By McPherse Thompson, Staff Reporter
Production staff at Henkel Jamaica turning out adhesives for local and export markets. - File
HENKEL JAMAICA, which has been producing adhesives such as Pattex, Tangit, Saxit and Ponal for the local market since the early 1960s, will close its manufacturing operations next month.
The company said it will be shifting focus to distribution of its products within Jamaica and other Caribbean territories as part of a thrust towards achieving cost-effectiveness and efficiencies, brought on by increased competition and other developments in regional and international commerce.
Steve Scott, Henkel Jamaica's administration manager, said 15 production staff would lose their jobs as a result of the reorganisation, but all distribution staff would be retained to continue that side of the business.
In a statement to its customers, published in last Friday's Financial Gleaner, the company said the move was designed to take the company "to an even higher level", and would include sourcing all its products from Henkel's other manufacturing plants in Chile, Mexico, the United States, Brazil and Canada.
It said the new opportunity would enable the company to operate more cost-effectively and viably in a very competitive market, open the gateway to access to a wider range of products, and provide customers with more choices.
"International companies are basing their operations where they find it most beneficial," said Jamaica Manufacturers Association (JMA) president Clarence Clarke. "That means some will come and some will go."
Some companies may have closed, but others such as Red Stripe are undergoing major expansion and modernisation, he said. "There are opportunities out there."
The JMA will be carrying out a survey of the island's manufacturers early next year to get a clearer understanding of the state of the sector, Mr. Clarke said.
Henkel, a German-based company, started business in Jamaica during the island's growing industrial thrust in 1961 when businessman Lascelles Chin secured the distribution rights for its products. Mr. Chin had entered into a joint venture partnership with Henkel KgaA and himself founded Henkel Chemicals (Caribbean) in 1970.
A growing demand for adhesives pushed the company to move to larger facilities from the original location downtown Kingston, and with the formation of the new Henkel subsidiary, production and packaging operations were established at its present location on Red Hills Road, St. Andrew.
Increased product availability enabled Henkel to achieve a market share in Jamaica of 80 per cent of many of its products at one stage during its development, and up to two years ago, despite increased competition, was still the market leader with 65 per cent of local sales.
During its development, the local firm expanded its product base from adhesives to include institutional chemicals, toiletries, cosmetics and household detergents, and developed markets for those products in the Caribbean.
With the breakthrough in the CARICOM market, Henkel eventually achieved a 40 per cent market share in Trinidad, significantly contributing to Jamaica's export performance.
In 1986, the company ventured into the paints and automotive finishes business, acquiring Statcote Paints and Finishes. However, that division was closed after four years because the parent company was unable to support the local operation with international research and technology on paint production. In 1990, Mr. Chin sold his interest in Henkel to the parent company and left to pursue his own business.
