Ice cream manufacturer Ben & Jerry's Israel will build a new factory in the Kiryat Gat new industrial zone with an estimated investment of NIS 130 million.
The company currently makes its products at the factory covering 10 dunams (2.5 acres) in Beer Tuvia near Kiryat Malachi in southern Israel. The new 20 dunams (5 acres) factory will have production lines based on advanced technologies and is due to open in 2026. The land for the plant has been allocated by the state.
Ben & Jerry's has 200 employees in Israel, who will be transferred to the new plant, while more employees will be hired to operate the expanded production lines. "All our employees from the southern region (will move) - Ashkelon, Ashdod, the Gaza border, Kiryat Gat," said Ben & Jerry's Israel CEO and owner Avi Zinger.
He added, "We have been leasing the factory in Kiryat Malachi for 12 years already and in the past few years we have been looking for a new place suitable for our needs with options for significant enlargement. Today one of our bottlenecks is the warehousing area. As we grow, we have been forced to use external warehouses to store our inventory."
Support from Jewish communities
Ben & Jerry's has about a 50% market share in the family ice cream package market in Israel, and the company plans to expand to other products such as frozen desserts, and ice cream cones. A visitors center, a flagship store and a logistics center will be opened in the new factory complex. "We will bring significant innovations in the food sector, and increase our market share," says Zinger.
In the summer of 2021, global food company Unilever, the owner of Ben & Jerry's, announced it would no longer sell ice cream in Judea and Samaria, and would not renew its distribution agreement in the region. The announcement led to a harsh criticism of the company in Israel, both from the public and from legal, economic and political organizations.
Zinger made it clear at the time that Ben & Jerry's Israel is not related to the global company, and fought the directive. In June 2022, an agreement was signed in which the Israeli company would continue to produce and sell ice cream throughout Israel, including in Judea and Samaria, and the franchise agreement with Zinger was renewed.
Zinger says that Americans who visit Israel ask to see the factory, since the affair upset not only Israelis but also US Jewish communities. "After all the commotion caused, and the support we received from American communities, it became one of the landmarks of their visit to Israel."
"Not hiking prices"
Zinger only sells the ice cream manufactured by Ben & Jerry's Israel on the domestic market and most of the company's ingredients are from Israel including the cream and eggs. Other ingredients are purchased from the global brand including cherries, and brownies as well as the packaging.
During a wave of price rises, Zinger stresses that the company has no plans to make its products more expensive. He says, "Everything is going up - the imports, the packaging, some of our ingredients, transportation. The currency is also eroding. But due to the fact that we are always streamlining, we are striving not to put up prices and absorb the costs.
"Ben & Jerry's Israel prices are more attractive than in any other country due to our struggles. Today we sell more cheaply than we were selling 20 years ago."
One of the ways of becoming more efficient is not to invest bigger budgets in advertising. "We only advertise on social media and prefer to put all these budgets into the product and pass it onto the customer. We know for sure that those who put the product in their mouths love it, so it is better to keep it as attractive as possible in terms of price, and this has been our policy from the start."
Published by Globes, Israel business news - en.globes.co.il - on January 30, 2024.
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