Economy

Markets

Industries

Insights

Reports

Events

Henkel to stop detergent sales in China

By Yu Tianyu (chinadaily.com.cn)
Updated: 2008-12-19 17:16

Henkel AG & Co KGaA, the German detergents and glues manufacturer, has decided to discontinue its laundry and home care business operations in China by the end of this year.

The company said this decision is in line with Henkel's global business strategy and will allow the company to reach its full business potential and further consolidate its already strong Chinese adhesives and cosmetics businesses.

An industry insider said Henkel's exit can be attributed to its relatively lower popularity, market share and profit compared to its rivals P&G and Unilever.

Related readings:  China to ride into Henkel's top five markets  Henkel lines up headquarters  Johnson & Johnson buys out Dabao  Cosmetic changes in China market

From Jan 1, 2009, Henkel China will stop sales of all laundry and home care products, including three local brands (Wipp, Bref and Sky clean) and five imported brands (Persil, Perwoll, Pril, Sofix and Somat), the company said in a statement today.

All other products from the cosmetics and toiletries business including hair cosmetics, body care, skin care and oral care as well as its adhesives business will not be affected, the company said.

Several franchises and stores in Beijing have already been told to terminate their cooperation with Henkel before Dec 31 and to seek financial settlement. Also, sales staff have been informed to leave. However, the statement did not give the exact number of franchises, stores and staff that will be involved.

Henkel's cosmetics and beauty products first entered the Chinese market in 1994. The company then purchased several local Chinese brands including Tiantian, Kemeng and Seagulls.