Top 30 international roll goods companies.
This characterization of the nonwovens industry by the top 30 roll goods manufacturers surveyed in our annual top company survey may seem less than bright. But despite the discouraged executives who talk about a global economy gone awry, uncontrollable currency fluctuations and a tightening of purchasing dollars, the majority of these companies continued to concentrate on their own methods of combatting these issues and emerging better and stronger companies in the end.
This has not been easy, as the top companies have suffered, particularly in Europe and in specific industrial and commodity markets that have been hard hit by the worldwide recession. Yet, while executives have said that "the rapid growth days of the 70's are gone" and "nonwovens have reached their peak," these same executives still feel that "nonwovens remains a good business" and "it's surprising to see the growth still taking place in nonwovens." This belief requires a different tack, a mindset that looks toward future challenges, rather than resting on the past laurels attained through the last few decades.
Specifically, nonwoven roll goods manufacturers have attacked the economic and "maturing industry" issues with new capacity, product innovations and increasing quality control. Almost to the company, no manufacturer has sat still and attempted to wait out the recession. While companies have restructured and, in some areas, cut the workforce or eliminated unprofitable technologies or market segments, even this is done not as a desperate measure but with an eye to the future and the long--or at least medium--term growth it expects at the end of the day.
Issues on the lips of the industry this year centered around several primary topics. Obviously, one of the most important was the economy, which is currently causing many problems throughout the industry. German unification is wreaking havoc on that country, Europe and Japan are both suffering in a recession and while perhaps the U.S. looks less bleak than it did last year at this time, no one is unreservedly optimistic about the recovery. One executive called it "very fragile" and most expressed cautious hopefulness about its continuation.
While companies watch and wait for the economic situation to change, they are not sitting still. Nine of the top 10 companies and 23 of the top 30 have either completed, are in the process of or have announced some type of capacity expansion or technology diversification in the past year. This can take the form of new technology--as with Freudenberg Spunweb and Stearns--or upgrades of current capacity--Veratec, Dominion Textile and Suominen. The point is, while these companies may be experiencing financial difficulties, that has not stopped them from further investment, a measure that should prove pivotal in the long run.
New products have also been a focus at the majority of the top companies. These products have won awards at industry trade shows, replaced more traditional products in myriad applications and capitalized on niche markets never before discovered. Once again, many executives believe that the future lies in new products, not in current market segments.
Another focus by the top roll goods companies has been composites, which again and again were described as "the material of the future." Now that the industry has gained a high level of expertise in current technology portfolios, it is taking the next step in combining these technologies, raw materials and finishing treatments to create a variety of exciting and diverse product characteristics.
In a less tangible area, quality improvement was also a goal. A year ago, many of the top companies had focused internally, restructuring management, refining production and achieving maximum quality at minimum price. While this year's focus on external expansions and new product introductions certainly highlighted news at most of the companies, this internal focus continued. In times of economic hardship, when raising prices is out of the question, lowering costs is the only path to profitability and many companies have realized this and looked in-house at production lines, work flow and warehousing and distribution systems as areas of improvement, raising efficiency and reducing costs.
The focus on quality is also emphasized by the recent focus on ISO certification and its growing importance in the industry. Almost every top company is working on--or has already attained--ISO certification (whether it be 9001, 9002 or 9003) at some or all of its facilities. While across the board companies agree that it is more important in Europe than the U.S. and the Far East, because of the global industry in which nonwovens operates, no one, even a U.S. company, feels comfortable ignoring ISO and most are responding to the anticipated requests of present and future customers.
While globalization has been key for nonwoven manufacturers in the past five to ten years, this year was notoriously quiet in terms of new cross border expansions. Once the sale of Scott Nonwovens was finalized--with the purchase made by another U.S. company--and although the industry still waits to see who will be the next owner of Phillips Fiber, companies for the most part expanded at current locations rather than forging new ventures across international lines. Two notable exceptions were Corovin and Hof Textil and Design, both of which began extensive work in the former East Germany.
Eastern Europe in general remains an area to be watched by most of the companies, but many are cautious about putting down too many roots--or too much capital--at this time. Most are in the preparatory stages, doing research and making contacts to prepare for when the time is right to move forward. The same holds true for South America and the Asia Pacific region; these are certainly areas of consideration, but with few exceptions, companies are still on the fringes of the markets.
Explanation Of The Numbers
Worldwide roll goods sales in 1992 were approximately $6.5-7 billion, or in excess of 3.5 billion pounds, according to consulting firm John R. Starr, Inc., Osterville, MA. Of this, the top 30 companies make up $5.889 billion, or close to 90% of worldwide sales, continuing their strength as the driving force of the industry.
U.S. companies made up 14 of the top 30 positions, holding steady with last year, while European companies held 11 positions and Japanese companies held five positions. The top 10 companies remained the same, although Japan Vilene moved up to the sixth position, edging out Johnson & Johnson Advanced Materials Company and the Fiberweb Group and numbers 9 and 10, Reemay and Hoechst, have switched places. For the most part, slight movement occurred throughout the list; most companies remained in the same spot or moved one or two positions up or down.
For the first time this year, NONWOVENS INDUSTRY made the decision to exclude companies that are 100% in-house roll goods suppliers. This eliminates Molnlycke from our list of companies, bringing the total to 30 companies from last year's 31. Kimberly-Clark remains in the survey, however, due to its involvement--although minimal--in the merchant market.
As usual, NONWOVENS INDUSTRY ranks the top companies based on annual roll goods sales figures in U.S. dollars, using the 1992 average exchange rate as quoted by the Federal Reserve. Figures are provided to us by the companies or are industry estimates. Particularly for large companies with nonwovens divisions--such as Johnson & Johnson, Kimberly-Clark and Phillips Fibers--the numbers are estimates of 1992 sales. Sales figures alone do not present an accurate picture of the nonwovens industry, as many factors--such as fluctuating exchange rates, currency conversions and more updated information becoming available--cause rankings to fluctuate from year to year. For a more complete picture of individual companies, factors in addition to sales should be taken into consideration.
Top Ten Companies In Terms Of U.S. Sales (U.S. dollars, millions) DuPont $512 Kimberly-Clark $271 Veratec $230 J&J AMC $192 Freudenberg $168 Reemay $142 Dexter $132 Fiberweb $120 Phillips $115 FiberTech $110 Top Ten European-Owned Nonwovens Producers (U.S. dollars, millions) Freudenberg (Germany) $1.123 Fiberweb Group (Switzerland) $236 Hoechst (Germany) $203 Akzo Industrial (Holland) $128 Lantor Group (Holland) $120 Polyfelt (Austria) $114 Sandler (Germany) $91 Corovin (Germany) $74 Hof Textil & Design (Germany) $58 J.W. Suominen (Finland) $55 Top Ten North American-owned Nonwovens Producers (U.S. dollars, millions) DuPont $731 Kimberly-Clark $425 Veratec $330 Dexter $263 J&J AMC $255 Reemay $189 FiberTech $135 Phillips $115 Lydall $113 Dominion Textile $102 Top Japanese-Owned Nonwovens Producers (U.S. dollars, millions) Japan Vilene $260 Asahi $142 Toyobo $130 Unitika $81 Kuraray $79
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|Author:||Noonan, Ellen; Sullivan, Scott D.|
|Date:||Sep 1, 1993|
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