P&G Prepares New Investments and Localization Steps in Türkiye

Industry and Technology Minister Varank announced that Procter&Gamble (P&G), a global leader in cleaning and personal care products that has operated in Turkey for 33 years, will make new investments and localization efforts in the coming period. Procter&Gamble (P&G), which has operated in Turkey for 33 years and whose products are found in 9 of every 10 homes, shared its contribution to the country's economy at a "Domestic Production Investment Meeting" held at its production facilities in Gebze. Industry and Technology Minister Mustafa Varank, who attended the meeting, gathered information about the company's contribution to the country's economy, production activities, R&D work and investment plans, then toured the facilities. Kocaeli Governor Seddar Yavuz also accompanied Minister Varank. Minister Varank noted that Procter&Gamble has both produced and sold in Turkey for 33 years, pointing out that the company is among Turkey's major firms particularly in the personal hygiene and detergent sectors, and that following Gebze, its new investment in Şekerpınar was also completed. Referring to P&G's supply chain and localization efforts in Turkey, Varank said, "Particularly during the pandemic period, personal hygiene and cleaning products came into greater focus. At that time, I gave an example about how global suppliers were beginning to evaluate Turkey's suppliers during the localization period. That example concerned Procter&Gamble. When Procter&Gamble could not import certain chemicals used in detergent from China during that period, it reached agreements with Turkish manufacturers and began producing these products domestically."

Company has a new localization target through 2023

Varank stated that P&G, which holds a significant market share in Turkey, is planning to export USD 120 million this year, adding, "Turkish companies that supply to this company export USD 170 million to other Procter&Gamble factories worldwide. We are talking about a value chain here. The company has new investment plans for the coming period, and we discussed their plans for Turkey." Minister Varank emphasized that Turkey is a very strong and competitive country in manufacturing. "Global companies' factories in Turkey can operate quite efficiently compared to the world. During today's visit, we saw new products the company has recently developed in detergent, diapers and many personal hygiene areas. We listened to their plans on how to export these and jointly reviewed their planned investments in Turkey for the coming period." Pointing out that the company has a new localization target through 2023, Varank said, "They have made a plan to source USD 30 million worth of products—products they currently import—from domestic suppliers. If that plan is implemented by 2023, it will also contribute to reducing the current account deficit."

USD 250 million investment over the past 10 years

P&G Turkey, Caucasus and Central Asia Board Chairman Tankut Turnaoğlu stated that P&G is the world's largest cleaning and personal care company and that the company has operated in Turkey for 33 years. Expressing satisfaction that Minister Varank visited P&G's Gebze production facility, Turnaoğlu said they consulted with him to develop their operations in Turkey. Turnaoğlu said, "According to Turkish Exporters Assembly (TİM) data, we have been export leaders in the paper category for 9 years and in the detergent category for 5 years. We have invested USD 238 million over the past 10 years to increase this export strength. I am pleased to say that in the first seven months of 2020, we increased our exports by 20 percent. In fact, the export rates we achieved in March-April were the highest figures in our 33-year history. We were able to export approximately 40 percent of the production here."

Adding domestic players to the global supply chain

Noting that as a company they add domestic players to the global supply chain through self-sufficiency and localization activities, Turnaoğlu continued: "As P&G in Turkey, we contribute to the economy by sourcing products and services worth USD 175 million from approximately 450 suppliers. The number of Turkish suppliers exceeds our foreign suppliers. 89 different companies supply to us in Turkey. These companies also export products or services to other P&G headquarters. 42 of these 89 companies are 100 percent domestic manufacturers. Last year alone, these companies exported approximately USD 170 million worth of products and services to P&G's other production and operation centers in the region. We are very proud of this and want to develop it further." Turnaoğlu recalled that the new domestic R&D center became operational at the Gebze production facility in 2018, pointing out that it is Europe's newest R&D center and P&G's only R&D center between Europe and Asia.

Emphasizing that the center is a development facility built to meet an important local need in the Central Asia and Africa regions, Turnaoğlu noted:

"Currently, more than 30 technicians, researchers and senior engineers are working and conducting activities with our domestic partners to further increase this self-sufficiency and localization. There are 18 active projects with cooperation from 5 universities and 25 R&D industry partnerships. We also work with TÜBİTAK. These efforts are already bearing fruit. We have begun producing in Turkey products developed in line with the needs and expectations of Turkish consumers. We will soon ensure their export from Turkey to the region. On this occasion, on behalf of the P&G family, I would like to thank our Industry and Technology Minister Mustafa Varank and his valuable team for these visits and the wonderful support they have provided to us and to P&G."   Source