Rexam boss maps out the future

Related tags Packaging industry Packaging Packaging and labeling

Rexam CEO Rolf Borjesson told
yesterday that the packaging industry is only just beginning to
adopt new technology that could transform the food industry, and
that the industry will be characterised by consolidation for years
to come. Anthony FLetcher was at Total 2004 to speak to him.

"There are lots of opportunities for the packaging industry,"​ he said. "With new technology for example, you will soon be able to go home, scan a product and find out its content, how much you should eat, where it came from, etc. This revolution has only just started."

Borjesson envisions exciting times ahead for the packaging industry. Earlier on, he opened Total 2004 with a speech that highlighted recent changes in the packaging industry, and the opportunities that this presented.

"The exciting thing about packaging is that it is not simply an item for protecting goods,"​ he said. "It is the medium used to project values in a visually noisy world. Our job is to create packaging that is functional and exciting. It is about understanding consumer needs."

Borjesson said that the changes in the packaging industry have been reflected in the changes that Rexam has gone through. "When I came here in 1996, there were 150 different units. In the last eight years, we have sold 100 companies and acquired a few, and we are now a $6 billion operation."

Consolidation, says Borjesson, has been the keyword. "Our customers are getting bigger. Look at the merger between Interbrew and Ambev to create the biggest brewer in the world. Look at Morrison's takeover of Safeway in the UK. There is a lot of consolidation going on, and Rexam is playing a leading role in this."

Borjesson believes that this consolidation will continue for many years.

The packaging industry has of course been beset by a few problems. The beverage can market in Germany has been hit by the much-criticised deposit regulation, which Borjesson admits has impacted on Rexam's sales. The company lost 1.4 billion units in Germany last year.

"You need to put this in perspective though,"​ he said. "We sold 50 billion units worldwide. We have been able to compensate our losses in that sector."

Rexam is lobbying hard to srap the system. "It doesn't work,"​ said Borjesson. "The main idea of it is to protect the German brewing industry, nothing else. It's not a an environmental measure. There are a couple of court cases in Luxembourg at the moment, and Brussels is upset about the situation."

Nonetheless, Borjesson remains optimistic about the future of the industry. "Packaging is something that we are exposed to all the time,"​ he said. "It is a growing and vibrant business, new markets are opening all the time, more people are living longer. People are increasingly looking for convenience."

However, he believes that the industry is too far away from the consumer. Packaging firms need to understand the consumer better, he said, and learn more before they invest in R&D.

"And how do we convince the stock market that packaging is good business?"​ asked Borjesson. "One word - consistency, year on year on year."

Related topics Processing & Packaging

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