The French Packaging Machinery
Market
Analysis of Sales Potential for North
American Machine Suppliers
May 2003
Prepared for PMMI by:
11, rue de Buci
75006 Paris, France
www.idaconsulting.com
TABLE OF CONTENTS
EXECUTIVE SUMMARY ...........................................................................................................................................4
Strategic Guidance and Recommendations:............................................................................................... 9
I.
ECONOMIC/ POLITICAL/ FINANCIAL ISSUES ..................................................................................12
1.1.
1.2.
1.3.
II.
NATIONAL ECONOMIC P ERFORMANCE AND TRENDS ........................................................................ 12
POLITICAL OUTLOOK ............................................................................................................................... 14
ISSUES AFFECTING THE POTENTIAL OF PACKAGING MACHINERY IMPORTS TO F RANCE .......... 15
FRANCE’S PACKAGING MACHINERY MARKET ............................................................................17
2.1.
2.2
2.3
2.4
2.5
2.6
2.7
2.8
2.9
2.10
2.11
III.
MARKET S IZE AND POTENTIAL .............................................................................................................. 17
PACKAGING MACHINERY TRENDS 2000-2005 .................................................................................. 17
BEST PROSPECTS FOR PACKAGING MACHINERY SALES 2003-2005 .......................................... 18
DOMESTIC MACHINERY PRODUCTION ................................................................................................. 19
IMPORTED MACHINERY ........................................................................................................................... 22
COMMENTS ON NORTH A MERICAN PACKAGING MACHINERY /SUPPLIERS ................................... 24
MARKETING TECHNIQUES AND PRODUCT EXPOSURE...................................................................... 25
EQUIPMENT F INANCING .......................................................................................................................... 27
MARKET D RIVERS – FACTORS THAT INFLUENCE PURCHASING D ECISIONS ................................ 27
R EGULATORY FRAMEWORK ................................................................................................................... 28
IMPORT D UTIES ......................................................................................................................................... 30
PACKAGING MATERIALS/CONTAINER MANUFACTURERS ...............................................31
3.1
3.2
3.3
3.4
3.5
3.6
IV.
4.1
4.2
4.3
4.4
FRENCH MARKET OVERVIEW AND STRUCTURE................................................................................. 31
PAPER PACKAGING .................................................................................................................................. 33
PLASTICS PACKAGING............................................................................................................................. 35
GLASS PACKAGING .................................................................................................................................. 38
METAL PACKAGING .................................................................................................................................. 40
W OOD PACKAGING .................................................................................................................................. 42
THE FOOD INDUSTRY............................................................................................................................43
FOOD INDUSTRY OVERVIEW .................................................................................................................. 43
KEY PLAYERS ............................................................................................................................................ 45
SUMMARY OF INTERVIEWED COMPANIES ............................................................................................ 45
COMPANY PROFILES ................................................................................................................................ 48
Amora Maille ................................................................................................................................................... 49
Beghin Say S.A. .............................................................................................................................................. 52
Bonduelle S.A. ................................................................................................................................................ 55
Brossard S.A. .................................................................................................................................................. 58
Cadbury France.............................................................................................................................................. 61
Candia S.A. ..................................................................................................................................................... 63
Cogesal Miko France..................................................................................................................................... 66
Fleury Michon S.A. ......................................................................................................................................... 69
Fromageries Bel S.A. ..................................................................................................................................... 73
Harry’s France................................................................................................................................................ 77
Kraft Foods France........................................................................................................................................ 80
Lactalis S.A. .................................................................................................................................................... 83
LDC Le Gaulois S.A. ...................................................................................................................................... 86
Nestlé France.................................................................................................................................................. 90
Saveurs de France......................................................................................................................................... 94
Socopa S.A. .................................................................................................................................................... 97
Tipiak S.A. ..................................................................................................................................................... 101
Unilever Best Foods France....................................................................................................................... 104
Yoplait S.A..................................................................................................................................................... 107
2
V.
THE BEVERAGE INDUSTRY .................................................................................................................. 110
5.1
INDUSTRY OVERVIEW ............................................................................................................................110
5.1.1 Non-Alcoholic beverages ................................................................................................................ 110
5.1.2 Alcoholic beverages .......................................................................................................................... 111
5.2
KEY PLAYERS ..........................................................................................................................................112
5.3
SUMMARY OF INTERVIEWED COMPANIES ..........................................................................................112
5.4
COMPANY PROFILES ..............................................................................................................................115
L’Abeille S.A. ................................................................................................................................................. 116
Brasseurs de Gayant................................................................................................................................... 119
Castel Freres S.A. ........................................................................................................................................ 122
Coca-Cola France ........................................................................................................................................ 126
Danone S.A. .................................................................................................................................................. 129
Heineken France .......................................................................................................................................... 132
Kraft France................................................................................................................................................... 136
Kronenbourg S.A. ......................................................................................................................................... 139
Orangina Schweppes S.A. .......................................................................................................................... 143
PepsiCo France............................................................................................................................................ 147
Perrier Vittel S.A. (Nestlé Waters)............................................................................................................. 151
Taittinger S.A. ............................................................................................................................................... 154
VI.
6.1
6.2
6.3
6.4
THE PERSONAL CARE INDUSTRY............................................................................................... 157
INDUSTRY OVERVIEW ............................................................................................................................157
KEY PLAYERS ..........................................................................................................................................157
SUMMARY OF INTERVIEWED COMPANIES ..........................................................................................157
COMPANY PROFILES ..............................................................................................................................160
Beiersdorf France......................................................................................................................................... 161
Chanel S.A. ................................................................................................................................................... 165
Parfums Christian Dior................................................................................................................................ 168
Guerlin S.A. ................................................................................................................................................... 171
Lever Fabergé France................................................................................................................................. 174
Laboratoires Pierre Fabre S.A. .................................................................................................................. 178
Proctor & Gamble France........................................................................................................................... 181
Laboratoires Vichy (L’Oréal)....................................................................................................................... 184
Yves St. Laurent Beauté ............................................................................................................................. 186
VII.
7.1
7.2
7.3
7.4
THE PHARMACEUTICAL INDUSTRY............................................................................................ 190
INDUSTRY OVERVIEW ............................................................................................................................190
KEY PLAYERS ..........................................................................................................................................190
SUMMARY OF INTERVIEWED COMPANIES ..........................................................................................191
COMPANY PROFILES ..............................................................................................................................193
Abbott France................................................................................................................................................ 194
Baxter France................................................................................................................................................ 197
Pfizer France................................................................................................................................................. 200
Proctor & Gamble Pharmaceuticals S.A. ................................................................................................. 203
Schering-Plough France.............................................................................................................................. 207
3M Santé........................................................................................................................................................ 210
Groupe UPSA............................................................................................................................................... 213
APPENDIX A – S.W.O.T. ANALYSIS: NORTH AM ERICAN EQUIPMENT IMPORTS TO
FRANCE. .................................................................................................................................................................... 216
APPENDIX B – IMPORTS OF PACKAGING MACHINERY - BY COUNTRY OF ORIGIN......... 217
APPENDIX C – KEY INDUSTRY CONTACTS............................................................................................. 218
3
Executive Summary
In response to member company interests to identify promising, new international
markets, the Packaging Machinery Manufacturers Institute (PMMI) has begun to
evaluate the market potential and identify concrete business opportunities in a
number of countries. With this objective in mind, the follo wing document
investigates the French market for packaging machinery.
The report has been prepared by IDA Consulting, an independent, U.S.-owned
company operating from Paris and specializing in market, economic and policy
analysis across a wide range of b usiness and industrial sectors. The underlying
research methodology drew on the collection and analysis of information
gathered from primary and secondary sources in France, including executive
interviews, questionnaire responses, and key trade contacts.
The report is organized into seven main sections, which move from the general
to the specific in order to convey the parameters governing the French market for
packaging equipment. In this respect, the first section provides an analysis of key
economic and political trends in France, and discusses relevant issues affecting
imports of North American packaging equipment. The second section provides
an overview of the French packaging machinery market and summarizes, in
general terms, the findings from the market research and executive end -user
interviews in the four customer segments. This chapter also examines the import
and regulatory framework governing the import of packaging machinery into
France and the European Union.
Beginning with section three, the report takes a closer look at the companies and
products which comprise the French packaging materials markets, including a
ranking of top container suppliers in the principal sub-sectors, and packaging
material market shares by container type. The last four sections outline the
findings from the end-user interviews, including industry overviews and
assessments of market trends, competitive structures, customer evaluations, and
potential sales opportunities. Detailed company profiles and contact information
are included in each of the four chapters.
Economic and Political Outlook
Despite the recent global economic malaise, cutting across industry sectors and
continents, France seems to be weathering the global economic slowdown better
than its European neighbors. The current center-of-right government, which has
been taking the appropriate measures to shore up public finances and to push
through essential market reforms, has the potential to enable France to break
from historic constraints on trade and e nable it to enter a new, market-based era.
These relatively new macro developments bode well for foreign investors and
importers, regardless of the business or sector.
4
Vis-à-vis the recent geo-political dislocations driven by the Iraq War and the
perceived implications for Franco-American relations, it is worth noting that
France is one of America's longest-stranding trading partners. The two countries
have been linked for more than two centuries by diplomatic and military alliances
and a rich complex of cultural, intellectual and economic ties. Despite recent
high-profile differences on international political and trade issues, governments
and businesses in both countries are committed to the long term development of
greater trade and investment for the mutual benefit of their economies. Our
interactions with French executives have borne this out, as a majority of
companies expressed their commitment to continued open trade with the U.S.
and willingness to work with U.S. machine suppliers.
Furthermore, the recent appreciation of the euro against the U.S. dollar appears,
at least at this point in time, to be a considerable source of increased import
competitiveness for North American packaging machinery suppliers.
France’s Packaging Machinery Market
The French market for packaging machinery is the second largest in Europe
behind only Germany, and just ahead of the U.K. and Italy. France, positioned at
the heart of Europe with a highly-skilled, diverse labor market, hosts one of the
world’s premier manufacturing and end-user bases for packaging machinery.
The four end-user segments surveyed for the production of this report are among
the country’s largest, and most dynamic industrial sectors. France’s mild climate
and fertile soil provides it with one of the largest agricultural activities in the
world. Historical and cultural links to the personal care and luxury products
industries have allowed French producers to become leading competitors in
global markets. In this same light, years of intense investment in research and
development as well as the country’s privileged geographical location has led
France to become the Europe’s largest pharmaceutical manufacturing bases.
Although domestic manufacturing of packaging machinery is diverse and
competitive, France relies heavily on machinery imports, which account for
roughly 65% of the overall market. European packaging equipment imports,
particularly from Germany and Italy, are market leaders with strong penetration
rates in the major end-user segments.
Data gathered during our research shows that German machinery penetration is
especially strong in the food and drink segments, with an estimated market share
of roughly 40%. As is outlined in section four, this leadership position can be
attributed to a number of competitive advantages for German technology,
including a long history of quality and a strong brand image for reliability and
durability in high-production volume environments.
5
Italian full-line packaging equipment suppliers appear to ha ve a dominant
position in France’s pharmaceutical and cosmetic sectors, with roughly half of the
market share in both sectors. Our company interviews indicate that Italian
machinery technology is highly sophisticated, and versatile in handling complex
packaging, which are considered critical factors by these end-users. Italian
suppliers have also carved a lion’s share of the market through competitive
pricing strategies, undercutting their main German and French competitors in
these segments.
French machinery presence is also strong in the various customer-installed
bases, with penetration rates between 25-35%. Our findings show that French
packaging machinery manufacturers benefit from local ties and proximity to end users, particularly in the food and beverage domains. Generally-speaking,
French technology appears to be competitive in the four end -user segments, but
mostly in niche segments of each market. It appears that most local machinery
production is driven by strong export demand, particularly to end-user markets
that have less-sophisticated production needs than the domestic market, such as
North Africa, South America and Central Europe.
North American equipment penetration remains limited, with an estimated import
share of between 3-4%. The North American suppliers mentioned in our
company survey all benefited from a European presence, whether through a
local distributor or by means of a direct sales or manufacturing presence. The
strongest penetration rate for North American packaging equipment is in the food
and beverage sectors, and more specifically in end -of-line machinery segment.
Our research also showed market penetration, though considerably less than
France, Germany and Italy, from other countries including Switzerland, Spain,
the U.K., Japan, Sweden, Denmark, and Holland. Most notably, Swiss machine
manufacturer Sig recently reinforced its position in the beverage market through
its acquisition of the Italian liquid specialist Simonazzi.
Information gathered from the executive interviews indicates that despite
uncertain economic conditions most industrial end-users are moving ahead with
investment plans in 2003. Overall, the French market for packaging machinery
remains robust as end -users continue with their plans for plant modernization,
increased automation and augmented production capacity.
Best Prospects for Packaging Machinery Sales 2003-2005
The below list is a snapshot of sales opportunities that were compiled from our
research and company interviews. Our report explores these opportunities in
section four to seven, in which each customer segment is analyzed in more
detail.
6
1. Integrated bottling line machinery
2. Horizontal Form, Fill, Seal machinery
3. Palletizing equipment
4. Flexible packaging machinery
5. Telemonitoring and detection equipment
6. Labeling machinery (digital)
7. Cartoning machinery
8. Coding machinery
9. Blister packaging machinery
10. Multi-packing, grouping machinery
Factors Influencing Purchasing Decisions
Our findings and primary research on the French market indicate that PMMI.
member companies should be sensitive to a number of crucial factors affecting
the packaging machinery investment process. The below list of factors were
extrapolated from the company profiles across the four end -user segments.
Though general in nature, the list should act as a yardstick by which North
American exporters can gauge each factor’s relative importance in the decisionmaking process.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Overall machinery quality (reliability and durability)
Versatility in handling different packaging applications
Service, including availability of local staff and spare parts
Previous experience with supplier
Price-quality ratio
Brand reputation
Production speed
Productivity
Adherence to purchasing specifications
Delivery terms
Trade Barriers and Regulations
Trade barrier and restrictive regulations and/or bureaucratic red tape are
notorious for inhibiting or even precluding robust international trade, even when
other market circumstances are ‘good’. In the case of France, the market for
imports is highly receptive and open, as packaging machinery imports account
for a bulk of the overall market. Moreover, there are no significant tariffs or
technical trade barriers for North American packaging equipment imports. Import
duties remain low and do not represent a significant competitive or cost
disadvantage to North American packaging equipment imports. There do exist,
however, a number of administrative steps which must be taken to gain access to
7
the E.U. These tend to be pedantic and not prohibitive steps and processes,
including the C.E. mark technical certification and adherence to the E.U.
Packaging Machinery directive.
8
Strategic Guidance and Recommendations:
The French market for the purchase and use of packaging machinery is big and it
is competitive. It routinely experiences upswings in growth, sometimes
significant. Packaged products are purchased by sophisticated European
consumers who increasingly seek additional conveniences for storage and
portability. The French rely on imports to meet 65 percent of their demand for
packaging equipment, and have removed traditional barriers to facilitate this
dependence. Moreover, the strong Euro currency provides an immediate
competitive advantage for non-E.U. suppliers. Our assessment is those PMMI.
members, or any manufacturer of quality packaging equipment, looking to
increase sales will find the French market brimming with opportunity.
Making the most of these opportunities will, naturally, call for a strategic
evaluation of both the prospects and downside risks of entering the French
market. The following analysis is presented as a foundation for making these
strategic decisions:
o A high degree of competitiveness in the French market for packaging
equipment means that equipment users understand and demand quality,
price value, and service. Companies will need to emphasize quality and
durability of equipment, especially products featuring high production
speed and rhythm. This needs to be balanced with selecting export
products that are price competitive, but still yield sufficient margins.
Customers surveyed indicated that North American machinery pricing is
competitive in the European market, and that total landed cost including
transport and import duties are not prohibitive. Highlighting European
branches, service contracts, and the ability to communicate attentively will
be important to alleviate distance concerns.
o The French depend on imports to supply 65 percent of their equipment
needs. Although they are major manufacturers of packaging equipment,
much of this machinery is delivered to low-end markets, and not to their
sophisticated domestic packaging industry -- which uses high-end
equipment to satisfy its sophisticated packaging requirements. For this
equipment, France turns to specialists from Germany and Italy.
Companies can take advantage of this ‘open door’ inclination to imports by
marketing high-end product lines, especially those capable of delivering
innovative, leading-edge packaging. The current strength of the Euro
translates to a significant price advantage for non-E.U. suppliers.
o Long-standing ties between European suppliers and French end-users,
European brand awareness (particularly German and Italian), reputation,
and geographic proximity will require PMMI companies to emphasize the
capabilities of ‘North American’ manufacturing technologies to package
9
the innovative products known and used worldwide. Companies can
convey the mid- to long-term advantages of incorporating these
technologies that allow industrial clients to assume or preserve market
leadership positions in Europe. Aggressive communications, the
availability of online spare parts ordering, and the use of European sales
and servicing agents will be critical for ‘closing the continental divide’. In
particular, our research revealed that many French companies not only
use, but prefer internet information and services. Promoting software
systems to allow for real-time or automatic re-ordering of spare parts
online is suggested. Case studies, customer satisfaction, and advertising
legacies will be important for establishing confidence in PMMI brands.
o U.S. machinery currently represents 3-4 percent of the import market.
Although this is a modest share, it demonstrates that the French market is
attainable for North American suppliers. It also establishes precedent and
the opportunity to communicate, as our research has shown, that those
customers currently operating North American machinery consider U.S.
and Canadian equipment to be highly reliable and durable. Further
precedents include: (a) navigating French import regulations; (b)
communicating successes and lessons-learned; (c) service contracts.
Additional research into these early entrants is recommended. In-country
partnerships may provide a streamlined market entry strategy.
o Very simply, France is smaller than North America – from a café chair to
factory space for production lines. Likewise, overall production is smaller
in the European market. For these reasons, good candidate equipment for
the French market will be smaller in actual ‘footprint’ size and more
versatile and flexible in terms of functionality, i.e. shorter, more frequently
changing production runs.
o Presence, Presence, Presence. The French have recently and rapidly
entered the web community, where email communication and web
advertising and sales are increasingly becoming standard industry
practice. In this regard, all “e” communication strategies have great
potential in closing the ‘continental divide’. In addition, and maybe more
importantly, nothing substitutes for in-country presence. The most
effective means to increasing product exposure and testing potential
demand is to exhibit at the two major European packaging trade shows,
Emballage in Paris and Interpack in Dusseldorf, Germany. For a more
targeted approach, companies should attend the CFIA show in Rennes,
which targets food producers. Likewise, companies we interviewed
suggested that site visits to view machinery in operation is an important
factor in their investment decision.
o Advertising is highly effective. In particular, Emballages magazine is the
publication most often consulted by decision-makers across the four
10
customer segments. Emballages covers general packaging and
machinery trends, focusing roughly half of its coverage on food and drink
issues with the rest divided among cosmetic, personal care,
pharmaceutical, and chemical packaging concerns. More targeted
mediums exist, such as Process and RIA magazines, which have strong
readerships in the food, and to some extent beverage, industries.
Finally,
o France features a big and growing marketplace for packaging equipment.
Companies willing and able to compete for market share should take
additional steps to exploit market opportunities and identify prospective
new customers. IDA Consulting is prepared to provide further market
intelligence to PMMI members manufacturing packaging equipment that
fits well with the parameters of the French market as delineated above.
11
I.
ECONOMIC/ POLITICAL/ FINANCIAL ISSUES
1.1. National Economic Performance and Trends
France is the world’s fifth largest economy with an annual Gross Domestic
Product (GDP) of over US$ 1.4 trillion and a per capita GDP of roughly US$
22,000. France is also the fourth-largest exporter and fifth-largest importer of
merchandise goods, and is one of the foremost markets worldwide for imports of
U.S. goods and services. The country has a historical trade surplus with the
U.S., and according to U.S. Department of Commerce 2002 figures, France
imported roughly US$ 20 billion in U.S. goods while exporting close to US$ 30
billion to the U.S. market.
In 2002, France’s GDP grew by 1.2% representing its lowest level since 1996.
The latest figures from the French national statistics office suggest that the
economy is enduring the global slowdown much better than its European
neighbors. GDP grew by 0.3% in the first three months of 2003, compared to a
0.3% and 0.2% decline in the Dutch and German economies respectively.
In the first quarter of 2003, economic activity was boosted by a 0.6% rise in
household spending, which contributed 0.3 percentage points towards the growth
figure. Business investment also rebounded in the first quarter, rising by 0.4%,
following a sharp contraction in the fourth quarter of 2002.
According to the Economist Intelligence Unit (EIU), despite promising first quarter
figures, prospects for a sustained recovery in 2003 remain weak due to
continued slowdown in private consumption and a further contraction in business
investment. The EIU expects the French economy to show signs of recovery, at
the earliest, in the first half of 2004.
GDP Growth Rate Forecast
Real GDP Growth Rate (%)
3
2.5
2.5
2.2
2.1
2
2.1
1.5
1.2
1
0.8
0.5
0
2002
2003
2004
source: Economist Intelligence Unit 2003
12
2005
2006
2007
Consumer spending has historically been the main engine of growth for the
French economy, however rising unemployment, low growth in real wages and
fading overall confidence appear to be taking their toll. Although reductions in
taxation should provide a modest boost to disposable income, private
consumption growth is forecasted to slow to 1.3% in 2003.
As elsewhere in the E.U., the short-term outlook for investment spending in
France remains somewhat bleak. Business investment is forecasted to contract
for a second year running. Many French companies, having over-invested during
the cyclical upturn in 1998-2000, have been left with high levels of debt and
excess capacity. With demand at home and abroad still fragile, corporate
profitability weak and rates of capacity utilization below historical averages,
overall prospects for a recovery in business investment in 2003 remain slim.
Furthermore, the French government does not have much room to use fiscal
policy to spur economic growth. In 2002, weak tax receipts and increases in
public expenditure pushed the budget deficit over the limit of 3% of GDP
established by Maastricht treaty, and it appears likely that it will happen again in
2003 and 2004. The European Commission will press for fines to be imposed if
France’s deficit exceeds the 3% limit for three consecutive years; however, the
government may just be able to avoid this outcome if its current attempt to shore
up public finances is effective before 2004.
Core inflation rose sharply in early 2003, but according to the EIU, should fall
back through the middle of the year following weakening oil prices and the
appreciation of the euro exchange rate. Inflation should average 1.7% over 2003
as a whole, and many projections predict a rate below 2% in 2004.
The euro has appreciated sharply against the US dollar since the middle of 2002
and is trading close to its exchange rate when it was launched. Although the
current euro exchange rate coincides with most estimates of its equilibrium level,
markets have a tendency to overshoot. Should the euro rise further, France’s
growth and inflation profile should be revised down due to slower export growth
and the effects of lower import prices on reducing inflationary pressure.
13
Average U.S. Dollar-Euro Exchange Rate
1.2
US$ per Euro
1
0.8
0.6
0.4
0.2
0
1998 1999 2000 2001 2002 2003 2004 2005
2006 2007
source: Economist Intelligence Unit 2003
France still has to make additional efforts on structural reforms to achieve its full
economic potential and to improve its competitiveness. Identified prime areas for
reform include continued tax and government spending reduction, increased
flexibility of labor markets, and further deregulation of goods and services
sectors.
1.2. Political Outlook
France is one of America's longest standing allies. The two countries have been
linked for more than two centuries by diplomatic and military alliances and a rich
complex of cultural, intellectual and economic ties. Despite recent high-profile
differences on international political and trade issues, governments and
businesses in both countries are committed to the long term development of
greater trade and investment for the mutual benefit of their economies.
The end of the five-year political cohabitation between the president and
parliamentary government in 2002 has brought about a renewed sense of
purpose at home, and assertiveness abroad. The right-of-center government,
headed by Prime Minister Jean-Pierre Raffarin, has the political-backing of
President Jacques Chirac to push through difficult and often unpopular domestic
reform leading to a more market-based economic structure. Recent attempts to
shore up public finances, particularly with respect to Social Security and
pensions, have led to a wave of public protests and strikes in the public and
private sectors. France is under pressure from the European Commission to
reduce its budget deficit under the 3% limit established by the Maastricht Treaty,
and as such is weathering a popular resistance to elimination of long-standing
social benefits.
France under President Jacques Chirac has used its new political solidarity at
home to take on a more visible role in the international arena in attempts to
14
restore the country’s influence in European and World affairs. In particular,
France’s recent opposition to the United States’ position in the Iraqi crisis has
lead to a momentary chill in diplomatic relations between the two nations. It
remains unclear as to the full extent of the fall-out from this high-profile
confrontation, particularly concerning the short-term effects on bilateral trade and
investment.
1.3. Issues affecting the Potential of Packaging Machinery Imports to
France
France’s large manufacturing and packaged product export base can be
characterized as highly diversified, competitive, and closely linked to the state of
the global economy. As a result, many French firms are highly sensitive to shifts
in internal and external demand for goods and services. As noted in the section
above on economic trends, the slowdown in the global economy has affected
overall French business confidence, slowing investment spending in the years
following the cyclical upturn.
Our survey in the four end-user segments, among France’s most importa nt and
dynamic industry sectors, confirms that many manufacturer end -users of
packaging equipment have scaled-back industrial investment over the review
period to correct for earlier over-investment in production capacity. In addition,
continued economic and geo-political uncertainty has pushed many companies
towards a “wait-and-see” investment policy in the first half of 2003.
However, information gathered from our research and company interviews
indicates that manufacturers are indeed proceeding with industrial investment
plans to modernize and upgrade production equipment. In particular, companies
in the sub-sectors showing the most dynamic growth are investing in new
production capacity to meet increased market demand, anticipating a general
economic recovery by the end of 2003, beginning of 2004.
The recent appreciation of the euro against the U.S. dollar represents a major
source of increased competitive advantage for U.S. equipment imports to France.
The euro is expected to maintain a strong excha nge rate level over the forecast
period, which represents a 20-25% increase over average rates in 2001 and
2002.
Trade Barriers:
There do not appear to be any major trade barriers to North American packaging
machinery imports in France. Tariffs remain low and are not considered
significant enough to provide E.U. imports with a notable competitive advantage.
Furthermore, packaging machinery imports must carry the C.E. mark (see
15
section 2.11 “Regulatory Framework”); once this process is complete, C.E.
marked imports have a “passport” to enter and circulate freely within any
European Union market.
The major “barriers” to entrance for North American packaging equipment are the
attitudes and perceptions of the end-users with respect to distance, presence in
Europe, ability and capacity to ensure proper servicing, and overall commitment
to the French market. As is noticeable in customer evaluations of packaging
machinery in the company profiles, many manufacturers expressed reservations
regarding North American suppliers in these areas. For more specific examples
of customer perceptions, please consult “Company Profiles” sections in chapters
four to seven.
It is also the opinion of this report that recent tensions between France and the
United States will not have a major impact on trade in packaging machinery in
the long term. For the most part, industrial decision-makers base their
investment decisions on more concrete factors as outlined in section 2.10. This
does not mean that biases towards nationalities do not exist, as it was apparent
that brand reputations associated with a machine’s national origin as well as
historical links between countries play a role in the decision-making process. A
major hurdle for North American suppliers is to overcome the inherent
competitive advantages of the strong penetration rates of French, German, and
Italian machines in the country’s installed packaging machinery base.
16
II.
FRANCE’S PACKAGING MACHINERY MARKET
2.1.
Market Size and Potential
The French market for packaging machines grew by 2 % in 2002 to reach
approximately US$ 1 billion, positioning France as the second biggest package
machinery user in Europe behind Germany, and just ahead of the U.K. and
Italian markets in overall value terms.
The French market has shown slow, stable growth over the review period from
2000-2002, a noticeable difference from the double digit rates in the late nineties
when end-user clients, particularly food and beverage producers invested heavily
in new packaging equipment. This slowdown can largely be attributed to the
slower economic growth and general over investment in production capacity. As
a result, many downstream industries have reduced investment pace following
the boom years of the late nineties to reduce underlying over capacity.
In 2002, the total import market share was valued at US$ 645 million. The
market was dominated by major exporting countries, most notably Germany and
Italy (34% and 31% respectively), followed by Switzerland with roughly 6-8%.
North American machines accounted for between 3-5% of total imports, showing
little progression over the review period.
Industry projections indicate overall growth in packaging machinery imports of
between 10-15% over the next three years, with the import market approaching
US$ 700 million by 2006. This increased share will be largely driven by a
favorable exchange rate for extra-E.U. imports as well as a particularly dynamic
domestic manufacturing end-user base.
The food and beverage sector remains the largest customer segment for
packaging machinery in France with a roughly two thirds market share in value
terms. The pharmaceutical and personal care segments have shown strong
growth due to the increasingly complicated nature of packaging and the
particularly dynamic nature of these segments.
2.2
Packaging Machinery Trends 2000-2005
The French market for packaging machinery is mature, highly competitive, open
to imports, and has good prospects for new growth. The competitive nature of the
market requires that manufacturers compete on numerous fronts: price, quality,
production efficiency, servicing, delivery speed, and innovation. In the future,
manufacturers hoping to increase market share in France will need to adapt
quickly to customer requirements and specification, and to do so more quickly
17
than the competition. Our findings indicate the following general trends in the
industry:
2.3
•
Increased consolidation in end -user segments has led to more purchasing
power and better bargaining leverage in their dealings with suppliers of
manufacturing equipment. As a result, packaging machinery
manufacturers are experiencing overall downward price pressure in its
principal markets, which is expected to hinder overall value growth,
despite stable volume growth in the market
•
As demand increases for more integrated packaging processes, form, fill
and seal (FFS) machinery is forging ahead as the leader over pre-formed
packaging in the food segment. In particular, integrated FFS technology
allows for lower unit costs in high production environments, and
significantly reduces logistics, transport, and stocking costs. Over the
review period, form, fill, and seal technology has also shown strong growth
in beverage production (mineral water, beer, and soft drinks) and dairy
packaging (yogurt and milk).
•
Decision-makers are placing increasing importance on flexibility and
versatility of packaging equipment. More sophisticated packaging
requirements and fast-changing market trends across the four end-user
segments are driving machinery innovation in order to accommodate
increasing packaging applications.
•
Given the highly competitive and mature nature of the French packaging
machinery market, machine suppliers are increasingly competing on aftersales servicing to gain competitive advantage and increase market share.
This trend towards innovative servicing is evident in areas such as remote
video servicing, tele-maintenance, and on-line parts ordering. In
particular, full-line equipment manufacturer, KHS, has recently developed
a video repair and maintenance system called the “Remote Diagnostic
Service”. Sidel has also come out with a new “Efficiency Improvement
Tool”, which allows for real-time diagnostics.
•
More strict environmental legislation, in particular higher recycli ng targets
set by the E.U. Packaging Waste Directive, will drive innovation in
packaging machinery, as technology must adapt to new materials and
industrial waste targets.
Best Prospects for Packaging Machinery Sales 2003-2005
The below list is a snapshot of the major machine categories representing sales
opportunities for North American suppliers across the four customer segments.
The list was compiled using the information provided by the company interviews
18
and trade industry insiders and should not be interpreted as being exhaustive.
Trade opportunities are explored in more detail in chapters four to seven
dedicated to each end-user segment.
•
•
•
•
•
•
•
•
•
•
•
•
2.4
Integrated bottling line machinery
Horizontal Form, Fill, Seal machinery
Palletizing equipment
Flexible packaging machinery
Detection equipment
Video surveillance
Labeling machinery (digital)
Cartoning machinery
Coding machinery
Blister packaging machinery
Multi-packing, grouping machinery
Case packing and wrapping machinery
Domestic Machinery Production
Domestic packaging machine production accounted for roughly 35% of the
French market in 2001 in overall value terms. In 2002, total local production of
packaging machinery reached an estimated value of US$ 1.4 billion, placing
France as the sixth largest producer of packaging machinery in world. Strong
external demand and an undervalued euro helped to drive the French production
over the past three years, as international markets accounted for roughly three
quarters of French manufacturers overall turnover. Europe is the biggest market
accounting for approximately 40% of French exports, followed by North America
at roughly 25%, Asia-Pacific 15%, South American and the Middle East and
Africa at 10%.
Local production remains highly fragmented, consisting mostly of small- and
medium-sized manufacturers supplying niche market segments.
Local Production by Region:
Region
Ile-de-France (Paris)
Rhone-Alpes
Burgundy
Loire Valley
Other
Country
Number of
Manufacturers
18
10
2
7
37
74
Source: SESSI-EAE 2002
19
Employees
914
570
403
417
1,720
4,024
% of Total
Employment
22.7%
14.2%
10%
10.4%
42.7%
100%
Profile of Local Producers – by Size and Turnover
Size
Micro
Small
Medium
Large
Total
Employees
20 to 49
50 to 99
100 to 249
250 to 499
---
Number of
Manufacturers
Turnover
39
10
11
2
62
157.2
143.2
349.3
847.1
1496.8
US$ millions
% of Overall
Production
Value
10.5%
9.5%
23.3%
56.7%
100.0%
Source: SESSI-EAE 2002
Key Domestic Packaging Machinery Manufacturers
Sidel S.A.
French manufacturer Sidel S.A., recently acquired by the Swedish packaging
group Tetra Laval, is the leading domestic manufacturer, with estimated one -third
share of the overall market. Sidel is considered the leading producer and
innovator of PET blow molding machines for the Frenc h beverage industry.
Following its merger with Tetra Laval, the French company is re-focusing its
efforts on its historic core capability in PET blow-molding and is extending its
product offering to include bottle filling and form-fill-seal process technology.
Sidel has also expanded its market presence through its ownership position in
many key French manufacturers (see table below on “local manufacturers”).
Sidel’s strong financial position has allowed it to invest heavily in product
development, such as its new PET blowing -filling-capping technology, which is
allowing it to be present in more segments and applications. Most recently, Sidel
has concentrated its marketing efforts on entering and expanding its presence in
the beer market.
The bulk of Sidel’s turnover is accounted for by exports, most notably to other
European markets (40%), North America (35%), Asia-Pacific (14%), South
America (7%), and the Middle East and Africa (6%).
Thimonnier S.A: Key Innovator
Thimmonier S.A. is another important player in the packaging machinery market,
not necessarily in terms of overall market share (turnover € 14 million in 2002)
but more so in terms of market-driving packaging innovations. Thimmonier is a
leading producer of flexible packaging machinery and has developed product
20
innovations for food, plastic, medical, and personal care industries and is patent
holder of the Doypack™ stand -up pocket technology. It exports roughly 50% of
its production and an estimated 20 billion pouches have been manufactured
using its technology. Thimmonier’s leadership position in French flexible
packaging, a particularly dynamic growth sector, is expected to leverage this
position increase its market penetration over the forecast period.
Local Manufacturers – ranked by Turnover
Company Name
Ownership
Sidel S.A.
Tetra Laval 91%
Cermex
Tetra Laval via Sidel
Serac
Remy Equipement
Andre Zalkin et Cie
Arcil S.A.
Graffin Family
Tetra Laval via Sidel
Zalkin Family
Danone Groupe
Multivac France
Multivac Sepp
Hagenmueller (Germany)
U.S. ownership
Mead Europe
Erca Formseal
Savoye Nouvelle
Iwke Industrie-Werke
Karlsruhe; (Germany)
Legris Industries
Netra Systems
---
Kalix
Tetra Laval via Sidel
Mécaplastics
---
Stork Systems
Stork NV (Holland)
21
Main activity
Complete line from blowmolding (PET), wrapping,
conveying, to palletizing
End-of-Line specialist;
wrap-around; filmwrapping; cartoners
Filling, capping
Filling, capping
Bottle capping specialist
Thermoform, fill and seal
equipment for fresh
products
Thermoform, sealing
Over-wrapping, group
packaging
Specialist in thermoformfill-seal for dairy products
Cartoning, materials
handling
Conveying, palletizing,
(specialists in PET
bottling)
Filling and cartoning for
the pharmaceutical and
cosmetic sectors
Plastic packaging: formfill-seal, high-speed tray
sealing
Complete line: imprinting
to palletizing
Turnover
2002
548.4
50.8
40.7
38.9
34.4
33.0
31.7
29.1
28.9
24.6
22.5
22.3
19.6
18.1
Hema Technologies
Sabatier
Thimon
Tetra Laval via Sidel
Soudronic AG (Germany)
Chaffardon Family
La Girondine
Thimmonier S.A.
