Efficiency & technology

ALPLA as a regional economic player

Over the past four years, ALPLA has experienced growth in particular in Asia and in the region Africa, Middle East and Turkey (AMET). The Americas have remained stable or have experienced a slight downturn. Growth was relatively strong in Central and Eastern Europe in the reporting period. Even so, we do not see this region as being a decisive growth market any more in the future as we have already achieved a high degree of market saturation here. We anticipate strong growth of more than 10 per cent per annum in Asia and the AMET region.

We will continue to grow globally by 3 per cent per annum up to 2022, meaning our growth by then will total 12.5 per cent. In Asia and the AMET region, we will achieve 45 per cent growth in total compared with the reference year 2018.

ALPLA’s global presence offers many advantages. The benefits for our customers, in particular regarding new product development, are short routes and our globally applicable quality and production standards. We are also creating in-demand jobs at all of our sites

Christoph Hoffmann, Director Corporate Strategy, Sustainability & Circular Economy.

ALPLA’s collaboration with business partners and suppliers also makes it an important indirect initiator of regional economic development. Our customers include global brands and many local businesses. We intend to build up these business relations in growth markets in particular.

Growth regions

ALPLA achieved its strongest growth rates of the reporting period in Africa and Asia.

The region of Africa, Middle East and Turkey (AMET) experienced the largest acquisition in the history of ALPLA in the period under review. In July 2017, ALPLA announced its acquisition of the African market leader Boxmore Packaging comprising nine sites and some 1,000 employees. In a press release, ALPLA CEO Günther Lehner called Africa an ‘attractive growth market’ and said the acquisition was a ‘basis for entering the South African market’.

At the end of 2018, ALPLA signed another purchase agreement sealing the full takeover of Zamil ALPLA. ALPLA and Zamil founded a joint venture in 2008 in which ALPLA held a 49 per cent share until the end of 2018. The sites in Dammam and Jeddah (both Saudi Arabia) and Dubai (United Arab Emirates) will continue to operate under the name ALPLA with the existing workforces.

ALPLA Competence Center Shanghai

China is the top growth market for many industries, and that includes the packaging industry. Market activities in this region are characterised by pace and flexibility – the market is highly dynamic and there is stiff competition there. The customers demand short development times in order that they can roll out products quickly. ALPLA nonetheless focuses on sustainable growth, with the expansion of existing customer relations and the acquisition of new local customers being two key factors.
The inauguration of the centre of excellence in Shanghai in March 2016 was therefore an important milestone in the development of ALPLA China. In addition to serving as the regional headquarters in China, it is the region’s technology and training centre. The modern Technical Center offers customers and business partners in northern Asia excellent services, from 3-D design and pilot tool production to synthetic resin printing. ALPLA’s quality standards are guaranteed by a quality lab and an internal toolmaking division. E-commerce and strong demand for luxury cosmetics products are current consumer behaviour trends.

South East Asia (SEA) offers both great potential and some major challenges. This region has experienced strong economic growth in recent years. The heterogeneity of the countries there makes management and organisation in this region demanding. ALPLA is focusing on adopting a clear market position. With price pressure being high, quality and product performance are key success factors.

Growth markets
2015 2016 2017 2018
Total plants 159 160 176 178
Countries 42 43 45 46
New Plants 12 7 17 4
Closed Plants 7 6 1 2
New countries Egypt, United Arab Emirates Iran, Angola (Bosnien closed) Zambia, Mauritius Greece

Outlook

In the future, we will focus in particular on expanding our recycling activities. Investments in modern recycling technologies and new partnerships are in the pipeline.

The acquisition of Argo S.A. with two sites in Greece and Romania opened up new potential for tapping new market segments. Argo has specialised in packaging solutions for the pharmaceutical and personal care markets since its foundation in 1970. ALPLA is now creating a centre of excellence for the pharmaceutical market at the Greek site. We generally foresee attractive growth opportunities in the areas of medicine and health care. We are anticipating growth in the food segment as glass and metal are substituted for plastic.

Composition of the management teams in the growth regions

We examined the origins of the management teams in our growth regions of Asia and Africa, Middle East and Turkey (AMET).

Depending on the region, there are a number of international representatives on the regional management teams (AMET 50 per cent, SEA and China approximately 33 per cent). All of the regional managers in India are locals.

The ratios are more pronounced at the plant management level. Only in AMET and SEA is a very small proportion of these managers international, with the remainder of the management workforce being made up of local staff. This ratio continues to increase as a percentage at the level of all the employees (no chart).

This shows that we are endeavouring to develop local roots in our growth markets by primarily recruiting local employees. However, our international set-up makes it necessary from a business perspective for a certain proportion of the regional management teams to be made up of international employees.