Casualties Of Phwoar: Condom Maker Goes Bust Over Russian Trade Ban
Tough Russian trade sanctions have caused Europe’s largest condom manufacturer to flop.
The company – founded in 1987 and which produces more than 200 million condoms a year – has applied for insolvency in Germany, axing more than 100 jobs.
Makers CPR GmbH – in Sarstedt, Lower Saxony – relied heavily on exports to Russia to keep their business afloat.
Around 25 percent of the firm’s entire production run was exported to Russia before the sanctions.
Now trade bans – sparked by Russia’s invasion of Ukraine – means the firm’s financial bubble has burst.
Lawyer Karina Schwarz has been appointed provisional insolvency administrator, records from Hildesheim district court have revealed.
One in four of the condoms the firm produced were sold in Russia before sanctions began to bite.
But now the firm, founded in 1987, has become a victim of sanctions against Russian President Vladimir Putin.
The company was told that they could only be paid in Russian Rubles for sales there, and the bank said that while they could accept the Rubles, they would not be able to pay it out into euros because of the sanctions.
The German condom manufacturer is one of the first companies in Europe to have to close because of the sanctions.
For a long time, the company was mainly active as a private label manufacturer of condoms for drugstore and supermarket chains such as Rossmann and Rewe.
In order to be able to compete against cheaper providers, CPR began a few years ago to build up its own brands such as Siko, online platform Mein Kondom and Crazy Monkey.
In addition, CPR is active on the market as a manufacturer of special machines for condom production.
Before the beginning of the Ukraine war, company founder and CEO Michael Kesselring was still confident that CPR would continue to grow.
And indeed the business had become more profitable and the brand business had also developed well, Kesselring said a year ago before the sanctions hit.
Following Russia’s invasion of Ukraine in February 2022, the United States, the European Union, and other countries introduced or significantly expanded sanctions to include Vladimir Putin and other government members, and cut off “selected Russian banks” from SWIFT, triggering the 2022 Russian financial crisis as the massive international boycott of Russia and Belarus was imposed.