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Protecting The Future Of Sealed Air:

Protecting The Future Of Sealed Air:. Financial Analysis and Recommendations. Company Background. Market leadership Technical accomplishment Consistent 25% annual growth

fredrica-justin
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Protecting The Future Of Sealed Air:

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  1. Protecting The Future Of Sealed Air: Financial Analysis and Recommendations

  2. Company Background • Market leadership • Technical accomplishment • Consistent 25% annual growth “We intend to seek market leadership because market leadership optimizes profit, and foster technological leadership because it is the only long-term guarantee of market leadership.” CEO T.J. Dunphy

  3. Challenge • Competition in the protective packaging market • How to sell against uncoated bubbles. • Enter uncoated bubble market • US, Germany, England, France • Continue exclusively in the coated bubble market

  4. European Air Bubble Market • Price Sensitive • Viewed packaging supplies as “expendable commodities” • England • Sansetsu market dominance • Estimated 50% loss of current market share to uncoated for Sealed Air • France • Increasing use of uncoated over coated. • 90% of new bubble applications uncoated • Germany • Sansetsu market dominance • Loss share to uncoated by 20%-30% a year for Sealed Air

  5. U.S. Air Bubble Market • Quality over Price. • Packaging supplies viewed as productive, cost-saving resource • Growing protective packaging market • Sealed Air dominance in U.S. air bubble market

  6. S.W.O.T. Analysis Strengths Weaknesses • Brand name recognition • Existing manufacturing operations • High quality products • Knowledgeable sales force • Strong competitors • Difficult to differentiate • Decreasing market shares for Sealed Air Opportunities Threats • Cannibalization of coated products • Weakening quality image • Large market for uncoated bubbles • Increase profit

  7. Financial Analysis

  8. Marketing Objectives: Increase annual sales and net earnings of AirCap by 30% for the next two years. Increase awareness of AirCap as a packaging option. AirCap Market Segment: Small to large scale businesses located in the US, UK, Germany or France, that sell products which require packaging after manufacture.

  9. Flexible Wrap Segment Direct Competitors Indirect Competitors US Astro Packaging of Hawthorne GAFCEL Europe Sansetsu (Germany & UK) Two major competitors entered 　the market in France Paper Based Foams

  10. AirCap Competing Dimensions: Price Value Customization

  11. Price: • Note: Prices for AirCap are adjusted with a 20% distributor mark-up.

  12. Price (cont): A Two-Pronged Strategy Is Needed Avoid “Price War” with entrenched competitors Tailor strategy to fit each particular region Any price advantages had by lowering prices are temporary Steps must be taken to boost demand

  13. Price (cont): Our Initial Pricing Strategy Allows us to use uncoated bubbles to penetrate Protective Wrap and Void Fill markets further in the US Helps penetrate European markets where there is more price sensitivity Captures market share from Air Bubble manufacturing competitors

  14. Value: • Differentiate coated and uncoated AirCap bubble uses. • Uncoated: Packaging of less fragile products geared towards smaller businesses. Ex: Wood items, plastic goods, smaller products, etc. • Coated: Packaging for fragile items geared towards bigger businesses. Ex: Glass, pharmaceutical bottles, computer components, clocks, larger items, etc.

  15. Customization: • We have the specific wrap to meet your specifications • 6 Grades Coated (Simplified): • A-100, SB-110, SC-120, ST-120, SD-120, SD-240 • Potential of 3.7% loss in sales • 6 Grades Uncoated: • A-100, SB-110, SC-120, ST-120, SD-120, SD-240

  16. Sales Strategy in U.S./England • Use existing sales network to target large business orders. • Focus on value and quality • Emphasize Coated AirCap • Use direct mail and trade shows to target smaller businesses and refer to distributors • Maintain efficient distribution network

  17. Sales Strategy in U.S./England (cont.) • Change sales strategy to focus more on penetration and away from anti-uncoated • Increase sales force to 77 in the US • Maintain current time allocation (Instapak more growth potential) • Used to accommodate 30% sales increase (Avg. sales person = $600,000 in AirCap sales)

  18. Sales Strategy in Germany/France: • Increase sales force within Germany and France • Use one sales person for every $600,000 of expected or hopeful sales • Target large businesses focusing on Price of uncoated AirCap • Establish distribution network equivalent to sucessful models seen in US and England • Use direct mail and trade shows to target smaller businesses and refer to distributors

  19. Marketing Objectives: Increase annual sales and net earnings of AirCap by 30% for the next two years. Increase awareness of AirCap as a packaging option. AirCap Market Segment: Small to large scale businesses located in the US, UK, Germany or France, that sell products which require packaging after manufacture.

  20. Outlook for the Future Further differentiating Aircap uncoated and coated bubbles by introducing colored bubbles Renaming both uncoated and coated bubbles for further differentiation and eliminate negative connotations on uncoated bubbles

  21. And, that’s a WRAP!

  22. Questions & Answers

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