Opportunity’s Still Knocking

Even amid turbulent economic times, flexible packaging converters find ways to improve their bottom lines.

“Efficiency is now the word,” comments Dr. Rani Stern, global head of research and development, CLP Industries, Ltd., on the current state of this industry. “From raw material through setups and changeovers, high-speed, in-line lamination and reduction in waste, we are all about efficiency. [CLP] accomplishes it through thorough training and by implementing international standards. Improving our efficiency gives us the opportunity to be very competitive in price compared with our competitors.”

Success stories

Innovation has proven to be the secret to success for many companies. Stern cites double-gusseted pouches as one example. “This is a new era for us as our double-gusset pouch reaches shelves in Europe [soon],” he says. “Its unique technology allows us to accommodate more volume in a pouch that stands rigid on the shelf and is easy to handle and dispense from. We are seeing a lot of interest in Europe and the States among manufacturers of beverages and other liquids, sauces, and gels.”

Innovation helped fuel continued growth in 2008 for Sonoco. Extending its Smartseal™ easy-open and reclosable packaging for Kraft Foods’ Nabisco® cookies was a big part of that growth. In fact, according to its annual report, Sonoco is focusing on increasing flexible packaging sales in fast-growing markets like hard-baked goods and confectionary. 

The company also devotes significant R&D to deliver new sustainable packaging solutions for its customers without sacrificing performance or aesthetics. Sonoco cites its one-pound bags for PJ’s Coffee that comprise a three-layer structure of polyester, foil, and polyethylene sealant as one example. The structure yields a bag that uses 10 percent less material and 15 percent less energy, while generating 10 percent fewer carbon emissions compared to a traditional, four-ply structure.

At Bemis Company, flexible packaging accounted for $3.2 billion in net sales during 2008, about 84 percent of the company’s total net sales. “This has been a demanding year for our flexible packaging business,” says Bemis President and CEO Henry Theisen. “We recorded improved sales volumes in several of our key markets, including packaging for meat and cheese, dairy and liquids, and medical markets. The benefits of this sales growth were offset by declines in sales volume for protective display films as well as packaging for industrial, confectionery, snack, pet food, and multipacks markets.”

According to Theisen, the company moved to recover increasing raw materials costs during the second half of 2008, but economic conditions during the fourth quarter created a difficult operating environment for many of Bemis’s businesses. Be that as it may, Theisen claims, “We are entering 2009 with a strong core business and well prepared to react promptly to future market fluctuations.”

Where it’s at

Though the market has slowed, and negative growth is expected, there are opportunities to be had out there.

For Stern, the economy has been an opportunity. The company recently invested in a new flexo machine—a Windmoeller & Hoelscher 47˝, eight-color press that runs up to 1,640 fpm. “Because of the world economic situation, we were able to get it in quite a short time. It will be installed in May,” he says.

Until things stabilize, though, converters will continue to adjust their businesses as necessary. “Of course, we can’t ignore the economy,” Stern says. “In some markets we still keep going like we did before. Some markets have been more negatively affected. At CLP, we have decided to see this as an opportunity.” pP

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