Page last updated at 01:51 GMT, Monday, 19 January 2009

High hopes for Wedgwood in Jakarta

By Steve Jackson
BBC World Service, Indonesia

Worker applying transfers
The factory in Indonesia can produce up to seven million pieces a year

As administrators try to sell the company that owns two of the UK's most venerable brands, Wedgwood and Royal Doulton, one part of the business may have a more promising future - the firm's factory in Indonesia.

In a dusty town 80km (50 miles) outside the Indonesian capital Jakarta, 1,500 workers are employed in a clean modern factory producing Wedgwood and Royal Doulton bone china products.

They make between five and seven million pieces of tableware every year.

The staff may be Indonesian but the brands remain quintessentially British, with the huge kilns and the expertise having been sent over from the UK.

'British experience'

Alongside the rows of uniformed workers who decorate the china in painstaking detail, there are Indonesian designers charged with inventing new products.

One of them, Chris, has just joined the company.

He said: "I just came out of university so I needed men with experience to teach me with some pottery like this.

"Wedgwood and Royal Doulton are very old brands and very classic."

The out-sourcing of production to Indonesia - which began more than a decade ago - has always been a subject of controversy in Stoke-on-Trent, the city in the English Midlands that was once at the centre of a thriving pottery industry.

Indonesian worker
The factory in Jakarta employs around 1,500 workers

The placing of parent company Waterford Wedgwood into administration and the loss of hundreds of employees has rekindled some of the anger in Stoke-on-Trent, about jobs being moved abroad.

People inside the company say the Indonesian factory is likely to be one of the main attractions for potential buyers.

The factory has its own free health clinic, trade union building and canteen where the company provides its employees with one free meal a day.

It also has a football pitch on site and a mosque to allow the staff to come and pray while they are at work.

So what about the key issue of pay?

John Wright, the company's production director in Indonesia, said he thought they offered a good

deal.

"We certainly don't pay the highest wages in the area but the package that we've put together is a good package and I think that shows in the labour turnover and the attendance.

"Our labour turnover is less than one percent. Our absence rate is nearly one percent.

"Generally speaking it's a reasonable environment to work in," he said.

This is a little bit of Stoke-on-Trent living in Indonesia
John Wright
Production director

Former Wedgwood employees in the UK say the Indonesian workers get around an eighth of the sum paid to their British counterparts.

The average Indonesian factory worker is paid around $100 (67) a month.

Mr Wright said he was very sad about the decline of the British pottery industry - where he himself worked for many years - but he believed it was a fact of economic life.

"The UK factories undoubtedly have struggled against growing costs and you reach a point where everything has a value.

"There used to be 26 manufacturing sites in the UK and sadly as we sit here today there's probably going to be one or two left.

"Quite frankly they've all gone that way because of the same thing. It's just down to cost," he said.

Peter Taylor is another member of staff brought over to Indonesia from Stoke to monitor quality in the factory.

He said the lower wages were not the only reason the goods could be made for less overseas.

"This factory I think is probably a little bit more efficient because it's purpose built. It's built with a process flow kind of thinking in mind, whereas most of the British factories were Victorian buildings."

Kiln
The huge kiln was brought over to the factory from Stoke-on-Trent

"There is an efficiency here that we didn't have in the UK," he said.

The loss of manufacturing jobs from industrialised countries to the developing world is certainly not new and Waterford Wedgwood has been struggling with falling sales for some time.

Expensive formal dinner sets are no longer so popular among couples getting married and, in a throw-away society, many people prefer cheaper more practical china that can be replaced more easily if it gets broken.

So could tableware brands synonymous with British values and tradition survive if they came exclusively from outside the country?

Mr Wright thought so: "This is a little bit of Stoke-on-Trent living in Indonesia. OK, the people are very very different but they are just as dedicated."

He added: "They firmly believe in the brands, they firmly believe in what they're doing."

"There is not 250 years of experience, but the experience they've gained has stood them in very good stead and we have brought in the techniques that we've learned over these 250 years [in the UK]"

So while the administrators in the UK decide what to do with the whole of Waterford Wedgwood, work in Indonesia continues.

The company has also had its eye on new markets - China and India in particular.

If it can sell to the rapidly-growing population of wealthy urban consumers in those countries, it might just help secure the future of Wedgwood and Royal Doulton products.



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SEE ALSO
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Minister's pledge over Wedgwood
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12 Jan 09 |  Business
US firm in talks to buy Wedgwood
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Wedgwood family speak of 'tragic' demise
06 Jan 09 |  Staffordshire
How Waterford Wedgwood cracked
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Wedgwood goes into administration
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Most of Wedgwood output may move
02 Jan 09 |  Staffordshire

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