So you (don’t) want to be an engineer?
U.S. converted flexible packaging to reach $16.5 billion in 2011
Private labels: Silver lining ’round the dark economic cloud
Where have all the new products gone?
Security packaging features needed to curb global theft loses
SOURCES FOR CURRENT RESIN PRICES

So you (don’t) want to be an engineer?
Many kids saying no to a career in engineering.

A Harris Interactive/American Society for Quality (ASQ) survey released last week shows that an overwhelming 85% of children ages 8 through 17 say they are not interested in a future engineering career. With National Engineers Week only a month away (Feb. 15–21, 2009), the findings give manufacturers more to worry about as they struggle with a troubling shortage of engineers, which may reach 70,000 by 2010 based on an estimate by the National Science Foundation.

The survey found that 44% of children aren’t interested in engineering simply because they don’t know much about the topic. Still another 30% of respondents shied away from engineering because they prefer a more exciting career than engineering. Finally, 21% of those kids surveyed don’t feel confident enough in their math or science skills to perform well in engineering. (Ironically, the largest number of kids ranked math (22%) and science (17%) as their favorite subjects.)

The Harris/ASQ study also surveyed parents and found that engineering isn’t a career they’re seeing their children in, either. The adult survey found that only 20% of parents have encouraged or will encourage their child/children to consider an engineering career. Further, the majority of parents (97%) believe that knowledge of math and science will help their children have a successful career.

(Note to readers: A press release about the survey is expected to post to the ASQ manufacturing website in the next two weeks.)


U.S. converted flexible packaging to reach $16.5 billion in 2011
Pouches to see the swiftest demand increases, driven by cost, performance and material reduction benefits.

The demand for converted flexible packaging will expand 4.2% annually, growing to $16.5 billion by 2011 says Converted Flexible Packaging, a study released by Cleveland-based industry research firm The Freedonia Group Inc.

Much of the growth, according to the report, will be attributable to cost, performance and source reduction advantages over glass, metal, paperboard and other rigid packaging. Barrier requirements in many markets will drive increased demand for value-added materials to enhance shelf life or product protection while advancements in breathable and self-venting films and resealable features will also fuel growth. Additionally, greater numbers of single-person households and older consumers will support demand for more convenient prepared foods and single-serving portions: This trend will boost material consumption as smaller packages tend to use more packaging relative to their size.

Of all the major converted flexible packaging types, pouches (especially stand-up and flat pouches) will see the largest and fastest advances-the demand there is expected to grow 5.9% annually, expanding to $6.9 billion by 2011. In addition, faster line speeds and increased throughputs combined with and the increasing use of value-added features like spouts, zippers, retortability and microwavability will further boost prospects for pouches.

According to the study, food markets are projected to increase 4.5% per year to $11.6 billion in 2011; the produce, meat and related products, beverage and frozen food markets will see the fastest growth. Increased demand for food in smaller package sizes or larger multipacks containing smaller units will drive the demand for converted flexible packaging.

Non-food markets are forecast to climb 3.5% per annum to $4.9 billion in 2011, growth that is helped by cost, source reduction, barrier protection, product visibility, theft protection and product unitization. The pharmaceutical and medical markets will expand more rapidly based on heightened barrier requirements, cost and convenience advantages and adaptability to growing unit-of-use requirements.


Private labels: Silver lining ’round the dark economic cloud
Retailers capitalizing on the momentum in virtually every grocery aisle.

For the year ending Nov. 2, 2008, private-label goods represented $82 billion in U.S. sales and a 16.4% dollar share within food, drug and mass merchandisers, including Walmart stores, according to a Nielsen Co. report. Despite such a strong presence in American pantries and shelves, the U.S. is dwarfed by more developed private-label markets in Switzerland (a 46% share), the UK (43%), Germany (30%), Belgium (29%) and Spain (26%). Recently in the U.S., though, the trajectory is decidedly upward for private-label dollar and unit sales, reaching a 21.4% unit and 17% dollar share during the latest four-week period.

Retailers have gotten in on the private-label movement, introducing house brands throughout their stores and have seen huge successes in the dairy cases, deli department and frozen cases where retailer brand dollar share has represented 40%, 25% and 20% of sales, respectively. Private-label performance has improved in fresh meat and dry grocery areas, fresh produce and non-food, health-and-beauty and packaged meat areas as well, all while national brand performance is worsening in nearly every department, especially in commodity categories and those with little product differentiation.


Where have all the new products gone?
CPG product launches may have slowed in 4Q2008, but leading companies stick to the “fundamentals” of success.

Will flexible packaging converters have to search harder for business from new product launches at consumer packaged goods companies? According to an article published on AdAge.com, although the number of new product launches in 2008 was up 5.9% versus the previous year, introductions in the fourth quarter were flat.

The decline could be due to the worsening economy…or to a delay in reporting on new products.

Not everyone is taking a “hunker down” attitude. Procter & Gamble chairman/chief executive officer A.G. Lafley told investors in December 2008 that consumers are just as receptive to new products during bad economic times as they are in good times. This is not just wishful thinking. Lafley cited data from three earlier recessions showing that consumer purchase intent and value perception remained consistent.

John Hall, chief executive officer of consulting firm SpencerHall, doesn’t see a slow down in new product development either. “There’s a lot of push for value-added things, trying to set products apart by adding more to core offerings,” Hall says.

At its December analysts meeting, P&G executives reassured investors that the company would succeed by sticking to the fundamentals of business by continuing to invest in brand building and innovation. And that means a healthy dose of new products.


Security packaging features needed to curb global theft loses
Retail shrinkage cost North American retailers more than $42 billion last year.

Flexible packaging solutions to help prevent in-store theft could help save billions of dollars each year. Globally, retailers lost $104.5 billion in the year ending June 30, 2008, with the majority of those losses coming from North America ($42.338 billion-a figure that represents 1.48% of total sales).

According to the Global Retail Theft Barometer-an annual survey conducted by the Centre for Retail Research and sponsored by Checkpoint Systems-almost a third (30.3%) of retailers did not provide any specific protection for their top 50 most-stolen items.

Rob van der Merwe, Checkpoint’s president/chief executive officer, says, “This represents an immediate opportunity for improvement. As the recession increases pressure on shrink, we are partnering with retailers to help solve their biggest challenges. Most of them see the need to improve their shrink management programs and it is critical to develop a targeted approach for the most vulnerable products to protect their bottom lines in 2009.”

Of course, Checkpoint encourages product manufacturers to use more of its electronic article surveillance (EAS) tags. And those brand owners are more apt today to ask their packaging suppliers to apply/embed these at the point of package manufacture.


SOURCES FOR CURRENT RESIN PRICES
Chemical Data Inc.
Chemical Market Associates Inc.
DeWitt & Co. Inc.
ICIS
IDES Inc.
Plastics News