A research study submitted in partial fulfillment of the requirements for the degree of Master of Business Administration, School of Management

Research Studies Project Report (M.B.A.) - Asian Institute of Technology, 1995

This research study assesses the business opportunity of paper manufacturing in Indonesia and the entry barriers that the new entrants may face when enter the industry. The research overviews and updates the development of Indonesia paper industry; Present and analyze the status, growth and prospects of Indonesian paper industry; Present and analyze the barriers to enter the industry and identify the basic underlying economic and technological characteristics of paper manufacturing particularly in Indonesia. Analytical framework which is based on the practicing environment of paper manufacturing industry and conceptual approach is developed to conduct such assessment. The research revealed that Indonesia has the necessary comparative advantage that it needs to grow as prominent paper producer in the world. In addition the facts that the demand for domestic consumption is potentially huge and fast growing thus presents a sound market opportunity for investors to tap into. Since there are entry barriers which are inherent and related to the industry, new entrants should evaluate and select entry mode that suit their objectives. Research also shows that barriers in term of capital intensity and technological competence are significant. Entrants that have the competency in technology and financing investment shall have more favorable position to enter and stay in the business profitably.