The development trend and challenges of the hottes

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You must pay attention to the development trend and challenge of corrugated packaging processing industry

when AICC (American independent corrugated box Association) was established, the paper supply was insufficient. Those large carton packaging groups did not outflow enough paper suppliers to let more independent carton enterprises serve customers. As a result, many independent carton enterprises affected joined forces to form AICC

this is a huge opportunity. Because the economy is still growing rapidly, there are still a lot of new customer opportunities. At that time, Asia and other emerging manufacturing markets in the world had not had a significant impact on the United States

as a result, in the next decade, North America's carton board market capacity continued to grow, while the growth in demand gradually cooled, while other markets, especially Asia, began to grow exponentially. A new balance has been found between the supply and demand of carton paper. At this equilibrium point, all processors can operate without supply problems

in 1990, North America accounted for 40% of the global carton board production capacity. Today, this figure may be less than half - but most of the factories that existed at that time still exist

millions of new capacity have entered the market (millions of new capacity will be put into operation in the next few years), which makes us in the situation of oversupply. North American factories currently export more than 500000 tons of cardboard to the market, many of which are developing their own papermaking systems. In the long run, no paper supply is required. Recently, export prices have been declining. Although these markets always rise and fall, the growth of domestic demand is unlikely to account for the sales of all new paper machines and paper machines put into operation in the next few years

worse, the trend of low gram weight will continue. The average basic gram weight of corrugated board sold in North America in 1990 was almost 140 pounds per thousand square feet. Today, this figure has reached a medium to high level of 120 pounds, and is declining every year. When the unit weight of composite corrugated board decreased rapidly, the paper mills here invested a lot in producing 42 pound gram kraft paper. This trend is expected not only to continue, but also to accelerate, which is why a large number of new tonnage can produce very low gram weight paper in the near future

in 1990, 16 large carton packaging groups accounted for 74% of the market share, and more than 50 companies owned paper mills. Today, four paper and packaging groups account for 76% of the market share, and about 20 companies in total have paper mills. So far, this concentration of economic power has successfully kept the price high, which is of great importance to the papermaking and packaging group, High impact resistance and strength and relevant standards of ISO 10993 (cytotoxicity and independent carton factories are good for both.

but in my opinion, in a limited time, they will be able to violate the basic law of supply and demand. The export market is drying up, new competition will promote lower weight paper, and the new factories that will soon be put into operation will be able to produce lighter paper. Risi has announced that the price of vermicelli cardboard has decreased by $10 per ton in the past two months. In any case, North American carton paper has The whole concept of the market is an extension, because the tonnage purchased by the independent carton factory is so small. In any case, the downward trend in prices is expected to continue unless large paper and packaging groups begin to close their paper mills

technological innovation is also changing the face of corrugated packaging processing. In 1990, the standard width of the corrugated board production line was 87 inches, and the average speed was 500 longitudinal feet per minute. Today's standard is that 110 inch machines run at 1000 longitudinal feet per minute

processing equipment used to take half an hour to prepare orders. Its maximum output reached 5000 cartons per hour, but now it usually takes only two minutes to get ready. It runs more than 20000 cartons per hour. Digital printing has changed from a "curious thing" to an integral part of the daily production and operation of many processors. At present, the speed of the digital printing press is more than 200 feet per minute, the format is as high as 6 feet, and the total potential production area per 8-hour shift is 5376000 square feet. With the improvement of speed and printing quality, they will begin to bring real development to flexographic printing

the biggest problem my clients and friends told me was that it was difficult to attract qualified employees at all levels. The unemployment rate is at a historically low level. For most small and medium-sized enterprises, attracting and retaining high-quality employees is becoming a problem. In addition, the professional ethics and overall mentality of young employees are different from those of our aging baby boomers

it is necessary to formulate new strategies on how to motivate the younger generation. For them, more downtime and the quality of the work environment seem to be much more important than the overall salary level. They don't seem to like staying in the same position for several years. Everyone seems to be worried about a recession in the near future. The current economic expansion has broken the old record of the longest continuous growth of 120 months in history. Of course, this expansion must end at some time. When it ends, some companies will be in trouble and people will be hurt

therefore, the paper supply in the North American market has been excessive, and the demand for corrugated paper products has grown slowly. Therefore, it is necessary to purchase expensive equipment to maintain competitiveness. At the same time, it is also difficult to transform to low gram weight packaging and attract and maintain employees. Some people may think that for the corrugated packaging processing business, the prospect may be slightly bleak. However, there is always a ray of light in the dark, isn't there? In this case, processors must accept these trends and find ways forward. In my opinion, this is a great opportunity. The reasons are as follows:

- although the problem of oversupply will not disappear, processors must learn to adapt to a period of falling prices of cardboard. Prices have been rising for so long that it is difficult to remember how to manage customer relationships in an environment of falling prices. But this can certainly be done. The independent carton factory must immediately start to develop these plans. Customer contracts must reflect this new reality, and negotiations with suppliers will need to be more proactive

- despite the high cost of new capital projects, interest rates are still at historically low levels, and the current tax environment allows you to offset 100% in the year of equipment purchase. In addition, the high cost of printing experimental reports after the end of the whole experiment of equipment and industrial real estate (at a very high level in almost every major market) is a huge obstacle to entering the industry. The days when salespeople can compete with you by buying some old equipment and opening a shop in an old building are over. If someone wants to enter the processing business, they will not be able to make more investment

- although everyone seems to fear recession, they also create opportunities. When a company with a strong balance sheet enters a recession, it will find some good deals in real estate and equipment. Similarly, there should be some qualified employees looking for a new home. The key is to remain financially strong when the recession strikes. Now it's time to get all your financing in place, because the interest rate is still very low, and clean up your accounts receivable and inventory. Pay more attention to slow paying customers and make sure you don't bring them any excess inventory. Now is also the time to tighten credit, because if the economic recession strikes, there will be more bankrupt and insolvent customers to deal with

- increase your knowledge and experience and accumulate more experience in low gram weight paperboard. See which machines can be processed and which machines can not, and formulate a long-term strategy in corrugated board processing, so that when the market turns weak, your customers begin to demand it, and you are ready

- adopt high-speed processing equipment and start to develop relevant indicators to understand their impact on your operation. When you evaluate the profitability of an order, be sure to take time into account. Perhaps because of the frequent use of

change seems to be the only constant in the universe. Businessmen who look for future trends and start planning for them will have an advantage over competitors who are more responsive to changing market conditions. If you accept the changes that are taking place, now is still a good opportunity to become an excellent corrugated board processor

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