Tetra Laval via Sidel
---
Filling
End-of-line; overwrapping specialist
Flexible packaging;
stand-up pouch
Doypack®
Source: Xerfi 2002; figures in US$ millions
2.5
Imported Machinery
France has a long-standing trade deficit in packaging machinery, as the domestic
market relies heavily on imports, which account for approximately 65% of the
total market. The bulk of total imports originate from the European Union, which
holds an estimated 82% import share in overall value terms. Germany is the
largest exporter of packaging machinery to France with an estimated 33% import
share, followed closely by Italy at 31%, and Switzerland, Spain, Netherlands,
U.K., and Denmark at roughly 5 -6%. The North American equipment share is
estimated at between 3-4% of the overall market.
Import Market Share - France 2002
2% 2%
5%3% 3%
33%
5%
5%
5%
6%
31%
Germany
Italy
Switzerland
Spain
Netherlands
Denmark
United Kingdom
Belgium
United States
Sweden
Japan
Source: PMMI import market figures 2002
In most general terms, German and Italian manufacturers appear to have a
historical know how in packaging machinery technology. Major machine
manufacturers from these two countries hold leading market positions, both in
their domestic markets and abroad. German full-line packaging machinery
manufacturers, such as Krones, KHS, Kisters, and Bosch, have long-standing
reputations for overall quality, reliability, and durability. This quality reputation,
which is often associated to German machinery technology, makes these
22
17.3
15.3
14.7
13.4
11.7
machines popular with the major high volume end -user clients, who tend to be
less price-sensitive and more concerned with reliability and return on investment
over the long run.
Italian manufacturers compete on versatility and pricing, generally providing endusers with a high-level of flexibility in handling complex packaging requirements.
This technical know how coupled with Italian design competencies, render
machines that are highly sophisticated yet relatively user-friendly. This was
confirmed during our company survey, which showed Italian machinery suppliers
holding an estimated 50% market share in the pharmaceutical and cosmetic
sectors, both of which require complex packaging technology. Many of the endusers interviewed also pointed to the competitive pricing of Italian packaging
equipment with relation to quality as a key competitive advantage for these
suppliers.
More detailed analysis on market structure and penetration rates are provided in
chapters’ four to seven under “Summary of Companies Interviewed”.
Foreign Import Market Leader: Krones A.G.
German manufacturer, Krones A.G., which makes complete packaging lines for
the bottling industry, holds the biggest share of the French beverages market
with a dominant position in the filling and labeling segment. Krones has a highly
diversified export base, with more than 80% of its US$ 1.3 billion yearly turnover
generated outside of its home market. Europe is the company’s largest market
accounting for roughly 30% of value sales.
Krones is currently leveraging its market leadership and strong financial position
to invest in new product development, such as an innovative coating process for
PET bottles that was developed with Coca-Cola and Leybold Systems. Other
recent innovations include the Wrapapac™ technology for wrap-around cartons
and trays.
Strengthening Euro: Source of Increased Competitiveness for Extra-E.U. Imports
E.U. machinery imports will experience increased competition from extra-E.U.
imports as the European common currency continues its rise against other major
currencies. Relatively-speaking, U.S. imports have become 20-25% more pricecompetitive vis-à-vis E.U. imports over the course of 2002 and the first half of
2003. This represents a considerable source of increased competitiveness for
North American packaging machinery imports, which have until recently been
penalized by an overvalued dollar exchange rate.
23
2.6
Comments on North American Packaging Machinery/Suppliers
Most of the companies interviewed indicated that they had little information on
North American machinery, and were rarely approached by suppliers with
concrete information or proposals. Consequently, many end-users were not able
to provide in-depth analysis of their experience with North American machinery
suppliers, and thus expressed their views on U.S. and Canadian equipment in
more general terms.
Many decision-makers across the end-user segments indicated that North
American equipment tended to be poorly adapted to European production
environments. For example, European production sites are more compact,
requiring different machine ergonomics than in the U.S. and Canada and endusers stated that North American packaging machinery, and in particular U.S.
equipment, is perceived as being prohibitively large for European facilities.
These differences might extend from U.S. production practices, which are based
on high-volume schemes for few packaging applications. In order to compensate
for concerns such as this, it was suggested that US manufacturers may need to
develop smaller, more versatile and flexible machinery to handle a wide variety of
packaging formats in European markets.
Those customers currently operating North American machinery consider U.S.
and Canadian equipment to be highly reliable and durable, and are by and large
satisfied with the overall technical capacity and performance of the machinery.
These customers also noted that North American machinery pricing is
competitive in the European market, and that total landed cost including transport
and import duties are not prohibitive. However, several industry contacts and
distributors that were interviewed commented that U.S. machinery and spare
parts imports are still on U.S. standards, requiring initial technical modifications
particularly with regards to European safety norms (see CE-marking in section
2.11).
It is important to note that most of the North American machinery referred to in
our survey is manufactured in Europe according to local standards, and as such
does not suffer from these differences. The existence of European
branches/franchises also serves (or can serve to) to overcome another hurdle -that of distance between North America and Europe, which creates concern over
initial delivery speed, overall responsiveness of after-sales servicing, repair and
spare parts provision. An important aspect of selling in France might be to
overcome this important psychological barrier by emphasizing the European
presence, whether through a direct investment or partnership, whenever
possible.
Appendix A provides a list of strengths and weaknesses of North American
imports, and an assessment of market opportunities and competitive threats.
24
2.7
Marketing Techniques and Product Exposure
Trade Shows :
Our research indicates that the most effective means to increasing product
exposure and testing potential demand is to exhibit at the two major European
packaging trade shows, Emballage in Paris and Interpack in Dusseldorf,
Germany. Most end-users surveyed stated that they regularly attend both trade
shows to gather information on new machinery technology and to research new
suppliers. None of the companies surveyed indicated that they attend the Pack
Expo show in the U.S.
Emballage is France’s premier international trade show for the packaging
industry, with visitor and exhibitor participation rates growing at between 5 -10%
per show. In addition, the Emballage exhibition has been combined with the IPA
world food processing show to expand the show’s scope and appeal. The next
edition of the Emballage trade show will take place in Paris in November 2004.
In addition to the Emballage trade show, many end -users in the food segment
indicated that they regularly attend the C.F.I.A. show in Rennes, France. This
national show, located in the heart of France’s food production region, is gaining
in importance and offers exhibitors a much more targeted audience of food
industry decision-makers (see Appendix C “Key Industry Contacts”).
Industry Publications:
French industry journals offer a targeted means to increasing product exposure
and raising brand awareness among end-user audiences. Our survey indicates
that Emballages magazine is the publication most often consulted by decisionmakers across the four customer segments. Emballages covers general
packaging and machinery trends, focusing roughly half of its coverage on food
and drink issues with the rest divided among cosmetic, personal care,
pharmaceutical, and chemical packaging concerns.
The journal publishes 44 weekly editions per year, with nine monthly
supplements focusing on a chosen theme. The online version
(www.emballagesmagazine.com) reproduces the paper version and offers
subscribers the possibility to receive electronic newsletters.
Emballages magazine also publishes “Pharm Pack Europe” a monthly
supplement in English targeting a European pharmaceutical readership and a
comprehensive guide of packaging and packaging machinery suppliers in
France.
25
Other French publications that were frequently mentioned during our research
include the “Revu des Industries Agroalimentaire (R.I.A.)” and Process
Magazine, both of which target French food processing and packaging
audiences. The two publications are estimated to have strong penetration rates
among technical and machinery purchasing readerships. In addition, R.I.A.
publishes a special edition (yearly) on industrial investment plans in the food
sector in France (see Appendix C “Key Industry Contacts”).
Local Representation:
An effective, yet often neglected, means of increasing brand awareness and
product exposure in France is through local representation and partnering
agreements. Over the course of the study, industry insiders often pointed to
local importers and distributors as the quickest, most cost-effective means to
approaching the French marketplace.
Many of the interviewed companies expressed concern over distance and
cultural gaps between their production site teams and North American suppliers.
Local representation helps to bridge language and cultural gaps, while providing
access to established client bases, technical know how, after-sales servicing
capacity, and industry knowledge. In addition, local partnerships help reassure
end-users’ concerns about distance, responsiveness of maintenance and repair,
and the supplier’s ability to insure technical assistance and training. Agents and
distributors also provide the possibility to stock machinery and demonstrate
product technology year round, which our research indicates is often an
important step in the investment process.
France hosts an active packaging machinery importers’ association, the
Secimep, which facilitates contact between its members and foreign
manufacturers seeking representation. Secimep’s full contact information is
provided in Appendix C.
Internet:
While Inte rnet communications have for years been standard procedure, email
has only become prevalent in France over the last three years. This
‘development lag’ enables e-marketing lessons learned in the U.S. to be quickly
applied to the French market. Where email correspondence might be taken for
granted in the US, the French are enthusiastic about using the technology to
initiate contact and allow products to gain reference in company supplier lists.
Many of the interviewed companies indicated a preference for this type of
marketing procedure. For example, the emergence of email presents a modern
26
solution to overcoming historic barriers of geographic distance between U.S.
manufacturers and European clients. The use of simple technologies such as
email rapidly close the communication gap and reduce concerns about service
and parts follow up after the initial purchase of North American equipment. In
this respect, the Internet is also making inroads in spare parts ordering, as
machine manufacturers and their representatives are testing software systems to
allow for real-time, and often automatic re-ordering of spare parts online.
Although, industrial decision-makers continue to use traditional information
sources, such as industry contacts, when researching potential suppliers, our
study shows that the Internet, as a research tool, is consulted more and more
often by company research and development staff than by industrial production
and technical managers. In this respect, R&D departments use the Internet to
research general company and product information as well as to react to specific
demands or technological issues concerning packaging – all of which represents
an opportunity for PMMI member companies to use the web and email to
increase awareness among decision-makers.
It should be pointed out that recent attempts to create industry portals to facilitate
online machinery purchasing have, like in other countries, all but failed in France.
Our survey indicates that none of the end-users resort to e-commerce to
purchase packaging equipment. Moreover, there appears to be little interest in
purchasing equipment online given the complexity of the investment decision and
the importance of supplier relationships in the decision-making process. This
does not, ho wever, preclude the potential of using online spare parts ordering
and email direct marketing as key sales tactics in making valuable inroads into
the French market.
2.8
Equipment Financing
Most of the companies interviewed indicated that packaging machinery
investments were financed with internal resources, with very few using external
financing measures. None of the companies interviewed pointed to vendor
financing as a key factor in the decision-making process.
Most companies indicated that they preferred purchasing machinery directly from
the machine manufacturer. The survey indicated that most end-users follow the
industry standard when structuring payment schedules, which normally includes
a down payment upon order and the balance 60-90 days after the machinery has
been installed.
2.9
Market Drivers – Factors that Influence Purchasing Decisions
27
Our research indicates that for the most part, the packaging machinery
investment process is highly decentralized, with production teams at each facility
acting as the main decision-making unit. Though it varies according to the
company and industry segment, the site production manager normally heads a
team of technical, maintenance, and production line managers, which manages
investment plans and supplier relations according to company specific marketing
and operational requirements.
The main factors driving the investment process are diverse and vary according
to the end -users’ specific objectives. Despite this inherent variation, the list
below is a compilation of the drivers that were mentioned the most frequently by
our respondents.
1. Overall machinery quality (reliability and durability)
2. Versatility in handling different packaging applications
3. Service, including availability of local staff and spare parts
4. Previous experience with supplier
5. Price-quality ratio
6. Brand reputation
7. Production speed
8. Productivity
9. Adherence to purchasing specifications
10. Delivery terms
2.10
Regulatory Framework
Trade barrier and restrictive regulations and/or bureaucratic red tape are
notorious for inhibiting or even precluding robust international trade, even when
other market circumstances are ‘good’. In the case of France, the market for
imports is highly receptive and open, as packaging machinery imports account
for a bulk of the overall market. Moreover, there are no significant tariffs or
technical trade barriers for North American packaging equipment imports. Import
duties remain low and do not represent a significant competitive or cost
disadvantage to North American packaging equipment imports.
There do, however, exist a number of administrative steps that must be taken to
gain access to the E.U. These tend to be pedantic and not prohibitive steps and
processes, including the C.E. mark technical certification and adherence to the
E.U. Packaging Machinery directive.
E.U. Machinery Directive
28
The 1995 E.U. Machinery Directive (updated version 98/37/EEC) outlines safety
requirements for all new and used machinery sold in the E.U., including minimum
hygiene requirements for food packaging equipment. The Machinery Directive
requires that all equipment falling under the definitions of the directive carry the
C.E. mark of approval. (C.E. stands for Conformité Européenne, or European
Conformity).
C.E. marking is a self-certification process required for all imported machinery to
the European Union, which entitles machinery imports access to and free
circulation within the European Union. The certification process, either carried out
by the manufacturer or a third-party “notified body*”, requires that a manufacturer
or authorized representative:
1. Establish an E.U. declaration of conformity (in any official E.U. language)
2. Affix the “C.E.” marking on the machinery
3. Publish a technical construction file and instruction handbook in French
*Lists of notified bodies are published by the European Commission in the
Official Journal of the European Communities.
For the E.U. declaration of conformity, manufacturers must show compliance to
harmonized standards specific to its packaging machinery type. Harmonized
standards are so numerous that a database search is usually required.
Examples of E.U. harmonized standards most likely to apply to North American
machinery imports include:
EN 60204
Safety of machinery - Electrical equipment of machines
Part 1: General Requirements
(Identical to the German standard VDE 0113, Teil 1)
EN 292
Safety of machinery. Basic terminology. General principles
To obtain the list of applicable standards for a product, one should contact
AFNOR (see Appendix C “Key Industry Contacts”).
For specific inquiries concerning E.U. machinery directive or for questions
regarding the overall regulatory framework, the European Union’s official web
site offers a wealth of specific information and contacts: http://europa.eu.int/ ; or
for the official text of the E.U. Machinery Directive:
http://europa.eu.int/comm/enterprise/mechan_equipment/machinery/direct/dir9837.htm
29
Product liability:
Legally, the manufacturer is ultimately liable for its equipment; however, in some
cases, the authorized representative can be held responsible for any defects or
complications associated with the machinery. As such, most
importers/distributors require that suppliers follow the C.E. marking process and
provide proof of conformity to relevant harmonized standards.
E.U. Packaging Waste Directive:
The E.U. Packaging Waste and the Recycling Directive (94/62/EC) aims to
harmonize national packaging waste regulation and to ensure the proper
functioning of the internal European market, so as to avoid trade obstacles and
potential distortions to competition. The directive sets ambitious recovery and
reuse targets, pushing the entire manufacturing chain towards further waste
reduction from the source, or manufacturing point. The packaging directive is
expected to drive innovation in packaging and packaging machinery, as endusers attempt to meet stricter future targets.
By % of Weight EU targets set for EU targets proposed EU targets proposed
2001
for 2006*
for 2011*
Min. Recycling
45%
60%
70%
Paper
15%
65%
75%
Glass
15%
75%
75%
Metals
15%
55%
75%
Plastic
15%
20%
60%
Source : European Commission DGXI.E.3; Member states must comply to new targets by June 30, 2006;
Targets are set as a percentage of packaging flowing in to the waste stream.
2.11
Import Duties
Goods and services imported from outside the European Union are subject to
import duties. In particular, packaging machinery imports fall under H.S. codes
8422 and are taxed at a 1.7% rate on C.I.F. (E.U. port of entry) value. In
addition, a Value -Added Tax of 19.6% is added to the price of the equipment
including the import tax. However, it is important to point out that the V.A.T.
should not be factored into the final landed cost, as the equipment purchaser is
reimbursed the V.A.T. expense at a later date under French tax law.
Given the cur rent tariff rate, extra-E.U. imports do not suffer from a cost
disadvantage with regards to E.U. imports, as favorable currency fluctuations
often render the tax insignificant when calculating average total landed cost.
30
III.
PACKAGING MATERIALS/CONTAINER MANUFACTURERS
3.1
French Market Overview and Structure
The French packaging material and container manufacturing industry showed
remarkably sustained growth in 2002, despite a general slowdown in overall
industrial activity. This sustained activity can partly be explained by strong
household consumption of packaged goods as well as the increased use of
packaging in marketing and differentiating products across a variety of sectors.
French packaging container manufacturing remains a dynamic sector, employing
125,000 people in over 1,000 companies for a total turnover of roughly US$ 19
billion -- making France the fifth largest market and fourth largest producer of
packaging materials worldwide.
Value Share of Worldwide Packaging Market
Germany France
8%
9%
China
12%
United States
53%
Japan
18%
Source : Exposium Emballage 2002
With the exception of the glass and metal sectors, local production of packaging
and containers is highly fragmented with mostly small- to medium-sized
companies specializing in niche areas of the market:
Number of
companies
Employees
Turnover
Investments
Plastic
303
Paper/Cardboard
338
Glass
21
Metal
60
Wood
230
Total
952
41,000
5,810
415
43,000
6,435
296
14,500
2,295
170
14,700
2,700
105
12,800
1,545
42
126,000
18,785
1,028
31
Export
Share
27.3%
12.4%
19.8%
31.7%
20.3%
21.2%
Source : SESSI ; figures in US$ millions
Packaging Materials Share by Sector:
Paper is the most widely used material in packaging (31%) followed closely by
plastics (30%), glass (16%) metal (15%), and wood (8%).
Market Share by Packaging Material
Metal
15%
Wood
8%
Paper
31%
Glass
16%
Plastic
30%
source: Profound 2002
32
3.2
Paper Packaging
Paper packaging is a stable, mature industry comprised mostly of small- to
medium-sized firms of less than 100 employees. The 13 firms with over 250
employees account for a little more than half of total turnover in the sector (54%).
Despite the important role of small, local providers, it has been apparent over the
review period that there is a movement towards greater concentration in the
sector, as mergers and acquisitions are multiplying and suppliers are increasingly
partnering in the hopes to become more competitive internationally.
Major Local Paper/Cardboard Producers:
Company
Ownership
Smurfit Socar
International Paper S.A.
Kayserberg Packaging
Ahlstrom Packaging
Smurfit Cellulose du Pin
Cascades S.A.
Emin Leydier
Rochette Cempa Ondule
Cenpac
Smurfit International
Societe Papetiere
David Smith France
Ahlstrom Industries
Smurfit Int’l France
Les Industries Paperboad
Finel
La Rochette Emballage
Groupe Gasgogne
Turnover 2002
(US$ Millions)
514
428
278
246
239
183
177
171
142
Source: Expansion 2002 – Palmares des Entreprises
The corrugated paper format dominates the paper packaging market, with almost
a three-fourth’s volume share and over half of the total market value:
Paper Packaging Share by Format
Paper
9%
Flat paper
19%
Corrugated
72%
33
Source: FEFCO 2001
Value shares by Packaging Type
Paper bags
5%
Liquid food
packaging
7%
Other
11%
Corrugated
boxes
57%
Folded
Cardboard
20%
source: FFC-FNTP-ONDEF 2001
34
3.3
Plastics Packaging
Plastics packaging, the second largest sector behind paper/cardboard, is highly
valued by many end -users clients for its flexibility, transparency, and wide range
of use in different formats. New plastics innovations have led to more resistant,
thinner, and shock-resistant material, allowing PET bottling formats to penetrate
the beer market. In addition, plastic packaging is used increasingly to condition
products in the food/beverage and personal care sectors.
Major Plastics Packaging Suppliers (ranked by Turnover):
Company
Ownership
Sealed Air S.A.
Guillin Emballages
Cebal S.A.
Groupe Barbier
Ets Polyflex
Autobar Flexible France
Soparil
Wipak Gryspeert
Linpac Plastics Pontivy
S.A..
Rexam France
Graham Packaging France
Sealed Air BV
Groupe Guillin
Financiere Europeenne
Barbier Familly
Carnaud Metalbox
Autobar Holding
Pechiney Flexible Packaging
Toray Industries Inc.
Lin Pac France
Rexam Sofab
Graham Packaging Europe
Turnover 2002
(US$ Millions)
229
224
200
153
138
131
114
97
95
87
54
Source: Emballage magazine December 2002
Extrusion remains the principal transformation method of plastic packaging with
roughly half of total local plastics production, followed by blow-molding. Injection
plays a relatively minor role, and has seen its production share decrease
dramatically over the course of the last fifteen years.
35
Production share by transformation method
Injection
9%
Other
9%
Extrusion
50%
Blow molding
32%
source: SESSI
The overall plastics packaging market is relatively evenly-distributed between the
principal packaging container types, with bottles, caps and lids, bags and
sachets, and boxes holding a lion’s share of the overall market.
Value Share by Packaging Type
Others
17%
Bags
23%
Bottles
22%
Boxes
15%
Caps and lids
23%
source: SESSI; total market value estimated at US$ 4.9 billion
36
Volume share by Packaging Type
Others
13%
Bags, sachets
37%
Bottles
28%
Caps and lids
12%
Boxes
10%
Source: SESSI; 2002 total market volume estimated at 1,350 tons
37
3.4
Glass Packaging
French glass production ranks second in Europe only to Germany in terms of
size and importance, as local production is largely driven by export markets. The
glass packaging market is highly concentrated with the top five firms accounting
for over two-thirds of total employment and over three-fourths of market turnover.
In particular, the two largest producers, St. Gobain Emballages and BSN
Glasspack, dominate the market accounting for more than half of total
production.
Furthermore, glass suppliers are seeking to overhaul their existing industrial
structure in favor of new electrical machines with state-of–the-art servo-control
systems. This renewal should allow glass packaging manufacturers to improve
the flexibility of their production processes to allow for faster changeovers and
lower overall unit costs and downtime.
Major Glass Packaging producers (ranked by Turnover):
Company
Saint Gobain Emballage
BSN Glasspack
Saint Gobain Desjonqueres
Verreries Pochet et du Courval
VMC
Societe Autonome de Verrerie
Verreries de Masnieres
Verrerie d’Albi
Societe Verdome
Ownership
Vertec
CVC Capital Partners
Saint Gobain Emballage
Pochet S.A.
BSN Glasspack
Desjonqueres Family
Bormioli Rocco e Figlio
Spa.(IT)
Saint Gobain Emballage
BSN Glasspack
Turnover 2002
(US$ Millions)
588
535
386
169
125
116
81
67
65
Source: Emballage magazine 2002
The main end-user markets for glass containers are the beer, wine and digestive
markets. Colored bottles hold a dominant position in overall production, with a
share exceeding 60%.
38
Value Share by End-User Market
other
22%
wine and
digestives
36%
water
5%
spirits
5%
beer
32%
source: CSVM 2001; principal food and beverage end-user markets (2002)
Production Share by Packaging Type
Jars
10%
Flasks Other
3%
6%
Non-colored
bottles
18%
Colored bottles
63%
source: FEVE 2001
39
3.5
Metal Packaging
The metal packaging industry is highly concentrated, comprised mostly of
subsidiaries of large, multinational conglomerates, which account for over twothirds of sales and the bulk of total exports.
The principal end-users are in the food and beverage segment, mostly in canned
food and beverages. Small-to medium-sized suppliers are present in
complementary markets such as corking, aerosols, cosmetics, and chemical
products.
Exports are the major motor of growth for metal packaging manufacturers,
accounting for over 30% of total value sales. Environmental and strict hygienic
standards are driving innovation in the sector, as manufacturers seek to reduce
packaging waste and increase recyclables from the source.
The overall market is estimated at € 2.2 billion. Metal cans, for both food and
beverage, represent over half of all value sales in the sector. However, the can
market is expected to decrease 10% over the forecast period as flexible,
aluminum packaging is gaining favor with end-user clients not to mention the
increasing popularity of plastic pouches.
Major Metal Packaging Suppliers (ranked by Turnover):
Company
Crown Cork Company
France
Continental Can France
Impress Metal Packaging
Ferembal
La Francaise de Devp’t
de la boite boisson
Pechiney Emballage
Flexible Europe
Pechiney Emballage
Alimentaire
S.P. Metal France
Rexam Beverage Can
France
Ownership
Crown Cork USA
Continental Can Europe
Impress S.A.
-Carnaud Metalbox
Turnover 2002
(US$ Millions)
525
153
142
132
126
Pechiney
93
Pechiney
79
S.P. Metal
Rexam Plc
72
63
Source : Emballage Magazine December 2002
40
The food and beverage segments are by far the largest customer bases for metal
packaging containers with almost an 80% value share. Metal food and beverage
cans account for almost half of total market sales in this category.
Major End-User Segments (% value sales)
Health and
Beauty
Chemical 9%
13%
Food
49%
Beverage
29%
source: Sessi 2002
Product category (% of total value sales)
Other
22%
Food Cans
30%
Barrels
5%
Industrial
Packaging
8%Cork and lids
16%
Beverage Cans
19%
source: Sessi 2002
41
3.6
Wood Packaging
The wood packaging industry has shown little growth since the early nineties,
and relatively speaking, is a minor player in the French packaging market (8.2%
of value sales). Recent restructuring has led to mergers of many smaller
producers, particularly in light wood packaging, where increased competition
from paper and plastics packaging has eroded market share and sales.
Major Wood Packaging Suppliers:
Company
Ownership
Sequin
Moreau
et
Compagnie
Nature Bois Emballages
Beynel Manustock
Tonnellerie Vicard
Tonnellerie François Frères
Tonnellerie Radoux S.A.
Sabaté Diosos
N.B.E.
Beynel et Compagnie
Groupe Vicard
SCI La Demigniere
Sabaté Diosos
Turnover 2002
(US$ Millions)
67
42
41
27
26
25
Source: Emballages Magazine December 2002
For the most part, any growth in this industry is driven by barrel and cask
production used in winemaking. Two-thirds of all wood packaging exports are
used in the wine industry, with overall production is this customer segment
having tripled over the past five years.
Value Market Share by Packaging type
Other
19%
Boxes
6%
Palettes
30%
Light Wood
Packaging
16%
Barrels and
Casks
29%
Source: SESSI 2002
42
IV.
THE FOOD INDUSTRY
For the purpose of this report, the analysis covers the following sub-sectors in the
food industry:
§
§
§
§
§
§
§
§
§
§
§
§
§
§
§
§
§
4.1
Bakery product
Baby foods
Canned food
Confectionary
Chilled food
Dairy products
Dried food
Frozen foods
Ice cream
Noodles
Oils and fats
Ready meals
Sauces, dresses and condiments
Savory snacks
Snack bars
Soups
Spreads
Food Industry Overview
The packaged food market in France continued to show steady growth in 2002,
growing in value terms to roughly US$ 53.4 billion, a 2.4% increase over the
previous year. Despite waning consumer confidence and a general economic
slowdown, the market is expected to continue to grow at a mature annual rate of
1-3% over the next three years.
Dairy and Bakery Products
The dairy and bakery sectors accounted for over half of the overall packaged
food market, both in terms of volume and value sales. These sectors were
driven by further segmentation of product offerings particularly in breakfast
cereals, bakery goods, “fromage frais” not to mention emerging niche areas such
as fruit juice flavored milk drinks, fermented dairy drinks, and cheese snacks.
Trend towards Convenience
Recent socio-economic trends indicate a fundamental shift in consumer behavior
towards “on-the-move’ and snacking consumption. Evolving demographics, such
as increasing number of working women, the growing number of single
households, rising disposable incomes have led to a general increase in the
demand for products that are easily prepared and consumed. This trend is
43
particularly evident in categories such as ready meals (4% increase in value
sales), chilled food (11% growth), prepared sauces (4% annual growth rate),
snack bars (4.5% increase in value sales), and ready-to-eat baby food (10%
annual increase), which is driving new packaging innovations and new
investment in specialized machinery adapted to these changing requirements.
Value vs. volume growth
As volume sales show signs of maturity, food producers are focusing on value
growth by developing new packaging formats. In this respect, innovative
packaging allows manufacturers to increase product differentiation in order to
target more specific customer segments and demand higher price premiums. In
this respect, equipment suppliers with specialized machinery or manufacturers
capable of customizing their technology rapidly are seeing their market
opportunities multiply.
High growth segment: Plastic tray packaging
The plastic tray packaging market is expected to grow over 50% during the
forecast period to reach 14 billion units in 2006. Form, fill, and seal machinery is
expected to increase its market share over pre-formed packaging, as end-user
clients integrate new FFS technology into production lines, particularly in the
dairy and bakery segments.
French Plastic Food Tray Market 2002:
Market size 9.5 billion units
FFS
44%
Preformed
56%
44
French Plastic Food Tray Market 2006:
Est. Market Size 14 billion units
FFS
48%
Preformed
52%
source: Emballages Magazine, November 2002
4.2
Key Players
Top Food Producers in France – 2002 Consolidated Results
Company
Predominant
Business
Sales (millions)
1USD=1€
Euros
US $
Nestlé France
Dairy, confectionary, chocolate,
prepared meals
4,257
4,257
Beghin Say
Sugar
1,871
1,871
Pomona
Processed vegetable and meat
1,860
1,860
Socopa
Meat processing
1,827
1,827
Fromageries Bel
Processed cheese
1,741
1,741
Unibel
Processed cheese
1,741
1,741
Roquette Freres
Dairy, cheese
1,670
1,670
Danone France
Dairy and confectionary
1,591
1,591
Groupe Lactalis
Dairy products
1,581
1,581
Unilever Best Foods France
Ready meals, confectionary, dairy,
sauces
1,499
1,499
Société LDC
Processed meat
1,348
1,348
Lu France
Bakery
1,277
1,277
Kraft Foods France
Confectionary, Chocolates (Coffee)
1,026
1,026
Source: COFACE – Top 250 Food producers.
4.3
Summary of Interviewed Companies
45
Nineteen companies were interviewed in the food industry. For the purpose of
this report, food producers were chosen from the sub-sectors with the most
potential for packaging machinery investment, including the bakery, dairy, meat
processing, and ready meals segments.
For the most part, the end -users surveyed provided candid responses to our
questions. The breadth and depth of information provided varies widely,
depending on individual company policies governing external communications.
Information concerning capacity utilization and machine quantities, and to a
certain extent purchasing behavior, were described in more general terms as
many companies considered the specific information to be for internal-use only.
Market Structure:
According to the information gathered during the interviews, manufacturers from
Germany, France, and Italy account for the bulk of the packaging machinery
installed base. German and French machinery shares are estimated at roughly
one third each, followed by Italian machinery with roughly a fifth of the installed
base of the surveyed companies.
Estimated Installed Packaging Machinery Shares by Country of Origin
2%
3%
5%
France
3%
30%
7%
Germany
Italy
Spain
Switzerland
20%
U.K.
30%
Japan
Scandinavia
Competitive Structure:
Our research findings indicate that the major French packaging machinery
manufacturers are concentrated primarily in the food industry. Sidel is the clear
market leader in PET blow-molding equipment for liquid dairy products. Sidel is
also present in many other machinery categories through its ownership positions
46
in specialist manufacturers, Cermex, Remy, La Girondine, and Hema
Technologies.
Remy, Hema, and Serca are leading players in the filling and capping machinery
segment. Cermex appears to hold a leadership position in the end-of-line
machinery market, though Italian specialists Ocme and Acme show a strong
penetration rate among the companies interviewed.
French supplier Mécaplastics S.A. has a good market share in the thermoform,
fill, and seal machinery market, especially in the dairy and bakery end-user
segments. Other key players include German manufacturers, Erca Formseal
and Multivac, both of which sell a majority of the equipment for thermoforming
processes. Krones, the bottling line manufacturer, showed strong presence in
the labeling machinery segment.
Despite relatively low penetration rates, U.K. and Spanish suppliers are gradually
selling more and more equipment, competing on low price in areas such as film
and flow wrapping equipment.
Market Drivers: Factors Influencing Purchasing Decisions:
1.
2.
3.
4.
5.
Reliability and durability
Servicing, availability of local staff and spare parts
Previous experience with supplier
Versatility and flexibility
Brand reputation
It is important to note that the companies interviewed for this report, for the most
part, are not highly price-sensitive. Pricing remains an important factor, but is
balanced among a number of other factors mentioned above. In many cases,
end-users indicated that they were willing to pay a price premium for highly
reliable and durable equipment.
Customers’ Assessment of Packaging Machinery Suppliers:
Given the highly concentrated nature of the French food industry, many
customers showed a preference for reliable, high production machinery to ensure
that lines do not break down and production quotas stay on track. To date,
German machinery is the top seller in this segment, backed by a quality brand
reputation. In order to compete, PMMI members would need to compete with
this branding, as well as take advantage of the poor reputation that some
interviewees had of German suppliers that lacked in after-sales servicing, which
is considered to be more expensive and slower than Italian and French suppliers.
47
The survey results indicate that French machine suppliers have good reputations
for overall machine quality and versatility as well as effective after-sale servicing.
Furthermore, the survey showed that many smaller French suppliers benefit from
strong local relationships with and proximity to end-user customers, particularly in
the Brittany region, which has a strong concentration of food and dairy
production.
Best Prospects:
Our survey and research findings indicated investment plans and specific sales
opportunities in the following machinery categories:
Horizontal form, fill, and seal machinery
Cartoners of all kinds
Case packaging machinery
Filling line machinery
Flowpacking machinery
Palletizing machinery
Bag fill and seal machinery
Film packaging machinery
Thermoform, fill, and seal machines
Filling machines, semi-viscous
Coding machines
Labeling machines
Detection equipment
Heat sealing machinery
Automated end-of-line machinery
Wraparound machinery
Purchasing Potential:
Purchasing potential for the surveyed end-users is estimated to exceed US$ 100
million over the next three years. For the most part, our findings indicate that
many major customers plan to move ahead with machinery investment plans,
including upgrading and automating installed capacity. Despite an unfavorable
economic environment, a number of companies interviewed, particularly in the
meat processing, ready meals, dairy, and bakery segments, will be investing
heavily in production capacity increases and line extensions over the forecast
period.
4.4
Company Profiles
48
Amora Maille
Industry:
Food
Sub Industry:
Cold sauces
Location:
Chevigny production site
Size: (2002 sales) Est. US$ 250 million
Specific Business Filling line machinery for
Opportunities:
sauces; end -of-line
equipment
A) Company Description:
Amora Maille, the cold sauce division of Unilever Best Foods France, produces
over 56,200 tons of cold sauces including mustard, ketchup, mayonnaise, and
vinaigrette for the French and European markets. Amora Maille, one of France’s
largest producers of cold sauces for mass consumption, markets it products
under the Amora and Maille brand names in most European markets. It is
estimated that roug hly three-quarters of its Dijon production is sold domestically,
with the remainder exported to the European Union.
B) Main Products Produced and how are they packed:
Amora Maille sauces are packaged in glass containers of various sizes and
formats, with aluminum and/or plastic lidding and plastic shrink security films.
C)
Installed Packaging Machinery:
Roughly 75% of Amora Maille’s packaging equipment at its Dijon site is of French
origin, with the remainder being of German, Spanish, or Italian origin.
