Being a Foreign Investor in Turkey: Experiences

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Being a Foreign Investor in Turkey Experiences
Expectations Saffet Karpat, Vice President
5th World Chambers Congress July 2, 2007-
Istanbul
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PG at a glance
1837 2006 Brands 2
300 Employees 2 135.000 Countries 1
80 (operations) 160 (markets) Sales
(M) 3,6 68,2MMM
The company is owned by 1,1 million shareholders
including employees and retirees.
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PG Turkey- History

• 1987 Entry to Turkish market with Mintax
  Deterjanlari San.A.S.
• Forming of a JV with Eczacibasi (Sanipak Saglik
  Ürünleri A.S.)
• 1997 Establishment of the PG Central Asian
  Caucasian Republics organization (CCAR).
• 1999 Merging of all business activities in Turkey
  into PG Tüketim Mallari San. A.S.
• Full integration of the CCAR business to PG
  Turkey.
• Wella acquisition
• 2006 Gillette acquisition

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PG Turkey Local Investments Our People, Our
Plants, Our Products

• 1 HQ 3 plants 1 distribution center
• 925 employees more than 3000 indirect
  employment
• 23 brands
• Leading brands in the sectors of cleaning
  products and personal care/cosmetics.
• Total investment 400MM

Most favorite company in the cleaning
products/chemical industry and personal
care/cosmetics sectors since 2000.
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PG TurkeyLocal Investments Our Plant

• Total Area 79,360 m2
• Covered area 38,500 m2
• Capacity Granule detergents 1000 tons/days
  
• Diapers 5 million/day
• Hygienic pads 5 million/day
• Employees 660 - 15 female, 85 male
• 30 contractor
• Brands produced Ariel, Alo, Ace, Tide,
  Bonux,Orkid, Always, Prima, Pampers
• Located at Gebze Organized Industry Zone

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Exports from TR
60 of diapers, 30 of hygienic pads 20 of
granule detergents produced in Gebze are exported
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Export Performance

• 1,2 Bln exports in 12 years
• Rewarded as
• 1 exporter of paper products for the last 7
  years
• and as
• 1 exporter of cleaning products for the last 2
  years by the Undersecretariat of Foreign Trade

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Our brands in Turkey
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How do we operate? Assessing the Landscape

• 20 years ago Turkey
• Internet
• Mobile phones
• Laptop computers, blackberries
• Private TV channels
• Multinational distributor channels
• Consumer and market research companies
• Sectoral industry associations
• were almost or totally non-existent.

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How do we operate? Assessing the Landscape

• In the last 20 years
• 15 governments changed
• 3 economic crises (94, 98 Russian, 01) and
• 1 big natural disaster (99 eartquake) occured

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How do we operate?

• PG is a local citizen together in good and
• bad times
• Sustaining investments both financially and
  socially
• Over 400 MM financial investments
• Investment on local workforce (60 managers
  exported, 10 expats vs 900 locals in turkey)
• Over 3 MM yearly for social responsibility
  programs for the welfare of public, specifically
  children, youngsters and women on education and
  health

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How do we operate?

• Compliant to all relevant industry governing
  local laws and regulations annual
  internal/external audits assure compliance to
  global standards
• Operate with higher global standards in terms of
  local safety, quality and environmental standards
• Prepared to comply with relevant laws and
  directives due to EU harmonization

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How do we operate?

• PG is well connected throughout 20 years of
  governmental changes with relevant bureaucratic
  offices at local and central levels
• PG is well recognized by various influential
  professional associations as well as NGOs and
  academia.
• We hold board memberships or chair in key
  industry and business associations, as well as
  represented at TOBB Cosmetics, Paper and
  Chemicals Sectoral Councils.
• We are a member of GOIZ Environmental Committee

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How to further improve investment environment?

• Simplifying the investment approval process
• Investments on local manufacturing facilities via
  competitive incentives
• Provision of well organized industry zones like
  GOIZ
• Streamlining importation of raw / packaging
  materials
• EU regulatory harmonization with relevant
  industrial sectors

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How to further improve investment environment?

• Protection of intellectual property rights
• In market control effectiveness
• In general, unregistered economy deserves being
  a priority of the political and economical agenda
  of the governments to avoid unfair competition

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Thank You!