Swallowfield plc has opened a production facility in Tabor in the Czech Republic with the aim of achieving significant cost efficiencies whilst maintaining the same quality systems operated in the company’s UK plants.
The 5000m² operation will employ 100 production staff to fill, finish and package colour cosmetics, fragrances and other liquid products as well as undertaking gift packaging of toiletry and cosmetic products.
Ian Mackinnon, ceo of Swallowfield, said: “In the last 12 months we have made great strides, with operating profit up 122% to £1.32m for the year ended 30 June. Our new facility in the Czech Republic is part of our ongoing strategy to increase revenues and reduce our cost base. Whilst there will be an increase in freight costs associated with moving an operation overseas, the labour costs are approximately a third of those in the UK for the type of work that will be undertaken in our new operation, thereby providing a significant net saving.”
The production plant in the Czech Republic forms part of Swallowfield’s global expansion programme, which also includes the development of a joint venture operation in China, which will be unveiled early in 2008. The opening of the Tabor facility comes on the back of Swallowfield’s announcement that it has unconditionally completed the sale and leaseback of its Lowmoor warehouse facility, which will support the company’s expansion programme both in the UK and overseas. The company is predicting a pre-tax profit on this transaction of £1.25m.