Bong to start envelope production in Russia

Kristianstad 2005-10-13

For several years Bong has served the Russian envelope market via exports from Finland. Now, the company is taking the next step and setting up its own envelope manufacturing in Russia. Production will be based in Kaluga, some 200 km south of Moscow. The company has started to move envelope machines from other parts of the group for use in Russia and plans to expand production in pace with market growth. “Russia is a very interesting market for us. The country’s large population and fast-growing per capita envelope consumption offer significant potential,” says Anders Davidsson, CEO & President of Bong. “We have already established our Postac brand on the Russian market in collaboration with some major distributors. But in order to give our Russian customers better service and fully exploit growth in this market, it is vital that we also have a production presence here.” At present Bong has recruited a number of key staff, leased and prepared suitable facilities and is in the process of installing envelope machines. Costs of around SEK 3 million for the Russian venture have been charged against profit for 2005 to date, and Bong anticipates additional start-up costs in the range of SEK 1–2 million for the remainder of the year. Full-scale production is scheduled to start in the first half of 2006.