Kimberly-Clark, a leading manufacturer of diapers and sanitary pads, is poised to announce the imminent shutdown of its Ikorodu production facility, just two years after investing $100 million in the Nigerian market.
The decision follows a period of suboptimal production capacity utilization from late 2023 into 2024, attributed to the challenging economic environment in the country.
Sources within Kimberly-Clark informed Nairametrics that the company has struggled with various operational difficulties, including volatile exchange rates, high production costs, and regulatory challenges.
These issues have collectively impacted the feasibility of maintaining the Ikorodu facility, which was launched in 2022 as part of a $100 million investment aimed at revitalizing local production following a previous closure in 2019 due to a strategic business review.
According to them, the Ikorodu facility, which was intended to cater to the growing demand for Kimberly-Clark’s products in the West African region, has been operating below capacity.
The sources say the economic conditions in Nigeria, characterized by inflation and supply chain disruptions, have hindered the company’s ability to achieve its production targets and sustain profitable operations.
Kimberly-Clark Nigeria is expected to formally announce the shutdown soon, detailing the implications for its workforce and the local economy.
The development is a setback for Nigeria’s manufacturing sector and raises important questions about the country’s business environment.
