Wooden Bakery eyes $35 million factory

Will launch operations in Turkey this year

Wooden Bakery seeks to expand its production capacity with a new factory in Chekkascheduled to be up and running around end-2014. Wooden Bakery is currently working on getting the license to begin construction works.

“The new production unit will serve the increasing demand in the North,” said Asaad Bou Habib, partner and Production Manager. The cost of investment in the project is around $35 million.

The Chekka factory will have an overall built-up area of 20,000 square meters. Bou Habib said: “The new factory’s output will be the same as the output of the Antelias factory.” Wooden Bakery’s head factory in Antelias uses around 70 tons of flour per day to produce 100,000 packs of Arabic bread. The Chekka factory will create about 600 new jobs.

Maintaining cost efficiency in light of increasing operational costs is a challenge for Wooden Bakery, as for many local bread makers. “Although our sales grew by 40 percent last year, our profits declined by some 30 percent mostly due to the increase in production costs, namely fuel prices and wages,” Bou Habib said.

Wooden Bakery plans to open a production unit in Turkey during 2013 through a joint venture with Turkish partners. “Once the Turkish government learned that we were one of the fastest growing brands in Lebanon, it granted us a 30-year license to exploit a 3,000 square meter plot in the town of Gaziantep at no cost ,” said Bou Habib. The Turkey branch will adopt the same concept as the local Wooden Bakery factory. It will produce both Arabic bread and French-style baguettes, in addition to breakfast meals and pastries. “We dispatched a team to Turkey to study potential demand for traditional Arabic bread, which turned out to be encouraging,” Bou Habib said. Investment in the Turkey branch reached $4 million. It will create about one hundred jobs for both Lebanese and Turkish nationals.

The Wooden Bakery brand and facilities are owned by their founders Edouard Bou Habib and his two sons Ghassan and Assaad. The owners have also sold franchise rights to local partners, which will bring the total number of its local branches to 30 during 2013. The company has been present in Riyadh since 2009 with three branches and a factory. It also has plans to open in the United Arab Emirates.