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Dr. Fresh Moving Manufacturing from China to Buena Park HQ

Buena Park-based Dr. Fresh Inc. is pushing tooth and nail to move its manufacturing from China to Orange County.

The maker of toothbrushes, toothpastes, mouthwashes, dental floss, hand sanitizers and other goods will begin manufacturing products out of its new 5,000-square-foot lab at its recently expanded 100,000-square-foot headquarters.

Dr. Fresh generates $44 million in yearly sales making dental and personal care products under the Dr. Fresh brand and licenses owned by companies such as Walt Disney Co., Marvel Entertainment Inc., Cadbury PLC and Church & Dwight Co.

Its products are sold directly to stores operated by discount retailers and drug stores, including Wal-Mart Stores Inc., Target Corp. and Walgreen Co.

For years, Dr. Fresh has carved its niche in the personal care products industry against big rivals such as Procter & Gamble Co. and Johnson & Johnson by keeping its prices low.

Dr. Fresh products sell for less than $5, which is 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, is pushing Dr. Fresh to change the way it does business.

Dr. Fresh never had to recall toothpaste but the company wants to revamp its image among American shoppers by touting products that are made in the U.S., said Puneet Nanda, founder and chief executive.






Nanda: “products made in America reassure our customers”

“Consumers are skeptical about products that are made in China especially when it comes to toothpaste,” Nanda said. “Having our products made in America reassures our customers that they’re safe.”

The company decided to move production to OC earlier this year.

Dr. Fresh leased an additional 40,000 square feet of space at its 60,000-square-foot headquarters about six months ago.

The extra space will be used to warehouse more products and could be used for manufacturing space, Nanda said.

The company beefed up its local employee count from 64 workers to 100 people with a bulk of the newcomers working in manufacturing and warehousing, Nanda said.

Dentyne mouthwash, a license that Dr. Fresh acquired from Cadbury earlier this year through a deal for Trident, will be the first product made out of the newly built Buena Park lab.

The mouthwash is currently made at a factory in Chino Hills and is sold at Target stores nationwide, Nanda said.

The company’s toothpastes, dental floss, hand sanitizers and other products are currently made at contracted factories in Los Angeles and the Inland Empire, Nanda said.

Dr. Fresh could eventually move manufacturing of these products to the company’s Buena Park headquarters, he said. Toothbrushes, which are made at Nanda’s family-owned and -operated factory in India, will continue to be made there.

Rising fuel costs, increased Chinese employee wages and a slower economy were other factors that contributed to Dr. Fresh’s decision to manufacture products locally.

“It used to be really expensive to make products locally but with the weak dollar and the appreciation of fuel, materials and wages going up overseas it’s not a bad alternative to make products in the U.S.,” Nanda said.

By making toothpastes, mouthwashes and other goods locally the company will have the option to manufacture less if demand for Dr. Fresh products wanes because of a weak economy, Nanda said.

“We want to take it slow in this economy by having more control over what we produce and how much of it we need,” he said.

Challenges affecting California manufacturers such as high minimum wage rates and insurance costs are hurdles Dr. Fresh will have to deal with.

“We’re very worried about the rising labor and insurance costs,” Nanda said. “Being in California has its pluses and minuses.”

Last year the company toyed with the idea of going public but Nanda wants to put those plans on hold until the economy improves, he said.

The company doesn’t have investors and receives many buyout offers from private equity firms but Nanda isn’t interested in such a deal right now, he said.

This year, Dr. Fresh plans to expand its international business through its Aim and Pepsodent licenses. The company sells products in 40 countries with the help of international distributors.

“We’re growing leaps and bounds in Europe and Latin America with those brands,” he said.

Disney’s Hannah Montana and High School Musical and Marvel’s Spider-Man and Hulk licenses are keeping the demand for Dr. Fresh’s children’s products strong.

Dr. Fresh’s signature Firefly light up toothbrush, mouthwash and soap line remains a company best seller, he said.

This year, the company plans to create more products for its adult line, Nanda said.

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