14 - Noodle King

Summary

After Suharto gained power, the United States provided aid to help him consolidate it. But Washington could not provide one thing the general wanted — big supplies of rice. The United States pressed Suharto to accept surplus wheat under the “Food for Peace” programme. But in the 1960s, Indonesians weren't keen on wheat, which they did not grow. Fifty years later, rice remained the essential staple, but the diet of many Indonesians included wheat products in the form of instant noodles, available in a dazzling assortment of flavours — and a Salim company, Indofood, was market king. Per capita consumption of wheat shot up from a miniscule 0.3 kilograms in 1966 to around 9 kilograms at the start of the 1980s and doubled to 18 kilograms in 2010.

As noted by the U.S. Department of Agriculture in April 2011: “The price of instant noodles is currently cheaper than rice and many more middle to lower income consumers substitute instant noodles for breakfast or dinner.”2 Over the decades, “Indomie” noodles became the Salim product best known to the public, and noodles became Salim's “money machine”, as described by SWA, a Jakarta business magazine, in 1994 — by which time Indofood was the world's largest maker of instant noodles, surpassing Nissin Food Products of Japan, whose founder Momofuku Ando invented the instant noodle in 1958.

MUSCLING INTO NOODLES

The story of how Salim became a noodle giant reflects the group's potency, not pioneering. For years after Bogasari began grinding wheat, Salim did not try to make anything with the flour it produced. Also of interest is that another man, not Liem, started Indomie, a contraction for “Indonesian mie” (mie is Indonesian for noodles). This case was similar to that of Indomobil, where a product with the “Indo” prefix was originally owned by another party. According to Anthony, Salim got into the noodles business by “accident”, not design. Behind the famous Indomie name was an enterprising businessman from Medan, North Sumatra, by the name of Djajadi Djaja, who also started a distribution company, Wicaksana. He reluctantly entered a partnership with Salim and, over time, was bought out. After Suharto fell many years later, Djajadi sued Indofood and members of the Gang of Four, contending he had been forced to exit the joint venture and sell the now-famous Indomie name for a pittance.