Detergents Kalia, Cillit and Cillit Bang will be the first products to be produced in Israel.
Sources inform ''Globes'' that Reckitt Benckiser Israel general manager Eran Tor is arranging for the transfer of production of most of the company’s brands to Israel. Reckitt Benckiser Israel is a subsidiary of Britain’s Reckitt Benckiser plc (LSE:RB). Tor is negotiating with a number of factories to outsource production. Detergents Kalia, Cillit and Cillit Bang will be the first products to be produced in Israel.
Outsourcing production is intended to make the manufacture and marketing of products suited for Israeli consumers more flexible. Local manufacture will make possible local product solutions, such as package sizes to meet changing consumer demands. It might also overcome the minimum production run limitations of foreign factories.
Outsourcing of production to an Israeli manufacturer will improve profitability by reducing exposure to changes in the exchange rates and shipment costs. There is also a factor that has become dominant in Israel transport breakdowns. Many importers suffered problems from the month-long ports strike during 2004, which severely disrupted business plans. Importers struggled to meet demand because goods were stuck in port.
Last year, Reckitt Benckiser Israel outsourced production of its Colon laundry powder to Zohar Dalia, owned by Kibbutz Dalia.
Published by Globes [online], Israel business news - www.globes.co.il - on December 15, 2005