Foreign Packaging and Competition (II)

In 1985, Tetra Pak was established in Hong Kong, but in reality it was only a trading company that had been staying in Hong Kong. "At that time, it was only interested in selling things in China and it had not reached the point of investing in China." Until 1992, “The headquarters visited China once and felt that the market has great potential.” In 1994, 75% of Tetra Pak Holdings Co., Ltd. was established in Foshan.
Now, Tetra Pak has already completed its first step in China: setting up offices in nine key cities such as Shanghai and Beijing; four joint venture factories in Beijing, Foshan and Kunshan, and establishing Distribution network around. In 2000, Tetra Pak China headquarters was officially relocated from Hong Kong to Shanghai.
However, with the increasingly fierce competition in the beverage packaging market in China in recent years, Tetra Pak began to feel pressure.
Hong Kong's multinational companies each other Bo last year, Tetra Pak's old rival, ranked second in the field of international sterile paper packaging Swiss Industrial Group (SIG) began to attack the Chinese market. On November 27th, SIG Combibloc established its first carton packaging plant in Suzhou Industrial Park with a total investment of 90 million US dollars. The completed SIG Leisure Pack Suzhou plant will be put into production in the first quarter of 2004 with a capacity of 3.3 billion packs of cartons.
"We are indeed late, but it is never too late to make a correct decision," said Mr. Edwin Somm, Chairman of the SIG Group's Board of Directors. He revealed that in recent years SIG Combibloc will also set up a new aseptic paper pack factory in China. This time may be located in a place closer to the customer, such as Inner Mongolia and other moderately developed regions.
“If a manufacturer accounts for 90% of a market, then this is when we want to enter that market. Because we have always been following the market later.” Giving SIG great confidence is their success in Thailand: 1996 When Combibloc first entered Thailand, the market conditions in Thailand were similar to today’s Chinese market, but six years later, the market share of SIG Commodity in Thailand has increased to 30% to 40%. “Our strategy is to win the market by taking a different path from our competitors.” In the Chinese market, the immediate goal of SIG Combibloc is to achieve a market growth rate of 20% to 30% over the next few years in order to gain as much market share as possible in China. .
In fact, Combibloc now poses no small threat to Tetra Pak. According to an industry source, prior to Combibloc, Tetra Pak did not generally have a discount on the prices of machines sold in China. However, Combibloc’s marketing strategy of winning customers with low-cost delivery machines and then selling packaged materials has forced the company to The Music had to change the original sales methods, and also began to sell the machine at a very low price (for example, the market price of a certain kind of machine is about 15 million, while the current price of Tetra Pak is about 2 million) - of course its condition If the customer uses Tetra Pak in a certain amount of time, how much material is used? Now, Tetra Pak, Kangmei, and IP (International Paper) have all adopted marketing methods that sell at low prices and even send equipment.
Competitors’ increasing emphasis on the Chinese market has made Tetra Pak uncomfortable. Since entering the Chinese market in the 1970s, the price of Tetra Pak has increased by an average of about 2 times, and Tetra Pak's last price increase in China was about 1998. This is precisely the time when companies such as IP and Comtech began to attack the Chinese market.
However, the fact that IP is frustrating is that the capacity of this market is limited, and Tetra Pak has seized the majority of customers in the first place. At the beginning of last year, IP announced that it would withdraw globally from aseptic paper packaging. IP needs to take into account the fact that it is not worthwhile to compete with Tetra Pak. The huge investment in the market is not worthwhile.
However, this does not mean that IP has no threat to Tetra Pak. In the field of fresh milk packaging (fresh house), IP is still the company that has done the most, and the price war between different beverage packaging materials has caused Tetra Pak to suffer from foreign influence.
According to industry insiders, PET packaging is currently the most serious threat to aseptic paper packaging. “PET packaging has been growing at a double speed in the past few years, which has caused a great impact on sterile paper packaging. In Europe and the United States, with the relative shrinkage of the market, the trend of PET replacing sterile paper packaging is more obvious.”
It's worth mentioning that Combi Billy's eco-saving packaging material for the customer's production system. In the beverage and dairy market where the price war has intensified, the significance of cost savings is self-evident. At the beginning of the previous year, at the beginning of last year, the price of a box of 250 ml sterile paper-packed milk was generally around 2.5 yuan. Now it is already coming. Sold to 1.6-2 yuan. Obviously, the impact of price wars between customers on Tetra Pak is unavoidable. For example, around 1997, Tetra Pak had more than 100 production lines in Guangdong. Today, about one-third of the companies have closed down.
In spite of this, it is certain that the market and industry experience accumulated over the years can still ensure that Tetra Pak will be the leader of aseptic paper packaging for a long time. Now, what Tetrah needs to do is more like " Baojiang Mountain."
The recent series of actions of Tetra Pak is also focused on this goal: Lee Husson said that the realization of 1.25 billion packs of production capacity in 2004 will not only fully supply the entire Chinese market, but also 20% more. For the part of China that has more capacity in the Chinese market, Tetra Pak's plan is to "sell to Southeast Asia."