We will further globalize our company and capture growth opportunities in both emerging and mature markets by implementing differentiated regional strategies: expanding our footprint in emerging markets while leveraging our strong positions in mature markets.
In 2013, we successfully expanded our footprint in emerging markets where we see significant growth potential for the future: The share of sales generated in emerging markets climbed to 44 percent, driven by all three business units. In mature markets, we maintained sales at around the prior-year level despite continued challenging market conditions with negative or low growth and intense competition.
Expand footprint in emerging markets
In the course of 2013, we significantly grew our Laundry & Home Care business in the Africa/Middle East region, despite ongoing unrest in a number of countries. Reporting a double-digit increase in sales, this region has become the biggest growth driver for Laundry & Home Care in the past five years. In November 2013, we opened a regional innovation center in Dubai. It will focus on the development of laundry and home care products designed to meet consumer needs in the region.
The successful development of our Beauty Care business in China is an impressive example of leveraging an existing presence in one of the fastest-growing emerging markets. With an ambitious go-to-market strategy and a disciplined distribution offensive, China has now become the fifth largest market globally for our Beauty Care business, while still offering significant potential for further growth.
We utilize our global setup of research and development centers as well as our production and manufacturing footprint to serve customers in many different industries around the world. In September 2013, we opened the world’s largest adhesives factory in Shanghai, China, with a total production capacity of up to 430,000 metric tons. The plant also sets new standards in efficiency, safety and sustainability thanks to water recovery systems, recycling procedures and energy-saving technologies.
Leverage strengths in mature markets
Mature markets will continue to play an important role for Henkel. Here, we will leverage our strengths and aim to generate profitable growth with strong brand investments and by maintaining our cost focus.
In 2013, we faced a challenging business environment in several mature markets, particularly in Southern Europe. However, we were able to capitalize on our leading positions in many mature markets – thanks to our strong brands and technologies, and close cooperation with our customers.
In our Adhesive Technologies engineering center near Munich, Germany, we develop individual solutions for customers in the automotive industry as well as a broad range of other industries. Our technical experts develop tailor-made adhesives solutions for our customers which are then applied in their global manufacturing processes.
To support our customers beyond the development process, we also train their employees to ensure the safe and efficient use of our adhesives in their specific production setting. For example, training programs near Munich are held almost every week throughout the year, with around 800 engineers of customers participating annually.