Yavne plant and needs to ex-
pand. It hopes to build a new,
10,000-square-meter building
within the next two years, on-
ly 250 meters away from its
present site.
According to operations
division manager Alex
Magen, Yavne is no longer a
developing area with attrac-
tive economic incentives for
domestic investors. However,
the city offers other reasons
for the company to stay where
it is.
"Yavne is attractive, first of
all, as a place in which to
live," Magen says. "The level
of education and the quality
of life are very high, and if
you have this quality you
have the best people coming
here. And, if you have the best
people coming here, you have
the ability to found new com-
panies."
Magen also cites incentives
from the municipality itself.
The city has established two
industrial zones: Mul-T-Lock
is located in the old industrial
zone near the downtown area,
while Ormat is in the new•
zone on the west side of town.
The city still offers a great
deal of reserve industrial
space, Magen says.
And Yavne is an ideal
location.
According to Magen, when
Mul-T-Lock started planning
its new plant, it looked to
Rishon LeZion, Sderot, Holon
and other areas. "After
discussing all the alter-
natives, we finally decided to
stay in Yavne — not so much
because of the export as
because of the local market.
Every day we ship 250 doors
to all parts of the country, and
Yavne is centrally enough
located that it facilitates
this," he says.
The high level of education
and industrial incentives
have caused Yavne to boom.
Yavne's population increased
from 7,000 to 12,000 between
ducted a conference with
potential Detroit investors.
"We felt there was- a new need
to bring in foreign investors
to strengthen local industry,"
the mayor explains. "I
believe, and I believed at the
time, that a partnership with
a community is not only giv-
ing and asking for money .. .
"I spoke with my colleagues
in other Project Renewal
cities. I told them I believe
that government wouldn't in
any way solve the problem of
creating jobs and factories. I
believe in initiative. We can
find the answer to enlarging
industry and solving
unemployment ourselves
through our partners in Pro-
ject Renewal. They can help
us more than any govern-
ment."
A
iding Yavne's efforts
to bring in new in-
vestors is Herzliya-
based marketing and invest-
ment consultant Murray
Grant.
Grant, a University of
Michigan graduate, is trying
on a volunteer basis to in-
terest Detroiters in either in-
vesting money, expertise and
marketing ability in selected
Yavne companies. These com-
panies, he says, make
"economic sense" in the ex-
port field, or expanding their
own industries to Israel.
D iane Wolkow
form optical inspection of
printed circuit boards for elec-
tronic industry. These two Or-
mat affiliates have a combin-
ed work force of 300.
In 1980, Yavne gained
another major industry — one
which is virtually a
household name in Israel.
Mul-T-Lock had been founded
in Holon in 1973 by two
young innovators, locksmith
Avram Bahri and El Al
technician Moshe Dolev, who
developed a revolutionary
four-way locking system that
renders entrance doors
tamper resistant. Bahri and
Dolev started manufacturing
the locks in the backyards of
their homes. After several
years of developing and ex-
panding their company, they
invented the steel door known
as PlaDelet, which is now
sold by the thousands in
Israel each month.
In the early 1980s, Mul-T-
Lock developed its cylinder
and padlock systems and,
more recently, a car transmis-
sion lock.
When this homegrown in-
dustry started looking for a
new base, Yavne was attrac-
tive because it was defined as
\) a developing area which
qualified for government in-
centives. The company, which
four years ago joined Israel's
Discount Investment Co., has
since opened a second plant in
the Barcan Industrial area in
Samaria.
Two years ago, Mul-T-Lock
had a work force of 650. To-
day, due to investment in
high technology and other
improvements, it has cut its
work force to about 500 while
increasing productivity.
Mul-T-Lock, with total 1988
sales of $33 million — $5.6
million of them in export —
entered Dunn & Bradstreet
this year as the 100th largest
private company in Israel in
terms of sales. The company
has outgrown its current
1976 and 1980, reached
21,000 by 1984, and now
stands at about 25,000.
While the first waves of im-
migrants were workers with
moderate incomes, a 1983
project of the Israel Defense
Force Officers Association to
build 602 houses in Yavne at-
tracted educated profes-
sionals from the upper social-
economic stratum. Concur-
rent with the IDF Officers
project, professionals started
building homes independent-
ly in Yavne, and the city now
boasts about 1,000 detached
homes.
