Tunisie Ouate makes big move to ensure future growth

Tunisia’s biggest tissue producer is embarking on growth plan to develop the domestic market, both in terms of quality and quantity. In addition to the new paper machine which started up last year, the company is also planning to make a major move into the consumer products area with the installation of a new converting plant.

Hugh O’Brian

There is probably more happening on the Tunisian tissue market than one might at first assume. A small market in North Africa, the country has a population of about 10 million people, and annual tissue consumption is estimated at about nine to ten thousand tons per year. That, however, may be about the change. The country’s leading tissue maker, Tunisie Ouate, has recently installed a modern new 2.75 m wide tissue machine capable of making 18,000 tons per year, more than triple the company’s previous capacity of 5,000 tons per year. The new PM 2 started operation in early 2003. Along with the start of the new machine, Tunisie Ouate is making a major move into the production of finished products for the consumer tissue sector.

This represents a new line for Tunisie Ouate, which until recently has been focused mainly on the manufacturing of jumbo rolls for sale to converters. Also, the company has recently concluded an agreement with Georgia-Pacific to produce and market finished products under the Lotus brand name.

Finally, the mill is also moving into the recycled-fiber-based tissue sector through the installation of a new deinking line during 2004.

HUMBLE BEGINNINGS. The man behind Tunisie Ouate is Mr. Abdelaziz Kooli, who is president and CEO of the company. Mr. Kooli started his career in the textile industry, doing studies in France and then working for several years with the textile business. He got into the paper business for the first time in 1974, when he started a paper distribution company mainly working with printing and writing paper, as well as packaging grades.

In 1979 he began considering the idea to start tissue production in Tunisia as the country had no local suppliers of jumbo rolls at that time. In 1982, after further analysis of the market potential, Kooli created Tunisie Ouate. For the mill site the company chose an industrial location in Enfidha, not far from the beach areas of Sousse, about 100 km south of the capital city of Tunis. Thus in 1984 PM1, a two-meter wide fourdrinier machine from the Italian supplier Gino Celli, started up. At only 2-m wide, that first machine is not big by world standards.

However, says Kooli, “at that time, in Tunisia, it was truly a big step.” Based on this machine, which initially produced 3,000 tons per year but was rebuilt several times to bring capacity up to 5,000 tons per year, Tunisie Ouate built a very strong position on the Tunisian market for jumbo rolls.

THE FIRST CONVERTING OPERATIONS STARTED IN TUNISIA AROUND 1980, says Kooli, and when the company’s PM1 started in 1984 there were three or four converters. Now, it is estimated that there are about a dozen in the country.

Tunisie Ouate has grown with the market in the 20 years since the first machine started up. Of course, growth has taken place at a rather slow pace, with cultural differences based on religion as well as tradition meaning that tissue is not widely used in the Islamic countries.

However, the company has been very successful as a supplier of jumbo rolls to the Tunisian market, as well as exporting to other neighboring markets such as Algeria and Libya. It is estimated that Tunisie Ouate now supplies about 80% of the jumbo rolls used in Tunisia.

AFH CONVERTING STARTED IN 2000. Recently, in 2000, Mr. Kooli decided to enter the tissue converting sector, concentrating on the away-from-home (AfH) or commercial business, a market that Kooli says hardly existed in Tunisia at the time. “We had seen how the AfH products had grown so well in other more developed markets such as in the European countries. Therefore we thought we could build a similar business here in Tunisia.”

To carry out that task, a separate company called SIPP (the French acronym for Société International de Production de Papier) was created to be the converting arm of the family owned group. Thus Kooli started its first tissue converting operations in 2000 with the launch of a product line aimed at the Away-from-Home tissue market. The product line is broken into industrial, medical, hotel and family areas and, to market and sell these products, a third company called Paco was started. In addition to the tissue products, Paco also carries a wide range of tissue dispensers and other supplies for the AfH customers.

GROWTH PLAN WITH AN EMPHASIS ON QUALITY. As the company looked further down the road into the future, it became clear that more papermaking capacity and perhaps more converting equipment would be needed to allow the company to grow further. With one small paper machine, Tunisie Ouate recognized that it might be risky to remain dependent on only one machine. At the same time, the company was concerned about the possibility of low-price imports flooding the market as import tariffs are gradually being reduced.

Thus the management team took the decision to follow a two-part strategy for growth. These included, primarily, installation of a modern crescent former tissue PM to make higher quality tissue and, secondly, the move into finished consumer products to help develop a greater level of quality consciousness on the market.

