Sakal moves to expand military supply business

Emily Pacey

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United Nations troops based in Lebanon boost Israeli military duty-free retailer

Israel-based diplomatic and military retailer Sakal Bros is in negotiations with a number of unnamed United Nations (UN) forces to supply their personnel with duty-free goods. Sakal already runs five military shops in the Middle East, and supplies about 13 outlets.

The retailer is keen to take advantage of the dramatic increase in the number of UN troops based in South Lebanon since violence erupted between Hezbollah and Israeli forces last July. There are about 20,000 troops in South Lebanon.

Sakal buyer Serge Lewkowicz told RavenFox.com: “The increase of foreign soldiers in the region has prompted us to seek to either open our own shops or supply stores at military bases. We have closed deals with some European forces already and are in discussions with several other organisations with regard to supplying them.”

Lewkowicz refused to name the European forces the company was in discussions with. However, he described the importance of being aware of cultural differences between forces from different regions:

“We try to bring people products from their own countries to make them feel more at home – I bring certain flavours of Pringles crisps for US forces, for example. It is also crucial for us to supply goods that do not have Hebrew on the labels, since UN forces want to be neutral here. It is difficult but the fact is our suppliers understand the special needs that we have.”

Sakal’s biggest suppliers in the tobacco, liquor and confectionery categories are Philip Morris, British-American Tobacco, Japan Tobacco International, Diageo, Maxxium, Brown-Forman, Nestlé, Masterfoods, Kraft and Lindt.

Lewkowicz is optimistic about Sakal’s opportunities for growth over the next few years. He said: “In 2–3 years business should be booming because more and more forces are coming here. However, we didn’t forecast what happened last year so it is difficult to say what will happen in the future.”