata spoke with real enthusiasm about PM3 and gave us some impressive statistics. The new mill will cut 30-50% off the waste, energy and water required.  The new mill produces faster too, enabling inventory to be reduced and to speed up deliveries. Of course part of the increased production is destined for local and regional markets and "the investment does cater to the regional growth."

BMJ's 3rd Generation Defects Tracking & Prevention quality control system is state-of-the-art, with fully computerised tracking systems enabling the mapping of the characteristics of an entire kilometer of paper at a time, records kept so as to deal with any subsequent enquiry from a customer "and speed up any technical problem-solving."

PM3 will reduce the strain on the two existing mills, the second of which specialises in tipping.  BMJ's bmjtip is tipping paper specially designed for high speed cigarette makers and offers features to meet international quality standards; it is available in various printing design and colour according to customer's requirements. It features five 12-colour Rotogravure presses.  It is made on BMJ's high quality tipping base paper and produced to a very high quality to ensure the best runnability, colour consistency and best properties. bmjtip enables cigarette manufacturers to run high speed cigarette machines trouble free with high productivity and efficiency levels, and can also offer security features against counterfeiting. Until BMJ offered this line, said Hendrata, "previously much of the tipping paper needed to be imported from outside the region, while apart from our line today there is still not a great supply of quality tipping around the Asia region."

Best management techniques

As a progressive c.e.o. in a progressive company in a progressive country, Hendrata is committed to the best management techniques and instituted a series of measures to improve the relationship between BMJ's various departments and also get management to engage better with the staff of the company.

"We carried out a Hay engagement survey and then tried to inject an element of fun into the business to help our staff feel part of the process and involved in the growth of the business," Hendrata revealed. "That fun element and sense of involvement and responsibility reflects very positively in improved productivity too, so it's win-win."

Among BMJ's products is OBA-free cigarette paper available in wood, flax or flax + wood furnishes, from 20-27 gsm with features that meet international quality standards. Made from best pulps and food-grade chemicals, the paper contains no optical brightener, to ensure it has good formation, high consistency in properties and safe usage for food contact. It has high tensile strength, wobble free bobbin as well as high consistency, critical for high productivity and efficiency in cigarette production. BMJ's non-porous plugwrap, designed for high speed filter rod makers, is available in basis weight of 20-30 gsm and cut to size in bobbins. Tipping base paper specially designed for high speed printing machines is available in various colours according to customer's requirements as well as sweetened, while BMJ also supplies aluminium foil laminated paper, available in 50 and 60 gsm, manufactured on a wet lamination machine. It is made of high quality base paper (OBA free) and aluminium foil. All materials are within FDA guidelines. Enditem