Current Machinery Used
Rinsing and Filling
machines
Capping and lidding
machinery
Labeling machines
Cartoners, fill and seal
Tray forming and fillers
Palletizing, depalletizing
Rinsing and positioning
machinery
Brand
Hema
Origin
Zalkin,CVB
France
Krones
Cermex, Ortor
Cermex, Ortor
Kettner
(Krones)
Cermex
Sipac
Germany
France
France
Germany, France
France
49
Italy
D)
Last Purchases of Packaging Machinery:
No specific information was provided on recent machinery investment for the
Dijon site.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
UBF Amora Maille indicated that machinery purchasing plans included important
replacement machinery for a wide variety of its sauce filling lines including
upgrading end -of-line grouping and palletizing equipment.
Units Origin
Machinery
Complete filling line machinery (sauces) -French
F)
Motive of purchase
Replacement
Purchasing Policies and Financial Arrangements.
The Dijon production site team develops recommendations for new and
replacement equipment in collaboration with the machine purchasing director,
Mr. Gabriel Berthias. Amora Maille determines the specifications and requests
quotes from its primary machine suppliers. At least three proposals are
compared for each machine category.
Amora Maille generally purchases machinery directly with the manufacturer.
Concerning repair, technical issues, and spare parts supply, it either works with
the manufacturer or the country representative. Amora Maille requires that each
supplier dedicate a technical representative to work with its internal technical
staff on an ongoing basis.
Payments schedules are structured according to industry standards and past
experience with the suppliers.
G)
Factors That Influence Purchasing Decisions.
1/ Quality and reliability
2/ Adherence to specifications
3/ Servicing, availability of staff and spare parts
4/ Rapid delivery time
5/ Price in relation to quality
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
UBF indicated that its Dijon facility has a long -standing relationship with its
French machinery suppliers. For the most part, it considers this close working
50
relationship a key factor in its purchasing decisions. French machines are
considered to be technically solid and reliable, with a better price in relation to
quality than many comparable machines from Germany or Italy. The proximity of
French machine manufacturers is yet another key factor in parts supplies and
technical collaboration.
UBF Dijon stated that it has little information on North American suppliers, and
currently does not operate any American machines in its factory.
I)
Trade Show Attendance / Trade publication Information:
UBF attends the major European trade shows, Emballage in Paris and Interpack
in Dusseldorf. Purchasing executives consult the major trade publications:
Emballage, Usine Nouvelle, R.I.A., and Process. The company also consults the
Internet to gather specific product and company information.
J)
Specific Interests
UBF would be interested in receiving product information concerning complete
filling and packaging lines for sauces.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Amora Maille (Unilever Best Foods France)
Mr. Emmanual Carette
Director of Industrial Development, Dijon
Site de Production de Dijon
48 quai Nicolas Rolin
21000 Dijon
-France(33) 3.80.44.44.44
(33) 3.80.44.43.76
emmanuel.carette@unilever.com
www.amora.com
51
Beghin Say S.A.
Industry:
Sub Industry:
Location:
Food
Sugar
Thumeries production
facility; Nationwide: nine
production facilities
Size: (2002 sales) US$ 1.9 billion
Purchasing
US$ 350,000
potential:
Specific Business Bag fill and seal machinery
Opportunities:
(sugar)
A)
Company Description:
Beghin Say is France’s leading sugar refiner for both the mass and industrial
markets. Industrial end -user segments include food, beverage, chemical,
pharmaceutical, bakery products, animal food, and cosmetics. Beghin Say’s
daily sugar production exceeds 15,000 tons.
B)
Main Products Produced and how are they packed:
Product
Molded sugar packs
Sachets (crystal and powder
sugar)
Cases (0.5 and 1 kg)
Individual portions
Bags (5 to 50 kg)
C)
Brand
Packaging
Béghin-Say Flat cardboard
Béghin-Say Paper
Béghin-Say Flat cardboard
Béghin-Say Flat and corrugated paper
Béghin-Say Paper
Installed Packaging Machinery:
Machinery
Brand/
Supplier
Sachet filling machines (1 Bosch, ICA
kg)
Custom sugar molding
Chambon
Units Origin
7
Germany 23
Italy
France 30
Sugar stick fill and seal
Cartoning (1 kg)
Cartoning (0.5 kg)
Dosing
Sugar enveloping
-1
1
2
13
Japan
Italy
Italy
U.S.
Germany
3
Toyo
Ciba
Gammapack
Jones
RoseTheegarten
52
Average Specifications
Age
-10
1
15
15
130 to 140
tons/day
60 to 120
tons/day
60 tons/day
150 tons/day
60 tons/day
15 tons/day
45 tons/day
Bag filling and closing
D)
Cetec
2
160 tons/day
Origin
Japan
Future Packaging Machinery Ordering Plans (2003-2005):
Machinery
Bag fill and seal
F)
10
Last Purchases of Packaging Machinery:
Machinery
Brand
Sachet fill and seal (sugar stick) Toyo
E)
France
Quantity Origin
Purpose
1
Replacemen US$ 350,000
t
France
Budget
Purchasing Policies and Financial Arrangements.
In terms of financial arrangements, Beghin Say generally contracts directly with
the machine manufacturer though they have used the in-country agent/distributor
as an intermediary in specific cases.
Typical financial arrangements include a down payment upon ordering, a 30-40%
payment upon delivery, and the remaining balance within 60-90 days.
G)
Factors That Influence Purchasing Decisions.
Beghin Say indicated that it places the most importance on acquisition price.
The interviewee explained that Beghin’s core market has been declining at a
yearly rate of 4-5%. As a result, the company has been cutting purchasing
budgets and squeezing its machine suppliers for more price discounts.
1/ Price
2/ Servicing, availability of local staff and spare parts
3/ Reliability and durability
4/ Production speed
5/ Development and delivery speed
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Beghin Say indicated that most of its installed base is customized machinery that
operates with one type of material and one (or two) packaging formats. Given
the nature of its production process (high volume, one product), machine
flexibility in terms of changeover time and handling of different materials is not
important.
53
Beghin’s sugar packaging for its large formats (molds) is specific to the French
market, which represents over 50% of its overall turnover. There are only two
machine manufacturers that provide equipment for this packaging process:
Chambon S.A. (French) and Elba (Dutch).
For small sugar packaging formats, Beghin Say works with German and Italian
suppliers specializing in this equipment, and whose machines generally meet
Beghin’s strict specifications. The interviewee does not believe there are any
North American manufacturers who provide these types of machines.
Beghin Say has two U.S. machines manufactured by Jones Inc. used in the
production of small, rectangular sugar packages (5 to 10 grams). The interviewee
expressed concern over the size of many U.S. machines, as it was mentioned
that U.S. machines are perceived as too cumbersome for Beghin Say’s factories.
European machines tend to be more compact and ergonomically-adapted to
European production sites.
Beghin Say’s evaluation of packaging machinery by country of origin:
Origin
United States
Germany
Italy
Japan
I)
Technology
Very Good
Very Good
Good
Very Good
Flexibility
Good
Good
Good
Good
Service
Good
Poor
Good
Good
Price
Good
Expensive
Average
Average
Trade Show Attendance / Trade publication Information:
Beghin Say decision-makers attend Emballages in Paris and Interpack in
Dusseldorf to gather supplier information. The company’s principal information
sources are Emballage magazine (both the paper and web versions) and the
Emballage trade show web site (www.emballage2002.com).
J)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email :
Web site :
Beghin Say S.A.
Jean-Michel Lanuque
Director, Industrial Packaging
12 rue Joseph Béghin
59239 Thumeries
-France(33) 3.20.62.45.47
(33) 3.20.86.34.34
jlanuque@fr.beghin-say.com
www.beghin-say.com
54
Bonduelle S.A.
Industry:
Sub Industry:
Location:
Food
Prepared vegetables
Lille (headquarters);
Twelve production sites
nationwide
Size: (2002 sales) US$ 1.3 billion
(consolidated)
A)
Company Description:
Bonduelle S.A. is positioned as France’s premier producer of prepared vegetable
products, and the number one supplier of canned vegetables in Europe. In 2002,
the company saw its consolidated turnover increase by almost 20% to reach US$
1.3 billion, fueled by particularly dynamic domestic and export markets.
Bonduelle’s French operations include a headquarters in Lille and 12 production
sites located throughout the country. Its principal markets are France (roughly
50% of total turnover), the E.U., and Latin America. Major brands include
Bonduelle, Cassegrain, and Marie Thomas.
B)
Main Products Produced and how are they packed:
Bonduelle produces approximately 700,000 tons per year of fresh, frozen, and
canned vegetable products. Packaging materials include: flexible plastic formats,
plastic trays, shrink film wrap, metal cans, glass jars, aluminum lids, sleeve wrap,
and carton boxes.
C)
Installed Packaging Machinery:
Bonduelle communicated the following information regarding its installed
packaging machinery base:
Current Machinery Used
Thermoforming machinery
Labeling and marking equipment
Tray and carton over wrapping
Palletizing equipment
Stretch wrapping equipment
Conveying equipment
D)
Brand
Multivac, Meca Systemes
Krones, PE
Prasmatic
Condi, New Tech
ITW
Safime
Last Purchases of Packaging Machinery:
55
Origin
Germany, France
Germany, Italy
Italy
France
U.S.
France
Bonduelle did not provide specific information on past machine purchases or
average machinery age.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Bonduelle’s core market is experiencing double digit growth, particularly in the
canned goods segment. The company indicated that it has investment plans for
new production line e xtensions and that it will be investing heavily in an
assortment of new packaging equipment.
F)
Purchasing Policies and Financial Arrangements.
Blonduelle’s purchasing process is centralized in its Lille headquarters. The
purchasing manager for production equipment works directly with the marketing
department and individual site development managers to identify investment
requirements.
Blonduelle consults at least five manufacturers from its supplier database. Often,
it will request site visits in order to view the equipment functioning in a production
environment.
Blonduelle requires that machinery repair take place within 24 hours. Financing
is structured to provide down payments at the time of ordering and the balance
60-90 days after installation.
G)
Factors That Influence Purchasing Decisions.
1/ Price in relation to quality
2/ Rapid Repair and Servicing
3/ Reliability
4/ Delivery terms
5/ Flexibility
H)
Comments on Preferred Brands and Perceptions of North American
Equipment:
Blonduelle i ndicated that European packaging equipment supply was sufficient
for its production requirements. In this respect, it was mentioned that North
American suppliers suffer from the perceived distance between their production
facilities and European end-users. In the interviewee’s opinion, it is critical for a
supplier to have a European, if not French presence, if it is to increase its market
penetration. Proximity is also particularly important for rapid and efficient aftersales servicing and parts supply.
Bonduelle’s evaluation of packaging machinery by country of origin:
56
Origin
France
Germany
Italy
I)
Technology
Very Good
Very Good
Good
Flexibility
Good
Good
Good
Service
Good
Average
Good
Price
Average
Expensive
Average
Trade Show Attendance / Trade publication Information:
Blonduelle regularly attends Emballage/IPA and Interpack trade shows, as well
as the C.F.I.A. regional show in Rennes, France. The company subscribes to
Process, R.I.A., and Emballage trade publications (both paper and online
versions).
J)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Bonduelle S.A.
Mr. Patrick Socha
National Packaging Director
rue Nicolas Appert
B.P. 173
59653 Villeneuve d’Ascq
-France(33) 3.20.43.61.92
(33) 3.20.43.60.10
Patrick.socha@bonduelle.fr
www.bonduelle.com
57
Brossard S.A.
Industry:
Sub Industry:
Food
Industrial cakes and
biscuits
Location:
Pithivier production site
Size: (2002 sales) US$ 171 million
Specific Business End-of-line equipment:
Opportunities:
grouping, over-wrapping,
palletizing
A)
Company Description:
Brossard S.A. is a major producer of non-refrigerated industrial cakes, cookies,
and biscuits (recently merged with Saveurs de France S.A). Brossard’s cakes
are marketed under the Brossard brand name mostly for the domestic market
(95% of turnover). The Pithivier site is the primary production facility for Brossard
cakes and pastries.
B)
Main Products Produced and how are they packed:
Brossard packages its products in plastic film, aluminum and polyethylene trays,
and carton boxes.
C)
Installed Packaging Machinery:
Current Machinery Used
Brand
Horizontal flow pack machinery Record, Au Couturier
Carton form, fill, seal machinery Ila Pack
Labeling and marking
-machinery
Case forming and grouping
Cermex, Ixmanu
Palletizing equipment
Cermex, Ixmanu
D)
Origin
Italy, France
Italy
English
French
French
Last Purchases of Packaging Machinery:
Brossard indicated that it recently invested in replacement flow pack machinery.
Average machinery age is estimated to be roughly 10 years old.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Brossard mentioned that it has a number of machinery investments on hold due
to an uncertain economic environment in France in the short term. It expects to
authorize machinery replacement in 2004, including the automation and
upgrading of its end-of-line equipment.
58
F)
Purchasing Policies.
Brossard’s technical director is responsible for packaging machinery investment
planning for the five Saveurs de France-Brossard production sites (four frozen
food production; one non-refrigerated cake production). Each production facility
team identifies machinery needs on a yearly basis, and submits a proposal to the
Pithivier site technical manager for analysis and approval.
When evaluating an equipment investment, Brossard consults its list of existing
suppliers - mostly European and Japanese - and contacts at least three
manufacturers with a request for proposal.
Brossard prefers to purchase machinery directly from the manufacturer. All
equipment investments are financed internally, and payment schedules are
structured according to industry standards and previous experience with the
supplier.
G)
Factors That Influence Purchasing Decisions.
1/ Servicing, availability of local staff and parts
2/ Previous Experience with supplier
3/ Quality (reliability and durability)
4/ Price
H)
Comments on Preferred Brands and Experience with North American
suppliers:
Brossard mentioned that the only experience it had with a North American
supplier was with Well Metron (light film wrapping), which was represented by the
French distributor Dem. The supplier relationship fell through due to difficulties
associated with after-sales servicing and spare parts supply.
Brossard emphasized the importance of close working relationships with its
packaging machine suppliers, including ongoing cooperation between the
machine manufacturer’s technical staff and each site’s maintenance team.
Supplier relationships are essential to winning future machinery orders, and can
act as a barrier to entry for new suppliers.
Brossard’s evaluation of packaging machinery by country of origin:
Origin
France
Italy
U.K.
Technology
Good
Good
Average
Flexibility
Good
Good
Good
59
Service
Good
Good
Average
Price
Fair
Average
Fair
I)
Trade Show Attendance / Trade publication Information:
Brossard attends the Emballage/IPA trade show in Paris, as well as the Interpack
show in Dusseldorf. It also regularly attends the regional packaging show in
Lyon, France. The company regularly consults Emballage magazine and the
Internet to gather company and product specific information.
J)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Brossard S.A.
Mr. Jean-Claude Marie-Antoinette
Technical Manager
rue Gare des Marchandises
45300 Pithivers
-France(33) 2.38.06.12.50
(33) 2.38.30.33.05
jeane-claude.marie-antoinette@brossard.fr
www.brossard.fr
60
Cadbury France
Industry:
Sub Industry:
Food
Confectionary products
(chocolate, chewing gum,
candy)
Location:
Blois production facility;
three production sites
nationwide
Size: (2002 sales) US$ 600 million (France)
A)
Company Description:
Cadbury France is the French subsidiary of British multinational Cadbury
Schweppes, and is the leading producer of sugar confectionary products in the
French market. Cadbury France’s nationwide operations include three
production facilities and an administrative headquarters in Blois. Cadbury France
products are marketed under French brand names (La Pie Qui Chante, Poulain,
Vichy…) targeted mostly for domestic consumption.
B)
Main Products Produced and how are they packed:
Cadbury France’s confectionary products are packaged in a wide range of
materials including flexible plastic packaging formats, aluminum and paper wrap,
and carton.
C)
Installed Packaging Machinery:
Cadbury did not provide specific information on its installed machinery base. It
did indicate that most of its equipment is of German, French, Italian, or Dutch
origin.
D)
Purchasing Policies.
Each production site acts as a decision-making unit, consulting both the French
headquarters in Blois and corporate headquarters in the United Kingdom on
budgetary and marketing matters. Machinery replacement plans are defined on
a yearly basis by each production site team and investment proposals are
submitted to the French and corporate headquarters for analysis and final
approval.
For new machinery purchases, existing suppliers are contacted for initial quotes.
At least three suppliers are consulted and compared per machine category.
E)
Factors That Influence Purchasing Decisions.
61
1/ Quality and reliability
2/ Production efficiency
3/ Servicing
4/ Previous experience with brand
F)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Cadbury France commented that European packaging machinery supply was
sufficient to meet its production requirements. Given its high production volume
environment, it believes German technology to be the most reliable and durable
equipment on the market. French and Italian machines, though considered
slightly less robust than their German counterparts, are appreciated for their
quality with relation to price.
Cadbury France’s evaluation of packaging machinery by country of origin:
Origin
Germany
Italy
France
Holland
G)
Technology
Very Good
Good
Good
Good
Flexibility
Good
Good
Good
Average
Service
Poor
Good
Good
Average
Price
Expensive
Fair
Fair
Average
Trade Show Attendance / Trade publication Information:
Cadbury France attends the major European trade shows Emballage and
Interpack. Trade publications are consulted but not on a regular basis. Internet
is used for specific information on supplier product lines.
H)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Cadbury France
Mr. Jacky Papin / Mr. Daniel Pellot
Packaging Machinery Purchasing Coordinators
2, rue de la Garbotiere
41013 Blois
-France(33) 2.54.44.48.41
(33) 2.54.44.47.38
jacky.papin@csplc.com
Daniel.pellot@csplc.com
www.cadburyfrance.com
62
Candia S.A.
Industry:
Sub Industry:
Location:
Food
Dairy: milk
Lyon (head office);
11 production facilities
nationwide
Size: (2002 sales) US$ 888 million
(consolidated)
A)
Company Description:
Candia is Europe’s leading milk producer, with annual production exceeding 1.5
billion liters and a 30% value share of the French market. The company’s
operations include a headquarters in Lyon and eleven production sites situated
throughout the country.
B)
Main Products Produced and how are they packed:
Product
Milk
Brand
Candia, GrandLait, Croissance,
Viva, Silhouette,
Package
Carton box, polyethylene
bottle
Candia indicated that roughly two-thirds of its production is packaged in carton
« brick » containers, and the remaining third in plastic bottles.
C)
Installed Packaging Machinery:
Current Machinery Used
Blowing machinery
(polyethylene)
Filling machines – liquid
for plastic bottles
Form-fill-sealing
machinery (carton “brick”
packs)
Palletizing, carton over
wrapping machinery
D)
Brand
Sidel, Stork
Origin
Remy, Serac
France
France, The Netherlands
Sidel (Tetra Pak), France, Sweden
Condi
Cermex, Ocme,
Acme
France, Italy
Last Purchases of Packaging Machinery:
Machinery
Brand
Blowing; filling machinery Sidel, Remy
63
Country
France
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Candia’s three year investment plan includes expansion of its blow-molding
capacity to increase its plastic bottle production.
F)
Purchasing Policies and Financial Arrangements.
Candia’s centralized purchasing department in Lyon coordinates packaging
machinery investment for its 11 production sites. Each production site teams
provides yearly machinery requirements according to new packaging formats and
replacement needs.
G)
Factors That Influence Purchasing Decisions.
1/ Reliability and quality
2/ Production speed
3/ Servicing, availability of local staff and spare parts
4/ Previous experience with brand
5/ Compatibility with existing machines
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Candia’s evaluation of packaging machinery by country of origin:
Origin
France
Italy
Holland
I)
Technology
Very Good
Good
Good
Flexibility
Good
Good
Average
Service
Good
Good
Good
Price
Fair
Average
Average
Trade Show Attendance / Trade publication Information:
Candia regularly attends the Emballage and Interpack trade shows to gather
information on existing and potential suppliers. It also consults Process, RIA,
and Emballage trade publications.
J)
Specific Interests
Candia would be interested in receiving more information on North American
packaging equipment, particularly concerning innovations in the area of
thermoform, fill, and seal.
K)
Contact Information:
Company Name:
Cedilac-Candia S.A.
64
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site :
Mr. Philippe Tournemelle
Director of Purchasing - Packaging
42, cours Suchet
69286 Lyon Cedex 02
-France(33) 4.72.40.52.52
(33) 4.72.40.51.35
philippe.tournemelle@candia.fr
www.candia.fr
65
Cogesal Miko France
Industry:
Food
Sub Industry:
Frozen food; ice cream
Size: (2002 sales) Est. US$ 150 million
Purchasing
US$ 500,000
potential:
Specific Business Robotic palletizing
Opportunities:
equipment
A)
Company Description:
Cogesal Miko France is a fully-owned subsidiary of Unilever N.V. The
company’s French production facility manufactures over 100 million liters of ice
cream for both global Unilever brands (Cornetto, Miko, Carte d’Or) and private
label accounts.
B)
Main Products Produced and how are they packed:
Unilever brand ice creams are packaged in plastic containers, individual paper
and aluminum formats in carton boxes.
C)
Installed Packaging Machinery:
Below is a representative example of the packaging machinery used in Cogesal
Miko’s ice cream production:
Current Machinery Used
Measuring and dosing
equipment
Case and tray form, fill,
and seal
Film wrapping machinery
Grouping and film over
wrapping machinery
D)
Origin
Brand
Atea, Graham --
Average Age
Cama, Cermex Italy, France
New
New-5
Haggmann
Germany
New-5
Schubert,
Germany, Italy, New
Vortex, Cama, France
Cermex
Last Purchases of Packaging Machinery:
Cogesal Miko is in the process of upgrading its installed packaging equipment
base. An estimated 80% of the new packaging machinery has already been
designated.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
66
Machinery
Origin
Motive of
purchase
Palletizing equipment
French, Italian
Automation US$ 500,000
F)
Estimated Budget
Purchasing Policies.
Machinery investments are determined over a three-year time frame. The
production site team develops its machinery investment plan in conjunction with
Unilever’s marketing department. Final investment proposals are submitted to
Unilever’s corporate headquarters for final approval.
Cogesal Miko indicated that it consults at least three suppliers and selects at
least two suppliers for each machine category.
Payments are scheduled and disbursed through Unilever’s centralized
purchasing office in France.
G)
Factors That Influence Purchasing Decisions.
1/ Reliability
2/ Price to quality ratio
3/ Compatibility with existing equipment
4/ Previous experience with brand
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Cogesal Miko commented that European packaging machinery supply was
sufficient for its production and processing requirements. Most of its installed
machinery base is of French and Italian origin, with some German equipment.
For the most part, the technical reliability and sophistication of European
machines provides it with a competitive edge over North American equipment,
which is perceived as being less flexible and poorly adapted to European
standards and safety measures.
Cogesal Miko’s evaluation of packaging machinery by country of origin:
Origin
France
Germany
Italy
I)
Technology
Very Good
Very Good
Good
Flexibility
Good
Good
Good
Service
Good
Poor
Good
Price
Average
Expensive
Good
Trade Show Attendance / Trade publication Information:
The company regularly attends the two major European packaging expositions,
Interpack and Emballage/IPA. It also attends the C.F.I.A. trade show in Rennes
67
(Brittany region). It consults both the paper and electronic versions of Process
and Emballages magazine.
J)
Specific Interests
Cogesal Miko would be interested in receiving product information on automated
palletizing machinery.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Cogesal Miko France (Unilever N.V.)
Mr. Bruno Mulac
Director of Engineering
2 rue Malgras
Z.I. de Trois Fontaines
-France(33) 3.25.07.35.35
(33) 3.25.07.55.75
bruno.mulac@unilever.com
www.unilever.fr
68
Fleury Michon S.A.
Industry:
Sub Industry:
Food
Ready meals, cold cuts,
salads, prepared
vegetables
Location:
Brittany
Size: (2002 sales) US$ 513 million
(consolidated)
Purchasing
Est. US$ 5-10 million
potential:
Specific Business Complete packaging line
Opportunities:
(cold cuts); micro-bacterial
detection equipment
A)
Company Description:
The Fleury Michon group’s two major divisions: cold cuts; and prepared meals
and vegetables, have shown dynamic double digit growth over the past three
years. Fleury Michon’s operations include a head office and seven production
sites located in Northwestern France. Of the seven production facilities, four are
dedicated to cold cut production and three to prepared meals and vegetables.
B)
Main Products Produced and how are they packed:
Fleury Michon products are packaged in a wide range of materials including:
thermoformed plastic trays, carton, flexible plastic packaging, and aluminum
trays.
C)
Installed Packaging Machinery:
Fleury Michon estimated that roughly 40% of its installed packaging base is of
French origin, 30% Germany, and 30% Italian. Below is a cross-section of the
type of packaging machinery used in the company’s cold cut and vegetable
production:
Current Machinery Used
Thermoforming machinery
Heat sealing machinery
Vertical sachet fill and seal
Brand/Supplier
Multivac, Tiromat
Mondini
Rovema, Thimmonier
(Doypack)
Carton form, fill and seal
Cermex
Sleeve/film wrapping machinery Thimmonier, Cermex
69
Origin
Germany, France
Italy
France
France
France
Overwrapping, grouping
End-of-line
D)
Ocme, Cermex
Thimon
Last Purchases of Packaging Machinery:
Machinery
Complete packaging line for cold cuts
E)
Italy, France
France
Reason
Country
New Production France, Germany,
facility: Brittany Italy
Future Packaging Machinery Ordering Plans (2003-2005):
Machinery
Units Origin
Motive of
purchase
Detection machinery (bacterial)
Sleeve/film wrapping for meat
trays
---
New line --New Line ---
F)
-French
Estimate
Budget
Purchasing Policies and Financial Arrangements.
Each production site acts as its own decision-making unit regarding packaging
machinery investment. New and replacement machinery requirements are
decided upon according to new market- and/or technology- driven needs as
determined by the Fleury Michon’s marketing and research and development
departments. In conjunction with its centralized purchasing office, each
production site teams acts upon these new requirements by evaluating and
comparing technology from its existing suppliers.
For packaging equipment investment, the site team headed by the local
production director, consults suppliers with whom they are familiar. If existing
suppliers are unable to meet the purchasing criteria, then new suppliers are
consulted.
Fleury Michon requires that each machine supplier make available a technician
for servicing and repair in less than 24 hours. In terms of machine purchasing,
the company prefers to deal directly with the machine manufacturer.
Payment schemes are developed on a case-by-case basis. Generally, a down
payment is provided upon order, and the balance paid within 60-90 days after
installation.
G)
Factors That Influence Purchasing Decisions.
1/ Quality and reliability
2/ Sevicing, availability of staff and spare parts
3/ Adherence to specifications
70
4/ Delivery terms
5/ Price
H)
Comments on Preferred Brands and Existing Business
Arrangements With Packaging Equipment Suppliers:
Fleury Michon commented that its existing supplier base of French, Italian, and
German machine manufacturers provided high-quality machinery adapted to its
diverse production needs. French suppliers are appreciated for rapid and
efficient servicing as well as for their innovations in the flexible packaging
domain. German machines are considered robust, but less flexible and versatile
and more expensive than Italian equipment. It was also mentioned that servicing
and spare parts supply are slow and often expensive with German suppliers.
Fleury Michon requires that its suppliers designate a technician to work with its
internal maintenance staff on an ongoing basis. It commented that this factor
favors its existing suppliers (particularly French), which generally have longstanding working relationships with its sites’ staff.
Fleury Michon’s evaluation of packaging machinery by country of origin:
Origin
France
Germany
Italy
I)
Technology
Good
Very Good
Good
Flexibility
Fair
Average
Good
Service
Good
Poor
Average
Price
Fair
Expensive
Average
Trade Show Attendance / Trade publication Information:
Fleury Michon attends the two major European packaging trade shows –
Interpack and Emballage/SIAL. In addition, it attends the C.F.I.A. show in
Brittany.
Fleury Michon regularly consults trade publications including Emballages
magazine, Process, and “Revu des Industries Agroalimentaire” (R.I.A.).
J)
Specific Interests
Fleury Michon is interested is receiving information on innovations in the areas of
individual and convenience packaging.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Fleury Michon S.A.
Mr. Bruno Le Goallec
Technical Director
B.P. 1
71
Telephone:
Fax:
Email:
Web site:
85707 Pouzanges Cedex
-France(33) 2.51.66.32.32
(33) 2.51.65.82.33
legoallec.bruno@fleurymichon.fr
www.fleurymichon.fr
Purchasing Department:
Contact:
Position:
Email:
Mr. Luc Grillet
Purchasing Manager Packaging
grillet.luc@fleurymichon.fr
72
Fromageries Bel S.A.
Industry:
Sub Industry:
Location:
Size: (2002 sales)
Purchasing
potential:
A)
Food
Dairy: cheese products
Paris
US$ 1.5 billion
(consolidated)
US$ 15 million (for forecast
period)
Company Description:
Fromageries Bel S.A. is positioned as one of Europe’s largest producers and
marketers of cheese products, with its ten French production facilities processing
and conditioning over 235,000 tons per year. Fromageries Bel markets its
cheese products under well-known French brands (La Vache Qui Rit, Babybel,
Kiri, Apericube) in over 90 export markets. The company’s worldwide operations
include 24 production facilities located on five continents.
Roughly two-thirds of Bel’s French cheese production is used to meet local
demand, with the remainder exported to neighboring European countries.
Furthermore, Bel’s cheese products are renowned for their distinct individual
packaging, which is closely associated with its brand image and product
awareness.
B)
Main Products Produced and how are they packed:
Fromageries Bel packages its six main cheese products in individually-wrapped
plastic, aluminum and carton mini-formats. Most individual formats are grouped
in carton boxes. The “Vache Qui Rit” cheese brand (roughly 50% of total yearly
turnover) is packaged in mini-cheese aluminum formats.
C)
Installed Packaging Machinery:
Below is a representative cross-section of packaging equipment used in Bel’s
French production facilities:
Current Machinery Used
Thermoformers
Horizontal form, fill and seal
Dosing machines (fondue
products)
Horizontal flow pack
machinery
Brand
Erca Formseal, Illig
Mecaplastic, Kramer
(CVS)
---
Origin
PFM
Italy
73
Germany
Germany
Germany
Cartoners
Primary conditioning and
dispensing machinery
Group packaging and
palletizing
D)
Cermex, small French
suppliers
Sapal (SIG), Kimaco,
Corazza
Cermex
France
Switzerland, Italy
France
Last Purchases of Packaging Machinery:
Fromageries Bel indicated that it has invested heavily in packaging machinery
(replacement and increased capacity) over the past five years, driven by new
packaging innovations and particularly dynamic sales growth over the review
period. The average age of its machinery base varies greatly.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Fromageries Bel indicated that it is continuing to invest heavily in new production
capacity and replacement equipment for its French production sites. It was
mentioned that consolidated budgets for machinery investments would exceed €
15 million over the forecast period. Bel will be investing in most machine
categories to handle new packaging formats and sizes, and to upgrade its
installed base.
F)
Purchasing Policies.
Fromageries Bel’s centralized purchasing department establishes yearly
machinery investment plans according to recommendations from production site
teams and the global marketing department. Once product specifications are
developed, three to four manufacturers are consulted from an existing supplier
list. Technical comparisons are carried out among at least three candidates, and
are evaluated according to the criteria in section G.
All machinery purchases are finance internally. Down payments are provided
upon order, with the remainder 60-90 days after delivery.
G)
Factors That Influence Purchasing Decisions.
1/ Adherence to machine specifications
2/ Price to quality ratio
3/ Return on investment calculations
4/ Previous experience with supplier
5/ Servicing agreement
6/ Productivity
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
74
Bel indicated that most of its installed machinery base was of German (50%),
French, or Italian origin. It was mentioned that European machines are welladapted to European production requirements, in terms of ergonomics, technical
standards, as well as flexibility and versatility in handling different packaging
formats. German machines are considered to be the highest quality and most
reliable packaging equipment for the food processing market. Italian and French
suppliers are competitive due to a fair price to quality ratio, even though the
equipment is less robust than its German equivalents.
Fromageries Bel tends to select specialist manufacturers in each machine
category for their quality assurance and brand reputation. The company also
selects a number of small local French suppliers, mostly in niche machine areas.
The interviewee was familiar with U.S. machinery and indicated that North
American packaging equipment is often perceived in France as being too
cumbersome and poorly-adapted to multiple packaging requirements. European
machines tend to be more technically sophisticated in this regard. Bel also
commented that U.S. machines tend to be 10-15% more expensive than their
European equivalents.
Bel’s evaluation of packaging machinery by country of origin:
Origin
United States
Germany
Italy
France
I)
Technology
Good
Very Good
Good
Good
Flexibility
Poor
Good
Good
Good
Service
N/A
Poor
Good
Good
Price
Expensive
Expensive
Fair
Fair
Trade Show Attendance / Trade publication Information:
Major trade publications consulted include Process Magazine and Revu de
Industries Agroalimentaire (RIA), both of which specialize in French food
processing issues. Emballage magazine is also referred to for more general
packaging information (i.e. new packaging trends and materials).
Fromagerie Bel representatives attend both the Emballage/IPA and Interpack
trade shows.
J)
Specific Interests
Fromageries Bel would be interested in receiving detailed company and product
information, particularly on new food packaging process technology (i.e. for soft
cream cheese packaging).
K)
Contact Information:
75
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site :
Fromageries Bel S.A.
Mr. Jean Schneider
Director of Purchasing – Packaging Machinery
12 cours Louis Lumiere
94300 Vincennes
-France(33) 1.41.93.89.23
(33) 1.41.93.89.32
jschneider@fromageries-bel.fr
www.fromageries-bel.fr
76
Harry’s France
Industry:
Sub Industry:
Location:
Food
Industrial bakery goods
Châteauroux production
site
Size: (2002 sales) US$ 324 million
Purchasing
US$ 1-2 million yearly
potential:
Specific Business Palletizing machinery
Opportunities:
A)
Company Description:
Harry’s France is the country’s largest bakery foods producer, holding roughly
one third of the domestic bread and pastry market in overall value terms. The
company has experienced strong growth, with average annual turnover
increasing at a 10% rate over the review period. Annual production is estimated
at 120,000 tons spread over five production sites nationwide. Products are sold
in mass consumer markets under the Harry’s brand name.
B)
Main Products Produced and how are they packed:
Harry’s France sliced bread and pastries are packaged in American-style plastic
film sacks, plastic trays, and carton boxes.
C)
Installed Packaging Machinery:
Harry’s France Chateauroux production site provided the following information on
its installed packaging equipment:
1/ Sack fill and seal machines (Au Couturier, Record)
2/ Case fill and seal machinery, wrap around (Cermex)
D)
Last Purchases of Packaging Machinery:
The company did not provide specific information o n past purchasing behavior;
however, it did indicate that it had invested heavily in new equipment to increase
its capacity due to strong growth in market demand.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
77
Harry’s France indicated that it will be pursuing industrial expansion plans and
will be investing several million euros a year in new packaging equipment over
the next three years.
F)
Purchasing Policies and Financial Arrangements.
With regards to new packaging machinery investments, each of Harry’s five
production sites acts as its own decision-making unit. The site team develops
yearly machinery investment plans, and consults machine manufacturers from its
supplier list and the Internet.
G)
Factors That Influence Purchasing Decisions.
1/ Quality and reliability
2/ Productivity
3/ Servicing
4/ Price
5/ Rapid delivery
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Harry’s France commented that it has a preference for French and Italian
packaging machinery, mostly due to their competitive pricing and strong servicing
reputations.
Harry’s France production facilities do not include any North American packaging
equipment.
Harry’s evaluation of packaging machinery by country of origin:
Origin
France
Italy
I)
Technology Flexibility
Very Good Good
Good
Good
Service
Good
Good
Price
Fair
Average
Trade Show Attendance / Trade publication Information:
Harry’s France representatives attend the major European trade shows,
Emballage and Interpack. The company consults the Internet regularly to gather
information on new technologies and market trends – particularly the online
versions of Emballages and Process magazines.
