Sampoerna Opens Third-Party Factory
Sampoerna opened a new third-party operator (TPO) factory for hand-rolled kretek cigarettes (SKT) in Jaten, Central Java, Indonesia, on March 27.
Owned and operated by Attin Sigaret Indonesia, Jaten facility employs approximately 2,000 people.
During the inauguration ceremony, Directorate General of Customs and Excise Representative Iyan Rubiyanto lauded the anticipated economic impact of the new factory.
“We hope that the opening of this TPO will continue to absorb workforce and create a multiplier effect on the surrounding economy,” he was quoted as saying. “The sustainability of the industry is among the focus of the Directorate General of Customs and Excise, Ministry of Finance. Therefore, let’s maintain economic sustainability as a positive impact of the SKT industry.”
Following a period of sustained decline, the SKT segment started recovering in 2020 after the government started supporting the segment in an effort to boost employment. Partially as a result of its measures, the SKT’s share of the tobacco market increased from 17 percent in 2019 to 28 percent in 2023.
“On behalf of Sampoerna and tens of thousands of SKT hand-rollers, I would like to express my gratitude for the concern and support of the Directorate General of Customs and Excise, which represents the central government, in ensuring the sustainability of the tobacco industry, including protecting the SKT labor-intensive sector through various policies,” said Sampoerna Director Elvira Lianita in a statement.
TPO Jaten is one of five new TPOs that officially started operations in the first quarter of 2024. It complements Sampoerna’s other new SKT partnerships in Cilacap, Purwodadi, and Kebumen Regencies in Central Java, as well as Bojonegoro Regency in East Java.
Sampoerna now has partnerships with 43 TPOs, all of which are owned and operated by local entrepreneurs and/or local cooperatives. The company now employs, directly and indirectly, more than 90,000 people, about 90 percent of whom are working in SKT production facilities.