Competition in the hottest flexible packaging mark

2022-08-14
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Competition in the flexible packaging market

the global flexible packaging market for consumer goods is as high as 30 billion US dollars. With the globalization of consumer goods production (such as food groups Nestle E and Mars), the internationalization of packaging substrate supply is no longer a new concept. However, the globalization of packaging and processing groups is still a relatively new phenomenon

15 years ago, some large packaging and processing groups were attracted to invest in distant overseas markets, partly because of customer expectations. However, except for a few successful examples, few of these joint ventures have achieved commercial success. On the contrary, these processors who invest overseas suffer from cultural barriers, costs, language, policies and regulations, and high expectations. Nevertheless, the trend of investing in overseas markets is getting stronger and stronger. Why

two types of markets

there are two investment environments in today's world. With the emergence of new communication technology, the change of political pattern and the increase of disposable income, emerging markets such as Southeast Asia and central and South America are usually more attractive for investment than many more mature markets, while the demand growth of mature markets is relatively slow, and some regions even show a downward trend

many regions of the global market are in a state of oversaturation, such as printing, composite processing, substrate production, etc. Therefore, business merger has become a common phenomenon. Small processors (usually family style) have to face higher investment costs; Large scale processors also face increasing price pressure, which is the case in the global market

processors are working hard to reduce costs in order to survive. Some processors obtain some processing orders (often with low profits) from overseas partners or enterprise acquisitions, and then get domestic processing; The medium-sized and large flexible packaging groups ensure their competitive position in the market by adopting new technologies and looking for emerging markets with rapid growth

emerging markets

in the past 10 years, the global flexible packaging market has experienced polarization: large and mature markets, such as North America, Western Europe and Japan; The scale is small. Before using any experimental machine, you should fully understand the functions and other aspects of the product, such as the developing emerging markets in India, China, Southeast Asia, Eastern Europe and South America

although emerging flexible packaging markets also have the problem of oversupply, these emerging markets have lower costs and stronger demand growth potential than mature markets. The factors driving the growth of the emerging flexible packaging market are as follows:

◆ international investment established by western consumer goods manufacturers, such as some Western candy, snack food and tobacco companies, has invested in emerging markets

◆ the continuous development of powerful and technologically competitive processors in emerging markets

◆ the consumption of packaged products is growing, especially processed convenience foods

◆ the disposable income of the urban population continues to increase

◆ standard packaging methods are adopted for end consumer goods in the global market

◆ a more effective retail system is gradually developed and improved

put it another way.

if business is successful, one way is to explore rapidly growing emerging markets, and the other way is to ensure the leading position of technology or consumer satisfaction. New technologies exist in both mature and emerging markets, but processors in mature markets can more easily adopt new technologies by providing funds, training, release and marketing skills. Global consumers may favor domestic processors who cooperate/support/joint venture with Western flexible packaging groups

it seems that large western groups are seizing the global market, but this is not the case. Processors from western countries are no longer simply "nibbling" the market. For example, iTap Bemis, a joint venture between Bemis in the United States and iTap in Brazil, is a win-win business cooperation case. The parent company of iTap resold 1/3 of the company's shares to Bemis company of the United States, thus making up for the deficiencies of iTap company in new technology and marketing skills, and Bemis company opened the Brazilian market through such cooperation

therefore, in emerging markets, some ambitious local companies are carrying out international cooperation to ensure their competitiveness, and actively seek international cooperation with Western processors with unique technology and marketing means

how about the prospects

in the next five years, the pressure faced by processors in mature markets will continue to increase, and they will become more and more rational in the face of shrinking marginal profits and European and American markets. This pressure will lead to the closure of some factories, and will also urge processing manufacturers to take measures to reduce the excess production capacity in the market

some companies have taken measures to connect more closely with customers. Through cooperation with partners to improve service levels and comprehensively reduce costs. A typical example is that some technicians of the company are often sent to customers to provide customers with technical plastic material support, material procurement guidance and after-sales support. Processors also cooperate with raw material suppliers in the same way. For example, the ink manufacturer sends technicians to the packaging processing factory to manage the supply of ink

Southeast Asia and South America are now the most attractive markets for large processing manufacturers who want to explore emerging markets. These areas have a large population and increasing disposable income. It is also worth mentioning the markets of India, China, Indonesia, Brazil and Argentina. Argentina is not the best place to invest now, mainly because its economic situation is not good

some smaller processing manufacturers can also find suitable markets, technologies or "complete solutions" in some limited regions and markets in the process of market development

some smart companies in emerging markets will become stronger and stronger. These companies mainly follow and learn from the development model of mature markets. In addition, these companies will increasingly seek the following support from overseas markets:

◆ technologies with competitive advantages (such as high barrier coating technology)

◆ establish a supply partnership with manufacturers who make simple changes to other processing steps

◆ mergers (especially with domestic companies and surrounding markets)

the right business strategy depends on the size of the company, its goals, and its attractiveness to potential partners

in order to maintain their competitive position and explore emerging markets, there is a fierce competition between major processing manufacturers in mature markets. They not only face competition, but also face strong local competitors from emerging markets who are eager to seize more markets. In order to remain invincible in the future, Hecai packaging and processing company must know itself and the enemy, act according to the information, expand market share and seize potential investment opportunities as soon as possible

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