J)
Specific Interests
78
The company would be interested in receiving company and product information
through email. It is particularly interested in receiving information on automated
palletizing machinery.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Harry’s France
Mr. Francis Nadaud
Director of Industrial Development
rue du Grand Pré
B.P. 193
36004 Châteauroux
-France(33) 2.54.53.70.00
(33) 2.54.22.69.33
francis.nadaud@harrysgroup.com
www.harrysgroup.com
79
Kraft Foods France
Industry:
Sub Industry:
Location:
Food
Chocolate products
Strasbourg production
facility
Size: (2002 sales) Est. US$ 150 million
(chocolate activity)
Purchasing
US$ 3-4 million
potential:
Specific Business Wrapping equipment;
Opportunities:
brushless motor systems
A)
Company Description:
Kraft Foods is the leading manufacturer of chocolate bars and tablets in the
French market. Kraft’s chocolate production site is located in Strasbourg, serving
the domestic (est. 75% of total turnover) and European markets.
Kraft Foods France markets it chocolate products under the following brand
names:
o
o
o
o
o
o
B)
D’aim
Côte d’Or
Toblerone
Milka
Privilege
Suchard
Main Products Produced and how are they packed:
Kraft Foods France packages its chocolate products in aluminum wrap, paper,
and plastic sachets.
C)
Installed Packaging Machinery:
Kraft provided the following information concerning its installed packaging base:
Current Machinery Used
Flow packing
Sorting
Cartoning
Sachet fill and seal
“Pick and place”
Brand
-Sig
Ocme, Acme
-Bosch
80
Origin
-Switzerland
Italy
-Germany
Fold wrapping
Grouping; palletizing
D)
Rasch, Sig
Germany, Switzerland
Schubert, Cermex Germany, France
Future Packaging Machinery Ordering Plans (2003-2005):
Kraft Foods France indicated that it continually invests in new and replacement
packaging machinery. Industry sources estimate that capital equipment
expenditure will reach several USD million over the forecast period.
E)
Purchasing Policies and Financial Arrangements.
The Strasbourg production team works in conjunction with the central purchasing
department located in Kraft Foods headquarters to identify yearly machinery
requirements. Once machinery specifications are developed, Kraft consults its
existing machine suppliers for proposals. It was mentioned that at least three
suppliers are compared per machine category.
Capital expenditures are internally financed. Payment schedules are structured
to provide a down payment upon order, and remaining balance 60-90 days after
delivery.
F)
Factors That Influence Purchasing Decisions.
1/ Servicing, availability of local staff and spare parts
2/ Reliability and durability
3/ Brand reputation
4/ Previous experience with supplier
5/ Price
6/ Delivery terms
G)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
For the most part, Kraft Foods Strasbourg facility works with the major European
machine suppliers, namely German, Italian, Swiss, and French. It is comforted
by the strong brand reputations of these suppliers in their areas of expertise.
German machines are highly-regarded for their reliability and durability, with
expected machine lives well exceeding those of its nearest competitors. Italian,
Swiss, and French machines are appreciated for their quality, servicing, and
competitive pricing.
Kraft Foods’ evaluation of packaging machinery by country of origin:
Origin
Switzerland
Germany
Technology Flexibility
Very Good Good
Very Good Good
81
Service
Good
Average
Price
Good
Expensive
Italy
France
H)
Good
Good
Good
Good
Good
Good
Good
Good
Trade Show Attendance / Trade publication Information:
Kraft Foods France attends Emballage and Interpack trade shows. It subscribes
both to the paper and online versions of Emballage
(www.emballagesmagazine.com) and Process (www.process-magazine.com)
magazine.
I)
Specific Interests
Kraft Foods France is interested in receiving information concerning brushless
motor and “intelligent” packaging systems.
J)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Kraft Foods France
Mr. Guillaume de Laval
Purchaser, Packaging Machinery
13 avenue Morane Saulnier
78140 Vélizy Villacoublay
-France(33) 1.34.88.70.00
(33) 1.34.88.70.08
gdelaval@krafteurope.com
www.kraftfoods.fr
82
Lactalis S.A.
Industry:
Food
Sub Industry:
Dairy Products
Size: (2002 sales) US$ 5.5 billion (2002
consolidated)
Purchasing
US$ 5-15 million yearly
potential:
A)
Company Description:
Lactalis is Europe’s largest diversified dairy products manufacturer, processing
over 6 billion liters of milk yearly in 77 production sites (65 located in France).
The company’s milk, cheese, butter and cream-based products are marketed to
mass consumer markets under its global brand names (President, Le Petit,
Lactel…) in over 128 countries. In addition, Lactalis produces powder milk for
major industrial markets worldwide.
B)
Main Products Produced and how are they packed:
Product
Milk
Cheese
Butter
Creams
Meat
C)
Package/Container
PET bottle, Tetra Brik
Carton, paper, plastic
PET, paper, carton
Plastic
Polystyrene, plastic over wrap
Installed Packaging Machinery:
Below is a representative example of the packaging machinery used in Lactalis’
65 French production facilities – no supplier information was provided:
Current Machinery Used
Extrusion / Blow-molding for PET (Sidel)
Vertical and Horizontal Bag fill and seal
Thermoforming machinery
Heal sealing machinery
Liquid filling and sterilizing machinery
Labeling and marking
Tray forming and filling
Over wrapping and grouping machinery
Palletizing and depalletizing
83
Lactalis estimated its installed machinery base to be of French (50%), Italian,
German, English, Spanish, and Japanese origin. It was not aware of any North
American machinery in its installed base.
D)
Last Purchases of Packaging Machinery:
Lactalis was not able to provide a consolidated estimate of its past machinery
purchases for its 65 French sites. The company indicated that it has invested
heavily in replacement and extension line equipment over the review period.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Lactalis indicated that investment plans for replacement equipment and
machinery for new production lines was between €5-15 million yearly.
F)
Factors That Influence Purchasing Decisions.
1/ Productivity
2/ Reliability and durability
3/ Compatibility with existing equipment
4/ Innovative qualities
5/ Price
G)
Comments on Preferred Brands and Perceptions of North American
Packaging Equipment Suppliers:
Lactalis compared its European supplier base with its perception of North
American packaging equipment (from its U.S. operations). It was stated that
U.S. packaging equipment tends to emphasize speed and productivity, but is
much less technically sophisticated than its European equivalents. In the
interviewee’s opinion, this reflects the fundamental differences in the European
and U.S. markets – namely, the U.S. market requires high speed production but
not as much flexibility and versatility vis-à-vis different packaging sizes and
materials. Over time, European machine manufacturers have developed more
technically complex machines that handle many sizes, formats, and packaging
materials.
It was also stated that U.S. machine prices are perceived to be prohibitively high
for the European market. In addition, important technical modifications are often
required to adapt U.S. machines to local standards.
H)
Trade Show Attendance / Trade publication Information:
Lactalis attends major international trade shows such as Pack Expo, Interpack,
and Emballage. It also attends regional food processing and packaging show –
84
Carrefour des Fournisseurs des Industries Agroalimentaire (CFIA) – in Rennes,
France.
Lactalis consults Food and Beverage World, Process, Revu des Industries
Agroalimentaire (RIA) and Emballages trade magazines.
J)
Specific Interests
Lactalis would be interested in receiving company and product information from
PMMI member companies. In particular, it would like information on new
packaging machinery innovations that do not exist in Europe.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Lactalis S.A.
Mr. Alain Apert
Purchasing Director – Packaging Machinery
33 avenue de Maine
75755 Paris Cedex 15
-France(33) 2.43.67.46.51
(33) 2.43.67.46.50
alain.apert@lactalis.fr
www.lactalis.fr
85
LDC Le Gaulois S.A.
Industry:
Sub Industry:
Food
Prepared and processed
meat and poultry; ready
meals
Location:
Sablé sur Sarthe;
25 production sites
nationwide
Size: (2002 sales) US$ 1.5 billion
Purchasing
US$ 5-10 million yearly
potential:
Specific Business Flow pack; cartoning, heatOpportunities:
sealing; thermoforming
A)
Company Description:
LDC Le Gaulois is the leading poultry producer in the French market, with a total
market value share of roughly 30%. In addition to poultry, the group
manufacturers ready meals, cold cuts, and pizzas under the Le Gaulois and La
Toque Angevine brand names.
The company has experienced double digit growth in total turnover during the
review period. The French market accounts for roughly 80% of LDC’s total sales,
and yearly turnover is expected to continue to progress at a 5 -10% yearly rate
over the next three years.
B)
Main Products Produced and how are they packed:
LDC packages its poultry and cold cuts in thermoformed plastic trays and plastic
film wrap, in carton boxes. Its ready meals are packaged in thermoformed plastic
trays and carton boxes. Pizza products are packaged in film wrap and carton
boxes.
C)
Installed Packaging Machinery:
LDC mentioned that most of its suppliers are European or Japanese. For the
most part, it principal suppliers are French (40%), German (20%), and Italian
(20%). The company stated that it has several film wrapping machines from U.S.
supplier Ocide.
LDC indicated that it used the following packaging machinery:
Current Machinery Used
Film wrapping; Flow pack (horizontal)
86
Carton fill and seal
Thermoform, fill and seal
Plastic heat sealing
D)
Last Purchases of Packaging Machinery:
Over the review period, LDC indicated that it has invested in replacement
equipment and production line extension in all machine categories. Average
machinery age ranges from new to 15 years old.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
LDC is experiencing stable growth rates in sales of roughly 5-10% per year,
which is driving production growth and investment. The company indicated that it
invests between US$ 5-10 million per year in its packaging machinery
infrastructure.
F)
Purchasing Policies and Financial Arrangements.
LDC’s purchasing process is highly-decentralized, with each production site team
managing its yearly investment in packaging machinery. Each production site
team identifies its yearly requirements, researches suppliers and technology, and
manages the bidding process. LDC indicated that it consults at least three
suppliers before making the final purchasing decision.
LDC’s industrial development head acts as a facilitator and coordinator, helping
production site teams share information on suppliers and new technologies. As
such, the industrial director (see contact information below) is the key interlocutor
for new suppliers, as this position acts as the machinery investment advisor to
each production site team.
LDC indicated that it packaging machinery investments are financed internally. A
down payment is provided upon order, and the balance 60-90 after the machine
has been installed.
G)
Factors That Influence Purchasing Decisions.
1/ Reliability
2/ Servicing, availability of local staff and spare parts
3/ Ease-of-use
4/ Flexibility
5/ Price with relation to overall quality
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
87
LDC commented that its current European and Japanese suppliers adequately
meet their packaging requirements. LDC indicated that it often favors local
French machine suppliers due to close commercial relations as well as for
proximity reasons. German machinery is appreciated for its robustness and
overall reliability, while Italian equipment is considered more flexible for different
packaging applications. Despite being priced at a premium, Japanese machinery
is also highly-regarded for its overall quality and flexibility.
LDC stated that its North American equipment (Ocide film wrapping) is
technically-sound and reliable equipment. It was mentioned that North American
equipment tends to be conceived according to U.S. production environments,
which require high speed and volume for one product and package type. LDC’s
packaging needs demand a high degree of flexibility in handling different
products and packaging formats. As such, European packaging machinery is
generally more technically-sophisticated than its North American equivalents.
LDC also mentioned that North American equipment is often not adapted to E.U.
and French safety and technical standards which, in the interviewee’s opinion,
are stricter than those in the U.S. Consequently, clients are required to make
initial modifications, which are both costly and time-consuming.
LDC’s evaluation of packaging machinery by country of origin:
Origin
United States
Germany
Italy
France
Japan
I)
Technology
Very Good
Very Good
Good
Good
Very Good
Flexibility
Poor
Good
Good
Good
Good
Service
Poor
Average
Good
Good
Average
Price
Average
Expensive
Average
Fair
Expensive
Trade Show Attendance / Trade publication Information:
LDC indicated that it attends Emballage and Interpack trade shows, though not
on a regular basis. It regularly visits the IPA-Matic trade show in Paris (www.ipaweb.com), which focuses on meat processing and packaging.
LDC subscribes to Process magazine, which it considers to be the leader in meat
processing and packaging information. The company also subscribes to R.I.A.
(Revu des Industries Agroalimentaires).
J)
Specific Interests
LDC indicated that it would be interested in receiving information on packaging
machinery innovations from the PMMI, particularly technology that does not exist
in Europe.
88
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
LDC Le Gaulois S.A.
Mr. Alain Reynaud
Director, Corporate Industrial Development
Z.I. Saint-Laurent
B.P. 88
72132 Sablé sur Sarthe
-France(33) 2.43.62.70.00
(33) 2.43.62.70.96
alain.reynaud@ldc.fr
www.ldc.fr
89
Nestlé France
Industry:
Sub Industry:
Food
Confectionary, dairy, ready
meals, soups, canned food,
frozen food, chilled food,
sauces, dressings and
condiments, baby food
Location:
Marne La Vallée
(Headquarters); 25
production sites nationwide
Size: (2002 sales) US$ 4.1 billion
(consolidated)
A)
Company Description:
France represents Nestlé’s second biggest market after the United States with
over US$ 4 billion in sales. Nestlé France production is spread over 25
production sites nationwide, serving the French and European markets. Nestlé
France markets the following brands:
o
o
o
o
B)
Culinary produc ts: Maggi, Herta, Buitoni
Catering and vending: Nestlé Food Products
Ice Cream: Gervais
Dairy products, baby food, clinical nutrition, confectionary: Nestlé
Main Products Produced and how are they packed:
Nestle France packages its extensive line of food products in a wide variety of
packaging material including glass, plastic, carton, and metal containers.
C)
Installed Packaging Machinery:
Given the highly-diverse nature of Nestlé’s production and packaging
requirements, it was not able to provide a detailed profile of its installed base. It
was mentioned that the bulk of its packaging equipment is German (30-40%),
Italian (20%), Swiss (10%) and French (10-15%). Major suppliers mentioned
were Krones, KHS, Sig, Bosch, Schubert, Sidel, Cermex, Erca Formseal, Serac,
and Multivac.
D)
Last Purchases of Packaging Machinery:
Nestle indicated that it invested US$ 16 million during 2001 and 2002 in new
packaging equipment, both replacement and new line machinery, for its
90
powdered dairy products site located in Boué. The company also invested US$
7 million in packaging equipment for its fresh dairy products site in Douai.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Nestlé did not want to unveil its future packaging material investment plans as it
is considered to be strategic information for internal use only.
F)
Purchasing Policies and Financial Arrangements.
Nestlé France indicated that its twenty five production sites are responsible for
identifying yearly machinery requirements and developing investment plans. Site
production teams define machinery specifications according to packaging
requirements as defined by Nestlé France’s marketing and engineering
departments. Each site team consults corporate wide supplier lists and division
technical directors. Between five and ten machinery manufacturers are contacted
to submit a proposal. The site team develops an investment recommendation
which is sent to Nestlé’s corporate headquarters in Vovey, Switzerland for
analysis and approval.
Nestlé prefers to purchase packaging machinery directly from the manufacturer.
It deals with in-country representatives concerning technical training,
maintenance, and spare parts supply.
Nestlé France’s packaging machinery investments are financed through internal
corporate credit. Payment schedules vary according to supplier, but usually
include a down payment upon order, a percentage upon delivery, and the
balance two months after installation.
G)
Factors That Influence Purchasing Decisions.
1/ Return o n investment (time to “payback”)
2/ Reliability and durability
3/ Availability and rapidity of maintenance and repair
4/ Availability and efficiency of spare parts supply
5/ Delivery terms
6/ Price with relation to overall quality
H)
Comments on Preferred Brands and Existing Business
Arrangements With Packaging Equipment Suppliers:
The bulk of Nestlé France’s packaging machinery is either of French, German, or
Italian (Swiss) origin. In the interviewee’s opinion, machine manufacturers from
these nations have historical competencies in the packaging machinery sector,
which gives them a clear edge over machinery manufacturers from other major
91
manufacturing companies. In addition, these suppliers’ proximity to the French
market allows them to identify market needs more quickly and adapt their
technology accordingly.
Nestlé France stated that it generally favors the larger full line machinery
manufacturers, who have strong brand reputations and longstanding commercial
and technical relationships with Nestlé’s production teams.
Nestlé commented that German machinery is highly-appreciated for its
robustness, overall reliability, and durability. It was mentioned that German
suppliers are lacking in after-sale servicing, which is often slow and over-priced.
Italian and French technology is selected for its versatility and technical
sophistication in handling a wide variety of packaging formats.
Nestlé France mentioned that it has very little experience with North American
suppliers. It was commented that the distance between North American and
Europe is a clear handicap, and in order to overcome this hurdle, suppliers must
have a direct presence or partnership with a local agent or distributor.
Nestlé France’s evaluation of packaging machinery by country of origin:
Origin
United States
Germany
Italy
Spain
France
Japan
I)
Technology
Good
Very Good
Good
Average
Good
Very Good
Flexibility
Poor
Average
Good
Good
Good
Good
Service
Average
Poor
Good
Good
Good
Average
Price
Average
Expensive
Average
Good
Fair
Expensive
Trade Show Attendance / Trade publication Information:
Nestle France regularly attends the major European trades, Emballage/IPA and
Interpack. Regional shows include the CFIA show in Rennes, France and Matic
in Paris.
The company subscribes to Emballage, Process, and RIA magazines, which
cover the spectrum of food processing and packaging trends and issues in the
French market.
J)
Specific Interests
Nestlé France would be interested in receiving company and product information
from the PMMI concerning new developments in food packaging technology.
Company hard copy brochures or electronic information are both adequate
communication means.
92
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Nestlé France
Mr. Michel Cam porro
Director, Packaging Machinery Installation
7, boulevard Pierre Carle
B.P. 900 Noisel
77446 Marne-la-Vallée Cedex 2
-France(33) 1.60.53.28.11
(33) 1.60.53.29.34
georges.camporro@fr.nestle.com
www.nestle.fr
93
Saveurs de France
Industry:
Sub Industry:
Location:
Food
Frozen
Four production sites
(frozen cake and pastry)
Site interviewed: Le
Neubours
Size: (2002 sales) US$ 126 million
Purchasing
US$ 1-2 million yearly
potential:
Specific Business Cartoning machines;
Opportunities:
horizontal flow pack
(replacement)
A)
Company Description:
Saveurs de France is a major producer and marketer of frozen cakes, pastries,
and confectionary goods under the Brossard brand name. Saveur de France’s
five production sites (including Brossard non-refrigerated cakes facility) serve
mostly the French market and a few neighboring European markets. It is
positioned just behind Danone (Lu brand) in the French market for industrial
cakes and pastries.
B)
Main Products Produced and how are they packed:
Saveurs de France’s frozen pastries are packaged in paper/cardboard and
aluminum trays, plastic film wrapping, and carton boxes.
C)
Installed Packaging Machinery:
Below is a representative cross-section of the type of packaging equipment used
at the Le Neubourg production facility:
Current Machinery Used
Integrated Horizontal
Flowpack machinery
Semi-automatic horizontal
cartoners
Feeding machinery
Palletizing, depalletizing,
grouping machinery
D)
Brand
Record
Origin
Average Age
Italy
new-10
ETN, Cermex, Oeust
Packaging
Lagenpack
Cermex, Oeust Packaging
France
5-10
Last Purchases of Packaging Machinery:
94
Holland 10
France ---
Saveurs de France indicated that it recently invested in upgrading its flowpacking machinery base.
E)
F)
Future Packaging Machinery Ordering Plans (2003-2005):
Machinery
Origin
Motive of
purchase
Cartoners, form fill and seal
French
replacement
Purchasing Policies.
Each Saveur de France production director heads a site team to identify new and
replacement machinery needs on a yearly basis. A list of suppliers is consulted
and a minimum of three suppliers are consulted and compared per machine type.
It was also mentioned that information on new technology and suppliers is
exchanged informally between production sites. Each site team develops a
proposal which it submits to the Brossard technical director for analysis and
approval.
SDF works either directly with the machine manufacturer or with the local agent/
distributor concerning new machinery proposals, technical collaboration,
servicing, and spare parts supply.
G)
Factors That Influence Purchasing Decisions.
1/ Servicing, availability of spare parts and local staff
2/ Price in relation to quality
3/ Production efficiency
4/ Previous experience with supplier
5/ Reliability
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Saveurs de France’s indicated that its French suppliers are appreciated for their
machinery technology, competitive pricing, and servicing capacity. Italian
machines are considered to be priced competitively in relation to machine quality
and versatility, but are not as reliable or durable as German or French machines.
SDF has had no direct experience with North American suppliers.
Saveurs de France’s evaluation of packaging machinery by country of origin:
Origin
Germany
Italy
Technology Flexibility
Very Good Average
Good
Good
95
Service
Poor
Good
Price
Expensive
Fair
Holland
French
I)
Good
Very Good
Good
Good
Average
Good
Average
Average
Trade Show Attendance / Trade publication Information:
Saveurs de France attends the Emballage/IPA trade show in Paris. It also
regularly attends the regional food show “Carrefour des Fournisseurs des
Industries Agroalimentaires” (CFIA), which is rapidly taking on a national status in
the food and drink sector.
It also consults trade pub lications Emballages Magazine, Emballage Digest,
Process Magazine, and R.I.A.
J)
Specific Interests
Saveurs de France is open to receiving company and product information from
PMMI member companies by email with links to company homepages.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Saveurs de France-Brossard
Mr. François Vaserman
Director of Industrial Development
Z.A. Le Clos Mesnil
Route de Pont de l’Arche
B.P. 32
27110 Le Neubourg
(33) 2.32.35.58.15
(33) 2.32.35.68.67
francois.vaserman@brossard.fr
96
Socopa S.A.
Industry:
Sub Industry:
Size: (sales)
Purchasing
potential:
Specific Business
Opportunities:
A)
Food
Meat Processing
US$ 1 billion
Est. US$ 6-8 million
Packaging equipment for
three new meat processing
lines
Company Description:
Socopa S.A. is one of France’s largest meat processors, with 20 production sites
serving mass consumer and industrial markets in France and the rest of Europe.
Socopa’s nine production facilities located in the Northwestern France (Brittany)
process roughly 1,300 tons of meat per week.
B)
Main Products Produced and how are they packed:
Socopa meat products are packaged in polystyrene trays with BDF oxygen
barrier shrink film, and plastic and carton boxes.
C)
Installed Packaging Machinery:
Below is a representative cross-section of the type of packaging machinery used
in Socopa’s production facilities:
Current Machinery Used
Thermoforming machines
Cartoners, fill and closing
machinery
Vertical sorting and orienting
Group packaging, palletizing
Heat sealing machinery (and
meat processing equipment)
Brand/Supplier
Multivac, Ulma (BDF),
Erca Formseal
Meca Systemes,
Cermex, Omori
Ishida
Mead, Cermex
Multivac, Meca
Systemes, Ross
Origin
Germany, Spain
France, Japan
Japan
U.S., France
Germany, France, U.S.
Socopa indicated that roughly one third of its packaging equipment is of French
origin, a quarter German and Spanish, and the remainder divided between niche
machinery suppliers from Japan, Denmark, Holland, and North American. It was
estimated that roughly 20% of Socopa’s packaging process is automated.
D)
Last Purchases of Packaging Machinery:
97
Socopa indicated that the average age of its installed packaging machinery is
above 10 years. There have been no important machinery investments in the
last two years at the Brittany sites.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Machinery
Units Motive of
purchase
New meat processing production lines
(La Serthé site)
F)
3
Automation,
expansion
Estimated Budget
€6-8 million
Purchasing Policies and Financial Arrangements.
Socopa’s centralized purchasing department develops investment plans on a
three-year basis, with yearly revisions driven by new packaging requirements
and sales growth. Before issuing a tender, a team composed of machine
purchasers, site production and development directors research potential
suppliers (trade show catalogues, web site search engines, trade magazines,
and word of mouth). Once machinery specifications are developed, an
international tender is issued. Socopa evaluates at least three potential suppliers
before selecting a machine.
Socopa’s machinery investments are financed internally. The larger capacity
machines are generally purchased directly from major machine manufacturers.
Payment structure is determined by the order size and previous experience with
the supplier.
G)
Factors That Influence Purchasing Decisions.
1/ Adherence to product specifications
2/ Servicing, availability of local staff and spare parts
3/ Price in relation to machine quality
4/ Productivity
5/ Previous experience with brand
H)
Comments on Preferred Brands and Perceptions of North American
Packaging Equipment:
Socopa indicated that the installed packaging machinery at its La Serthé facility
included North American equipment (Formax, Mead, Biro, Ross…). It was
commented that North American technology is highly productive and suited for
high production environments. However, the company commented that U.S.
machines exports still do not adhere to E.U. electrical and safety standards,
which represents a significant barrier to entry for North American manufacturers.
98
Socopa has long -standing relationships with local, niche machine manufacturers
(particularly in the Brittany region). The cultural ties and proximity of these
suppliers provide these manufacturers with an edge over European and
international suppliers, especially for niche food packaging and processing
machinery.
Following a machinery purchase, Socopa demands close working relationships
with its suppliers, from installation through to regular maintenance and spare
parts provision. The proximity of a machine supplier (or its representative) is an
important driver in the decision-making process.
Socopa evaluation of packaging machinery by country of origin:
Origin
United States
Germany
Spain
France
Japan
I)
Technology
Good
Very Good
Good
Good
Very Good
Flexibility
Poor
Good
Good
Good
Average
Service
Average
Poor
Good
Good
Poor
Price
Average
Expensive
Average
Fair
Expensive
Trade Show Attendance / Trade publication Information:
Socopa attends the regional biennial CFIA show which specializes in food
processing and packaging machinery for the French market. Socopa also visits
Emballages and Interpack trade shows.
The company consults Process and RIA magazines, which both specialize in
French food and beverage production issues. It also reads Emballage Magazine,
which is more general in nature and focused more on national and international
marketing and packaging trends.
J)
Specific Interests
Socopa will be issuing an international request for proposal (RFP) for processing
and packaging equipment for its three new production lines in the La Serthé
production facility. The company would be interested in receiving information
from the P.M.M.I concerning new technologies in food packaging equipment in
the U.S. and Canada.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Socopa S.A.
Mr. Christian Lintanf
Director of Industrial Development
B.P. 20
72401 La Serthé Bernard Cedex
99
Telephone:
Fax:
Email:
Web site:
-France(33) 2.43.60.22.22
(33) 2.43.60.22.03
Christian.lintanf@socopa-entreprise.com
www.socopa.fr
100
Tipiak S.A.
Industry:
Sub Industry:
Food
Ready meals, dried food,
delicatessen
Location:
Fouesnant production site;
Eight production facilities
nationwide
Size: (2002 sales) US$ 144 million (7%
growth over previous year)
Purchasing
US$ 2-3 million
potential:
Specific Business Heat sealing; flow
Opportunities:
wrapping; cartoners;
palletizing
A)
Company Description:
Tipiak’s core production revolves around frozen foods, ready meals, patisseries,
and delicatessen products spread over eight production facilities. The company
has been experiencing strong, double digit growth rates in both sales and profits
over the review period.
B)
Main Products Produced and how are they packed:
Tipiak’s Fouesnant production facility packages its frozen ready meals in plastic
trays, plastic film wrap, and carton boxes.
C)
Installed Packaging Machinery:
Tipiak did not provide specific information on its installed packaging base in its
eight production facilities.
D)
Last Purchases of Packaging Machinery:
The company indicated that it has made a number of investments in different
machine categories over the past two years. It invested US$ 750,000 in new
packaging machinery for its frozen pastry production at its Tregunc site.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Industry sources indicated that Tipiak will continue to increase production
capacity over the next two years to accommodate demand growth in its four
areas of expertise. Investment in new packaging machinery is expected to reach
several million U.S. dollars.
101
F)
Purchasing Policies and Financial Arrangements.
Tipiak indicated that each production director develops yearly machinery
investment plans and coordinates machinery purchases along with the other
local sites. Information and recommendations concerning suppliers and
machinery technology are exchanged between sites.
During the purchasing process, each site team consults existing supplier lists in
order to contact at least three potential bidders. Tipiak commented that the
production teams generally know the European machinery market well, and this
process is often an informal exchange with existing machine suppliers.
No specific information was provided on machine financing, but it was inferred
that machinery investments are entirely financed by internal cash flow. Payment
is structured to provide a down payment upon order, and the balance 60-90 days
after the machine has been installed.
G)
Factors That Influence Purchasing Decisions.
1/ Servicing, availability of local staff and spare parts
2/ Machine flexibility and scalability
3/ Reliability
4/ Delivery terms
5/ Price
6/ Innovation
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Tipiak indicated a preference for its French and German suppliers, which the
interviewee considered to have the best adapted machine technology for its
production needs. Tipiak requires that its machine suppliers provide its technical
staff with initial training and on-going assistance, and that repair be completed in
less than 24 hours.
Tipiak’s evaluation of packaging machinery by country of origin:
Origin
Germany
Spain
France
I)
Technology
Very Good
Good
Good
Flexibility
Good
Good
Good
Service
Poor
Good
Good
Trade Show Attendance / Trade publication Information:
102
Price
Expensive
Average
Fair
Tipiak production site teams regularly attend the C.F.I.A. show in Rennes and the
Emballage exhibition in Paris. The company subscribes to R.I.A., Emballages,
and Process magazines.
J)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Tipiak Plats Cuisinés Surgelés
Mr. Louis Castric
Technical Director
zone artisanale Park l’Hastel
29170 Fouesnant
-France(33) 2.98.51.62.00
(33) 2.98.51.62.29
louis.castric@tipiak.fr
www.tipiak.fr
103
Unilever Best Foods France
Industry:
Sub-industry
Location:
Size: (2002 sales)
Purchasing potential:
Specific Business
Opportunities:
A)
Food
Cold sauces; desserts;
soups; olive oil
France (food) :
6 production facilities
US$ 750 million
(consolidated)
Est. US$ 5 million
yearly
Horizontal form-fill-seal
machinery; complete
filling and packaging
lines for ice cream
Company Description:
Unilever Best Foods (UBF) France is a major producer of food stuff, drinks,
personal and home care products. UBF France operations included 12
production facilities used primarily to supply the European Union, Middle East,
and African markets.
Well-known food and drink brands such as Knorr, Ben and Jerry’s and Lipton are
produced and marketed in France and European-wide.
B)
Products produced (by factory location):
Dijon and Chevigny: cold sauces (mayonnaise, mustard, ketchup)
Ludres: de-hydrated desserts
Duppigheim: de-hydrated and aseptic soups and sauces
South: Olive Oil
C)
Purchasing Requirements:
Unilever was not able to provide specific information concerning installed
capacity or future purchasing requirements. It was mentioned that it was
planning on expanding its ice cream production facilities and would require filling,
closing, and labeling machinery. Furthermore, UBF plans to market new ice
cream packages utilizing innovative custom and personalized formats.
D)
Purchasing Policies and Financial Arrangements.
The Dijon site production manager coordinates machinery purchases for UBF’s
French operations, working closely with the centralized purchasing and research
104
and development departments. Each production facility is responsible for
identifying new technical requirements and proposing machinery replacement on
a yearly basis.
E)
Factors That Influence Purchasing Decisions.
1/ Reliability
2/ Servicing
3/ Delivery terms
4/ Productivity
5/ Price
Given UBF’s high production environment, equipment reliability is critical as
downtime can become very costly. Consequently, rapid maintenance and repair
is the second most important element when evaluating a potential equipment
investment.
F)
Comments on Preferred Brands and Existing Business
Arrangements With Packaging Equipment Suppliers:
Unilever Best Foods France (UBF) mentioned that its French installed packaging
base is dominated by French, German, and Italian machinery. Above and
beyond any historical link with these European suppliers, UBF commented that
European equipment is generally more adapted to European production needs,
and requires much less upfront investment than its North American counterparts.
UBF mentioned that the distance between North American manufacturers and
the French market is a barrier to entry for these suppliers. Namely, UBF’s site
production teams place a great deal of importance on quick repair and
maintenance, generally under 24 hours. Even though in-country partners such
as agents or distributors could help to bridge the gap, UBF often prefers to deal
directly with the manufacturer for major repair and spare parts provisions.
It was mentioned that North American machinery is often poorly adapted to
European Union technical and safety standards, requiring additional modification
costs and time. Furthermore, UBF commented that U.S. machinery is not
ergonomically suited for European factory requirements and is perceived to be
overly cumbersome.
G)
Trade Show Attendance / Trade publication Information:
UBF attends Emballage in Paris and Interpack in Germany. Major sources of
information include major French publications: Emballage Magazine, Process,
RIA and Emballage Digest. It was mentioned that the Internet is used on an ad
hoc basis for product and technical consultation.
105
H)
Specific Interests
Unilever Best Foods France would be interested in receiving information on
machines specialized in ice cream custom packaging and horizontal form-fill-seal
machinery.
I)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Unilever Best Foods France
Mr. Gabriel Berthias
Production Manager - Country manager machine purchasing
48, quai Nicholas Rolin
21000 Dijon
(33) 3.80.44.44.44
(33) 3.80.44.44.50
Gabriel.berthias@unilever.com
www.unilever.com
106
Yoplait S.A.
Industry:
Sub Industry:
Location:
Size: (2002 sales)
Specific Business
Opportunities:
A)
Food
Dairy products
Monténeau, France
US$ 950 million
Horizontal form-fill-seal
machinery
Company Description:
Yoplait is one of France’s largest manufacturers of fresh dairy products,
producing over 3 billion yogurt packs per year. The company is the clear market
leader in the fruit and flavored yogurt market with roughly 40% of overall value
sales, and is second only to Danone in cream-based products. Yoplait exports
roughly two-thirds of its production to worldwide markets.
B)
Main Products Produced and how are they packed:
Yoplait packages its yogurt in individual and multi-pack formats in polystyrene
containers and carton boxes. The cream-based products are packaged in plastic
containers.
C)
Installed Packaging Machinery:
Yoplait provided the following information on its installed packaging machinery
base:
Current Machinery Used
Brand
Thermoforming form-fill-seal machinery Erca Formseal,
Elton, Sidel
Filling machinery
Hamba, Hema,
Serac, Sig
Palletizing; end-of-line equipment
Cermex, Ocme,
Acme
Multi-packing
--D)
Origin
Germany, Spain,
France
Germany, France,
Switzerland
France, Italy
French, Germany
Last Purchases of Packaging Machinery:
Yoplait indicated that it recently completed a round of machinery purchases, both
for replacement and production line extensions.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
107
Yoplait mentioned that it plans to invest in new replacement horizontal form, fill,
and seal machinery over the next three years.
F)
Purchasing Policies.
Under Yoplait’s “two -year payback” policy, the costs associated with a packaging
machinery investment must be recovered in less than two years. Production
managers from each of the four factories work closely with the centralized
research and development center and the corporate marketing department to
develop yearly packaging and packaging machinery investment plans.
It was mentioned that the company has seen its investment budget reduced for
2003-2004.
G)
Factors That Influence Purchasing Decisions.
1) Innovation
2) Adherence to specifications
3) Quality
4) After sales support
5) Price
Machine pricing is an important factor, but it plays a relatively less important role
than innovation and quality in the decision-making process. The company is
particularly concerned with recovering its investment under its “two-year
payback” policy.
H)
Comments on Preferred Brands and Perception of North American
Packaging Equipment Suppliers:
Yoplait commented that U.S. machinery is generally solid and technically-sound,
rendering it competitive vis-à-vis European machines in high production volume
environments.
For the most part, Yoplait has a long relationship with French and German
machinery suppliers. In terms of product conditioning, the German machines are
appreciated for their reliability and durability. Erca Formseal (former French
subsidiary of German manufacturer Iwke) is highly-regarded for its quality and
continual innovation in the area of thermoforming form-fill-seal process
technology.
Yoplait’s evaluation of packaging machinery according to country of origin:
Origin
Germany
France
Technology Flexibility
Excellent
Good
Excellent
Very good
108
Service
Good
Good
Price
Expensive
Good
U.S.
