General Description
Sealed Air Corporation was one of the leading protective packaging companies with a good market reputation in countries like France, Germany, US and England. The company differentiated itself in the market with technological innovative leadership and hence the company was the first who made a new protective packaging product using coated air-bubble, AirCap. For ten years, the company remained successful with its unique AirCap protection packaging product however, unfortunately the market trends were rapidly changed and the technologically advanced coated bubble was replaced by the inexpensive and regular uncoated bubble products. The increasing demand of inexpensive uncoated bubble packaging was a direct threat for
…show more content…
The current strategy of that time for Sealed Air Corporation was customer orientation and they had manufactured products according to the needs of the customers regarding packaging. So they manufactured a number of products including InstaPak foam in-place systems. Later on due to the continuing drop in demand for coated products the company needed to change their strategy and Hauser proposed to produce low cost uncoated bubbles in a short time with no major capital investments. Hauser was himself unclear about the marketing plan for the new product because the launch of new products and the new marketing program would increase the cost to the company and so the company would be needed to make certain adjustments in its overall policies.
Analysis of the Competitive Structure of the Market
The market of the protective packaging products was divided into two major classes, uncoated bubbles and coated bubbles. Thus different types of packaging products were Positioning, Blocking, Bracing, Flexible wraps and Void fill (uncoated bubbles) and AirCap (Coated Bubbles). In this regard the competitive structure of the market for uncoated bubbles was high with a number of competitors whereas in the category of coated bubbles, Sealed Air Corporation was the only producer and market leader and so they offered this product at a premier price.
The customers of all these products were companies and organizations through select distributor
Packaging involves designing and producing the tin or bottle for a product. Packaging contains two levels. The primary packaging is the container for each individual product. For instance, A&W uses bottle with variety of sizes to fill the root beers. Plastic bottle can prevent leakage problem and can keep it once couldn’t finish it at once. The secondary packaging contains the quality of the product. A&W uses different colours and designs to wrap the bottle to differentiate the function of products. For example, white is for “Diet Root Beer with Cream Soda” and golden is for “Root Beer with Cream Soda”. The difference of packaging designs conveys the characteristics of the brand. Besides, this packaging can provide correct and useful information
It is critical for Sealed Air to introduce uncoated product if desire to maintain the market leader’s position, with existing machinery and technology, it would not require extra effort to produce uncoated products but have comparable production costs to competitors. As several distributors has been demanding uncoated products from Sealed Air, it seems reasonable for the company to start producing it, it would increase loyalty from the distributors and allow Sealed Air to have a more complete range of products with affordable prices for high to low-end customers. Sealed Air has already lost some market share and showed signs of continuous decline in the market’s position, uncoated product will be a ticket back into the game, it is likely to
Sealed Air Corporation has been the market leader in the protective packaging market for many years. Unanticipated competitors have entered the market offering uncoated bubble packaging which has gained significant market share from Sealed Air’s AirCap® coated bubble packaging material. To regain market share and expand Sealed Air’s business, a swift strategy of introducing uncoated bubble products needs to be implemented. By leveraging their large distribution network and existing manufacturing infrastructure, Sealed Air can capture the price-sensitive customers before their competitors have time to expand.
In “What’s in a Package?” article. Thomas Hine talks about the roles and effects of package. Hine explains how it is different from culture to another culture. Also, he mentioned the danger of focusing on packaging. There are differences between packaging in the past and packaging now. Employee who sell products to customers don’t impact like what packaging does. packages are around us in our daily lives. Packaging or the way of packaging not just can attract people to buy, it does many other things like protecting product from damage. there are some specialists who do testing for packaging and study what people want or need to make packaging in that way. Packages are different between cultures that they are present
Mensa’s packaging business had three major markets; Food and Beverage, Specialty Packaging, and International. This sector was economically sensitive, as it was difficult to build any competitive
Packaging material is the main shield for your fragile items. If not used properly, you risk experiencing breakage. Sufficient materials include, newspaper, packaging sheets, bubble wrap and extra cardboard.
Sealed Air has the technology to launch uncoated products which will maintain its leadership in the US market and reverse the decreasing tendency in the European market.
As a signatory to new Australia packaging covenant Blackmores has also promised good product stewardship without neglecting the importance of packaging design and style, choice of packaging products. Therefore, Most of the Blackmores items tend to be packaged in glass with a polypropylene tamper-evident cover and the products are positioned in cartoons leading to improved design and package recycling
Market leadership and technological innovation have marked Sealed Air's participation in the U.S. protective packaging market. Several small regional producers have introduced products, which are less effective than Sealed Air's but similar in appearance and cheaper. The company must determine its response to this new competition. The company is faced with a difficult choice of choosing from a range of feasible options ranging from doing nothing to introducing a new product. This has raised product line management issues, particularly cannibalization, and affords the opportunity for the development of a marketing plan for any new product introduction. The timing of launch and any change in policies for Air Cap
Within this case analysis, we will examine Autozone's stock repurchasing program, as well as the mechanics behind it and the benefits it provides to the firm. Additionally, this report will analyze the alternative operating cash flow options Autozone should consider, detailing the benefits and costs of each option. A comprehensive examination of these operating cash flow alternatives will be presented, allowing for the determination of the most viable alternative for the use of Autozone's operating cash flows.
The proliferation of packaging products and poor product education has caused confusion among end users. US consumers have traditionally viewed packaging supplies as a cost-saving resource. Consequently, packaging engineers are accorded high status and influence roughly 40% of material purchase decisions. The US market is experiencing strong growth, driven in part by the growth of the coated and uncoated bubbles segment. However, AirCap's market share remains stagnant (Appendix A).
It is of critical importance that Sealed Air address the threat presented by the growth of the uncoated bubble segment, which outstrips that of coated bubble in the US and Europe. Serving the lower end of the market is consistent with the company's customer-focused market leadership and provides distributors with a full-line of product. In addition, there appear to be a number of segments that may be serviced by uncoated bubble (e.g., the ½ in. GAFCEL bubble is comparable to Sealed Air's ST/SD-120 for light loads) . Further, uncoated bubble would require minimal capital as
Changes witnessed over the last few years on mode of packaging and its economic impact.
A special dividend was paid to the shareholders of the company when Sealed Air Corporation borrowed the total common stock for a value of 90% of its market value. This was a program which was basically initiated by the management of the company for improving the product quality and improving the efficiency of the manufacturing processes of the company. The leveraged recapitalization was used as a watershed event and this was done successfully and purposefully by the management of the company.
Dixon is raising debt capital by issuing long3 and short term bonds; an interest rate of