"The bad image was a bad
obstacle to investors, even if
the location was the best of
the best and prices were low
at the time," Mayor Berros
says. "When Yavne's image
changed from a hopeless city
to one with a future, it at-
tracted investment."
Yet city leaders recognize
that at a time when Israel's
economic picture is changing,
Yavne must tap into new
resources to continue its
economic development. Accor-
ding to Berros, Yavne has
been affected, like other
areas, by Israel's economic
slowdown. More than 10
small factories have closed
this year, resulting in an an-
nual tax loss to the city of
$750,000. About 600 heads of
families are unemployed,
with the local unemployment
rate standing at six to seven
percent.
"This is the worst year I
know of all over for factories
closing and firing their
workers," Berros says.
Yavne's unemployment rate
is still lower than the na-
tional average of 10 percent
because people can find jobs
in Ashdod or Tel Aviv, the
mayor points out. And,
Yavne's past economic
development has helped buf-
fer it from the current
economic crisis. Still, new in-
vestment resources are need-
ed, and Yavne is looking to
foreign investors for help.
In 1986, at a critical time
for Ormat, Detroit
businessmen David Hermelin
and Bill Davidson made a
significant investment in the
company. "That support
helped in going forward," Or-
mat's Gill says. "And since
then they continued with
more investments and sup-
port. That investment was
needed."
The Ormat investors came
in before Detroit became in-
volved with Yavne's Project
Renewal. However, Berros
says he hopes the Project
Renewal ties will help bring
in more foreign investors.
At the end of 1988, Berros
and other Yavne leaders con-
Workers at MuI-T-Lock Co. in
Yavne assemble locks. A
household name in Israel, Mul-T-
Lock employs 500 people.
Recently, the company developed
a car transmission lock.
Says Grant, "It seems to be
a natural extension of the
Detroit involvement to have
Detroit investors in relative-
ly similar fields become in-
volved in Yavne."
Grant cites several incen-
tives for Detroit investors.
Among them are Yavne's
strong labor force — either
trained or willing to be train-
ed, its readily available in-
dustrial space, its accessibili-
ty to scientific institutes such
as the Weizmann Institute
and the Hebrew University
Institute of Agriculture, and
its strategic proximity to
Ashdod and Ben Gurion In-
ternational Airport.
What is not known to the
general public, Grant adds, is
that Israel sits at the center
of what he calls the "golden
triangle": it is the only coun-
try in the world with duty-
free status with both the
United States and the Euro-
pean Common Market. Con-
sequently, he says, a U.S. com-
pany wishing to effectively
penetrate the European
market would do well to con-
sider Israel as a second base
for its factories.
To qualify as an Israeli-
made product, only 35 per-
cent of the product's added
value must originate in
Israel.
Israel also can offer high
skills, brainpower and
technological superiority over
many countries than can pro-
vide a cheaper labor force for
a foreign factory, Grant adds.
He maintains that the corn-
bination of money, knowhow
and skills results in a strong
potential for development in
Yavne. The government, as
part of its share of Project
Renewal, is offering work
training programs; invest-
ment in industry would pro-
vide the jobs to use those
skills.
"This is another, and
sometimes better, way of pro-
tecting your investment in
Israel," Grant says. "I believe
that investment should be
based on a profit motive, and
that Zionism, or a sense of in-
volvement in Israel as a Jew,
is strictly a secondary motiva-
tion. The first motivation is:
Does it make economic
sense?"
Grant also is involved in ef-
forts to construct a shopping
center in Yavne. He says the
city is now about 50 percent
under-commercialized, with
no major shopping available.
A local developer has plans
to build approximately
120,000 square feet of shopp-
ing space on two levels at the
main entry road to Yavne
near the Central Bus Station,
at an estimated cost of $10
million, including land.
According to Grant, the
land is in the final stages of
the rezoning process, and four
or five major Israeli retail
operations are interested in
becoming tenants.
The project has attracted a
great deal of interest from
Israeli investors, Grant says.
He hopes to attract Detroit in-
vestors, as well, to finance
half the project. He cites an
investment return of 20 per-
cent or better and beneficial
Israel tax laws for foreign in-
vestors. ❑
THE DETROIT JEWISH NEWS
51