Italian
Spanish
I)
Good
Good
Good
Average
Good
Average
Average
Average
Good
Good
Good
Very Good
Trade Show Attendance / Trade publication Information:
Yoplait attends the major European trade shows, Interpack in Germany and
Emballage in France, as well as a select number of regional exhibitions. It
regularly consults trade magazines Emballage, Process, and Usine Nouvelle.
J)
Specific Interests
Yoplait, though it mentioned that its machinery requirements are being
sufficiently met by existing suppliers, is open to receiving more information on
form-fill-seal process technology.
K)
Contact Information:
Company Name:
Contact:
Position:
Telephone:
Email:
Web site:
Yoplait S.A.
Mr. Jean Malherbe
Assistant Production Director
(33) 6.07.56.52.08
jean.malherbe@yoplait.fr
www.yoplait.fr
109
V.
THE BEVERAGE INDUSTRY
5.1
Industry Overview
For the purpose of this analysis, the French beverage market is divided into two
sub-sectors: Alcoholic and Non-Alcoholic beverages.
5.1.1 Non-Alcoholic beverages
Including:
o
o
o
o
o
o
Bottled water
Carbonates
Concentrates
Fruit and vegetable juice
Ready-to-drink tea (RTD)
Ready-to-drink coffee (RTD)
Bottled Water: A Key Market Driver
The French soft drinks market grew 4.5% in 2002 in total volume terms and was
driven by particularly robust growth in bottled water sales. The bottled water
segment grew over 7%, representing roughly two thirds of volume sales in this
sector.
Bottled water sales are expected to continue to grow over the forecast period at a
5% yearly rate, reaching approximately 14 billion liters in volume terms driving
demand for PET and glass bottles. In addition, competitively-priced spring water
has experienced strong growth over the review period and is expected to
continue to capture market share from brand name mineral waters.
Conversely, strong growth in the bottled water segment is expected to limit
growth in other competing sub-sectors such as cola carbonates, as French per
capita consumption remains the lowest of any E.U. country.
Trend towards “on-the-move” consumption
Rapidly-changing consumer preferences, particularly in younger customer
segments, have led soft drink manufacturers to multiply new product offerings
and brand extensions. Product packaging has become an increasingly important
marketing tool to differentiate product lines and target even more highlysegmented markets. For example, many beverage manufacturers have
developed smaller bottling formats with innovative closing systems, such as
sports caps and belt attachments, for easy consumption on the move.
110
The growing trend towards “on-the-move” consumption has stimulated demand
for single-serve, resealable bottling formats. In particular, Polyethelyne
Terephthalate (PET) bottles have significantly increased its market penetration in
the soft drinks market through new innovative single-serve formats. PET
containers, both single serve and larger formats are expected to continue to
capture market share in this segment from can and glass containers.
In the fruit and vegetable juice sub-segment, carton containers remain the most
popular format with roughly 65% of value sales in 2002. This is largely the result
of the carton container’s square shape, light weight, and high percentage of
recyclables. Carton packaging innovations have had a significant impact on
sales growth in the fruit and vegetable segment, as the 1 -liter re-sealable screw
top format is showing dynamic and sustained growth. Glass and plastic
containers both have market shares in the single digits, and are used by
manufacturers to target customer segments wishing to view the juice before
making the purchase. The share of metal cans in the fruit sector remains
marginal.
5.1.2 Alcoholic beverages
Including:
o Beer
o Wine
o Spirits
French beer market
The French beer market was estimated at roughly € 2 billion in 2002, showing a
stable 2% growth rate over the review period. French beer consumption
remains mitigated, as per capita consumption of 39.1 liters places France as the
next to lowest consumption rate in Europe, just ahead of Italy. Despite a
lackluster domestic market, overall beer production is driven by robust export
sales, which represent roughly 45% of overall value sales, as well as increased
demand for “specialty” beers. Furthermore, industry concentration is the order of
the day, as the top five beer producers account for roughly 90% of total sales in
the sector.
Recent innovations in PET packaging containers, most notably Sidel’s “Actis”
blow-molding process, have allowed PET bottles to penetrate the French beer
market (see below). Despite the practical and functional advantages of PET
bottles, glass containers remain the preferred format for manufacturers wishing
to give their beverages a more premium or traditional image.
111
French wine market
The overall French wine market is estimated at €1.6 billion, accounting for
roughly 10% of overall sales in the beverage segment. The sector is
experiencing negative yearly growth rates of 2-3%, largely the result of changing
consumption patterns. Namely, the French consumer is opting more and more
for quality and less so for quantity. This trend seems to be confirmed, and will
continue to affect volume growth over the forecast period
On the other hand, French wine production has been sustained by robust export
sales, particularly to the United States and Japan, where volume and value sales
have shown stable growth over the past three years. Yearly wine production in
France is estimated at roughly 54 million hectoliters and is expected to remain at
this level over the forecast period.
Glass bottling formats dominate the wine sector. Other packaging material, such
as plastic and carton containers, are rarely used in this segment, and if so, are
found in large packaging formats for lesser quality wines. Recent innovations in
packaging include smaller, individual formats such as glass ampoule packaging.
5.2
Key Players
Top Beverage Producers in France – Consolidated Results 2002
Company
Predominant
Business
Sales (millions) 1USD=1€
Euros
US $
Pernod Ricard
Wine and spirits
4,555
4,555
Castel Freres
Wine, spirits, bottled water
1,981
1,981
Coca Cola Enterprise
Carbonated cola, fruit juices
1,196
1,196
Remy Cointreau
Spirits
1,019
1,019
S.A. des Eaux Minerales d’Evian
Bottled water
966
966
Brasseries Kronenbourg
Beer, cider
944
944
Perrier Vittel
Bottled water
867
867
Taittinger
Champagne
779
779
Brasseries Heineken
Beer and cider
600
600
Hennesy and Company
Champagne and spirits
556
556
Champagne Moet et Chandon
Chapagne
551
551
Remy Cointreau
Spirits
502
502
Moet Hennessy France
Wine and spirits
477
477
Orangina Schweppes
Carbonated
fruit-based
338
338
fruit-based,
Source: COFACE – Top 250 Food producers.
5.3
Summary of Interviewed Companies
112
still
Twelve beverage companies were surveyed including:
o
o
o
o
o
o
o
o
o
France’s largest wine maker
A major champagne producer
Two large cola carbonate producers
France’s two largest bottled water producers
Two multinational breweries
One specialist brewery
A coffee producer
A principal fruit juice producer
A small bottling sub-contractor
Market Structure:
Information gathered from the company interviews indicated that the packaging
machinery market for the beverage segment is dominated by the major full-line
manufacturers from Germany, Italy, France, and Switzerland. Very few
companies indicated that it used North American equipment, whose overall
market penetration is estimated at below 3%.
Estimated Installed Packaging Machinery Shares By Country of Origin
6%
4%
Germany
3%
33%
12%
Italy
France
Switzerland
U.K.
17%
Spain
25%
North America
Key market players in this end-user segment include Krones, KHS, and Kisters
(Germany); Sig-Simonazzi (Switzerland -Italy); Ocme and Acme (Italy); and Sidel
and Cermex (France). Our findings indicated that Krones is the clear leader in
integrated bottling lines, and in particular labeling systems. Sidel holds a
dominate position in PET blow-molding equipment. Cermex, Ocme, and Acme
are the market leaders in grouping and end-of-line equipment for the beverage
113
market. U.S. supplier, Mead, was present in the end-of-line segment, particularly
in the multi-packing segment.
Market Drivers: Factors Influencing Purchasing Decisions
1.
2.
3.
4.
5.
Reliability and durability
Servicing, availability of local staff and spare parts
Machine versatility
Previous experience with brand
Price
Customers’ Assessment of Packaging Machinery Suppliers:
A majority of companies showed a preference for German machinery, referring to
the durability, reliability, and overall robustness of German packaging machines.
Companies indicated that they were willing to pay the price premium demanded
by German suppliers in order to gain the quality assurance that is often
associated with their brand reputation.
Many end -users mentioned that Italian machinery, though generally less robust
than German equivalents, tends to be more flexible and adaptable to different
packaging formats Moreover, our findings indicate that Italian machinery
suppliers increased their market penetration in the beverage segment through
increased price competitiveness, particularly in end-of-line machinery.
Many end -user clients mentioned that French machinery is generally appreciated
for its solidity, good flexibility, and superior after-sale servicing. It was also
implied through various interviews with manufacturers and distributors that strong
cultural ties often play a decisive role in the selection process.
North American manufacturers such as Mead, ITW, and Husky, were present in
a few installed bases, particularly those of U.S. subsidiaries. End-users indicated
that these suppliers’ European presence was critical, if not essential, in their
ability to win a contract and insure proper servicing and technical assistance.
Furthermore, many companies interviewed commented that they perceived the
distance between North American manufacturers and France to be a major
obstacle to penetrating the packaging machinery market. End-users also
frequently mentioned that they had very little information on U.S. and Canadian
machinery and were rarely, if ever, approached by North American packaging
equipment suppliers.
Best Prospects:
114
Data gathered from the survey and initial research indicates that a number of
specific business opportunities exist for PMMI member companies in the
beverage segment:
Full bottling line machinery – including screw capping
Fill and seal machinery – liquid
Labeling machinery
Coding machinery
PET blow-molding equipment
Film wraparound machinery
Palletizing machinery
Multi-packing (4, 6, 12 packs)
Telemonitoring and detection equipment
Purchasing Potential:
The overall purchasing potential of the companies interviewed is estimated at
between US$ 80-100 million over the forecast period (2003-2005). Major
projects include Coca-Cola’s US$ 40 million investment in its production facility in
Socx. In addition, PepsiCo bottler, St. Alban, will be issuing a tender in the
summer of 2003 for packaging and material handling machinery to equip its three
new bottling production lines. It is also noteworthy to mention that the bottling
sub-contractor, L’Abeille, will be investing in new bottling line following its recent
contract with Mecca Cola.
Despite a morose economic forecast for 2003, research indicates that many
companies are moving ahead with investment plans this year. Automation and
upgrading requirements are the main drivers of industrial investment in
packaging machinery for the forecast period.
5.4
Company Profiles
115
L’Abeille S.A.
Industry:
Sub Industry:
Size: (sales)
Specific Business
Opportunities:
A)
Beverage
Brewery; bottling
US$15-20 million
New bottling line
equipment (Mecca Cola
carbonate production)
Company Description:
L’Abeille S.A. is a small sub-contractor specializing in bottling and packaging for
cola carbonate and bottled water. Major accounts include PepsiCo France,
Mecca Cola, and numerous independent private labels.
B)
Main Products Produced and how are they packed:
L’Abeille S.A. bottles its cola carbonates and water in glass and polyethylene
(PET) containers.
C)
Installed Packaging Machinery:
Current Machinery Used
Brand
Cleaning and drying
machinery
Filling machinery – liquid
Sig Simonazzi,
Switzerland (Italy);
Krones, Sidel
Germany; France
Sidel, Sig, Krones Switzerland (Italy);
Germany; France
Sig
Switzerland
Krones, Sig, Sidel Germany,
Switzerland, France
Krones
Germany
Ocme
Italy
Capping machinery
Bottle conveying equipment
Labeling and marking
Palletizing, grouping, and
tray over wrapping equipment
D)
Average
Age
5-10
5-10
5
5-10
8
5-10
Future Packaging Machinery Ordering Plans (2003-2005):
Machinery
Units Origin
New bottling production line 1
equipment
E)
Origin
Motive of
purchase
European: existing New colasuppliers
carbonate
bottling
contract
Purchasing Policies.
116
Estimated
Budget
n/a
L’Abeille’s production team knows the European packaging machinery market
well and generally works with the leading full line bottling machine
manufacturers. The site team identifies yearly machinery requirements; once a
need is identified, the company consults its current suppliers. In most cases, it
gives preference to its European suppliers for a number of practical reasons,
such as compatibility with existing equipment, spare parts supply, and
relationship discounts.
F)
Factors That Influence Purchasing Decisions.
1/ Previous experience with brand
2/ Quality and reliability
3/ Servicing, spare parts provision and local staff availability
4/ Price
5/ Delivery terms
G)
Comments on Preferred Brands and Existing Business
Arrangements With Packaging Equipment Suppliers:
L’Abeille is satisfied with its current supplier base, which is mainly composed of
the major players in the beverage packaging market – Krones, Sig, Sidel, Ocme.
Generally-speaking, it finds German machinery to more reliable and durable than
French and Italian equipment, and as such, is willing to pay the required price
premium for this quality assurance.
L’Abeille mentioned that it has never been actively approached by North
American suppliers. The interviewee’s only exposure has been at U.S. and
Canadian stands during the Emballage and Interpack trade shows.
It was commented that North American suppliers face considerable barriers to
entering the French market. For one, U.S. machinery technology is adapted to
production environments in the U.S., which are not necessarily the same in
France – particularly with regards to machine ergonomics, process and
packaging flexibility, or technical norms. Also, North American suppliers most
often do not have a physical presence (or servicing structure) in Europe, which in
most decision-making processes eliminates U.S. and Canadian suppliers from
competition, especially when the technology already exists in Europe.
L’Abeille’s evaluation of packaging machinery by country of origin:
Origin
Germany
Italy
France
Technology
Very Good
Good
Good
Flexibility
Good
Good
Good
117
Service
Poor
Good
Average
Price
Expensive
Average
Fair
H)
Trade Show Attendance / Trade publication Information:
L’Abeille attends Emballage trade show in Paris. It subscribes to Emballage
magazine (both the paper and electronic versions).
I)
Contact Information:
Company Name:
Contact:
Position:
Telephone:
Email:
L’Abeille S.A.
Mr. Alain Duprez
Technical Director
(33) 2.41.62.09.52
a.duprez@l-abeille.fr
118
Brasseurs de Gayant
Industry:
Sub Industry:
Location:
Size: (2002 sales)
Purchasing
potential:
Specific Business
Opportunities:
A)
Beverage
Brewery
Douai brewery
US$ 45 million
US$50-100,000
Robotic palletizing
equipment
Company Description:
Brasseurs de Gayant is a family-owned, regional brewery that specializes in
specialty beer production. Despite its status as a regional brewery, Brasseurs de
Gayant holds the sixth position in the overall French beer market. The Douai site
produces 180,000 hectoliters of beers yearly, of which 30% is exported to
neighboring European countries.
B)
Main Products Produced and how are they packed:
Brasseurs de Gayant branded beers are packaged in 12 different models of
glass bottles as well as metal kegs (20, 30, or 50 liter). Multi-pack formats
include 3, 4, 6, 8, 10, 12, 15, and 24 bottles.
C)
Installed Packaging Machinery:
Brasseurs de Gayant’s Douai facility includes two production lines. The bottling
line is completely automated and produces 50,000 25cl bottles per hour, or
20,000 75cl bottles per hour. The keg filling line is also entirely automated and
produces 200 kegs per hour.
Current Machinery
Used
Liquid filling machinery
Brand
Kisters, Krones, Sig
Simonazzi
Pasteurization
Sig Simonazzi
equipment
Conveying, sorting and Krones
inspecting machinery
Multi-packing (6,9,12)
Krones
Palletizing, grouping,
Kupner (Krones), Mead
over-wrapping machinery
119
Origin
Germany,
Switzerland
(Italy)
Switzerland
(Italy)
Germany
Germany
Germany,
U.S.
Average
Age
10
5-10
5-10
5-10
10
D)
Future Packaging Machinery Ordering Plans (2003-2005):
Machinery
Palletizing equipment
E)
Motive of purchase
Estimate Budget
automation
US$ 50-100,000
Purchasing Policies.
The company identifies its machinery requirements on a yearly basis. Once a
need has been determined, the production team headed by the technical director
consults its existing supplier base, which is composed essentially of the leading
bottling line equipment manufacturers. It was indicated that at least two
proposals are evaluated before a final decision is made.
F)
Factors That Influence Purchasing Decisions.
1/ Previous experience with brand
2/ Servicing, availability of local staff and spare parts
3/ Quality
4/ Price in relation to quality
5/ Delivery terms
G)
Comments on Preferred Brands and
Arrangements With Packaging Equipment Suppliers:
Existing
Business
Brasseurs de Gayant indicated that it prefers to work with the leading European
manufacturers and bottling line specialists due to their strong reputations in the
field. German and Italian equipment is considered the most viable for Gayant’s
production environment, which requires high production speed and a good
degree of flexibility to handle different packaging types.
Brasseurs de Gayant is not familiar with North American equipment, aside from
Mead grouping equipment. It also mentioned that it has never been approached
by a North American supplier.
Brasseurs de Gayant’s evaluation of packaging machinery according to country
of origin:
Origin
Germany
Italy
H)
Technology Flexibility
Very Good Good
Good
Very Good
Service
Average
Good
Price
Expensive
Average
Trade Show Attendance / Trade publication Information:
Brasseurs de Gayant regularly attends the Emballage trade show in Paris, as
well as Brau in Munich, Drinktech, and from time to time Interpack in Dusseldorf.
120
It subscribes to Emballage magazine, and often consults the online version
(www.emballagesmagazine.com).
I)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Brasseurs de Gayant
Mr. Alain Dessy
Technical Director
B.P. 89
59502 Douai Cedex
-France(33) 3 27 93 26 22
(33) 03 27 93 26 20
a.dessy@brasseurs-gayant.com
www.brasseurs-gayant.com
121
Castel Freres S.A.
Industry:
Sub Industry:
Location:
Beverages
Wine
Blanquefort bottling facility
(Bordeaux)
Size: (2002 sales) US$ 740 million
Purchasing
US$ 2-4 million per year
potential:
Specific Business Replacement bottling line
Opportunities:
equipment
A)
Company Description:
Castel Freres is the largest producer and marketer of wines in France and the
second worldwide. Originally a family-owned firm, Castel grew rapidly in the
1970’s and 80’s through an aggressive acquisitions strategy, taking over
production of some of Bordeaux’s largest wine markers. The company solidified
its position in the wine market through its acquisition of the Nicolas chain,
France’s largest wine distributor.
Castel Freres’ wine-making capacity is spread over twelve chateaux domains in
the Bordeaux region. Its foreign subsidiaries are located in Germany, Japan,
China, and The Netherlands.
B)
Main Products Produced and how are they packed:
Castel Freres wines are packaged in glass bottle formats (including ampoules). It
also uses carton and paper over-packaging materials.
C)
Installed Packaging Machinery:
The company provided the following information on its installed packaging
machinery base:
Current Machinery Used
Full bottling line
Filling and closing
Labeling
Palletizing
Casing and grouping
Brand
Sig (Simonazzi),
Sidel
Serac, Remy
---Stork
Cermex
122
Origin
Italy (Swiss ownership),
France
France
Spain
The Netherlands
France
D)
Last Purchases of Packaging Machinery:
Castel Freres did not provide specific information on past purchasing behavior or
average equipment age.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
The company indicated that it will invest in various bottling line equipment over
the next two years to replace its aging machinery base. No specific machinery
types or investment budgets were provided.
F)
Purchasing Policies and Financial Arrangements.
Each Castel Freres production facility has a supplier list with preferred
manufacturers and brands. During an investment decision, the technical and
production directors consult at least three potential suppliers. Each proposal is
studied according to specific purchasing criteria and a recommendation is made
to the General Manager, Mr. Jean-Bernard Castel, for final approval.
Castel Freres works directly with machine manufacturers, especially for large
equipment purchases. However, it was mentioned that for some of the small
machine purchases (mostly imports), the factory works with representatives
concerning purchasing logistics and technical questions.
Castel Freres prefers to work directly with the machine manufacturer concerning
maintenance and repair issues.
All investments are internally-financed according to budgeted yearly
expenditures. Mr. Texier believes that despite the expected economic downturn
in 2003, that scheduled investment to improve the production line will be
maintained at predetermined levels.
G)
Factors That Influence Purchasing Decisions.
1/
2/
3/
4/
5/
Price
Reliability and durability
Ease-of-use
Servicing, maintenance support
Delivery terms
H)
Comments on Preferred Brands and Existing Business
Arrangements With Packaging Equipment Suppliers:
The company indicated that a large majority of its current suppliers are French.
This can be attributed to historical and cultural ties with existing suppliers, as well
123
as to proximity issues. Castel Freres believes its experience with French
equipment, along with long-standing commercial relations, are barriers to entry
for new packaging machinery suppliers. However it still evaluates closely new
equipment proposals. In this light, the company chose Spanish labeling
machinery for what it considered to be a highly-competitive price in relation to
quality.
Castel Freres’ evaluation of packaging machinery by country of origin:
Origin
France
Italy
Spain
Holland
I)
Technology
Very Good
Good
Good
Good
Flexibility
Good
Good
Good
Average
Service
Poor
Good
Average
Average
Price
Good
Average
Good
Fair
Trade Show Attendance
Castel Freres representatives attend the Emballage trade show in Paris along
with some regional exhibitions, including Vinitec in Bordeaux.
The company subscribes to Emballages magazine and consults the magazine’s
website (www.emballagemagazine.com) for latest developments in the sector.
The Internet is used as tool to gather information on potential suppliers and new
technologies.
Mr. Texier has never visited Pack Expo and mentioned that he probably would
not consult the web site for suppliers simply because of the language differences.
J)
Specific Interests
Despite its existing supplier relationships, Castel Freres is very much open to
receiving information on U.S. machinery and technology. Company
representatives have no experience with U.S. machines to date and would like to
learn more about U.S. and Canadian technology.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Castel Freres S.A.
Mr. Jean-Paul Texier
Production Director
24, rue Georges Guynemer
33290 Blanquefort
-France(33) 5.56.95.54.00
(33) 5.56.95.49.91
124
Email:
Web site:
jp.texier@castel-freres.com
www.castel-freres.com
125
Coca-Cola France
Industry:
Sub Industry:
Beverages
Carbonated Soft Drinks;
Fruit Juices; RTD tea
Location:
Five production sites
nationwide
Size: (2002 sales) US$ 987 million (France)
Purchasing
US$ 40 million (Socx
potential:
Production unit)
Specific Business Complete cola carbonate
Opportunities:
filling lines
A)
Company Description:
Coca-Cola’s operations in France produce and market major Coke brands and
flavors, as well as Minute Maid juices, and Aquarius and Powerade sport drinks.
Drink production is spread over five production sites, with most of the production
used to meet local demand (the only exception being the Dunkerque site, which
serves the Belgian and Dutch markets).
Coca-Cola corporate has followed a “think local, act local” policy worldwide,
which has led to decentralization of decision-making and increased product
segmentation to satisfy local demand. Recent product launches, such as the
Fanta Latina and Fanta Madness, are examples of Coca-Cola’s policy of
adapting its brands to local tastes.
B)
Main Products Produced and how are they packed:
Product
Cola Carbonates
Fruit Juices
Sports Drink
C)
Brand
Package
Coca-Cola (Cherry, Light, PET, Glass, metal can
Caffeine-free…),
Fanta,
Sprite
Minute Maid
Paper/cardboard, metal cans
Powerade, Aquarius
PET sports bottles
Installed Packaging Machinery:
Coca-Cola provided the following information on its installed packaging
equipment in its five French production facilities:
Current Machinery Used
Blow-molding (PET)
Brand
Sidel
Origin
France
126
Filling – liquid
Shrink film
Shrink film/ over-wrapping
Cartoning
Coding (PET bottles)
Palletizing/Depalletizing
KHS, Krones
Kisters
SMI / Ocme
Mead
Videojet Technologies Inc.
Acme, Ocme
Germany
Germany
Italy
U.S.
U.S.
Italy
It was estimated that roughly 75% of installed machinery was either of German or
Italian origin.
D)
Last Purchases of Packaging Machinery:
Coca-Cola recently purchased fourteen coding machines from U.S. supplier
Videojet Technologies, to be used in the “Up to You” promotion in the beginning
of April 2003.
Machinery
Coding Machines
E)
Brand
Units
Videojet Technologies Inc. 14
Origin
U.S.
Future Packaging Machinery Ordering Plans (2003-2005):
Coca-Cola France is planning an estimated US$ 40 million investment to expand
production capacity at its Socx production facility.
F)
Purchasing Policies/ Process.
Final purchasing decisions are made by the central purchasing department
located Coca-Cola’s French headquarters. A purchasing executive works with
the technical departments at each site to identify machinery needs and evaluate
proposals according to a strict set of specifications.
G)
Factors That Influence Purchasing Decisions.
1/ Production efficiency
2/ Quality and durability
3/ Servicing, availability of local staff and parts
4/ Price
5/ Delivery speed
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Under Coca-Cola’s corporate policy of “think local, act local”, national
subsidiaries such as Coca-Cola France focus on working with local suppliers of
raw materials and production equipment. As such, European machinery
127
manufacturers are often favored by Coke’s local purchasing process.
Nevertheless, Coca-Cola remains open to new, competitive bidders regardless of
nationality, which was evident in its selection of 14 coding machines from U.S.
manufacturer Videojet Technologies Inc.
Coca-Cola’s evaluation of packaging machinery by country of origin:
Origin
United States
Germany
Italy
France
I)
Technology
Very Good
Very Good
Good
Good
Flexibility
Good
Good
Good
Good
Service
Good
Good
Good
Good
Price
Good
Expensive
Average
Fair
Trade Show Attendance / Trade publication Information:
Coca-Cola France attends Emballage and Interpack trade shows. In addition, it
consults a wide variety of publications, in French, English and German including
Emballage Magazine, Process, Beverage World, a nd Usine Nouvelles.
J)
Specific Interests
Coca-Cola France is open to new suppliers for most machinery, as long as the
machinery is competitive according to the above decision-making criteria. It was
mentioned that it is critical for a machine supplier to have a presence either in
France or a neighboring country to ensure rapid servicing and spare parts
provision.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Coca-Cola France
Mr. Jean Valentini
Director of Development - Packaging
27 rue Camille Desmoulins
92784 Issy les Moulineaux Cedex
(33) 1.58.00.38.76
(33) 1.58.00.33.02
jvalentini@ge.cokecce.com
www.coca-cola.fr
Or
Contact:
Position:
Tel:
Email:
Mr. Marc Monteran
Purchasing Executive – Packaging Machines
(33) 1.58.00.27.46
mmonteran@ge.cokecce.com
128
Danone S.A.
Industry:
Sub Industry:
Location:
Size: (2002 sales)
Specific Business
Opportunities:
A)
Beverages
Bottled Water
Evian production facility
US$ 2.2 billion (Evian
division)
US$ 1.9 billion (Badoit)
Injection molds; filling
(liquid); injection and
blowing machines; bottling
line
Company Description and Main Products:
Danone is the market leader in France in the carbonated water segment and is
second in still water, with its Evian and Volvic representing its premier brands.
The Badoit brand competes directly with Perrier (Nestle Waters) in the premium
carbonated water segment.
Danone’s bottled water division includes the following brands:
o Still bottled water: Danone, Activ, Evian, Taillefine, Volvic
o Carbonated bottled water: Arvie, Badoit, Salvetat
o Flavored bottled water: Salvetat, Vertigo de Badoit, Volvic aux extraits
naturels
Danone is focusing its bottled water marketing efforts on developing different
packaging sizes and formats to target an even more highly-segmented audience.
Most recently, Danone introduced the 5-liter format for families and the sports
bottle for the younger, more active consumers.
Plastic/ Glass Packaging Formats (Evian/Volvic): 33cl; 50cl; 75cl (“nomad”
bottle); 1l; 1.5l; 2l; 5l (family-size).
B)
Installed Packaging Machinery:
No specific information was provided on Danone’s installed machinery base in
terms of number of units, utilization rate, or average age. See below for more
general information on current equipment suppliers.
129
Current Machinery Used Brand
PET blow molding
Sidel, KHS
Pre-injection molding
Filling line equipmentliquid
Labeling and marketing
Palletizing, tray forming,
over wrapping
C)
Origin
France, Italy,
Germany, Canada
Sipa, Husky
Italy, Canada
Krones, Sidel, Sig
Germany, France,
Simonazzi, Procomac Italy
Krones, Sig Simonazzi Germany, Italy
Ocme, Acme
Italy
Average Age
10
5-10
5-10
5-10
5
Purchasing Policies and Financial Arrangements.
Danone, through its Global Sourcing Manager, takes a global approach to
industrial purchasing, exploring offers from a wide-source o f equipment
manufacturers irregardless of nationality. Decision-makers place the most
emphasis on the long -term running costs when evaluating a potential machinery
investment.
No specific information was provided on future machinery investment. It was
opined that new production investment is mostly driven by capital markets and
the current valuation of Danone’s equity on global financial markets.
Industry sources say that Danone should replace a number of liquid filling, blowmolding, and pre-injection machinery over the next three years.
D)
Factors That Influence Purchasing Decisions.
1/ Global running costs over 5-10 years
2/ Production speed and capacity
3/ Production efficiency (material waste generation)
4/ Energy Consumption
5/ Acquisition price
Danone’s industrial purchasing department uses a complex set of coefficients to
determine the overall cost of a machine over five to ten years. This could include
energy consumption, purchase price, material waste generation, and estimated
maintenance cost over the lifetime of the machinery.
It is important to note that the initial acquisition price is not as important as the
long-run production cost (and savings) calculations associated with a machine.
E)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
130
Most of Danone’s packaging machinery suppliers are major French, German or
Italian manufacturers. As production speed (25,000-50,000 bottles/hour) and
reliability are crucial factors, Danone prefers to work with the large European fullline manufacturers. Italian end-of-line specialists, such as Ocme and Acme, are
preferred suppliers of secondary and over-wrapping machines.
Danone’s plastic bottle manufacturing (Evian and Volvic) includes either an
injection or blow-molding phase. Italian manufacturer, SIPA, based outside of
Venise, supplies Evian facitilies with injection mold machinery, which are
appreciated for their simplicity and ease-of-use. However, it was mentioned that
the cumbersome size and slow production speed were the drawbacks of the
Sipa’s technology.
Canadian machine manufacturer, Husky, is the only North American machine
supplier to Danone’s bottled water production facilities.
F)
Trade Show Attendance / Trade publication Information:
Danone purchasing executives attend Interpack in Dusseldorf, Emballages in
Paris, and DrinkTech (every three years in either Munich or Dusseldorf). Major
French publications consulted are Emballage Magazine and Usine Nouvelles.
G)
Specific Interests
Danone (Evian and Volvic brands) would be interested in receiving more
information on pre-injection and blow-molding, as well as liquid filling machinery.
H)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Website:
Danone France (beverages division)
Mr. Pierre Betat (or Thierry Becker)
Global Sourcing Manager
22 avenue Sources
74500 Evian les Bains
(33) 4.50.25.80.88
(33)4.50.26.86.43
Pierre.betat@danone.com
Thierry.becker@danone.com
www.danone.fr
131
Heineken France
Industry:
Sub Industry:
Location:
Beverage
Beer
Five production sites
nationwide
Size: (2002 sales) US$578 million (France)
Purchasing
Est. US$ 500,000potential:
1,000,000
Specific Business Control systems (tele Opportunities:
monitoring and bottle
inspection), misc. bottling
line equipment
A)
Company Description:
Dutch multinational Heineken is a leading European brewer with over 80 brands
sold in over 140 markets for a global annual turnover of roughly US$8 billion in
2001.
Heineken is the second largest brewer in France with an estimated turnover of
US$ 582 million in 2002, accounting for roughly one third of the total market in
value terms. Heineken operations in France include five production sites (of
which one is devoted to the Fischer brand), with the bulk of production sold
domestically. Sales have remained stable over the review period, and production
is expected to increase modestly over the next three years to meet modest
growth in domestic beer consumption.
New packaging innovations for the French market include the “Basket Pack”, a
six-pack for 33 cl glass bottles. Heineken has also launched individual beer
bottles made of PET and re-sealable caps in response to Kronenbourg’s recent
innovations in the area.
B)
Main Products Produced and how are they packed:
Brand
Heineken
Fischer
C)
Package
Glass, metal can, PET bottle
Glass, metal can
Installed Packaging Machinery:
Current Machinery Used Brand
Filling – liquid
Krones, KHS
Filling –liquid
Simonazzi (Sig)
132
Origin
Germany
Italy (Swiss ownership)
Capping
Conveying
Labeling, Marketing
Palletizing, depalletizing
Multipacking,
Overwrapping
D)
Krones, KHS
Gebo (Sidel)
Krones, KHS, Sig
Simonazzi
Ocme
Mead, Ocme, Acme
Germany
France
Germany, Switzerland
(Italy)
Italy
U.S., Italy
Last Purchases of Packaging Machinery:
Heineken stated that it has just completed a round of investment in bottling line
machinery, selecting its existing German and Swiss-Italian suppliers. Average
age of used equipment is estimated at between 10-15 years.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Heineken commented that there are no major machinery investments planned for
the short term since it recently completed a major investment round. However, it
was mentioned that opportunities remain for smaller-scale replacement or
bottling line modifications over the forecast period. In addition, new multi-pack
formats are expected to drive replacement equipment in this area. Heineken is
also exploring tele-monitoring and bottle inspection machinery to add to its
production line (current suppliers being consulted are of Japanese and German
origin).
F)
Purchasing Policies and Financial Arrangements.
Each site’s production team, in conjunction with the marketing and research and
development units in Holland, identify yearly machinery investment requirements.
Once the machinery specifications are developed, a proposal is submitted to
Heineken’s corporate purchasing office for approval. For new machinery
purchases, a tender is issued from the Dutch purchasing department and at least
five suppliers are evaluated per machine type.
Most investments are financed internally. Heineken provides a down payment
upon order (normally 30-40%), and the rest within sixty days after delivery. Long
term suppliers are given favorable payment plans, depending on past experience
and payment history.
G)
Factors That Influence Purchasing Decisions.
1/ Reliability and durability
2/ Servicing, availability of spare parts
3/ Past experience with supplier
4/ Price in relation to quality
133
5/ Brand reputation
6/ Rapid delivery terms
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Heineken stated that it has long -standing and close working relationships with its
current suppliers, which are mostly the major European manufacturers of
complete bottling line equipment. Heineken technical and maintenance staff
works closely with its suppliers to develop new machinery to accommodate new
and rapidly-changing packaging requirements.
The interviewee stated that German machines are generally more robust and
durable than its Swiss and Italian competitors. This is a major competitive
advantage for German suppliers in high speed, high volume beer production,
since reliability and durability are possibly the most important factors taken into
consideration during Heineken’s investment decisions. Consequently, the
premium price demanded by German manufacturers is justified when evaluated
over the life time of the machinery.
It was also mentioned that its German suppliers’ after-sales servicing is often
more expensive and less responsive than its French, Swiss, or Italian suppliers.
Sig Simonazzi was pointed out as having quick, efficient and cost-effective aftersales servicing, which has allowed it to increase its penetration in the highvolume beer production market.
I)
Trade Show Attendance / Trade publication Information:
Heineken attends the Emballage trade show in Paris, along with Interpack in
Dusseldorf. It also attends specialized shows such as Drinktech in Munich (every
three years) and Brau Nuremberg.
A wide range of trade publications are consulted, including Emballage Magazine,
Emballage Digest, Beverage World, and Brau.
J)
Specific Interests
Heineken receives very little information from North American suppliers, and
would like to receive information on bottling line machinery, particularly
innovative equipment that is highly versatile and flexible. It also is interested in
receiving product information on tele-monitoring and bottle inspection equipment.
