MANUFACTURER OF THE MONTH- Once a month, Inside Industry looks at a manufacturer — whether locally bred or an international player with a manufacturing base here in Egypt. The monthly feature covers manufacturers in different industries to look at their success stories, the challenges they have faced as local manufacturers, and the path forward as Egypt looks to build a more robust local industry. This month, we spoke with Sherif Khalil (LinkedIn), general manager at Henkel Egypt.

Henkel was founded in 1876 and today employs a diverse team of about 48k people worldwide, united by a strong corporate culture, shared values and a common purpose — "pioneers at heart for the good of generations.” Our business unit, Adhesive Technologies, is the global leader in the market for adhesives, sealants, and functional coatings. The company’s Consumer Brands segment also holds leading positions across multiple markets, especially in laundry, home care, and hair products.

Founded in 1992 as an extension of the German industrial and consumer goods giant, Henkel Egypt began by importing and distributing select products in the local market. Just a year later, it started local production of brands such as Pril, General, and Fa. Henkel has had a significant impact on the development of the manufacturing sector since entering the Egyptian market, with investments in infrastructure and modern technology amounting to approximately EUR 80 mn.

The company also directly employs around 500 people across three key business units — laundry and home care, beauty care and personal care, and adhesive technologies — with production centered at our renowned factory in Sixth of October City, which is considered one of the most advanced and largest facilities in the Middle East for detergents and home care products.

Over the past few years, we have successfully increased local sourcing from approximately 62% to 74%, and are working on steadily increasing this percentage. This aligns with Egypt's ambitious plans to boost exports and enhance the competitiveness of domestic manufacturing. Our focus on local sourcing not only contributes to Egypt’s economic development but also helps to ensure the sustainability of our operations.

The equation has evolved in recent months. Given the current economic landscape and the push for increased domestic production, we have been proactive in further strengthening our local sourcing capabilities. We've seen an improvement in the availability of high-quality local components. Additionally, we have focused on building closer relationships with our local suppliers, enabling greater flexibility and responsiveness. While we still rely on some imports for specialized components, our strategy remains centered on expanding local sourcing as much as possible to enhance our supply chain resilience.

Our primary focus is on achieving long-term economic sustainability and maintaining a competitive edge in the market. If we identify a local or international supplier offering superior financial terms or better overall value, we are always open to considering such options to optimize our supply chain. We continuously evaluate potential suppliers to ensure that we are getting the best possible solutions for our production needs.

We are actively working to position Egypt as a key export hub, especially within the African continent, which presents significant growth opportunities. In line with enhancing our production capabilities to support this vision, our goal is to increase our export volumes while maintaining a strong and sustainable presence in the local market, ensuring that we continue to meet the needs of Egyptian consumers.

Egypt’s manufacturing and export sector possesses numerous advantages that enhance companies' growth potential. Egypt’s strategic location — connecting Africa, the Middle East, and Europe — provides exceptional access to major global markets. Additionally, free trade agreements such as COMESA and GAFTA help reduce trade barriers and enhance the competitiveness of Egyptian products in international markets. Government initiatives supporting the sector — including investment incentives and infrastructure development — also create a favorable environment for business growth.

Our products stand out in international markets due to their high value and relevance to consumers' needs. We focus on developing formulas that address key challenges faced by consumers, especially in regions like Africa, where we offer innovative solutions for everyday problems. Whether it's in the home care, personal care, or beauty segments, Henkel products are designed to offer superior performance, quality, and sustainability, making them highly competitive.

As we work to expand our export activities — particularly targeting Africa — we anticipate several challenges. One is navigating the complex regulatory and customs requirements across different markets. Each country has its own set of import restrictions, tariffs, and documentation requirements, and ensuring full compliance can be time-consuming and resource-intensive. Additionally, cost-competitiveness is a critical factor as we look to expand exports. This will require us to continuously optimize operations, improve efficiency, and look for ways to reduce production costs without compromising on quality.

We take import and export compliance very seriously, as it is crucial to our operations and our commitment to ethical business practices. We ensure that our teams are informed and fully trained on local and international regulations, such as customs requirements, tariffs, and trade restrictions, as well as understanding any regional concepts. We also implement rigorous internal audits and monitoring procedures to ensure ongoing adherence to these policies, helping us maintain the trust of our stakeholders and operate seamlessly in international markets.

We believe in turning challenges into opportunities. Fluctuating exchange rates encourage businesses to explore more efficient sourcing and optimize costs, fostering resilience. Similarly, the complexities of customs and regulatory processes drive companies to develop expertise in navigating international trade, ultimately sharpening their competitive edge. For Henkel Egypt, these dynamics inspire continuous improvement, particularly in building strong local supplier partnerships and leveraging global best practices.

Your top industrial development stories for the week:

• Local packaging firm Medco Plast plans to set up a EGP 500 mn factory next year, with construction slated to kick off in early 2026, Al Borsa reports, citing an unnamed source.
• Global metal manufacturing firm World Metal is investing EGP 100 mn to build a new factory aimed at doubling its production capacity, company CFO Amr Mostafa told Al Borsa. The facility is under construction in Abu Zaabal Industrial Zone in Qalyubia, and is set to be completed and operational in 2025.