Buena Park-based Dr. Fresh Inc. is bringing more brands to Orange County.
Just months after the maker of toothbrushes, dental floss, mouthwashes, hand sanitizers and other goods expanded and outfitted its headquarters to make more products here, Dr. Fresh has acquired the Binaca, Tek and Dantax brands from bankrupt consumer products company Ascendia Brands Inc. of New Jersey.
Chief Executive Puneet Nanda is mum about how much Dr. Fresh paid for the brands but said the transaction was a one-time, all cash deal that closed earlier this month.
Industry sources estimate the transaction to be valued at more than $3 million.
Dr. Fresh generates $50 million in yearly sales making dental and personal care products under the Dr. Fresh brand and under licenses from companies such as Walt Disney Co., Marvel Entertainment Inc., Cadbury PLC and Church & Dwight Co.
Its products are sold through discount retailers and drug stores, including Wal-Mart Stores Inc., Target Corp. and Walgreen Co.
The company also sells products in 40 countries.
Dr. Fresh’s acquisition of the Binaca, Tek and Dantax brands is part of the company’s ongoing efforts to tap the adult oral hygiene market, Nanda said.
“The acquisition is priceless,” Nanda said.
The company has carved a niche in the children’s consumer products industry with its Firefly light-up and cartoon character-inspired toothbrushes, toothpastes, mouthwashes and other goods.
The popularity of Dr. Fresh’s own brand of products among adult consumers has grown steadily over the years, Nanda said.
The company made a recent push to attract adults with its Dentyne mouthwash, a license that Dr. Fresh acquired from Cadbury earlier this year. The deal also includes rights to use the Trident name.
The company has pushed international sales for its Aim and Pepsodent licenses.
Binaca, big in the 1980s among smokers, has faded in the U.S. in recent decades. But it was the brand’s strength in international markets that first attracted Nanda, he said.
He used Binaca toothpaste while growing up in India.
“In India, the Binaca brand was bigger than Colgate,” Nanda said.
Ultimate Prize
Nanda said he has kept a watchful eye on Binaca since starting Dr. Fresh in the U.S. in 1998.
He wanted to license Binaca when Energizer Holdings Inc.’s Playtex Products Inc. owned the brand, but his inquiries were met with no response.
He reached out to Ascendia when it purchased the Binaca brand but still could not get a license for it, Nanda said.
Ascendia filed for bankruptcy protection in August.
At the time, Nanda opted to bid on the Binaca brand and others.
The plan now is to revamp its newly acquired brands with improved products, packaging and marketing, Nanda said.
“I want to breathe fresh air into these brands,” he said.
Binaca will be the first to get a boost, Nanda said.
Dr. Fresh plans to take Binaca into mouthwash and toothpaste and away from its initial niche as a product for smokers.
Plans for breath mints and gum also are in the works, Nanda said.
The brand, which was created in 1928, has an 83% consumer recognition rate, according to marketing researchers.
Advertising Push
The plan is to create a marketing campaign that will make Binaca cool again, Nanda said.
Dr. Fresh plans to roll out an advertising campaign for Binaca, which includes television and radio commercials and magazine advertisements.
The company plans to hit the college scene hard with promotional giveaways and events.
A local factory now makes the Binaca products, Nanda said.
Dr. Fresh plans to eventually move production of its Binaca products to its 100,000-square-foot headquarters, where it recently opened a 25,000-square-foot factory that makes its Dentyne mouthwash.
The company plans to expand to make toothpaste at its headquarters next year, Nanda said.
Its long-term goal is to make most of its products in Buena Park, he said.
To accommodate the company’s local manufacturing push, Dr. Fresh has signed a lease on another building in Buena Park that will handle warehousing and distribution, Nanda said.
Dr. Fresh embarked on a plan to make products locally at the start of this year.
That could put a strain on Dr. Fresh’s business plan, which for years has relied on low prices to help it compete with big rivals including Procter & Gamble Co. and Johnson & Johnson.
Dr. Fresh products sell for less than $5,a price that has been made possible by manufacturing products cheaply in China.
But growing scrutiny from consumers after last year’s massive chain of recalls for toothpastes, toys and pet foods made in China prompted Dr. Fresh to move manufacturing to the U.S.
“More consumers want products made in the U.S.,” he said. “That’s boosting our business.”
But Dr. Fresh, like many local manufacturers, has to deal with high material costs, labor wages and insurance premiums.
The economic downturn, which has cut consumer spending, hasn’t impacted Dr. Fresh’s sales, Nanda said.
“Companies are cutting back on everything because they’re having a hard time selling their products, but we’re not,” Nanda said. “We expect our sales to grow more than 28% this year and we see a similar growth pattern for the next six months in 2009.”
