Kimberly-Clark, the producer and maker of the famous diaper brand ‘Huggies’ and numerous sanitary pads, is about to announce the closing of its manufacturing plant in Ikorodu, Nigeria. This decision comes after investing $100 million in the nation.
An inside source, who wished to remain anonymous, revealed that Kimberly-Clark has been struggling and operating below capacity since late 2023 due to Nigeria’s severe economic circumstances.
This marks the company’s second shutdown in Nigeria. Kimberly-Clark previously shut down operations in 2019 following a business review but restarted in 2022 with the opening of the $100 million facility in Ikorodu, Lagos State.
The closure of the Ikorodu plant reflects the ongoing challenges faced by businesses in Nigeria’s tough economic environment.
“Running cost is extremely on the high side. Our fixed spend every month is above N500 million and we spent about N100 million on just gas consumption for powering the gas engine aside from maintenance. The company has two assets and for last year, these assets didn’t run for like 90 days in 365 days.”
“Earlier this year, the company had to downsize to 2 shifts from 4 shifts. We run 24hrs and 7days and 365 days before but currently we don’t run on Friday, Saturday and Sunday anymore because of the economic situation. There is already an embargo on external recruitment. The company is looking for ways to reduce cost since it is not making a profit”, the source said.
The development comes as more than 15 multinational companies including Procter & Gamble, GlaxoSmithKline (GSK) and others announced an exit from Nigeria between last year and May this year.
