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Asia300

Top Glove wants to grab 30% of global glove market

Top Glove Executive Chairman Lim Wee Chai speaks at the Nikkei Global Management Forum in Tokyo on Nov. 9.

TOKYO --  Consistently expanding beyond the average growth in demand is key to maintaining the top position, Lim Wee Chai, founder and executive chairman of Malaysia's Top Glove said here on Wednesday.  

The company, which controls 25% of the global glove market, is in a very competitive environment with thin profit margins where earnings rely on sales volume.

"The global demand for gloves grows on average at about 8% annually but we will try to capture [growth] of more than 10%," Lim told the 18th Global Management Forum.

Top Glove has set a target to snag 30% of the world market by 2020. Accordingly, it has been building at least one new factory annually in recent years. Production capacity is set to grow by 26% to 58.8 billion gloves annually by May 2018.      

Technology has enabled the production of lighter, allergy-free, high-quality gloves, according to Lim. The weight of a single glove has been reduced from 9 grams in the 1990s to 3 grams now. Top Glove takes R&D very seriously to meet demand for gloves with high quality but low prices. 

Though the U.S. and Europe account for over 60% of sales, Lim said the future of demand will come from Asia, particularly in the emerging markets of China, India, Indonesia and Vietnam. 

Top Glove sells to 200 countries largely in U.S. dollars, but Lim is confident that the outcome of the U.S. presidential election will not have an impact on business. 

"There will not be much volatility," assured Lim. "The [governing] system is firmly in place regardless who wins."

He also has faith in the U.S. position on free trade despite Donald Trump's threat to tear up the Trans-Pacific Partnership in the event that he wins. 

"[Trump] alone cannot make such a big decision," said Lim, brushing off the threat as a mere appeal to populism.

As for the topic of leadership succession, Lim insisted "all employees are the children of the company, so anybody can be the chairman or CEO," adding "we will not have a problem of succession planning. We train and retain good people."

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