NEW BUSINESS STRATEGY OF PT CHANDRA ASRI PETROCHEMICAL TBK IN ORDER TO GAIN COMPETITIVE ADVANTAGE IN POLYETHYLENE PRODUCTS

• Main Author: Aprilya Natasha br. S., Stefany
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/47038
• Institution: Institut Teknologi Bandung

PT Chandra Asri Petrochemical, the largest petrochemical company in Indonesia, has doubled its polyethylene (PE) production capacity from 336 KTA to 736 KTA through investment in new facilities. The expansion was completed in November 2019. There is also an expansion happening in South East Asia; a joint venture between Saudi Aramco-Petronas in southeastern Johor, Malaysia that is estimated to be completed in early 2020 which will add around 750 KTA of polyethylene to SEA market. Competition is exacerbated with China-USA trade war which interferes with supply and demand of polyethylene. Besides that, there is an economic slowdown and weak sentiment issue, on the back of growing environmental concerns on plastic usage. Currently, this condition has made the polyethylene prices continue to weaken. The objective of this study is to provide insightful information for the most potential resources from the company to gain the competitive advantage as well as to formulate the new business strategy for PT CAP in order to increase and strengthen the position of Chandra Asri in a situation of a tight market. The internal analysis was done by doing resource-based view and VRIO while the external factor was analyzed using PESTEL and Porter five forces. The methodology used in this study is qualitative and quantitative data analysis. The author conducted the qualitative first by interviewing top management level to gather information from internal then continue with designing the questioner for polyethylene user as quantitative data. Consequently, based on SWOT analysis, the business strategies were formulated: production capacity expansion, geo-expansion, co-creation with the customer, the introduction of PCR and EPR into the market, R&D collaboration, and customer profitability analysis. The implementation of this strategy is divided into 3, which are market study, product development, and strategic partnership.