Cadbury to shut Nairobi factory at end of month

Corporate News

Cadbury Kenya plans to shutter its Kenyan manufacturing operations at the end of the month, shedding 300 jobs. PHOTO | FILE 

By JOHN NJIRU, Daily Nation

Posted  Thursday, October 2   2014 at  14:16

In Summary

• Cadbury Kenya plans to close down its manufacturing plant in Nairobi and shed about 300 jobs.
• Eveready Ltd this week said it is cutting 100 jobs and closing its dry cell-making plant in Nakuru.
• Other manufacturers that have closed local production lines include Reckitt Benckiser, Procter & Gamble, Bridgestone, Colgate Palmolive, Johnson & Johnson and Unilever.

Cadbury Kenya plans to close down its manufacturing plant in Nairobi as part of a global transformation strategy to reinvent its supply chain.

The company said it would cease all operations at its factory in Kenya by the end of this month and only retain marketing and distribution functions.

The move will leave about 300 Kenyans who worked in the plant, either as permanent or casual employees, jobless.

It becomes the second firm in as many days to cease local manufacturing after Eveready Ltd announced the closure of its dry cell-making plant in Nakuru on Monday. About a hundred people lost their jobs in that closure.

Mondelçz International, the US-based parent company of Cadbury Kenya, told the Business Daily’s sister paper, the Daily Nation, that it would now “focus its resources on scale manufacturing facilities where it can generate greater efficiencies, to reinvest in growth”.

The company will import its products from Egypt to sell locally.

READ: Cadbury retains Nairobi as hub for East Africa business.

“The decision has been taken after careful consideration and extensive due diligence and allows Cadbury Kenya to invest in creating a more commercially focused business in East Africa, with Kenya as its hub,” said Ms Navisha Bechan-Sewkuran, the firm’s corporate and government affairs lead for Southern, Central and Eastern Africa.

In 2011, the local factory stopped making Cadbury Chocolate, one of its biggest products, with the firm opting to import it from South Africa.

The company, which has been in operation for more than 60 years, is synonymous with products such as Cocoa, Cadbury Drinking Chocolate, Oreo biscuits and Trident chewing gum.

The company insisted that it would continue investing in the region in spite of the decision to move its plant.

“It is our intention to more than double our business here during the next three years,” said Ms Bechan-Sewkuran. “We plan to invest substantially in marketing and our distribution network to reach more and more consumers.”

An insider at Cadbury Kenya said the company was computing employee benefits ahead of their dismissal.

“We are a company which treats its employees with fairness and respect, and we adhere strictly to national labour laws and regulations, as well as international best practices,” noted Ms Bechan-Sewkuran.

Other manufacturers that have closed production lines in the country include Reckitt Benckiser, Procter & Gamble, Bridgestone, Colgate Palmolive, Johnson & Johnson and Unilever.