Center

Henkel lines up headquarters

By Chen Weihua (China Daily)
Updated: 2007-04-13 08:56

SHANGHAI: As a major move toward consolidating its China business, Henkel of Germany will inaugurate its Asia-Pacific and China headquarters in Pudong's Zhangjiang Hi-Tech Park in a few months.

The facility will also house a research and development (R&D) center, Henkel's largest in the Asia-Pacific region.

Faruk Arig, president of Henkel (China) Co Ltd, said the move is aimed at creating more synergy for the company.

"There is a lot of synergy to be created, such as sharing warehousing," said Arig, who assumed his current post late last year after working 32 years for Henkel, including 10 years in China and Singapore.

The new facility in Zhangjiang means that Henkel's divisions in laundry and home care, cosmetics, adhesive and technologies will operate under one roof from now.

Arig, once a member of the Turkish national basketball team, said the step to set up an R&D center in Shanghai shows the kind of importance Henkel attaches to the China market. In addition to its own projects, the Shanghai R&D center is expected to share some projects with Henkel's other centers worldwide.

Henkel has recorded double-digit growth in China in the last few years. Its total sales in the country exceeded 300 million euros in 2006.

Although this still is a fraction of Henkel's 12.74-billion-euro global sales last year, Arig believes 10 years from now, China will be one of the most important markets for Henkel.

Business for the Henkel Technologies division has grown rapidly in China, making the country its fourth-largest market in the world, according to Arig, also the regional head of Henkel Technologies responsible for the mainland, Taiwan, India and South Korea markets.

Arig said Henkel will continue to rely on acquisitions to expand market share, but refused to elaborate on the company's plans for acquisitions in China.

He called the acquisition a year ago of Huaiwei Electronics Co Ltd, based in Lianyungang of Jiangsu Province, a success story.

The Chinese company, making epoxy molding compounds for semiconductors, has complemented Henkel's portfolio, helping it to capture more business.

"Electronics has become a very important sub-business for us in China," Arig said, adding that many companies from the US, Japan, Taiwan and South Korea are moving their electronics businesses to the mainland.

Arig, who lives in Shanghai, said Henkel is also working on improving its brand awareness in China, especially in consumer goods.

Henkel's brands such as Schwarzkopf, Fa and Pritt are already a hit in China, but many consumers still don't associate them with Henkel.

For Arig, recruitment is another new challenge in China. Although Henkel has witnessed a lower staff turnover than other multinationals in China, finding and keeping good people has been high on Arig's agenda. To this end, Henkel has been cooperating with local universities.

(China Daily 04/13/2007 page14)