K)
Contact Information:
Company Name:
Contact:
Heineken France
Luigi Mergoli
134
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Technical Director France
19 rue des Deux Gares
92500 Reuil-Malmaison Cedex
(33) 1.47.14.28.93
(33) 1.47.14.36.01
l.mergoli@heineken.fr
www.heineken.fr
Corporate Purchasing Contact:
Contact Name:
Title:
Email:
Mr. Siep Hiemstra (The Netherlands)
Purchasing Director
s.hiemstra@heineken.nl
135
Kraft France
Industry:
Sub Industry:
Location:
Size: (2002 sales)
Purchasing
potential:
Specific Business
Opportunities:
A)
Beverage
Coffee
Laverune production facility
Est. US$ 450 million
US$ 4-5 million
Vertical sachet fill and seal;
automated palletizing
equipment
Company Description:
Kraft Foods France produces and markets chocolate, biscuits, and coffee goods
for the French and European markets. Kraft’s French operations include a
headquarters in Vélizy, and two production sites located in Strasbourg
(chocolate) and Laverune (coffee).
Kraft’s coffee production is marketed under its global brands: Maxwell House,
Carte Noir, Jacques Vabre and Grande Mère. Roughly 70% of annual
production is sold domestically, with the remainder e xported to neighboring E.U.
countries.
B)
Main Products Produced and how are they packed:
Most of Kraft’s coffee production is packaged in triplex (aluminum/polyethylene)
vacuum 250 gram packs or plastic “lift top” containers.
C)
Installed Packaging Machinery:
Current Machinery Used
Vertical sachet fill and
seal machinery
Vertical sachet fill and
seal machinery
Carton fill and seal
Overwrapping (film)
Conveying, weighing
D)
Brand
Bosch
Origin
Germany
12
SIG
Switzerland
15
Bosch
MAF
Siemens
Germany
France
Germany
Last Purchases of Packaging Machinery:
136
Average Age
10-12
5
---
Kraft Foods France indicated that it has not invested heavily in new machinery
over the review period. Average machinery age is estimated to exceed ten
years.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Kraft indicated that it plans to replace its aged installed base of sachet fill and
seal machinery. Other major projects include automation of its entire palletizing
activity.
Machinery
Bag
fill
machinery
Robotic
machinery
F)
Origin
Motive of
purchase
and
seal Germany, Italy,
Switzerland
palletizing ---
Estimated Budget
Replacemen US$ 4-5 million
t
Automation ---
Purchasing Policies.
Kraft Foods Laverune’s production site team, in accordance with the marketing
department’s packaging specifications, defines new and replacement machinery
requirements over a three- to five-year plan.. This site team works in close
collaboration with Kraft’s centralized research and development unit, which has a
permanent representative at the Laverune facility. Budgets and final purchasing
decisions are approved by Kraft’s European headquarters based in Switzerland.
Kraft Foods France purchases packaging equipment directly from the
manufacturer, and generally deals with the machine manufacturer’s French
representative for maintenance and other technical issues. Kraft’s internal
maintenance team requires continual contact with a manufacturer’s servicing
team to respond quickly to technical issues.
G)
Factors That Influence Purchasing Decisions.
1/ Reliability and durability
2/ Production efficiency (material waste)
3/ Price in relation to quality
4/ Quick and efficient servicing
5/ Previous experience with brand
H)
Comments on Preferred Brands and Existing Business
Arrangements With Packaging Equipment Suppliers:
Kraft considers German packaging machinery to be the best adapted to its
production environment in terms of durability and reliability over the machinery’s
expected lifetime. The largest machines are expected to last 15-20 years, and in
137
this respect German machines are believed to have a considerable competitive
advantage over its nearest competitors. In particular, Bosch machines are
appreciated for their production efficiency and reliability for vertical bag fill and
seal machines and end-of-line machinery. Swiss manufacturer, Sig, is also
appreciated for the reliability of its fill and seal technology.
Kraft’s evaluation of packaging machinery by country of origin:
Origin
Germany
Switzerland
Francw
I)
Technology
Very Good
Good
Good
Flexibility
Good
Good
Good
Service
Average
Good
Good
Price
Expensive
Average
Fair
Trade Show Attendance / Trade publication Information:
Kraft attends the major European packaging shows – Emballage and Interpack –
and consults Emballage magazine on a regular basis to learn about market
trends and new packaging technology. The Internet is used extensively by the
engineering and research department to learn about and compare current and
potential suppliers’ product lines.
J)
Specific Interests
Kraft is interested in receiving company and product information through
electronic newsletter with links to company homepages. In particular, it is
interested in receiving information on automated palletizing equipment.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Kraft Foods France
Mr. Patrice Carle
Maintenance Director
route Saint Georges
34880 Laverune
-France(33) 4.67.07.15.15
(33) 4.67.07.15.16
pcarle@krafteurope.com
www.kraftfoods.fr
138
Kronenbourg S.A.
Industry:
Sub Industry:
Location:
Beverage
Beer
3 production sites:
Obernai,
Champigneulles,
Rennes
Size: (2002 sales) US$ 850 million
Purchasing
Est. US$ 1-3 million yearly
potential:
Specific Business PET blow molding;
Opportunities:
palletizing; multipacking
A)
Company Description:
In 2000, the Danone group sold its Kronenbourg division to Scottish &
Newcastle, the leading brewer in the U.K. and the third largest European
producer. Kronenbourg is France’s largest brewer, producing roughly 9 million
hectoliters per year in its three brewing facilities.
Kronenbourg controls over 40% of the domestic beer market in volume terms,
and almost 50% of the market in overall value terms. Most of production is sold
locally with the French market accounting for over 95% of sales, of which 70% is
sold through on-trade channels (supermarkets and retail shops).
The Kronenbourg product portfolio includes the following brands:
o Kronenbourg, 1664, Kanterbrau, Gold, Grimbergen, Brugs, Wel Scotch
Partner brands (through licensing and promotional agreements):
o Beamish Stout, Beamish Red Irish Ale, Bud, Carlsberg, San Miguel,
Srongbow, and Fosters
New packaging innovations include a new logo and signage for the 1664 brand,
a new 33cl “anti-shock” PET bottle for Kronenbourg, as well as new multi-packs
for the Brugs and Kanterbräu brands.
B)
Main Products Produced and how are they packed:
Brand
Kronenbourg
1664
Kanterbräu
Gold
Package
Glass, Metal Can, PET Bottle (33cl)
Glass, Metal Can
Glass, Metal Can
Glass
139
Grimbergen
C)
Glass
Installed Packaging Machinery:
Kronenbourg provided the following information on its installed packaging
machinery base:
Current Machinery
Used
Bottling line
Bottling line, capping
Filling, conveying
Cartoning
PET blow molding
Shrink film
Multipacking
Palletizing, depalletizing
D)
Brand
Origin
Krones, KHS
Simonazzi (SIG)
Krones, KHS
Ocme
Sidel
Ocme, Acme
Mead
Schausser
Germany
Italy (Swiss)
Germany
Italy
French
Italy
U.S
Germany
Average
Age
12
15
12
12
2
10
12
6
Purchasing Policies.
Potential machinery purchases are evaluated first by a “pilot committee”
composed of a purchaser from headquarters, along with the technical and
production directors at the production facility concerned. The company consults
a list of suppliers and selects five candidates whom it contacts to submit
proposals. The committee then submits investment recommendations to
corporate headquarters in Strasbourg for approval.
It is important to note that Kronenbourg places a great deal of importance on
observing equipment in a production environment. Consequently, when
evaluating a proposal, company representatives often visit neighboring factories
in France or Germany.
Kronenbourg indicated that its packaging machinery investments are financed
internally. Payment schedules are structured to provide a down payment at the
time of order, and the balance after the machinery has been installed and has
been functioning for a fixed amount of time.
E)
Factors That Influence Purchasing Decisions.
The most important factor when evaluating a machinery investment is the
running cost of the machine over its lifetime. Kronenbourg indicated that its
machinery is expected to last over 20 years, and as such its calculations are
complete accordingly. It also indicated that the lifetime running cost estimates
often surpass the initial investment.
1/ Lifetime running cost
140
2/ Ease of Use
3/ Brand reputation
4/ Previous experience with supplier
5/ Availability of parts and service (less than 24 hours)
F)
Comments on Preferred Brands and Perceptions of North American
Equipment:
Kronenbourg has very little North American packaging machinery in its French
production facilities. The only exception is Mead, with whom Kronenbourg has
had a long-standing supplier relationship. It was mentioned that Mead’s
European presence is a decisive factor in its overall competitiveness, particularly
in terms of responsiveness of machine servicing and maintenance and spare
parts supply.
The bulk of Kronenbourg’s packaging machinery brands are either German or
Italian -, and for the most part are the leading full-line bottling equipment
suppliers - Krones, KHS, and Sig Simonazzi. Kronenbourg considers its
German equipment, in particular Krones and KHS brands, to be the best and
most reliable packaging equipment on the European market. Simonazzi
equipment is appreciated for its versatility and adaptability in handling different
packaging formats.
G)
Trade Show Attendance / Trade publication Information:
The company also visits Emballage (France) and Interpack in Germany.
Company executives consult major industry publications such as Usine
Nouvelles, Emballages, and Beverage World.
H)
Specific Comments concerning North American Machinery
The company representative interviewed mentioned that the distance between
North American suppliers and the European market represents a significant
“barrier to entry”. European end-users are comforted by the proximity of
manufacturers, particularly concerning technical collaboration, quick and efficient
servicing, and spare parts provision.
Kronenbourg also commented that North American machinery suffers from a
poor image with respect to machine quality and flexibility, both of which are major
factors in Kronenbourg’s decision-making process. German machines, in
particular, are regarded as being the highest quality, most durable equipment on
the market.
I)
Contact Information:
Company Name:
Kronenbourg S.A.
141
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Mr. Pascal Magoni
Technical Director
68 route d’Oberhausbergen
67037 Strasbourg Cedex 02
(33) 3.88.27.44.05
(33) 3.88.27.42.06
pascal.magoni@kronenbourg-fr.com
Or
Contact:
Position:
Tel:
Fax:
Email:
Mr. Gerald Jacquot
Purchasing Director
(33) 3.88.27.44.88
(33) 3.88.27.42.06
Gerald.jacquot@kronenbourg-fr.com
142
Orangina Schweppes S.A.
Industry:
Sub Industry:
Location:
Beverage
Soft drinks and fruit juices
France: 5 production sitesOrangina/Pampryl (3);
Schweppes (2)
Size: (2002 sales) US$ 427 million (of which
64.2% Orangina brand
drinks)
Purchasing
Est. US$ 2-4 million yearly
potential:
per production facility
Specific Business Complete bottling line
Opportunities:
equipment
A)
Company Description:
Orangina Schweppes France, a subsidiary of London-based Cadbur y
Schweppes Plc, is France’s number one producer of non-alcoholic drinks. Its
product portfolio includes carbonated fruit-based, carbonated tonic, still fruitbased, and fruit-flavored drinks for children.
Major brands include:
o Orangina, Schweppes, Oasis, Pampryl, Champony, Gini, Canada
Dry …
Despite not being present in the cola segment, Orangina Schweppes has
increased its penetration in other target markets through product innovation such
as introducing new Orangina favors and novel 25 cl glass bottles for its Pampryl
fruit-juice brand.
Furthermore, the original design of Orangina’s 1.5 l plastic bottles and 20 cl
glass/plastic bottles are closely associated with its brand recognition and
awareness, and have been widely-supported by national advertising campaigns.
B)
Main Products Produced and how are they packed:
Orangina Schweppes packages its wide variety of beverage products in glass
and plastic (PET) containers, metal cans, and carton Tetra pak box formats.
C)
Installed Packaging Machinery:
Cadbury Schweppes did not provide detailed information on its installed
packaging machinery base. It did mention that roughly 80% of its installed
143
capacity is either of Italian or German origin, with the remaining 20% of French
origin (Sidel and small French manufacturers).
Current Machinery Used Brand
Full bottling line
Sig Simonazzi,
equipment
KHS, Krones
PET blow molding
Labeling and marking
Palletizing a nd
wraparound
D)
Sidel
Krones
Cermex
Origin
Average Age
Italy (Swiss
ownership),
Germany
France
Germany
France
5-15
10
-3
Last Purchases of Packaging Machinery:
The company indicated that it made the following purchases within the last three
years:
Machinery
Bottling line
equipment
End-of-line
E)
Brand
KHS, Krones,
Simonazzi
Cermex, Sidel
Country
Germany, Italy
France
Future Packaging Machinery Ordering Plans (2003-2005):
Machinery
Motive of
purchase
Estimate Budget
Bottling line equipment (liquid filling, screw
capping, conveying)
Replacement
Est. € 2 million
F)
Purchasing Policies and Financial Arrangements.
Cadbury Schweppes France follows a decentralized decision-making process.
Each production site is responsible for identifying and proposing packaging
machinery replacement and production improvements on a one to two year
basis. Market-driven changes as indicated by Cadbury Schweppes marketing
department are key factors when drawing up technical specifications.
Once technical specifications are developed, an existing list of preferred
suppliers is consulted, from which at least three proposals are evaluated per
machine category. In many cases, the corporate purchasing office in the U.K.
assists in negotiating and selecting new machinery.
Cadbury prefers to buy machinery directly from the manufacturer. It requires that
the machine supplier designate technical staff to work closely with its internal
maintenance personnel.
144
Payment schedules are structured in order to provide a down payment at the
time of order, a percentage upon delivery, with the remaining balance after the
machine has been functioning for more than a month.
G)
Factors That Influence Purchasing Decisions.
1/ Adherence to technical specifications
2/ Reliability
3/ Technical sophistication (flexibility/adaptability)
4/ Servicing, cooperation with internal technical and maintenance staff
5/ Compatibility with existing equipment
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Cadbury indicated that its supplier base of French, German, and Italian machine
manufacturers adequately fulfilled its packaging machinery needs. German
machines are viewed as the most reliable and durable; Italian machines are seen
as being the most versatile in handling different packaging formats.
The company indicated that it selects Sidel PET blowing machines due to its
leadership position, reliability, and strong brand reputation in this field. Cadbury
believes there is little real competition in the French market to rival Sidel in this
area of expertise.
Cadbury Schweppes indicated that it was not aware of any North American
machinery in its French facilities. In addition, the interviewee has rarely, if ever,
been approached by North American suppliers, and as such had no comments
on U.S. and Canadian packaging machinery technology.
I)
Trade Show Attendance / Trade publication Information:
Cadbury Schweppes indicated that it rarely attends trade shows to gather
supplier information. It mentioned that it is familiar with the key suppliers in their
field (the major bottling line suppliers) and consults their interlocutors in these
companies directly. It has attended the Emballage trade show in Paris.
The production team subscribes to Emballage and Beverage World magazines.
It indicated that it does not consult the Internet to gather supplier information.
J)
Specific Interests
Cadbury Schweppes would be interested in receiving company and product
information from machinery suppliers in the above machinery categories (see
setion C).
145
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Website:
Orangina Schweppes S.A.
Mr. Yann Maurice
Director of Development - Packaging
Domaine St. Hilaire
Rue Pierre Berthier
13100 Aix-en-Provence
(33) 4.42.37.65.34
(33) 4.42.37.65.70
Yann.Maurice@csplc.com
www.orangina.fr
146
PepsiCo France
Industry:
Sub Industry:
Location:
Size: (2002 sales)
Purchasing
potential:
Specific Business
Opportunities:
A)
Beverage
Cola Carbonates; Mineral Water
Saint Alban bottler
US$ 106 million
Est. US$ 5-10 million
Full bottling line and material
handling equipment:
June/July Request for Proposal
(RFP)
Company Description:
PepsiCo is the world’s second largest soft drinks manufacturer, with its soft drink
activity accounting for about a quarter of global turnover. The group acquired
Tropicana in 1998, becoming a major player in the fruit juice segment.
Pepsi’s sales in cola carbonates in France are relatively disappointing compared
with its nearest competitors, and are significantly below Coca-Cola’s. Pepsi was
able to maintain roughly a 15% volume share due to the success of its Pepsi Max
and Pepsi Light brands. The company also has a strong market position in notfrom-concentrate fruit juices with its Tropicana brand.
PepsiCo France’s bottler, Les Eaux Minérales de St. Alban, produces and bottles
the full Pepsi product line, including its own mineral water (under the St. Alban
brand) and private labels for large supermarket chains.
B)
Main Products Produced and how are they packed:
Product
Cola Carbonates
Mineral Water
C)
Brand
Pepsi, Pepsi Max,
Pepsi Light, Pepsi
Twist, Cool, 7-up
St. Alban; Private
labels
Package
Bottles (PET) ; metal can
Bottles (PET)
Installed Packaging Machinery:
PepsiCo France did not provide specific unit numbers, but it is estimated that
80% of installed machinery at its St. Alban bottling facility is of German origin.
Below is a cross-section of the machine used in the St. Alban bottling plant:
147
Current Machinery Used
Injection molds
Blow-molding
Blowing, bottling line,
conveying, rincing, drying
Palletizing
Labeling
Palletizing, depalletizing
Shrink film wrapping
Multipacking
Stretch wrapping
Injection
D)
Brand
Husky
Sidel
Krones
Origin
KHS, Ortmann and Herbst
Krones, Kisters
Acme
Kisters
Mead
ITW (“Octopus”)
VBS (Vacuum Barrier System)
Germany
Germany
Italy
Germany
U.S.
U.S.
U.S.
Canada
France
Germany
Future Packaging Machinery Ordering Plans (2003-2005):
The Saint Alban bottling facility will be issuing a request for proposal for bottling
line and materials handling equipment for two (or three) additional production
lines. A request for proposal will be tendered in June or July. In each machine
category, candidates will be evaluated according to a number of strict criteria. In
particular, suppliers must demonstrate ability to ensure rapid servicing and
maintenance (less than 24 hours). A European presence is an important factor
that will be taken into consideration.
The contact information for the RFP is included below in section K.
F)
Purchasing Policies.
Production and technical directors at the St. Alban facility work closely with the
research department (an external engineering firm) to develop the technical
specifications for the RFP. Proposals are studied by a team composed of St.
Alban production managers and PepsiCo’s central purchasing department
located in Belgium. Final decisions are made in the Belgian head office.
G)
Factors That Influence Purchasing Decisions.
1/ Reliability and durability
2/ Rapidity of servicing and repair
3/ Previous experience with the brand
4/ Price in relation to quality
The St. Alban production team places a great deal of importance on a supplier’s
ability to react quickly to maintenance and repair concerns. In this respect, it is
preferred that a supplier have a European presence with a technical assistance
infrastructure.
148
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
The interviewee from the St. Alban bottling facility commented that it has had a
good experience with its North American suppliers. It was mentioned that Husky,
ITW, and Mead’s European presence was a deciding factor in their selection.
(The distance between Europe and North American suppliers is perceived as a
considerable obstacle that renders communication and reactivity difficult)
PepsiCo considers German equipment to be the “Mercedes” of packaging
machinery. Since reliability and durability are the most important criteria in the
decision-making process, the purchasing team often selects the leading bottling
line equipment manufacturers for their strong brand image and reputation for
quality.
St. Alban operates a few Italian machines (Acme, Simonazzi). Priced lower than
their German counterparts, Italian machines are considered to be of lower overall
quality and durability when compared to its German equivalents.
St. Alban’s evaluation of packaging machinery according to country of origin:
Origin
United States
Canada
Germany
Italy
I)
Technology
Good
Very Good
Very Good
Good
Flexibility
Good
Good
Good
Good
Service
Good
Average
Poor
Good
Price
Good
Good
Expensive
Average
Trade Show Attendance / Trade publication Information:
PepsiCo’s St. Alban production team visits the major European packaging trade
shows, Emballage and Interpack. A wide variety of trade and industry
publications are consulted including Emballage Magazine, Process, Liquid
Magazine, and Beverage World.
J)
Specific Interests
PepsiCo would be interested in receiving information on full-line bottling
equipment for its production expansion plans.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
PepsiCo France (St. Alban bottling facility)
Mr. Gilles Kersriden
Production Manager
Les Grands Prés
42370 St. Alban les Eaux
149
Telephone:
Fax:
Email:
-France(33) 4.77.66.42.50
(33) 4.77.66.42.53
gilles.kersriden@eau-minerale-st-alban.com
Regarding June/July Request For Proposal :
Contact:
Position:
Tel:
Email:
Mr. Eddy Cool
Technical Director
(33) 4.77.66.42.50
eddy.cool@eau-minerale-st-alban.com
150
Perrier Vittel S.A. (Nestlé Waters)
Industry:
Sub Industry:
Beverage
Bottled Water (still and
carbonated)
Location:
Vergeze, France
Size: (2002 sales) US$ 791 million
A)
Company Description:
Perrier Vittel France belongs to the Swiss food and beverage giant Nestlé.
Following its takeover of Perrier Vittel, Nestlé Waters became the world’s leading
bottled water manufacturer. Present in over 140 countries, Perrier Vittel S.A.
employs over 20,000 people of which 2,000 work in the production facility in
Vergèze, where the Perrier source is located. The company produces
approximately 12 billion liters of bottled water yearly for most major export
markets.
In France, Perrier Vittel is the leader in the still bottled water segment, and
second in the carbonated bottled water segment behind Danone brands. Nestlé
Waters exports roughly a third of its local production to market worldwide. The
United States is a principal export market, of which the Perrier brand accounts for
roughly 80% of total bottled water imports.
Major Nestle Waters brands include:
o Still bottled water: Aquarel, Contrx, Hepar, Valvert, Vittel
o Carbonated bottled water: Perrier, Quezac, San Pellegrino
B)
Main Products Produced and how are they packed:
Product
Mineral water (still and carbonated)
Mineral water (still and carbonated)
Mineral water (still and carbonated)
Mineral water (still and carbonated)
Mineral water (still and carbonated)
C)
Size
20 cl
33 cl
50 cl
75 cl
100 cl
Package
Colored glass
Metal can, PET
PET, colored glass
PET, colored glass
Colored glass
Installed Packaging Machinery:
Perrier Vittel’s Vergèze production facility includes eleven production lines over
three sites (Perrier 1, Perrier 2, Perrier 3). Its bottle filling lines are fed with preformed bottled fabricated in the on-site glass facility.
151
The company provided only general information regarding its installed base: over
80% of its machinery is either German or Italian, with the remainder being mostly
of French or Dutch origin. Major brands mentioned included SMI (Italian marking
machines) and Kisters (German filling and dosing systems), Seimens and Krones
(labeling equipment).
D)
Purchasing Policies and Financial Arrangements.
The company was not a liberty to reveal its decision-making structure. However,
it was explained that a team composed of the industrial site director, production
line managers, and the research department develop recommendations which
are submitted to Nestlé’s central purchasing department.
E)
Factors That Influence Purchasing Decisions.
Perrier Vittel places importance on a wide rage of criteria. Of the aspects
discussed, the following were determined to be the most prevalent:
1/ Reliability and durability
2/ Production efficiency
3/ Versatility
4/ Service, availability of local staff and parts
5/ Previous experience with brand
F)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
It was estimated that over three-fourths of Perrier Vittel’s packaging equipment at
its Vergèze site was either Italian or German. The only North American supplier
identified was Mead (cartoning machines).
G)
Trade Show Attendance / Trade publication Information:
Perrier Vittel visits Emballage (Paris, France) and Interpack (Dusseldorf,
Germany) as well as Drink Tech in Munich. It consults a wide rage of trade
journals including Emballage Magazine, Process, Beverage Magazine, and
Usine Nouvelles.
H)
Specific Interests
Perrier Vittel receives little information from North American suppliers. It would
be interested in receiving any product information concerning bottling line
machinery, conveying, liquid filling, labeling, and shrink film packaging
machinery.
I)
Contact Information:
152
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Website:
Perrier Vittel France
Mr. Daniel Romieu
Director of Industrial Development
Source Perrier
30310 Vergèze
(33) 4.66.87.63.92
(33) 4.66.35.04.58
Daniel.romieu@waters.nestle.com
www.perrier.com
153
Taittinger S.A.
Industry:
Sub Industry:
Location:
Size: (2002 sales)
Purchasing
potential:
Specific Business
Opportunities:
Beverages
Champagne
Reims
US$ 78 million
(consolidated)
US$ 800,000
Labeling, Wrapping,
Capping, and Pallet
forming machinery
A) Company Description:
Taittinger is a major producer of premium champagne beverages marketed
under the Taittinger brand. Taittinger vineyards are spread over 270 hectares of
land in the Champagne region, and is one of France’s premier producers of
champagne for both the domestic and foreign markets.
B) Main Product and how they are packed:
Product
Champagne
Brand
Packaging used
Taittinger Glass, metal, paper/carton over-wrap
C) Installed Packaging Machinery:
Current Machine Used
Capping
Labeling
Tray forming
Cartoning
Pallet forming
Wrapping
Brand
Sick
Kosme,
Cavagnino
Cermex
Cermex
Mépal
Polypack
Units
Origin
Average Age
3
3
Germany
Italy
15
8
2
1
1
1
France
France
France
France
1
1
18
18
D) Future Packaging Machinery Ordering Plans (2003-2005) :
Machine
Capping
Labeling
Multi-position palletizing
Units
Motive of Purchase
Forecasted Budget
1
1
1
Replacement
Replacement
Replacement
US$ 200,000
US$ 200,000
US$ 200,000
154
Wrapping
E)
1
Replacement
US$ 200,000
Purchasing Policies and Financial Arrangements.
Taittinger prefers to purchase its packaging machinery directly from the
manufacturer though it has dealt with in-country agents for technical and training
purposes. The company gathers information from trade show attendance,
technical publications, and word of mouth to develop specifications for new
machines. Company representatives visit similar packaging facilities of nearby
champagne products to observe the machine in a production environment, which
is an important step in Taittinger’s decision-making process.
Taittinger mentioned that word of mouth is a key element in the purchasing
process. The French champagne producing community is relatively small, and as
a result, there is an active exchange of information between producers regarding
new equipment and process technology.
Packaging equipment purchases are financed by Taittinger’s internal funds.
Typical payment involves a down payment in cash upon ordering, 30% upon
delivery, and the balance 60 to 90 days after the machine has been installed and
is functioning.
F)
Factors That Influence Purchasing Decisions.
1/ Adherence to specifications
2/ Servicing, technical and training cooperation
3/ Quality and durability
4/ Price
5/ Previous experience with the brand
G)
Comments on Preferred Brands and Existing Business
Arrangements With Packaging Equipment Suppliers:
Taittinger, though aware of some U.S. labeling and marking equipment, has
received very little information from North American suppliers. Consequently, it
could not comment on the difference between European and North American
machinery.
It was estimated that Taittinger’s current installed capacity was 40% French, 40%
Italian, and 20% German.
Taittinger’s evaluation of packaging machinery by country of origin:
Origin
France
Italy
Technology Flexibility
very good
good
good
good
155
Service
good
good
Price
good
good
Germany
H)
good
average
average
average
Trade Show Attendance / Trade publication Information:
Taittinger representatives attend both InterPack in Germany and Emballage in
Paris France. The company subscribes to major trade publications in France
such as Emballage Magazine, Usine Nouvelle, and niche publications concerning
wine-making techniques.
As was mentioned before, word of mouth and reciprocal visits to production
facilities in the Reims region are major sources of information exchange and new
machinery investment decisions.
I)
Specific Interests
Taittinger is open to receiving more information on U.S. machinery, particularly
marking and labeling equipment. It was also mentioned that Taittinger’s U.S.
subsidiary, Le Domaine Carneros, sought U.S. machinery for its California-based
facility but was unable to identify equipment that met its specifications.
J)
Contact Information:
Company:
Contact:
Title:
Address:
Taittinger C.C.V.C.
René Chervier
Production Manager
9 Place St-Nicaise
51100 Reims
-FranceTelephone: (33) 3 26 85 84 13
Fax:
(33) 3 26 40 43 26
Email:
rene.chervier@taittinger.fr
Web site :
www.taittinger.fr
156
VI.
THE PERSONAL CARE INDUSTRY
6.1
Industry Overview
The personal care products market has show steady growth over the course of
the review period, with value sales increasing at a 4-5% yearly rate. The
cosmetics sector has shown the most dynamic growth with a 15% yearly growth
rate from 1999 through 2002. Growth in local production has been driven by
strong domestic demand and a robust export market.
France has benefited and will continue to benefit from its strong historical link to
the personal care industry, particularly perfumes and cosmetics. French
producers, such as L’Oreal, Louis Vuitton Moet Hennessy (LVMH), Christian
Dior, and Yves St. Laurent, are global players in the sector with strong footholds
in both the domestic and international markets. France also hosts a number of
large production facilities for major international producers such as Proctor and
Gamble, Unilever, Henkel, and Johnson and Johnson as well has a number of
small-to-medium sized producers of perfumes and cosmetics.
6.2
Key Players
Leading Personal Care Goods Manufacturers – 2002 Consolidated Results
Company
Predominant
Business
Sales (millions)
1 € = 1 US$
Euros
US $
L’Oreal France
Hair care, skin care, cosmetics, perfumes
1,269
1,269
Proctor & Gamble France
Hair care, skin care, body care
884
884
Henkel France
Hair care, and other personal care
854
854
Parfums Christian Dior
Perfumery products
684
684
Chanel
Perfume, skin care, make-up
640
640
Yves Rocher
Face and body cream
633
633
Elida Fabergé
Personal care product
456
456
Bourjois
Hair, face, body care products
392
392
Lancome
Luxury care products
390
390
Beiersdorf
Hair, face, body care products
374
374
Source: Xerfi 2002; Average dollar/ euro exchange rate calculated at parity
6.3
Summary of Interviewed Companies
Nine personal care companies were surveyed including five diversified personal
care products manufacturers and four leading luxury perfume and cosmetic
producers.
157
Market Structure:
The company survey indicated that packaging machinery market share is highlyconcentrated among relatively few major suppliers from the principal
manufacturing countries. The data shows that Italian machinery has a clear
leadership position in this sector, followed by France, Germany, and on a smaller
scale Sweden and the U.K.
Estimated Installed Packaging Machinery Shares by Country of Origin
5%
9%
Italy
5%
37%
France
Germany
Sweden
20%
U.K.
Other
24%
Italian manufacturers, IMA, Marchesini, Cama, and Ronchi, show strong market
penetration in both the luxury and mass market segments for filling, cartoning,
and wrapping machinery. Our findings also show the French manufacturer,
Kalix, as a leading competitor in the cartoning machine segment. Other key
competitors include Cermex, Ocme, Acme in end-of-line machinery; Serac,
Zalkin, King, and Groninger in filling machinery; Norden in tube filling machinery;
and Krones in marking and labeling machinery.
Market Drivers: Factors Influencing Purchasing Decisions
Most companies interviewed indicated that machine reliability and versatility are
the most important drivers in the decision-making process. Servicing was also
mentioned often as being one of the top three drivers, particularly concerning
repair speed and availability of local staff. In addition, brand reputation and
previous experience with suppliers play important roles in influencing purchasing
decisions.
1. Overall reliability
2. Versatility
3. Servicing
158
4. Brand reputation
5. Previous experience with supplier
With a few exceptions, it appears pricing, as a sole criterion, takes on less
importance than the above drivers. Price is evaluated within the context of
overall quality and is balanced with the other key factors in the decision-making
process.
Customers’ Assessment of Packaging Machinery :
Many companies mentioned a preference for Italian machinery, often referring to
the equipment’s overall flexibility and versatility. German equipment, renowned
for its solidity and durability, seems to suffer from a reputation for poor flexibility
in handling different packaging formats in this sector. German equipment was
often mentioned as being too expensive compared to Italian and French
machinery. Many e nd-users indicated a preference for French packaging
equipment, particularly filling and end -of-line machinery, due to its quality and
overall price competitiveness. French suppliers appear to benefit from proximity
and strong cultural ties with local end-users.
None of the companies interviewed indicated to have any experience with North
American packaging equipment suppliers.
Best Prospects:
Data gathered from the interviews show specific business opportunities for North
American suppliers in the following machine categories:
Film wrapping (cellophane) machinery
Pressure filling machinery
Cartoners of all kinds
Case form and filling
Palletizing equipment
Filling and capping machinery
Filling machinery for semi-viscous products
Complete tube filling line machinery
Labeling machinery
Purchasing Potential:
Overall purchasing potential for the companies interviewed is estimated at
between US$ 30-40 million over the next three years. Many companies indicated
that they are moving ahead with investment plans despite slower growth in
159
demand resulting from an uncertain economic environment. Noteworthy
investment projects include Beiersdorf’s and Pierre Fabre’s production extension
plans.
6.4
Company Profiles
160
Beiersdorf France
Industry:
Sub Industry:
Personal Care
Facial cream, skin and lip
care
Location:
Savigny le Temple
Size: (2002 sales) US$ 420 million
Purchasing
US$ 10-15 million
potential:
Specific Business Robotic palletizers; new
Opportunities:
production line equipment
(mascara and lipstick)
A)
Company Description:
Beiersdorf is a leading producer of facial creams and skin care mostly under the
Nivea brand. Other brands include: La Praire/Juvena, Hansplast, Eucerin, Atrix,
and Labello.
Beiersdorf’s French operations include a head office and one production site,
located in Savigny le Temple. The production from this site is distributed mostly
in the French market, one of the largest facial cream markets in Europe.
B)
Main Products Produced and how are they packed:
Beiersdorf’s skin care and facial creams are packaged in plastic and glass tubes,
bottles, flasks, and jars using a variety of cardboard and plastic over wrapping.
C)
Installed Packaging Machinery:
Below is a cross-section of the type of machines used in the Savigny le Temple
facility:
Current Machinery Used
Brand
Filling Machines for semi-vicous Norden
products (tube)
IMA
Groninger
Labeling and coding machines Krones
Carton filling and closing
Promatic
machines
Case forming and closing
Kalix
Palletizers
Cermex
161
Origin
Average Age
Sweden
New-10
Italy
Germany
Germany
Italy
-New--8
France
France
5-8
5
D)
Last Purchases of Packaging Machinery:
Beiersdorf France recently invested in replacement packaging machinery for its
existing lines. No specifics were provided in terms of quantities and machine
types.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Beiersdorf France is investing heavily in its production capacity and is looking to
expand its operations in France. New production lines are being established and
company decision-makers are currently selecting suppliers and new technology.
It was mentioned that the Savigny le Temple facility is seeking innovative
equipment in the areas of robotic palletizers, full packaging line equipment for
new mascara and lipstick production lines. In addition, Beiersdorf expects to
begin machine replacement for existing lines in two years.
No specific figures were provided in terms of overall investment during this
period, however investment budgets are expected to exceed € 5 million per year
for the next three years.
F)
Purchasing Policies and Financial Arrangements.
A production team composed of the technical, engineering and maintenance
directors, as well as production line managers develops yearly proposals and
specifications for equipment replacement.
Machinery for new production
investment is researched and selected by the production site team, with final
approval from Beiersdorf’s German headquarters.
At least three suppliers are considered per machine category, and preferred
status is given to long-standing suppliers. For the most part, current suppliers
are contacted first for a quote; then new suppliers are consulted in order to
determine overall competitiveness within the defined criteria.
Beiersdorf prefers to purchase machinery directly from the manufacturer, though
it has dealt with country representatives.
The company generally provides an initial down payment (between 40-50%); and
additional amount upon delivery, and the remaining balance after a month in
operation.
G)
Factors That Influence Purchasing Decisions.
1/ Reliability
2/ Adherence to purchasing specifications
3/ Servicing, availability of spare parts and local staff
4/ Fast delivery
162
5/ Price
H)
Comments on Preferred Brands and
Arrangements With Packaging Equipment Suppliers:
Existing
Business
Beiersdorf’s packaging equipment is mostly German (est. 40%), Italian, French,
and Swedish. The cultural and historic link with Beiersdorf’s German operations
often privileges German suppliers. German machines are considered to be
among the most reliable and durable, especially for Beiersdorf’s high production
environment.
Swedish manufacturer, Norden, is viewed as having the best technology in the
tube filling domain. Though these machines are priced at a premium, the pricequality-reliability ratio gives it a clear competitive advantage in its field.