“We are moving into the consumer tissue market to try to build the market further in Tunisia,” explains Abdelaziz Kooli. “We see a big potential in the market, as do other tissue producers outside the country. Basically we are making a proactive move to combat low-quality imports that might come into the country.”


“We are concerned,” says Kooli, “that we may face a flood of finished products imports as Tunisia is now part of the WTO and import tariffs are gradually being reduced. If imports flood the country, not only will we lose our market for jumbo rolls, but the Tunisian converters, meaning our domestic customers, will also lose their market as well. Therefore we took the decision to invest in the high quality paper machine, as well as high quality converting lines.

As far as the concern that his domestic customers might not be pleased that their supplier of jumbo rolls is moving into converting, Kooli says that this is not the case. “We do not see the move into high-quality consumer products as being competitive with our present customers here. On the contrary, by moving into the higher end consumer products and raising the quality awareness on the market, we think that it will support the other Tunisian converters.”


Sales and marketing activities are carried out by Med. Ali Kooli, son of Mr. Kooli. Concerning the Tunisian market and the growth potential, he is confident that the company can stimulate growth. “We intend to grow the market by promotion and marketing activities that will raise the per capita consumption here. We are on a very low level of about 0.6 kg per person per year. Even in neighboring Libya, the per capita use is much higher at 2 kg. So we see part of our job to educate the Tunisian consumer about the simplicity and convenience of tissue products in their daily lives. Of course we are also going to push the higher quality that we have to offer and the benefits it gives.”

Kooli’s idea is to serve the consumer market with three different product lines. The top of the line will be the Lotus brand made under license from Georgia-Pacific. A new brand being created by Tunisie Oaute under the name Kotiss is presently being launched by the company. This will be positioned as a quality brand but not quite up to the level of Lotus. Finally, the third line will be an economical and environmentally-friendly product based on recycled fiber, made on a new Lamort deinking line that is being installed to feed PM1. Presently both paper machines use 100% virgin fiber, with market pulp purchased from suppliers around the world.

The agreement with GP, says Kooli, gives SIPP the right to produce and market the Lotus brand for the consumer products line including facial tissue, toilet tissue, kitchen rolls and table napkins. The countries covered by the agreement include Tunisia of course, as well as Libya, Egypt, Sudan and Iraq. Essentially by installing the new PM2 the company was able to meet the quality specifications to be certified for Lotus quality.

“With the three lines,” says Med. Ali Kooli, “we feel we will be able to offer the customers a wide range to meet all possible needs from the market. We want to create a different attitude on the market, which will lead to higher consumption.”

PM FROM PMT ITALIA. PM2 is a 2.75-m wide crescent former from PMT, the Italian supplier based in Pinerolo, Italy, that was created out of the former Beloit Italia operations. The machine is a very modern machine designed for high quality tissue production. The PM2 project involved an investment on the order of 22 million dinars or about US$19 million; including the machine and all the associated auxiliary equipment.

Besides PMT, other important suppliers for the PM2 project included Honeywell Measurex for the QCS and DCS systems, Siemens for the automation and SEEI for the electrical installations.

Quality from the new PM2 has been excellent, says production engineer Ghassen Kooli. In fact, as an indication that the quality is up to the highest international quality standards, the company is presently exporting jumbo rolls to major converters in the Italian market. Says Kooli, “We think the fact that we are selling jumbos to one of the biggest players on the Italian market, as well as the fact that we have GP certification for quality, is a very strong indication that we are up to the best international levels.” To handle the large expansion into finished products, a brand new converting facility is being built about one km down the road from the Tunisie Ouate paper mill in Enfidha. The new converting plant has a covered surface of 6,000 sqm and will include extremely modern converting lines from suppliers such as Perini, Italconverting, and Winkler + Dunnebier.

PM3 ALREADY BEING CONSIDERED. Turnover at the company is projected to be about US$15 million in 2004. If all goes according to plan, Mr. Abdelaziz Kooli expects that turnover will reach around US$23 million by 2006. Looking further out into the future, Kooli is already planning the installation of the company’s next tissue machine, number 3, in 2008.

“If the market grows as we expect it to, we will need a third machine around 2008 to maintain our market leading position. Most probably it would be a 2.75-m wide machine like PM2.”While Mr. Kooli has big plans for the Tunisian market, he does not want to sound too boastful about the results just yet. “Please come back next year,” he says, “then we’ll have a lot more to show you as the new converting facilities will all be up and running. And we will be able to tell you about how we are progressing in our plans to develop the Tunisian market.” •

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