food packaging technologies summit
DESCRIPTION
Presentation by Harris DeLoach, Sonoco Chairman and CEO, at the Food Packaging Technologies Summit in May 2012TRANSCRIPT
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Food Packaging Technologies SummitHarris E. DeLoach, Jr.
May 8, 2012
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Sonoco Today
2011 2010
Sales $1,977.3 $1,798.5
Base EBIT $191.5 $196.0
2011 2010
Sales $1,892.2 $1,744.0
Base EBIT $138.2 $136.4
2011 2010
Sales $471.4 $477.2
Base EBIT $21.7 $14.2
2011 2010
Sales $158.0 $104.4
Base EBIT $15.2 $17.5
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Changing Business Mix
Global Consumer Strategy
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Sonoco’s strategy targets a shift in the mix of its businesstoward faster-growing consumer-related markets.
Only Total Solutions Provider
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Packaging Design, Innovation and
Artwork Management
Complete Consumer Packaging
Retail MerchandisingSustainabilityand Recycling
Packaging Supply Chain Services
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$250 million+$1 billion+
Brand Size
2011$1.1 billion sales
2005$0.7 billion sales
Corporate Customer GrowthKey New Brands Won Since 2005
Consumption Trends
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Macro Economic Trends Impacting Packaging
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Macro-economic Impacton Packaging Industry
Consumers
High unemployment – 8.1%
Low confidence in political leadership
Spending habits changing – High end
and private label
Customers
High raw material inflation
Cost reduction/substitutions
More CPG consolidation
Retailers
Food inflation, inability to raise prices
Pushing for retail-ready solutions
Private label and store brand acceleration
What are Key Trends We See in Packaging Technology
Packaging Format Changes
Product Safety and Security
Sustainability
Bifurcation of Consumer Spending
Consumer Convenience and Aging Populations
Improving Shelf Presence
E-Commerce and Non-Traditional Retailing
Packaging Customization
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Packaging Format Changes
Metal to Composite Cans
Composites to Rigid Plastic
Plastic to Flexible Pouch
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A Case Study for Powdered Infant Formula
Product Safety
Regulatory Changes
BPA, mineral oils, solvents, melamine, etc.
Global Food Safety Initiative
Supply Chain Security
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Health and Wellness Products
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87% of Consumer Trying to Eat Healthier
Product Stewardship and Sustainability
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GOAL
A product offering’s interconnected design variables…
…and Sonoco’s goal of consistently improving functionality, reducing cost and minimizing environmental impact!
Design for the Environment
Packaging Sustainability
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Source Reduction
Packaging Sustainability
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Renewable, Recycled content, Recyclability
Packaging Recycling
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Grow U.S. collections 10% to 2 million tons in 2012
Greenville, S.C., MRF acquisition
Charleston, S.C., mini-MRF development
Onslow County, N.C., MRF
Company Stewardship
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Sustainability, Citizenship Reducing Footprint
Bifurcation of Consumer Spending
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Sonoco PL packaging sales to $165 million in 2011
(8% of Consumer Packaging sales)
PL Sales 2010
Composite Cans
FlexiblesRigid
Plastics
$150 million $96 million $19 million $35 million
% Division sales 13.5% 5.5% 7.15%
Private Label Growth
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Age-friendly Packaging
Consumer Diversity and Aging Populations
Shelf Presence
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Cold Chain Logistics
E-Commerce and Non-Traditional Retailing
Packaging Customization
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Emerging market influences
Consumer demands changing
Packaging technology must change
Key Takeaways
Questions
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