The Beiersdorf interviewee commented that the production team has had very
little, if no, experience with North American suppliers. It was mentioned that
there is little information available and that the low current market penetration
makes it difficult for a North American supplier to increase its visibility. In
addition, current supply in the European market is well-adapted and suits the
company’s strict technical requirements.
Beiersdorf’s evaluation of packaging machinery by country of origin:
Origin
Germany
Italy
France
Sweden
I)
Technology
Very Good
Good
Good
Very Good
Flexibility
Good
Good
Average
Good
Service
Average
Good
Good
Average
Price
Expensive
Average
Good
Fair
Trade Show Attendance / Trade publication Information:
Beiersdorf France representatives attend the Emballage and Interpack trade
shows. Major trade publications consulted are Emballage Magazine and Usine
Nouvelle.
J)
Specific Interests
Beiersdorf is interested in receiving specific information from North American
suppliers regarding new technologies in the personal care packaging sector. The
information must stress the difference between the proposed technology and the
technology currently available in the European market.
K)
Contact Information:
Company Name:
Beiersdorf France
163
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Mr. Gilles Gatel
Director of Industrial Development
1 rue des Sources
77176 Savigny le Temple
-France(33) 1.64.87.34.21
(33) 1.64.87.30.10
gilles.gatel@beiersdorf.com
www.beiersdorf.com; www.nivea.fr
164
Chanel S.A.
Industry:
Sub Industry:
Location:
Size: (2002 sales)
Purchasing
potential:
Specific Business
Opportunities:
A)
Personal Care
Luxury products
Compeigne Production Site
US$ 750 million
US$ 1-2 million per year
Pressurized filling
machinery (perfume flasks)
Company Description:
Chanel S.A. is a major producer and marketer of perfume and cosmetic products
under its landmark Coco Chanel brand name. The Compeigne production site is
the sole manufacturer of Chanel perfumes for worldwide distribution. In addition,
the site produces Bourjois brand perfume and cosmetic products under a
licensing agreement with Chanel S.A.
B)
Main Products Produced and how are they packed:
Chanel and Bourjois perfumes are packaged in pressurized glass dispensers,
carton boxes and cellophane.
C)
Installed Packaging Machinery:
Chanel was not a liberty to provide specific information on its installed capacity.
It did mention that over half of its equipment was of Italian origin, a third of
French origin, and the remainder of German origin.
Machine
Filling machines for liquid products
Carton fill and seal
Tray forming and sealing
Film wrapping (cellophane)
Weighing machines
Palletizing machines
D)
Country
Italy, France
Italy, France
France
France
Germany
France, Italy
Last Purchases of Packaging Machinery:
Chanel mentioned that it replaces machinery yearly and that recent investments
average between US$ 1-2 million per year.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
165
Chanel has a rolling investment scheme and plans to invest approximately €1-2
million to upgrade its packaging machinery in each of the machine categories
above.
F)
Purchasing Policies and Financial Arrangements.
Chanel’s production team, headed by the i ndustrial development director,
evaluates and researches new machinery investment. Once the specifications
are complete, the team contacts five or six suppliers that it knows well and
narrows the choice to two suppliers.
Once the selection is narrowed to two, the team generally requires the
manufacturer to show the machine functioning in a production environment.
Chanel normally purchases its machinery directly from the manufacturer, but not
exclusively so. It will work with agents and distributors in the early stages of the
investment process. In terms of servicing agreements, it prefers to deal directly
with the machine manufacturer.
It was mentioned that all machinery purchases are financed internally. Chanel
normally pays a 30-40% down payment, and provides the remaining balance
within 60 days after delivery.
G)
Factors That Influence Purchasing Decisions.
1/ Quality and reliability
2/ Flexibility in handling different formats and sizes
3/ Quick and Efficient Servicing (under 24 hours)
4/ Previous experience with supplier
5/ Price
H)
Comments on Preferred Brands and Perceptions of North American
Equipment:
Chanel commented that Italian packaging equipment is the most suited to its
production environment, which requires a high degree of flexibility and
adaptability to various package sizes and formats. In addition, it was mentioned
that Italian machinery’s price in relation to its quality is a source of competitive
advantage in the perfume and cosmetic sector. German machinery is perceived
as being more robust than Italian equipment particularly for high volume
production, however is viewed as less flexible with regards to different packaging
formats.
Chanel selects European equipment because it is familiar with the technology
and has long-standing relationships with many of the suppliers. French
machinery producers benefit from strong historical ties to the factory, while the
166
close proximity to the suppliers’ production and distribution sites is an important
factor in the decision-making process.
Chanel stated that it had very little communication with North American suppliers,
and had heard of only a few American suppliers with a European presence. It
also perceived North American equipment to be more costly and less technically
adapted to European production environments. Differences in norms, particularly
electrical standards, were viewed as prohibitively costly and time consuming.
Chanel’s evaluation of packaging machinery by country of origin:
Origin
Germany
Italy
France
I)
Technology
Good
Very Good
Good
Flexibility
Poor
Good
Good
Service
Poor
Good
Good
Price
Expensive
Fair
Average
Trade Show Attendance / Trade publication Information:
Chanel attends the Emballage trade show in Paris. It also consults Emballage
magazine, Emballage Digest, and Usine Nouvelles.
J)
Specific Interests
Chanel mentioned that it is currently experiencing problems with its pressurized
machinery for perfume conditioning and packaging. It would be interested in
receiving specific information on pressurized filling machinery for this sector.
Chanel would welcome any information concerning new packaging techniques
for perfume and cosmetic production.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Chanel S.A.
Mr. Denis Tousch
Industrial Development Director
7 rue de Ferdinand Lesseps
60200 Compeigne
-France(33) 3.44.30.15.00
(33)3.44.30.15.05
denis.tousch@bourjois-corp.com
www.chanel.fr
167
Parfums Christian Dior
Industry:
Sub Industry:
Location:
Personal Care
Perfumes
St. Jean de Braye
production facility
Size: (2002 sales) US$ 2.2 billion
Purchasing
US$ 5-10 million
potential:
Specific Business Film wrapping (cellophane)
Opportunities:
machinery; pressure filling
machinery; cartoners; tray
form and filling; palletizing
A)
Company Description:
Parfums Christian Dior, a subsidiary of French conglomerate LVMH, is the
country’s leading producer of luxury fragrances. The St. Jean de Braye site is
Dior’s principal perfumery production facility for its domestic and worldwide
markets.
B)
Main Products Produced and how are they packed:
Christian Dior packages its wide variety of luxury perfumes in pressurized glass
flasks, carton boxes, with cellophane film wrap.
C)
Installed Packaging Machinery:
Origin
Current Machinery Used Brand
Pressure filling machine IMA, Norden, Groninger Italy, Sweden,
Germany
Carton, form and seal
Marchesini, Kalix
Italy, France
Case/Tray filling
IMA, Cermex
Italy, France
Cellophane film wrapping IMA
Italy
Palletizing
IMA
Italy
D)
Average Age
New-10
New-10
New-10
New-15
New-10
Last Purchases of Packaging Machinery:
Parfums Christian Dior indicated that it has invested yearly in packaging
equipment for replacement and capacity extension purposes. The average age
of its packaging machinery base ranges from new to 15 years.
168
E)
Future Packaging Machinery Ordering Plans (2003-2005):
The company i ndicated that it has a rolling investment schedule, with yearly
packaging machinery investments exceeding several million dollars for all
machine categories. In particular, the company is phasing in new machinery to
increase its production speed.
F)
Purchasing Policies and Financial Arrangements.
Christian Dior indicated that its production team selects potential machine
suppliers from an existing list of manufacturers. Machine specifications are
developed in accordance with new packaging requirements a nd at least three
suppliers are consulted. It was mentioned that existing suppliers are often
consult first, before an official tender is issued.
Dior prefers to buy directly from the machine manufacturer. The site technical
team often works directly with in country representatives concerning technical,
servicing, and training issues.
Machinery investments are financed internally. Payment schedules are
structured to provide a down payment upon order, a percentage upon delivery,
and the remainder 60-90 days after installation.
G)
Factors That Influence Purchasing Decisions.
1/ Adherence to tender specifications
2/ Price
3/ Servicing
4/ Reliability and Durability
5/ Brand reputation
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Dior mentioned that European machine manufacturers, in particular Italian
specialists IMA and Marchesini, best meet their complex packaging needs. The
company commented that its Italian manufacturers have a strong know-how and
competitive pricing strategy that gives them a clear edge over the nearest
competitors. In the interviewee’s opinion, it would be difficult for North American
packaging equipment to become competitive in mainstream machinery
categories against European specialists.
Parfums Christian Dior’s evaluation of packaging machinery by country of origin:
Origin
Italy
Technology Flexibility
Very Good Very Good
169
Service
Good
Price
Good
Germany
France
Sweden
I)
Very Good
Good
Very Good
Average
Good
Good
Average
Good
Average
Expensive
Fair
Average
Trade Show Attendance / Trade publication Information:
Christian Dior representatives attend the Emballage trade show in Paris. The
company subscribes to Emballages magazine (www.emballagesmagazine.com).
J)
Specific Interests
The company is open to receiving information from the PMMI concerning new,
innovative equipment in the above machine categories.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Christian Dior S.A.
Mr. Thierry Thomas
Assistant Production Manager
185 avenue Verdun
45800 Saint Jean de Braye
(33) 2.38.60.35.42
(33) 2.38.60.30.31
tthomas@diormail.com
www.dior.com
170
Guerlin S.A.
Industry:
Sub Industry:
Location:
Size: (2002 sales)
A)
Personal Care
Luxury Cosmetic Products
Chartres Production site
US$ 262 million
(consolidated)
Company Description:
Guerlain S.A. is one of France’s largest producers of luxury beauty products
including cosmetic products and perfumes. The company belongs to the Louis
Vuitton Moet Hennessy (LVMH) group. French production includes two sites
located in Cha rtres and Rambouillet. The Chartres site manufactures a variety of
perfumes under the Guerlain brand name for distribution in worldwide markets.
B)
Main Products Produced and how are they packed:
Guerlain perfumes are packaged in pressurized glass flasks and carton boxes
with cellophane over wrapping material. Cosmetic products are packaged in a
variety of plastic containers and carton boxes.
C)
Installed Packaging Machinery:
Below is a representative sample of the installed machinery at Guerlain’s
Chartres site:
Current Machinery Used
Pressure filling machines – liquid
Origin
Average Age
Brand
IMA, Kalix, King Italy,France, U.K.
5-7
Carton filling and sealing machinery Kalix, IMA
Marking and decorating machinery Krones, IMA
Film wrapping machinery
(cellophane)
Over wrapping machinery
D)
BFB
France, Italy
Germany
Italy
Italy
BFB
Italy
5-8
--7
7
Future Packaging Machinery Ordering Plans (2003-2005):
Guerlain indicated that it will be replacing existing equipment over the next three
years, but would not divulge specific information. It was mentioned that pressure
filling and end-of-line machinery are important areas of investment. In addition,
171
rapidly-changing market trends and packaging innovations are drivers for new
machinery investment.
E)
Purchasing Policies and Financial Arrangements.
A production team evaluates equipment requirements on a yearly basis.
Machine specifications are defined and the production team consults its existing
suppliers for cost estimates and delivery schedule. A minimum of three
proposals are evaluated per investment decision.
A proposal with equipment investment recommendations is submitted to the
central purchasing department in Paris.
F)
Factors That Influence Purchasing Decisions.
1/ Versatility
2/ Reliability
3/ Servicing
4/ Delivery terms
5/ Price in relation to quality
G)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Guerlain indicated that it is familiar with most European packaging equipment
suppliers for the perfume and cosmetics trade. The company often opts for
manufacturers of complete packaging line equipment in search of important cost
synergies across machine categories.
Guerlin commented that Italian and French suppliers are the leading machinery
suppliers in the French luxury personal care industry. It was explained that this
leadership position is mostly due to these machines’ versatility in handling many
different sizes and formats. Also, competitive pricing strategies have allowed
French and Italian suppliers to increased market penetration over the review
period. German machines are considered robust, solid equipment but not quite
as adapted to the packaging requirement of luxury brand personal care products,
which require less standardization and higher versatility.
Guerlain mentioned that it has no experience with or information on North
American packaging equipment. Guerlain would only consider North American
equipment if the manufacturer had a permanent European presence – either
through a direct sales office or manufacturing facility, or through an agent or
distributor.
Guerlain’s evaluation of packaging machinery by country of origin:
172
Origin
Italy
France
Germany
United Kingdom
H)
Technology
Very Good
Very Good
Good
Good
Flexibility
Good
Good
Average
Average
Service
Good
Good
Poor
Average
Price
Fair
Fair
Expensive
Fair
Trade Show Attendance / Trade publication Information:
Guerlain does not regularly attend any particular trade show. When it has
specific needs, the company sends production representatives to the Emballage
exhibition in Paris.
I)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Guerlin S.A.
Mr. Grégoire Langet
Industrial Development Director
rue Charle Tellier
28000 Chartres
-France(33) 2.37.91.82.00
(33) 2.37.34.07.57
glanget@guerlain.fr
www.guerlain.fr
173
Lever Fabergé France
Industry:
Sub Industry:
Location:
Personal Care
Hair care; toothpaste
Compeigne Production
Facility
Size: (2002 sales) US$ 3.9 billion
(consolidated Unilever
France)
Purchasing
US$ 5 million
potential:
Specific Business Filling line machinery
Opportunities:
(shampoo and conditioner
production)
A)
Company Description:
Lever Fabergé is the personal care and house cleaning products division of
Unilever France. Fabergé’s French operations include two production sites, each
specializing in the production of one or two product categories. The Compeigne
facility is dedicated to the production of hair care (shampoo, conditioner) and
toothpaste under the global brand names Organics, Timotei, Dove, Signal, and
Sanogyl. Production is distributed primarily for the French and European
markets.
B)
Main Products Produced and how are they packed:
Lever Fabergé shampoos and conditioners are packed in polyethylene bottles;
toothpastes are packaged in plastic tubes and carton boxes.
C)
Installed Packaging Machinery:
Lever Fabergé’s Compeigne facility includes six full production lines for hair care,
and six lines for toothpaste production. Annual shampoo and conditioner
production is estimated at 220 million units; toothpaste production is estimated at
160 million units.
Current Machinery Used
Filling machines for tubes (toothpaste)
Filling machines semi-vicous (plastic bottles)
Brand
Norden
Ronchi
Ocme
Capping and lidding machinery
Ronchi
Feeding and orienting machinery (platic bottles / Ronchi
tubes)
Ocme
174
Origin
Sweden
Italy
Italy
Italy
Italy
Italy
Average Age
10-15
8-10
8-10
5
Labeling Machinery
Krones
Herma
Cermex
Cermex
BFB
Ocme
Cermex
Case form and fill machinery
Film wrapping
Palletizing machinery
D)
Germany
France
France
France
Italy
Italy
France
New
5
-----
Last Purchases of Packaging Machinery:
Lever Fabergé invested €15 million over the past three years in replacement
equipment for its six toothpaste production lines. There have been very few
recent investments in the hair care production lines, as average equipment age
exceeds ten years.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Machinery
Filling machinery for semi-viscous products
(shampoo and conditioner)
F)
Motive of purchase Estimate Budget
Replacement
US$ 5 Million
Purchasing Policies and Financial Arrangements.
The list of potential machine suppliers is defined by Unilever’s European
headquarters located in Rotterdam, Holland. The Compeigne production team
defines machine specifications and contacts at least five suppliers from the
headquarters’ list. Before a final investment decision is made, representatives
from the French factory and a purchasing executive from Unilever visit the
suppliers to view the machine functioning in a production environment.
The company purchases either directly from the manufacturer or from an agent,
depending on the machine type. Generally speaking, larger orders are placed
directly with the machine producers.
Equipment investments are internally financed and are paid for according to
industry standards.
G)
Factors That Influence Purchasing Decisions.
1/ Reliability and durability
2/ Production speed and efficiency
3/ Servicing, availability of staff and spare parts
4/ Price
5/ Delivery terms
175
H)
Comments on Preferred Brands and Perceptions of North American
Packaging Machinery:
Lever Fabergé’s installed capacity at its Compeigne site does not include any
North American equipment. It was mentioned that the perceived distance
between North American suppliers and European clients can act as a barrier to
entry in many cases. The company commented that supplier proximity and
technical and servicing cooperation are important factors in its decision-making
process.
Given its high production volume, Lever Fabergé feels that Italian, German, and
French technologies are most viable and best-suited for its production
requirements. It was mentioned that Italian suppliers provided more costeffective equipment and better servicing than the German counterparts, who are
often slow to react to technical problems. French equipment is seen as being
solid and good quality for the price. French supplier, Cermex, is considered the
leading global supplier of end -of-line machinery and is highly-regarded for its
reliability, versatility, and ease-of-use.
Lever Fabergé’s evaluation of packaging machinery by country of origin:
Origin
Germany
Italy
France
Sweden
I)
Technology
Very Good
Very Good
Very Good
Very Good
Flexibility
Good
Good
Good
Good
Service
Slow
Good
Good
Average
Price
Expensive
Fair
Good
Average
Trade Show Attendance / Trade publication Information:
The company attends the Emballage and Interpack trade exhibitions. It receives
information from Emballage magazine email newsletters and consults the paper
versions of Emballage magazine, Usine Nouvelle, and Emballage Digest.
J)
Specific Interests
Lever Fabergé would like to receive information from the PMMI concerning filling
line and packaging equipment for shampoo and toothpaste production. The
preferred method of communication would be through email and hot links to
company web sites.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Lever Fabergé France
Mr. Patrice Bros / Mr. Benoit Pasqualini
Industrial Development and Maintenance Directors
Zone Industriel
176
Telephone:
Fax:
Email:
Web site:
60880 Le Meux
-France(33) 3.44.90.57.73
(33) 3.44.90.57.24
Patrice.bros@unilever.com;benoit.pasqualini@unilever.com
www.unilever.fr
177
Laboratoires Pierre Fabre S.A.
Industry:
Sub Industry:
Location:
Size: (2002 sales)
Purchasing
potential:
Specific Business
Opportunities:
A)
Personal Care
Cosmetics and skin care
Soual Production Site
US$ 1.3 billion
(consolidated)
US$ 4-8 million
Complete tube filling line
machinery
Company Description:
Laboratoires Pierre Fabre is a major producer of dermatological skin care and
cosmetic products for the French (50% of total value tur nover), European, and
worldwide markets.
Pierre Fabre’s French operations are comprised of nine production facilities
located throughout the country (including pharmaceutical production). The Soual
site is the Fabre’s largest production units of skin care and cosmetic products,
with an annual volume of roughly 110 million units.
B)
Main Products Produced and how are they packed:
Pierre Fabre cosmetic and skin care products are packaged in glass and plastic
tubes, flasks, and jars and carton boxes.
C)
Installed Packaging Machinery:
Current Machinery Used
Semi-viscous filling machines
Labeling and marking machines
Carton fill and seal machines
Filling machines (tubes)
Semi-vicous filling machines
Filling machines
Film over wrapping machines
Cartoning and palletizing
Microbial detection machinery
Weighing machines
Brand
King
Harland
Marchesini
Ima
Cama
Norden
IMA
Serac, Hema
Multipac
Cermex
Chemunex
Gargens, Boekels
178
Origin
United Kingdom
United Kingdom
Italy
Sweden
Italy
France
Italy
France
France
Germany
D)
Last Purchases of Packaging Machinery:
The Soual production site has upgraded its entire production line equipment over
the last six years. Thus, the average age of its installed packaging machinery is
between one and five years.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Pierre Fabre’s Saoul site indicated that will increase its production capacity by
constructing two additional tube filling production lines. The machinery includes
tube filling, carton fill and seal, weighing, over wrapping, and other material
handling equipment associated with tube-filling production.
F)
Purchasing Policies and Financial Arrangements.
The production site team identifies machinery requirements and consults at least
three potential suppliers in each machine category. The final decision is made
by the production director after consultation with Pierre Fabre’s central
purchasing department.
Pierre Fabre generally purchases directly from the machine manufacturer,
though it has dealt with local representatives for smaller machinery purchases.
New machinery investments are financed internally. A down payment is provided
upon order, with the balance paid 30-60 days after installation.
G)
Factors That Influence Purchasing Decisions.
1/ Reliability
2/ Lifetime running costs
3/ Servicing, availability of spare parts
4/ Rapid delivery terms
5/ Previous experience with supplier
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Pierre Fabre commented that Italian machinery is the most versatile equipment in
its field, handling a wide variety of packaging formats. Italian technology is
highly-regarded for its technical sophistication and it more than adequately meets
Fabre’s complex production requirements. In terms of carton fill and seal, it
considers Marchesini to be the leader in its field. Other Italian suppliers such as
Cama and Ima are highly-regarded for their flexibility and competitive pricing visà-vis their nearest German competitors.
179
Swedish manufacturer, Norden, is appreciated for its precision, reliability, and
efficiency in cosmetic tube filling, and in this respect, is considered one of the
best suppliers in its field.
U.K. suppliers, King and Harland, are well regarded for their machinery’s
flexibility in handling smaller production volumes.
Pierre Fabre’s evaluation of packaging machinery by country of origin:
Origin
U.K.
Germany
Italy
Sweden
I)
Technology
Good
Good
Very Good
Good
Flexibility
Average
Average
Good
Good
Service
Average
Average
Good
Good
Price
Good
Expensive
Average
Fair
Trade Show Attendance / Trade publication Information:
Company representatives attend the Emballage show in Paris, Cosmopack in
Bologne, and Ipack-Ima in Milan.
The production team generally consults Emballage magazine (both the paper
and online versions).
J)
Specific Interests
Pierre Fabre’s Soual production team would like to receive specific information
on complete tube line packaging equipment.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Website:
Laboratoires Pierre Fabre S.A.
Jean-Louis Pons
Technical Director
Unité de Production de Soual
81580 Soual
-France(33) 5.63.82.50.00
(33) 5.63.82.50.26
jean.louis.pons@pierre-fabre.com
www.pierre-fabre.com
180
Proctor & Gamble France
Industry:
Location:
Size: (2002 sales)
Specific Business
Opportunities:
A)
Personal Care
Neuilly (Headquarters):
Blois Production site
US$ 1.3 billion (France
only)
Filling (semi-viscous),
coding machinery
Company Description:
Proctor & Gamble’s French operations include a head office and four production
sites -- Amiens, Blois, Longjumeau, and St. Cyr. Production from these sites is
distributed in the French and European markets.
The Blois facility is the European production platform for Proctor and Gamble’s
hair and body care products (including shampoo, conditioner, soap, face and
body cream) marketed under its major brand names: Pantene, Head and
Shoulders, Camay, and Infasil. It is estimated that roughly 80% of total
production is exported to the Europe Union and Saudi Arabia.
Production site
Amiens
Blois
Longjumeau
St. Cyr
B)
Products
Detergents and household cleaning products
Hair and body care products
Pharmaceutical products
Hygienic Paper
Installed Packaging Machinery:
Proctor and Gamble estimated that over half of its installed base is Italian,
roughly a third German, and roughly a fifth French. Below is a representative
example of the type of machinery used in the facility:
Current Machinery Used
Semi-viscous liquid filling
Liquid filling
Capping and Lidding
Capping
Labeling
Brand
Ronchi, Corniani,
Cermex
Zalkin
Krones
Krones
181
Origin
Italy
France
France
Germany
Germany
Average Age
5-15
5-15
5-15
5-15
5-15
Palletizing
Over-wrapping, film
C)
Krones, Ketner
Cermex, Acme, Ocme
Germany
France, Italy
5-15
5-15
Last Purchases of Packaging Machinery / Future Purchasing Plans:
Proctor and Gamble was not at liberty to unveil its past purchasing behavior;
however it did mention that important machinery purchases were already in the
pipeline for both replacement purposes and new line extensions.
D)
Purchasing Policies and Financial Arrangements.
Proctor & Gamble indicated that it follows a Global Purchasing policy for its
worldwide operations, dividing responsibility according to three distinct regions:
North America, Asia-Pacific, and Europe Middle East and Africa (EMEA). A
global working committee composed of purchasing directors from each region
determines key suppliers according to corporate guidelines and input from local
production teams. Preferred suppliers are determined for each region and each
production facility works directly with the manufacturer or the country distributor/
agent.
Financial agreements are developed according to well-known corporate
guidelines and are adjusted according to purchasing size and discount rates.
E)
Factors That Influence Purchasing Decisions.
1/ Productivity
2/ Return on Investment
3/ Previous experience with brand
4/ Service, availability of local staff and spare parts
5/ Rapid delivery terms
F)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
German packaging machinery is appreciated for its overall quality and durability,
however is considered more expensive and less flexible than Italian machines.
In the Blois facility, German end-of-line machinery is used extensively and is
considered to be the most durable equipment on the market. German and Italian
machinery are believed to be easy to operate and maintain.
French machinery is viewed as highly reliable and less expensive than Italian
and German equipment. Cermex and Andre Zalkin, two leading French
manufacturers, have long-standing relationships with the Blois production site.
182
European technology is believed to be closely attuned to end-user requirements,
and is considered to be more sophisticated and versatile than North American
equipment.
North American machinery often does not meet European standards.
Consequently, important technical modifications are required, which render the
investment more costly and time-consuming. It was also stated that North
American suppliers suffer from poor presence in Europe, which is considered to
be critical for relationship management and quick and effective servicing.
Proctor and Gamble’s evaluation of packaging machinery by country of origin:
Origin
United States
Germany
Italy
France
G)
Technology
Average
Very Good
Very Good
Good
Flexibility
Poor
Average
Good
Good
Service
Average
Good
Good
Good
Price
Average
Good
Very Good
Good
Trade Show Attendance / Trade publication Information:
Proctor and Gamble regularly attends the Emballage trade show in Paris, as well
as Interpack in Germany. Emballage Magazine and Emballage Digest are the
major sources of in country trade information, above and beyond trade show
attendance and web site visits.
H)
Specific Interests
Proctor & Gamble France receives the PMMI electronic newsletter. The
interviewee considers this to be an effective communication mechanism, and
would like to receive more detailed information on technology from member
companies.
I)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Website:
Proctor & Gamble France
Mr. Frederic Garcia
Director of Packaging Machinery
126 avenue de Vendome
41000 Blois, France
(33) 2.54.52.23.07
(33) 2.54.52.22.59
Garcia.f.3@pg.com
www.fr.pg.com
183
Laboratoires Vichy (L’Oréal)
Industry:
Sub Industry:
Location:
Size: (2002 sales)
Purchasing potential:
Specific Business
Opportunities:
A)
Personal Care
Cosmetics
Vichy, France
US$ 450 million
Est. US$ 4 million
Labeling and liquid
filling machines
Company Description:
A division of the L’Oréal group, Laboratoires Vichy manufacturers and markets
skin care creams and deodorants for the domestic and global markets under the
Vichy™ brand name.
B)
Main Products Produced:
Product
Facial Cream
Deodorants
Misc. Skin Care
C)
Installed Packaging Machinery:
Current Machinery Used
Liquid Filling
Labeling
Cartoning
Cartoning
Specialized (make-up)
D)
Brand
Kalix
SFE
CAM
Kalix
BFB
Units Origin
Average Age
8
3
5
4
2
10
5
5
10
10
France
France
Italy
France
Italy
Last Purchases of Packaging Machinery:
Machinery
Filling- liquid
Labeling
Palletizing
Custom (make-up)
E)
Brand
Vichy
Vichy
Vichy
Brand
BFB
Harland
ADMV
BFB
Country
Italy
U.K.
France
Italy
Future Packaging Machinery Ordering Plans (2003-2005):
Machinery
Labeling
Units Motive of purchase
Estimated Budget
3
US$ 2 million
Replacement
184
Filling - liquid
F)
2
Production extension US$ 2 million
Factors That Influence Purchasing Decisions.
1) Reliability and durability
2) Previous experience with brand
3) Price
4) Efficiency and yield
G)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Vichy’s evaluation of packaging machinery by country of origin:
Origin
German
Italy
France
United Kingdom
H)
Technology
Good
Good
Good
Good
Flexibility
Good
Good
Good
Good
Service
Average
Average
Average
Average
Price
expensive
Average
Good
Average
Trade Show Attendance / Trade publication Information:
Vichy attends the two major European trade shows, Interpack and Emballage. It
very rarely consults trade publications on packaging machinery. Much of the
information is through word-of-mouth, or is gathered during trade show visits.
I)
Specific Interests
Vichy is interested in receiving information on liquid filling and labeling machines.
J)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Website:
Laboratiores Vichy
Mr. Buisson
Assistant Technical Director
Z.I. Vichy
03203 Vichy
(33) 4.70.30.36.42
(33) 4.70.30.36.34
www.vichy.com
185
Yves St. Laurent Beauté
Industry:
Sub Industry:
Location:
Size: (2002 sales)
Purchasing
potential:
Specific Business
Opportunities:
A)
Personal Care
Cosmetic
Bernay Production Facility
US$ 166 million
US$ 2-4 million
Bottle filling and capping,
boxing and cartoning,
cellophane wrapping
machines
Company Description:
Yves St. Laurent (YSL) is the fragrance and cosmetics division of the Gucci
Group, one of the world’s leading multi-brand luxury goods companies. YSL is
present in all fragrance and luxury cosmetic segments: perfume, make-up and
cosmetics, soaps and toiletries, and designer and jewelry branded perfumes.
YSL production units – Yves St. Laurent Parfums (Lassigny, France) and YSL
Beauté Recherche et Industrie (Bernay, France) – manufacture and distribute the
group’s products directly to retailers via 15 subsidiaries in all major markets. The
YSL Beauté brand portfolio includes Yves Saint Laurent, Opium, Nu, Roger &
Gallet, Van Cleef & Arpel, Oscar de la Renta, and Fendi. Recently, the group
expanded its portfolio through licensing agreements to produce luxury brands
such as Alexander McQueen, Stella McCartney, and Ermenegildo Zegna.
B)
Main Products Produced and how are they packed:
The Bernay production facility manufactures a variety of perfumes, cosmetics,
and skin care products under YSL luxury brand names. Most perfume and
cosmetic products are packaged in crystal bottles and carton boxes. Soap and
skin care are packaged in glass and plastic flasks, paper wrap, and carton boxes.
C)
Installed Packaging Machinery:
YSL stated that roughly half of its machinery was Italian, a third French, and the
remainder German. The following machine and suppliers names were provided
by YSL Beauté’s Bernay facility:
Current Machinery Used
Tube fill and seal machines
Bottle filling and capping
Carton fill and seal
Brand/Supplier
Serac
PKB
Kalix
186
Origin
France
France
France
Average Age
5
7
8
Filling machines for cream
Carton fill and seal
Wrapping machines (Cellophane )
Ink Jet Coding and Marking
Filling and capping machines
D)
IMA, Marchesini
Marchesini, IMA
Marchesini, IMA (DFB)
Marchesini, IMA
-Kugler, Gorninger
Italy
Italy
Italy
Italy
Italy
Germany
5
7
5
---
Last Purchases of Packaging Machinery:
YSL Beauté recently invested in production line filling and capping equipment, as
well as coding and marking machines. Exact types and quantities were not
provided.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Yves Saint Laurent indicated that it will invest in new packaging equipment to
accommodate new licensing agreements to produce Alexander McQueen and
Zegna perfumes. This includes filling and capping, box filling and closing,
and cellophane wrapping machines. Exact types and quantities were not
provided.
F)
Purchasing Policies and Financial Arrangements.
YSL defines purchasing plans over a three year period as a benchmark for future
machinery investment. Given the dynamic nature of the luxury goods sector,
YSL generally reviews these plans every six months to adapt to new market
demand and rapidly changing styles and trends.
The production team evaluates and proposes changes in machinery
requirements, including recommending suppliers and machine types (YSL
Bernay maintains a list of over 2,000 references). Final decisions are validated
by the central purchasing department in Gucci’s headquarters.
Payment and financing schedules are determined according to length and depth
of experience with a supplier. Down payments are provided upon order, with the
remaining balance provided within 60 days after delivery.
G)
Factors That Influence Purchasing Decisions.
1/ Reliability
2/ Precision and efficiency
3/ Servicing, including availability of staff and spare parts
4/ Delivery terms
5/ Price
187
H)
Comments on Preferred Brands and Perceptions of North American
Packaging Equipment:
YSL mentioned that it has very little experience with North American equipment.
The interviewee stated that he had been in contact with a few North American
suppliers with a European presence – Video Jet and Mead Packaging were
examples given. YSL emphasized the importance of a European presence,
suggesting that North American manufacturers consider a direct presence by
means of a sales office or an agent-distributorship agreement with an established
machine distributor.
YSL mentioned that Italian packaging machinery suppliers are considered the
leaders in the cosmetic and pharmaceutical sectors in Europe. In terms of its
specific packaging requirements, YSL appreciates Italian machinery for its
flexibility and efficiency in handling a variety of sizes and formats, which is
particularly important given its vast brand portfolio and the fast-changing nature
of demand in its sector.
German machines are viewed as highly-reliable and durable, particularly for
handling high production volumes. However, for the lower production volumes
(40 units per minute vs. 300 units per minute) inherent to the luxury personal
care sector, German machinery is perceived as being poorly adapted to multibrand, multi-format packaging requirements. German machinery is also more
expensive than its French and Italian equivalents, which limits its penetration in
this sector.
French packaging machinery is highly-regarded in the cosmetic sector, both for
its flexibility and price-to-quality characteristics. The company mentioned that
French suppliers’ proximity and cultural ties are important drivers in the decisionmaking process.
YSL’s evaluation of packaging machinery by country of origin:
Origin
Germany
Italy
France
I)
Technology
Very Good
Very Good
Good
Flexibility
Poor
Very Good
Good
Service
Average
Good
Very Good
Price
Expensive
Average
Good
Trade Show Attendance / Trade publication Information:
Company representatives attend Emballage and Interpack trade shows. YSL
consults the online version of Emballage Magazine, and uses the Internet
extensively to research new technology and suppliers.
J)
Specific Interests
188
YSL would like to receive information on cosmetic filling and capping machines,
cellophane wrapping machines, and box filling and closing machines.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Website:
Yves Saint Laurent Beauté
Mr. Daniel Lefebvre
Manager - Engineering
28 boulevard du Parc
9220 Neuilly sur Seine
(33) 2.32.47.54.00
(33) 2.32.47.54.01
daniel.lefebvre@fr.yslbeaute.com
www.guccigroup.com
189
VII.
THE PHARMACEUTICAL INDUSTRY
7.1
Industry Overview
The size and competitiveness of French pharmaceutical companies, as well as a
strong historical competency in the domain, are key factors in France becoming
the largest pharmaceutical manufacturing country in Europe. Domestic demand
for medical products was estimated at roughly US$ 27 billion in 2001, and a
particularly dynamic export market has been driving strong yearly growth in local
production. Most major pharmaceutical firms have production in France, using
this presence as a platform to serve the European market. Subsidiaries of U.S.
pharmaceutical companies account for roughly 20% of local production while
European firms (excluding France) account for 33%.
The industry still remains somewhat fragmented, with over 70 firms, many of
which are independently-owned laboratories. However, the largest firms account
for over 80% of total turnover in the sector. Substantial research and
development costs along with increasing product sophistication have led many
firms to merge operations and acquire smaller, niche laboratories. The two
largest French firms, Aventis (German co-owned) and Sanofi-Synthelabo, make
up over 20% of total turnover and control over half of the top 15 pharmaceutical
companies present in France.
