UKRAINE: KIEV: BUSINESS SUCCESS FOR SC JOHNSON WAX

Описание: (17 Jul 1995) Eng/Russian/Nat

The American multinational company S-C Johnson Wax has been cleaning up in the former Soviet Union, literally and financially.

Since starting up in 1990, the floor-wax and polish giant has this year pulled itself out of the red, and has made its first profits.

Its success contrasts with the fortunes of projects set up by other foreign investors who came to the former Soviet Union anticipating untapped riches but are now becoming increasingly disappointed.

A business success story in the former Soviet Union.

After a few years of hiccups and false starts, some well-placed joint ventures such as this one are finding a hungry market for their much-improved goods.

S-C Johnson Wax, the American floor-wax and polish giant, started a joint venture with this Ukrainian enterprise back in 1990, before the breakup of the Soviet Union.

It has taken them five years, but they've finally pulled themselves out of the red and into the black.

The floor waxes, laundry detergents and bathroom cleaners keep rolling off the line, and the customers apparently like what they are buying.

The factory's 280 employees are making, in terms of buying power, three times their former salaries.

Revenues have steadily increased as the Ukrainian economy has slowly stabilised, now standing at close to five million dollars annually.

Factory General Manager Franck Benhamou says the operation now has the almost normal ups and downs of a Western enterprise, unlike the early crisis-filled days.

But his satisfaction is rare among business managers in the former Soviet Union, with most still struggling to keep their projects alive, and to keep their foreign investors happy.

More and more foreign businessmen are holding press conferences not to announce new ventures, but to complain about the often unfavourable investment climate here.

They tell of complicated and unreasonably high taxes; of a lack of established rules; and of a deep-rooted corruption that has you digging into your pockets for a bribe at every turn.

And despite some important progress, investors say, the corruption is getting worse.

SOUNDBITE: (In English)
"Corruption is an issue which is starting to become more and more difficult for foreign companies that are investing in this country. Particularly for American companies who have to comply with U.S. legislation, like the Foreign Corrupt Practices Act - this can be a very difficult nut to crack in this particular commercial environment."

SUPER CAPTION: Peter Charow, Executive Director, American Chamber of Commerce in Russia

S-C Johnson Wax has overcome such problems, building a successful new factory from what was once little more than a concrete and steel shell, the insides gutted and decayed.

It has taken Johnson close to 11 (m) million dollars (U-S) so far to do it.

The new cafeteria is especially liked by the local staff, most of whom remember the bad old days.

SOUNDBITE: (In Russian)
"I remember, yes. I worked here three years before the creation of the joint venture. The work was awfully difficult, it was so dirty. We made everything by hand. Of course it's impossible to compare with how we work now, five years later."

SUPER CAPTION: Maria Dogopolova, Factory Worker

Perhaps the biggest difference in the last few years is that bright new packaging and a new, computerised laboratory have brought Ukrainians products they actually like and choose to buy.


All in a day's work for the few lucky employees of this unusual case of a joint venture factory in the former Soviet Union that is making it.

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