Sea of Life, which manufactures and markets body care products based on Dead Sea minerals, is struggling to recover from a massive fire that destroyed their factory in Arad in June 2011. Sea of Life CEO Uri Ben Hur announced today that he is planning to cancel deals with foreign customers, including an $11 million contract to supply products to four national US retailers. As a result of damage from the fire, Ben Hur said, the company has not been able to meet demand or manufacture enough products to satisfy customers' needs. 100 out of 180 employees have been laid off over the last six months, some of them just last week.
"I am dealing with a crazy situation and a terrible reality. I wouldn't wish this situation upon anyone. Just now, when I should have been relaxed and comfortable, reaping the fruits of our labor, enjoying the fantastic capital that we have accumulated from years of hard work, everything has burned down, including millions of dollars worth of products," Ben Hur told "Globes" today.
Ben Hur says that his factory was completely destroyed in the fire, except for the kitchen, which is where he is currently carrying out manufacturing on an extremely small scale. The employees tried to repair some of the damaged machinery, and to broadcast an atmosphere of business as usual, but the company was unable to fulfill customers' orders. "Company stores have sold all of their inventory, foreign customers are angry about unreasonable delivery terms, and we have had to cancel a giant $11 million deal that was supposed to be delivered to the US in a month," Ben Hur said.
Ben Hur says he is making an effort to raise the money necessary to rebuilt the factory and restore production to its pre-fire level. "At first, we thought the cause of the fire was arson, but later we learned that it was a short circuit that had caused all this trouble. An insurance appraiser that assessed the damage, estimated it at $10.3 million. On the night of the fire, there was NIS 8.5 million worth of merchandise in the factory. There is a gap between the amount of damage and remuneration from the insurance company, and now I am trying to raise the funds necessary to resume business. We have not yet managed to return to business as usual. This is a tragedy on every level," Ben Hur said.
Ben Hur says that, in the upcoming days, he intends to approach the mayor of Arad and relevant government offices in an urgent search for aid that would save the factory and enable Sea of Life to renew activity. "Sales have fallen 70%. We have no choice - we need help. The fire destroyed everything," he said.
Published by Globes [online], Israel business news - www.globes-online.com - on February 28, 2012
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