7.2
Key Players
Top Pharmaceutical Producers in France – 2002 Consolidated Results
Company
Sales (millions)
1 € = 1 US$
Euros
US $
Aventis
GlaxoSmithKline (L2001)
Sanofi-Synthelabo France
Sanofie Winthrop
Laboratoires Servier
Astrazeneca
Lilly France
Laboratoires Merck Sharp
Aventis Pharma
Aventis Propharm
Synthelabo Groupe
Novartis Pharma
Bristol-Myers Squibb
Laboratoires GlaxoSmithKline
Aventis Pharma Usiphar
Roche
Pfizer France
1,852
1,322
1,203
1,183
1,109
1,018
932
893
851
813
749
746
726
685
635
632
620
1,852
1,322
1,203
1,183
1,109
1,018
932
893
851
813
749
746
726
685
635
632
620
Source: COFACE – Top250 Food producers. Figures in Dollars using exchange rate of 1.06 dollars per euro.
190
7.3
Summary of Interviewed Companies
Seven pharmaceutical companies were interviewed for the production of this
report. The companies that agreed to respond, all of U.S. origin or ownership,
range from small, product-specific producers to highly-diversified mass market
pharmaceutical goods manufacturers.
Market Structure:
Information gathered from the company interviews confirms our preliminary
research indicating that Italian packaging machine manufacturers hold a
dominate position in the French pharmaceutical segment. Our company survey
shows Italian machines with approximately 50% share of the installed equipment
base, followed by German equipment with roughly 30%, and French machinery
with an estimated 10% share.
Estimated Installed Packaging Machinery Shares by Country of Origin
10%
10%
Italy
Germany
50%
France
Other
30%
Major Italian manufacturers Ima, Marchesini, and Cama show a strong
penetration rate across the entire packaging line from blister machines to end -ofline equipment. German manufacturer, Uhlmann, appears to have strong
foothold in complete line equipment, and is the principal competitor to the major
Italian manufacturers in this sector.
Cermex, the French end-of-line specialist, is also present in many of the installed
bases of the companies interviewed.
Market Drivers: Factors Influencing Purchasing Decisions
191
1.
2.
3.
4.
5.
6.
Overall quality (reliability and durability)
Servicing, availability of local staff and spare parts
Previous experience with brand
Delivery terms
Price
Brand reputation
Customers’ Assessment of Packaging Machinery suppliers :
The end-users interviewed in this sector tended to express quite similar views on
packaging equipment supply in Europe. A strong majority appreciate Italian
machines for their technical sophistication and versatility in handling wide
varieties of packaging applications. Many customers also commented on the
pricing of Italian equipment, which is highly-competitive when compared to
overall qua lity and functionality.
German machinery, similar to customer evaluations in other segments, is
considered robust, reliable, and durable, providing it with a competitive edge in
high production volume environments. On the other hand, German machinery is
expensive compared to similar technology offered by Italian competitors.
German suppliers also suffer from a poor reputation for after-sales servicing,
which is often viewed as slow and expensive.
With one exception, none of the companies interviewed had enough experience
to provide comments on North American packaging machinery.
Best Prospects:
Our survey and research findings indicated investment plans and specific sales
opportunities in the following machinery categories:
Blister machinery
Cartoners of various kinds,
Filling machinery (aerosol)
Filling machinery (liquid)
Case, fill and close machinery
Automated palletizing machinery
Purchasing Potential:
Of the pharmaceutical companies that responded to our survey, very few wished
to provide specific information on future purchasing and machinery investment
192
plans, as it is considered internal, strategic information. Given the particularly
dynamic nature of investment in this segment, it is the opinion of this report that
the overall purchasing potential represented by these companies can be
estimated between US$ 10-15 million over the forecast period.
7.4
Company Profiles
193
Abbott France
Industry:
Sub-industry:
Pharmaceutical
Specialty products,
diagnostic tests, nutritional
products
Location:
Saint-Rémy-sur-Avre
Size: (2002 sales) US$ 80 million
Specific Business Blister; Filling (liquid);
Opportunities:
Cartoners
A)
Company Description:
Abbott France, a subsidiary of Abbott (Illinois, U.S.A.), is a major manufacturer of
a wide variety of specialty pharmaceutical product, diagnostic tests, nutritional
products, and laboratory equipment. Abbott France’s operations include a
headquarters on the outskirts of Paris and one production facility. Abbott exports
its specialty medical products worldwide, and is one of the premier suppliers of
lyophilized medicine for most major markets
B)
Main Products Produced and how are they packed:
Abbott France packages its pharmaceutical and medical products in blister packs
with aluminum foil, plastic flasks and jars, in carton boxes.
C)
Installed Packaging Machinery:
Abbott France provided the following information on its packaging machinery
installed base:
Current Machinery Used
Full-line machinery (blister, filling,
cartoners through to end-of-line)
Blister machinery
Palletizing equipment
Origin
Brand
IMA, Marchesini Italy
Uhlmann
Uhlmann
Germany
Germany
Average Age
3-10
5
5
Abbott estimated that roughly 80% of its installed packaging machinery base is of
Italian origin (entirely IMA and Marchesini) and 20% of German origin (mostly
Uhlmann).
D)
Last Purchases of Packaging Machinery:
Machinery
Blister and cartoning machinery
Brand
Country
Uhlmann, Marchesini Germany, Italy
194
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Machinery
Blister, liquid filling, cartoners
F)
Origin Motive of purchase
Estimated Budget
--
--
Replacement
Purchasing Policies and Financial Arrangements.
Abbott’s production team coordinates packaging machinery investments with its
marketing and research and development departments. The site team
approaches its existing suppliers for a proposal and quote. Since Abbott
emphasizes machinery and accessory compatibility, it tends to give priority to its
current complete line machinery suppliers.
Abbott purchases machinery directly from the manufacturers or in-country
representative. Abbott places a great deal of importance on servicing and
requires its suppliers to work closely with its technical and maintenance teams.
Abbott normally provides a down payment upon order, and provides the balance
after the machinery has been in place for about a month.
G)
Factors That Influence Purchasing Decisions.
1/ Quality and Reliability
2/ Servicing, availability of spare parts and local staff
3/ Price
4/ Delivery terms
5/ Previous experience with brand
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Abbott France works with a few major full-line packaging machine manufacturers.
It considers IMA and Marchesini to be the leading manufacturers in the French
pharmaceutical market. These suppliers’ competitive advantage arises from their
machinery’s range of flexibility in handling different packaging formats as well as
its relative ease-of-use. Abbott also commented that it considers Italian
sterilization technology to be the best in its field.
German equipment is considered to be robust, technically-sound material.
However, German machines suffer from a higher price and a reputation for
slower servicing relative to Italian machine suppliers.
Abbott France’s evaluation of packaging machinery by country of origin:
195
Origin
Germany
Italy
I)
Technology Flexibility
Very Good Good
Good
Good
Service
Poor
Good
Price
Expensive
Average
Trade Show Attendance / Trade publication Information:
Abbott attends Emballage and Interpack trade shows. It subscribes to
Emballage magazine, Pharmpack, and Usine Nouvelle. It also receives
company and product information from German and Italian trade associations.
J)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Abbott France
Mr. Loic Cloarec
Director of Packaging
rue Isle
28380 St. Remy sur Avre
-France(33) 2.37.38.86.02
(33)
loic.cloarec@abbott.com
www.abbott.fr
196
Baxter France
Industry:
Sub Industry:
Medical and Health Care
Transfusion systems; drug
delivery systems
Location:
La Chatre production
facility
Specific Business Carton, form and fill
Opportunities:
machinery
A)
Company Description:
Baxter Corporation, a U.S. based firm, is a major provider of medication delivery
systems worldwide. The company’s French operations include a head office and
two production sites dedicated to the fabrication of blood transfusion and parental
nutrition delivery systems.
B)
Main Products Produced and how are they packed:
Baxter La Chatre production facility individually packs its blood transfusion
pockets in polypropylene, and group packages (15-25 unit packs) in carton.
C)
Installed Packaging Machinery:
Current Machinery Used Brand
Horizontal flow wrap
FMC
Carton, form and fill
Cermex
D)
Units Origin
6
2
Average Age
Italy
France
20
17
Last Purchases of Packaging Machinery:
Baxter indicated that it recently purchased the following packaging equipment:
Machinery
Horizontal flow wrap
E)
Brand
Techno Pac
Country
Italy
Future Packaging Machinery Ordering Plans (2003-2005):
Given the advanced age of its packaging installed base, Baxter’s la Chatre
production site investment plans include replacement equipment purchases
progressively over the next five years. The company did not provide specific
information on quantities or timeframe for these future investments.
F)
Purchasing Policies and Financial Arrangements.
197
Packaging machinery investment plans are developed by Baxter’s production site
teams composed of the production, technical, and maintenance directors,
including the local engineering staff. The company indicated that it develops its
purchasing plans over a three to five year timeframe. It maintains a database of
suppliers, and it was commented that the production staff is highly familiar with
the packaging machinery suppliers for its production requirements. It generally
compares two to three proposals before making the final decision.
Payment schedules are structured according to industry norms.
G)
Factors That Influence Purchasing Decisions.
1/ Experience with the brand
2/ Overall brand reputation in its field
3/ Price and Financing terms
4/ Delivery terms
5/ Servicing
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Baxter indicated that it is not familiar with North American packaging equipment.
It commented that, as far as their decision-making process was concerned, it
was important for suppliers to have a close, physical presence to its production
site. Proximity is essential for servicing and spare parts provision, and acts as a
reassuring factor for decision-makers.
Baxter indicated that its Italian supplier meets its packaging machinery needs
very closely and cost-effectively.
Baxter France’s evaluation of packaging machinery by country of origin:
Origin
Germany
Italy
France
I)
Technology
Good
Very Good
Very Good
Flexibility
Good
Good
Good
Service
Average
Good
Good
Price
Expensive
Good
Average
Trade Show Attendance / Trade publication Information:
Baxter indicated that it regularly attends the major European packaging trade
shows, Emballage and Interpack. It did not mention that it consults any particular
trade publication.
K)
Contact Information:
Company Name:
Baxter France
198
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Mr. Bruno Lafarcinade
Maintenance Director
Etaille Thevet St. Julien
36400 La Chatre
-France(33) 2.54.06.25.25
(33) 2.54.06.25.00
bruno_lafarcinade@baxter.com
www.baxter.com
199
Pfizer France
Industry:
Sub Industry:
Pharmaceutical
Trade mark drugs, overthe-counter, prescription,
veterinary and specialty
medical products
Location:
Amboise production center
Size: (2002 sales) US$ 620 million (France)
Specific Business Blister machines, liquid
Opportunities:
filling machines
A)
Company Description:
Pfizer S.A. is the French subsidiary of the Pfizer Corporation in the U.S. Pfizer is
present in 150 countries; its French operations include a country headquarters,
two research and development centers, and six production facilities.
The Amboise production site is one of Pfizer’s largest European production
facilities, with production sold both domestically (roughly 60%) and to other
European markets. Along with the Angers and Orleans production facilities,
French operations represent the Pfizer’s largest European production platform for
human health products.
B)
Main Products Produced and how are they packed:
Given the wide variety of products produced by Pfizer France, it would be difficult
to describe each packaging type per product. Generally speaking, its liquid
goods are packaged in ampoules, vials, syringes, cartridges, infusion bottles, and
flasks of various kinds, tablets in blister packs, oral suspensions in glass and
plastic bottles, and injections in sterilized paper and bottles.
C)
Installed Packaging Machinery:
Below is a profile of the type of packaging machinery used by Pfizer’s Amboise
production facility:
Current Machinery Used
Blister machines
Cartoning machines
Case form and fill
Liquid filling
Inspection
Sterilizers
Brand
Uhlmann
Cama
Cermex
Calumatic, Bosch
Eisai
Fedegari
200
Origin
Germany
Italy
France
Norway, Germany
Japan
Italy
Average Age
5
-Over 7
Over 9
2
8
D)
Last Purchases of Packaging Machinery:
The follow information on recent purchasing was provided by the Amboise site:
Machinery
Blister machinery
Sterilizing machinery
E)
Brand
Uhlmann
Eisai
Country
Germany
Japan
Future Packaging Machinery Ordering Plans (2003-2005):
Pfizer was not at liberty to reveal its packaging machinery investment plans. It
did state in general terms that it will be investing in major machinery lines over
the next three years to augment production speed and further increase
automation.
F)
Factors That Influence Purchasing Decisions.
1/ Servicing
2/ Overall quality (reliability, durability, precision)
3/ Price in relation to quality
4/ Previous experience with brand
5/ Ease of use
G)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Pfizer mentioned that it is pleased with its core suppliers from Germany and Italy.
It was mentioned that German equipment is possibly the most durable and solid
machinery on the market, and is appreciated for its high level of automation.
Italian machinery is also highly-adapted to pharmaceutical manufacturing
requirements. Pfizer commented that Italian suppliers and their local
representatives provide efficient, cost-effective after-sales servicing.
Pfizer commented that it had no practical experience with and little information on
North American packaging equipment in this field. The interviewee did mention
that he believes U.S. equipment does not adequately meet European norms,
which hinders its development in the French market.
Pfizer France’s evaluation of packaging machinery by country of origin:
Origin
Germany
Italy
Japan
Technology
Very Good
Good
Very Good
Flexibility
Good
Good
Good
201
Service
Poor
Good
Average
Price
Expensive
Average
Average
H)
Trade Show Attendance / Trade publication Information:
Pfizer France regularly attends Emballage and Interpack trade shows to gather
information on packaging machinery suppliers. The major trade publications
consulted include Usine Nouvelle (www.usinenouvelle.com), Emballages
Magazine (www.emballagesmagazine.com), and Pharm Pack Europe.
I)
Specific Interests
Pfizer France would be interested in receiving information on North American
packaging machinery in the pharmaceutical industry, particularly concerning
innovations.
J)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Pfizer France
Mr. Jacques Bodenan
Production Director
B.P. 109
37401 Amboise
-France(33) 2.47.23.77.78
(33) 2.47.23.79.80
Jacques.bodenan@pfizer.com
www.pfizer.com
202
Proctor & Gamble Pharmaceuticals S.A.
Industry:
Sub Industry:
Pharmaceuticals
Specialty pharmaceutical
and medical products
(cardiology, rheumatism)
Location:
Longjumeau production
facility
Size: (2002 sales) US$ 150 million
Specific Business Filling machinery
Opportunities:
A)
Company Description:
Procter and Gamble’s Longjumeau site was created in 1936 under the name
« Nativelle Laboratories » and was acquired by P&G’s pharmaceutical division in
1986. With roughly 150 employees, the site produces specialized
pharmaceutical goods for cardiological and rheumatic applications. Roughly
50% of total production is distributed in the domestic market, with the rest
exported to worldwide markets.
B)
Main Products Produced and how are they packed:
Product
Didronel
Digoxine
Hemigoxine
Digitaline
Previscan
Natispray
Dantrium
Calcium
C)
Brand
Procter & Gamble
“
“
“
“
“
“
“
Packaging / Container
PVC/Aluminum
PVC/Aluminum
PVC/Aluminum
PVC/Aluminum
PVC/Aluminum
Spray
Plastic/ Glass flask
PVC/Aluminum
Installed Packaging Machinery:
Machinery used
Brand
Blister machine
"
Cartoning machinery
"
Labeling equipment
Filling machinery
Uhlmann
Partena
IMA
HF 77
SFE
Farmomac
Est. Number
of Units
1
2
1
1
4
1
203
Country of Origin
Germany
Italy
Italy
Germany
France
Italy
Average Age
7
7
2
7
5
20
Carton and tray filling Cermex
D)
3
France
3
Last Purchases of Packaging Machinery:
The following information was provided on recent packaging equipment
purchases:
Machinery
Cartoning machinery
Case and tray filling
Distribution
E)
Brand
IMA
Cermex
Aylward
Country
Italy
France
U.S.A.
Future Packaging Machinery Ordering Plans (2003-2005):
Procter & Gamble did not provide specific information on future packaging
machinery purchases, as it indicated that this is internal information. It indicated
that it will be investing in replacement equipment to increase overall automation.
Filling machinery represents a potential area of investment.
F)
Purchasing Policies and Financial Arrangements.
Procter & Gamble indicated that its Longjumeau production team handles
packaging machinery investment plans and supplier relations. Investment plans
are developed on a yearly basis by the production team and its French head
office. When evaluating a potential equipment purchase, the production
purchasing team consults an existing list of preferred suppliers. At least three
proposals are evaluated per machinery category. Investments amounts that
exceed a certain amount (roughly US$ 50,000) require corporate approval.
The company indicated that it finances equipment purchases through internal
corporate credit. Payment schedules depend on previous experience with the
supplier; generally it includes a down payment upon order, and the balance after
the machine has been installed (60-90 days average).
G)
Factors That Influence Purchasing Decisions.
1/ Overall Machinery Quality (reliability, precision, durability)
2/ Servicing, including availability of local staff and spare parts
3/ Versatility
4/ Delivery terms
5/ Ease of use
6/ Price
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
204
Procter & Gamble indicated that it considers German and Italy machinery
adequately meets its packaging requirements. The interviewee mentioned that
the equipment specialists from these two countries have a strong foothold in the
French pharmaceutical market. German equipment is appreciated for its overall
quality, precision and durability. Italian machinery is considered versatile,
technically sophisticated, and easy to operate.
The company mentioned that it would difficult for North American equipment to
penetrate the core market for pharmaceutical packaging machinery, dominated
by German and Italian suppliers. U.S. technology is viewed as viable, but
distance a nd differences in norms between the continents are hurdles that need
to be overcome.
Procter & Gamble indicated that it requires its suppliers to have an in country
representative capable of assuring technical assistance, maintenance and repair,
and spare parts provision. The company prefers placing large equipment orders
directly with manufacturers.
Procter & Gamble’s evaluation of packaging machinery by country of origin:
Origin
United States
Germany
Italy
France
I)
Technology
Good
Very Good
Good
Good
Flexibility
Poor
Good
Good
Good
Service
n/a
Poor
Good
Good
Price
Good
Expensive
Average
Fair
Trade Show Attendance / Trade publication Information:
The company indicated that it regularly attends the two major European
packaging trade shows, Emballage in Paris and Interpack in Dusseldorf. It also
subscribes to Emballages (Pharm Pack Europe) magazine and Usine Nouvelle.
J)
Specific Interests
Procter & Gamble recently purchased U.S. equipment from Aylward, and would
be interested in receiving more product information from the PMMI
K)
Contact Information
Company Name:
Contact:
Position:
Address:
Procter & Gamble Pharmaceuticals
Mr. Olivier Gautier
Production Director
1 chemin Saulxier
91160 Longjumeau
-France-
205
Telephone:
Fax:
Email:
(33) 1.69.10.55.00
(33)1.69.10.55.43
gautier.o@pg.com
Other contacts concerning packaging machinery:
1/ Sylvain Garcia; garcia.s@pg.com
2/ Christian Bisogni ; bisogni.c@pg.com
206
Schering-Plough France
Industry:
Location:
Pharmaceutical
Herouville St. Clair
production site
Size: (2001 sales) US$ 469 million
Specific Business Carton (fill and seal); case
Opportunities:
filling and closing
machinery
A)
Company Description:
The French subsidiary of Schering-Plough is the eleventh largest pharmaceutical
company in France. The company organizes its activities around the following
areas (volume percentage):
- SNC/Hepatitis
- Dermatology/Allergies
- Onco/Hematology
- Maturity
- Immunology
- Cardiology
54.4%
27.5%
8.0%
4.8%
4.8%
0.5%
The Herouville -Saint-Clair production site produces approximately 80 million
units per year in both sterile and non-sterile environments, and has experienced
20-30% yearly growth over the review period. Schering -Plough’s sales are
driven by strong domestic demand and a robust export market as roughly a
quarter of local production is exported.
B)
Main Products Produced and how are they packed:
Schering -Plough France uses a wide variety of packaging applications for its
pharmaceutical products. Examples of packaging include tablets in blister packs
and carton boxes; creams in aluminum tubes; lotions in plastic flasks; sirops and
throat drops; and ampoules and pre-filled syringes.
C)
Installed Packaging Machinery:
Schering -Plough provided the following information on its packaging machinery
installed base:
Current Machinery Used
Brand
Cartoner, fill and seal machines IMA
Ampoule, fill and close
Marchesini
207
Origin
Italy
Italy
Case filling machinery
Palletizing equipment
D)
Marchesini
Italy
IWKA, Pester, PRB, Cama Germany, Italy
Last Purchases of Packaging Machinery:
Machinery
Brand
Filling (tube); cartoners, grouping machinery IWKA
Palletizing equipment
Pester
E)
Country
Germany
Germany
Future Packaging Machinery Ordering Plans (2003-2005):
Machinery
Cartoning machinery
Case filling and closing machinery
F)
Units Motive of purchase
4
4
Replacement
Replacement
Factors That Influence Purchasing Decisions.
1/ Rapid delivery
2/ Servicing, availability of local staff and spare parts
3/ Price in relation to quality
4/ Previous experience with supplier
5/ Financing
G)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
Schering -Plough indicated that it currently does not have any North American
packaging machinery in its French production facilities. SP’s installed machinery
is entirely of European origin (French, German, Italian), which is partly due to
historical ties between its sites and local suppliers. It was also commented that
there is strong tendency, if not unwritten policy, to purchase from local and
European manufacturers.
The group has a global approach to machinery investment. Namely, SP
corporate has international agreements with many of its suppliers, which dictate
financing, delivery, servicing, and spare parts provision. Site managers identify
machinery requirements, research potential suppliers, and submit proposals to
SP’s U.S. purchasing department for verification and approval.
When there is a change in packaging for a specific line of products, SP corporate
determines the machine specifications and puts forward preferred suppliers for
its European sites.
Schering-Plough’s evaluation of packaging machinery by country of origin:
Origin
Technology Flexibility
208
Service
Price
Germany
Italy
France
H)
Very Good
Good
Good
Good
Good
Good
Average
Good
Very Good
Expensive
Average
Fair
Trade Show Attendance / Trade publication Information:
SP France regularly attends Emballage and Interpack trade exhibitions as well as
Achema (Frankfurt, Germany). Trade publications consulted include Pharmpack,
Emballage magazine, and Usine Nouvelle.
I)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email :
Web site :
Schering-Plough France
Mr. Nicolas Lebreuilly
Director of Industrial Development
2 rue Louis Pasteur
14200 Hérouville-Saint-Clair
(33) 2.31.06.92.00
(33) 2.31.06.92.22
nicolas.lebreuilly@spcorp.com
www.schering-plough.fr
209
3M Santé
Industry:
Sub Industry:
Pharmaceutical
Cardiology, Pneumology,
Immunology
Location:
Pithivier production site
Size: (2002 sales) US$ 1.137 billion
(consolidated results)
Specific Business Blister machinery,
Opportunities:
cartoners, aerosol filling
machinery
A)
Company Description:
3M’s French operations include six production facilities including one
pharmaceutical production unit located in Pithivier. France represents the third
largest European market and fifth largest worldwide, accounting for roughly 25%
of 3M’s European turnover in pharmaceutical products.
3M Santé, the French pharmaceutical branch, produces and markets its
pharmaceutical products primarily for the French and European markets. It is
estimated that roughly 75% of production is sold domestically.
B)
Main Products Produced and how are they packed:
3M Santé packages its tablet/capsule products in blister packaging and carton
boxes, its Drug Delivery System patches in carton boxes, and its allergy sprays
in aerosol canisters.
C)
Installed Packaging Machinery:
Current Machinery Used
Blister packaging
Cartoning
Printing, Imprinting
Filling – aerosol
Tablet and capsuling
Case filling
Palletizing
D)
Brand
IMA
CAM, Marchesini, IMA
Marchesini
Pamassol
Marchesini
CAM, IMA
Marchesini
Last Purchases of Packaging Machinery:
210
Origin
Italy
Italy
Italy
Switzerland
Italy
Italy
Italy
Average Age
3-15
3- 15
4-15
5-10
3-10
3-15
--
3M Santé indicated that it has not made any packaging machinery investments
over the last three years.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
3M did not provide specific information on future packaging machinery
investment plans. It was indicated that new packaging requirements will require
investment in various machinery categories.
F)
Purchasing Policies and Financial Arrangements.
3M commented that its production site team develops yearly packaging
machinery investments plans in conjunction with the corporate engineering
department located in Cergy Pontoise (Paris region). During the last investment
round, the company assessed German and Italian machinery, along with
packaging equipment from the U.K. Italian machinery was selected for its priceto-quality ratio and high degree of versatility.
3M finances its machinery investments internally. Payment schedules are
structured in phases, with a down payment upon order and the remainder 60-90
days after installation.
G)
Factors That Influence Purchasing Decisions.
1/ Price-to-quality ratio
2/ Development/delivery time
3/ Adherence to machine specifications
4/ Servicing
5/ Brand reputation
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
3M Santé mentioned that Italian packaging machinery manufacturers are the
leading suppliers in the pharmaceutical segment. This leadership position is
largely the result of Italian technical know how and strong brand reputation in the
field as well as a competitive pricing strategy. As a result, when compared to its
nearest competitors (German manufacturers), Italian manufacturers tend to have
an edge when taking into account price, overall reliability, and machinery
versatility in handling complex packaging requirements. It was also mentioned
that Italian machinery tends to meet the initial product specifications more closely
than German, French, or Swiss competitors.
3M Santé’s evaluation of packaging machinery by country of origin:
211
Origin
Germany
Italy
France
Switzerland
I)
Technology
Very Good
Very Good
Good
Good
Flexibility
Good
Very Good
Good
Good
Service
Average
Good
Average
Good
Price
Expensive
Good
Average
Average
Trade Show Attendance / Trade publication Information:
3M indicated that it regularly attends the Emballage trade show in Paris to gather
product and supplier information. It also subscribes to Emballages magazine,
which publishes a monthly supplement specializing in pharmaceutical issues
(“Pharm Pack Europe”).
J)
Specific Interests
3M is open to receiving product and company information from the PMMI,
particularly concerning North American innovations in pharmaceutical packaging.
E-mail correspondence is preferred.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
3M Santé
Mr. Jacques Lacassagne
Production Director
avenue 11 Novembre
45300 Pithiviers
-France(33) 2.38.32.45.45
(33) 2.38.32.45.46
jlacassagne1@mmm.com
www.mmm.com
Corporate Engineering Department:
Contact:
Email:
Mr. Maurice Schitter
mschitter1@mmm.com
212
Groupe UPSA
Industry:
Sub Industry:
Pharmaceuticals
Trade mark drugs, over the
counter, and other medical
specialty products
Location:
Agen production site
Size: (2002 sales) US$ 520 million
Purchasing
US$ 100-200,000
potential:
Specific Business Palletizing equipment
Opportunities:
(automated)
A)
Company Description:
The UPSA group is a wholly-owned subsidiary of Bristol Myers Squibb
Corporation. UPSA’s two French production sites, situated in southwestern
France, manufacture roughly 370 million units a year for both domestic and
international markets under the UPSA and Oberlin trademarks. Sales are
evenly divided between the domestic and export markets.
UPSA’s Agen facility includes 22 production lines used for the production of
effervescent products, representing the largest production of effervescent
products worldwide.
B)
Main Products Produced and how are they packed:
The UPSA group produces a wide range of medical products; its most important
products including analgesics and vitamins (effervescent and tablet), and oral
liquids. UPSA’s tablets are packaged in blister form, the effervescent products in
plastic tubes and carton boxes, and oral liquids in plastic and glass flasks.
C)
Installed Packaging Machinery:
UPSA provided the following information on its installed packaging machinery
base for its two production facilities:
Current Machinery Used
Blister machinery
Tablet and Capsule machinery
Sachet filling and closing
Gel tablet machinery
Cartoning machinery
Brand
Uhlmann
Korsch, IMA
Uhlmann
Marchesini
Uhlmann
213
Origin
Average Age
Germany
5-10
Germany, Italy 10
Germany
3-8
Italy
5
Germnay
5
Weighing machinery
Palletizing machinery
Prisma
---
Italy
5-10
Germany, Italy ---
A large majority (95%) of UPSA’s packaging machinery is of German or Italian
origin. Furthermore, it was estimated that roughly 80% of its installed packaging
machinery base originates from Germany.
D)
Last Purchases of Packaging Machinery:
UPSA indicated that it recently replaced packaging machinery for roughly half of
its installed capacity.
E)
Future Packaging Machinery Ordering Plans (2003-2005):
Motive of purchase
Estimate Budget
Machinery
Palletizing equipment Replacement, automation US$ 100-200,000
F)
Purchasing Policies and Financial Arrangements.
UPSA’s production and purchasing departments develop investment plans,
generally on a two- to three- year basis. Final purchasing schemes must be
validated by Bristol Myers Squibb’s purchasing division in the United States.
UPSA’s supplier relations are governed by Bristol Myers Squibb’s global supplier
agreements, which are negotiated yearly. Machine suppliers are chosen
according to production capacity, compatibility with existing lines, and global
servicing ability. A European steering committee composed of general mangers
and production directors from each country determines new investment plans
and production capacity increases.
The U.S. Headquarters are notified for validation; however, final supplier
selection is generally made locally by the country head offices. Each production
team plays an advising role, and for the most part, has very little decision-making
power.
G)
Factors That Influence Purchasing Decisions.
1/ Production speed
2/ Servicing
3/ Reliability and durability
4/ Delivery terms
5/ Flexibility in handling different packaging applications
H)
Comments on Preferred Brands and Existing Business
Arrangements with Packaging Equipment Suppliers:
214
UPSA commented that it believes German packaging equipment to be the most
durable and robust equipment on the market. In this respect, it is able to recover
its initial investment through longer operating lives and lower maintenance costs.
On the other hand, UPSA finds after-sale servicing and repair from German
suppliers to be too slow and expensive compared to Italian manufacturers.
UPSA considers Italian machinery to be more flexible and versatile than German
equipment in handling a wider variety of packaging applications. Italian suppliers
are also appreciated for their efficient, cost-effective servicing and timely spare
parts delivery.
The Group UPSA’s overall evaluation of packaging machinery by country of
origin:
Origin
Germany
Italy
I)
Technology Flexibility
Very Good Good
Good
Good
Service
Poor
Good
Price
Expensive
Average
Trade Show Attendance / Trade publication Information:
UPSA regularly attends Emballage and Interpack trade exhibitions. It subscribes
to Emballage magazine (Pharmpack Europe) and Usine No uvelle. It also pays
special attention to individual company brochures and product literature.
J)
Specific Interests
Though UPSA works closely with its current machine suppliers, it would be
interested in receiving new product information from North American
manufacturers particularly regarding automated palletizing equipment.
K)
Contact Information:
Company Name:
Contact:
Position:
Address:
Telephone:
Fax:
Email:
Web site:
Groupe UPSA (Bristol Myers Squibb)
Mr. Regis Gaboriau
Technical Director
304 avenue Doctor Jean Bru
47000 Agen
-France(33) 5.53.69.82.00
(33) 5.53.69.84.97
Regis.gaboriau@bms.com
www.bms.com
215
APPENDIX A – S.W.O.T. Analysis: North American Equipment
Imports to France.
Strengths of North American
Packaging Machinery Imports:
Weaknesses of North American
Packaging Machinery Suppliers:
o Production speed and rhythm
o Overall quality and durability
o Low machine versatility
o Poor brand awareness
o Low overall communication in
market
o Low current market penetration
o Lack of adherence to E.U.
standards
o Machine ergonomics not
adapted to European factories
o Distance from market
o Cultural and linguistic
differences
Market Opportunities:
Competitive Threats:
o Appreciation of the euro
o Market need for innovative
technology not found in Europe
o Expansion of integrated
packaging processes (i.e. form,
fill, and seal)
o Stricter environmental
regulations driving packaging
machinery innovations
o Online spare parts ordering
o Potential partnerships with
French importers and
distributors
o Strong brand awareness of
existing suppliers
o German suppliers’ reputation for
robust machinery
o Italian suppliers’ competitive
pricing and machine versatility
o European suppliers’ proximity to
market
o Long-standing ties between
European suppliers and French
end-users
o Strong European penetration in
existing packaging machinery
installed capacity: leads to
synergies for future purchasing
and spare parts compatibility
216
APPENDIX B – Imports of Packaging Machinery - by Country of
Origin
Source: PMMI Import Figures, May 2003
France Import Statistics
UDG: 8422.20 to 8422.90, Machinery and Parts
Year To Date: January – December
Partner Country
Thousand United States
Dollars
2000
2001
2002
World
528,621
497,819
Germany
174,774
Italy
%
Change
% Share
2000
2001
2002
2002/2001
549,099
100
100
100
10.3
151,470
174,937
33.06
30.43
31.86
15.49
151,865
146,089
164,500
28.73
29.35
29.96
12.6
Switzerland
40,621
35,816
31,346
7.68
7.19
5.71
-12.48
Spain
24,749
26,541
27,599
4.68
5.33
5.03
3.98
Netherlands
18,917
16,985
27,055
3.58
3.41
4.93
59.29
Denmark
11,692
21,322
26,265
2.21
4.28
4.78
23.18
United Kingdom
21,753
19,953
24,104
4.11
4.01
4.39
20.8
Belgium
10,218
14,497
15,888
1.93
2.91
2.89
9.6
United States
18,029
14,507
14,591
3.41
2.91
2.66
0.58
Sweden
19,085
14,389
11,783
3.61
2.89
2.15
-18.11
Japan
14,299
12,561
11,499
2.7
2.52
2.09
-8.46
217
APPENDIX C – Key Industry Contacts
Trade Exhibitions:
1) Emballage 2004
World Packaging Exhibition
November 22-26, 2004
Paris, France
www.emballageweb.com
Organizers:
Exposium S.A.
1, rue due Parc
92593 Levallois-Perret
-Francetel : (33) 1.49.68.54.44
fax: (33) 1.49.68.54.45
contact: Valerie Queffelec, Deputy Exhibition Manager
email: vqueffelec@exposium.fr
2) Carrefour des Fournisseurs de l’Industrie Agroalimentaire (C.F.I.A.)
Food Suppliers Trade Fair
March 9-11, 2004
Rennes Exhibition Center
Organizers :
Jangil S.A.
2, place du 4 septembre
B.P. 223
47305 Villeneuve Sur Lot Cedex
-FranceTel : (33) 5.53.36.78.78
Fax : (33) 5.53.36.78.79
Web site : www.jangil.fr
Industry Publications :
1) Emballages Magazine
12-14, rue Médéric
75815 Paris Cedex 17
-FranceTel : (33) 1.56.79.44.06
Fax : (33) 1.56.79.45.08
Contact : Henri Saporta, Editor in Chief
Email: hsaporta@lsa.fr
218
Web site: www.emballagesmagazine
2) Process Magazine
CS 77711
35577 Cesson-Sévigné Cedex
-FranceTel: (33) 2.99.32.21.21
Fax: (33) 2.99.32.14.17
Contact: Francois Morel, Editor-in-Chief
Email: fmorel@editionsduboisbaudry.fr
Web site: www.process-magazine.com
3) R.I.A. – Revu des Industries Agroalimentaires
8 cité Paradis
75493 Paris Cedex 10
-Francetel : (33) 1.40.22.70.60
fax : (33) 1.40.22.70.72
Contact : Denis Lemoine, Editor
Email: ria.redaction@gfa.fr
Web site: www.ria.fr
Trade Associations :
1) SECIMEP
French Packaging Machinery Importer’s Association
25-27, rue d’Astorg
75008 Paris
Tel: (33). 1.44.51.14.60
Fax: (33) 1.42.65.39.49
Contact: Mr. Opillard, Managing Director
Email: opillard@ficime.fr
Web site: www.ficime.fr
Regulatory Agencies :
1) AFNOR - Association Française de Normalisation
(National French Standards Association)
11, avenue Francis de Pressensé
93571 Saint-Denis La Plaine Cedex
Tel: (33) 1.41.62.80.00
Fax: (33) 1.49.17.90.00
norminfo@afnor.fr
www.afnor.fr
219