After Shlomo Tzuker, Gidon Huvernam and Shmuel HaCohen developed a patent for razors for the Dollar Shave Club, it was clear to them that the product must be manufactured in Israel. However, what was unclear was how to convince the American businessmen to agree.
"The American associates knew that Israel is a source of knowledge for razors, because there is a razor manufacturing plant here. That is why they were initially approached", explains Shmuel HaCohen, who is now the CEO of PCMR – the company that was established in Beit Shean earlier this year. "But that doesn't mean that they had to manufacture the razors that we developed here in Israel. One of the main factors behind our success was a meeting that we had with Invest in Israel. During the meeting, Ziva Eger, the Chief Executive of Invest in Israel and the Industrial Cooperation Authority (ICA) addressed the American investors' concerns, and explained that the country genuinely supports the factory being built in Israel".
Eger further explains: "During the first meeting, we discussed possible grants from the Foreign Investment and Industrial Cooperation with the investor, who remained unimpressed. We were aware that they had an offer to build a factory in Arizona, and I knew that if we couldn't give him a better deal on the spot we would lose the deal completely. I told him as clearly as possible, 'Tell me what they're offering you there, and I'll match it'. It's a business discourse, and we aren't discussing bureaucracy. It's a language that business executives like and understand well".
The business lingo is not all that Invest in Israel has to offer. The cooperation gave the investors grants that covered 20% of the expenses needed to establish the factory. To make the deal more attractive than the Arizona offer, Eger and her team went the extra mile to get an additional grant – an extra 10% off the establishment expenses from the Ministry for the Development of the Negev and Galilee. The lucrative offer was enough to convince the hesitant investors to build the factory in Beit Shean in Northern Israel.
A One-Stop-Shop
Building a factory is a long and tiring process – even more so for foreign investors. Invest in Israel is aware of the fact that this can drive potential investors and their business elsewhere. This is why the One-Stop-Shop policy was implemented. A representative from Invest in Israel escorted PCMR and the investors for three months, during every step of the way – from welcoming them at the airport through negotiations with the Israeli Land Administration.
The deadlines were tight. The process usually takes at least a year, but thanks to Invest in Israel's close attention and hard work the necessary approvals were attained within a few months. Different government organizations worked together because they understood that this was an important opportunity to build a factory that would create jobs in a peripheral region.
Shmuel HaCohen is convinced that thanks to Invest in Israel's dedicated work, their vision was carried out. "It wasn't easy to convince the investor to build the factory in Beit Shean", says Shmuel. "We thought that it would be cheaper to build in Beit Shean, which was not entirely the case. Invest in Israel were able to talk the Israeli Land Administration into giving us a better price for the land. Without the decreased price, I'm not sure we would be able to seal the deal".
Invest in Israel continues to support foreign investors even after the initial stage, using a service center. Since the opening of PCMR, the sleepy Beit Shean industrial zone began to flourish. Lots of land s are being sold after years of being empty, and the American investors are looking in to expanding the factory and relocating foreign activity into Israel. Eger and HaCohen are sure that it's not just because of the grants. "If you ask us, it can be attributed to the fact that in Israel, there is a dedicated unit that takes care of the foreign investor", concludes Eger. "They have someone to rely on for anything that they need, and they know that we want them here".
