European Beverage Can Manufacturers

Part
01
of five
Part
01

CanPack SWOT

CanPack is a leader in the beverage packaging industry in the European Economic Area with an annual output of 25 billion beverage cans. The company faces a profitability threat due to instability in product pricing.

Strengths

  • CanPack is a leader in the beverage packaging manufacturer industry in Central and Eastern Europe. The company is continuously strengthening its market position in Western Europe.
  • The company has over 30 years of experience in the beverage packaging industry and claims to have evolved into a leading global manufacturer of metal packaging.
  • With an annual output of 25 billion beverage cans and 28 billion pieces of bottle closures, CanPack is one of the four top global manufacturers of beverage cans.
  • CanPack offers a competitive pricing system allowing it to become a formidable force among competitors.
  • The company has twice been awarded the Silver Can of the year due to the Quadro-mix, Thermo, and Tactile effect of its can products.

Weaknesses

  • Compared to top competitor, Ball Corporation, CanPack has a limited number of production plants in Europe which are situated in the Eastern region. This means that the company lacks geographical coverage in Europe.
  • According to the European Economic Area (EEA) report, "Volume-wise, CanPack is considered to be a minor player in the market and are not suitable for delivering higher volumes."
  • In order to get to the majority of customers, CanPack has to deliver its product over a long distance exposing them to late delivery and inability to meet up with short-term deliveries.

Opportunities

  • The company will be launching a 25 billion can-units production plant in the Stříbřo, Plzeň Region, Western Czech Republic, creating an opportunity for the firm to reach more customers located in the area.
  • Through its strategic partnership with drinks and packaging companies such as Asahi Group and San Miguel group, the company is opportune to expand its width throughout Europe.
  • The 2017 agreement to reduce and harmonize conversion cost between competitors in the EEA opens up more opportunity for profitability.

Threats

Part
02
of five
Part
02

Ball SWOT

Ball Corporation has a successful track record of super performance in new markets and incorporating complimentary firms through mergers and acquisitions. The company still faces challenges associated with integrating its beverage packaging business with that of Rexam after acquiring the packaging giant in June 2016.

Strengths

Weaknesses

Opportunities

Threats

Part
03
of five
Part
03

Crown Cork SWOT

Crown is a key player in the European beverage can market. Its strengths lie in its innovativeness and leadership in sustainability, while its weaknesses lie in its relatively limited reach and product range. The growing number of beverage brands choosing cans over other packaging options and the growing preference of Europeans for smaller can sizes present business opportunities for Crown to increase its sales and market share in the region, but threats of competition and substitutes remain.

Strengths

  • Crown Bevcan Europe & Middle East is well-recognized for its beverage can innovations. For example, its CrownConnect technology, which enables brands and consumers to connect via interactive packaging, was awarded in 2018 the Metal Pack of the Year Award by the U.K. Packaging Awards and the Best in Metal award by the Metal Packaging Manufacturers Association (MPMA). Its "Shazamable" can, which was developed in collaboration with Island Records, won the Best Can Award at the Annual World Beverage Innovation Awards that was held in Germany in 2017.
  • Crown is also one of the leaders in the sustainability space. Business sustainability rating provider EcoVadis gave Crown a Gold Rating in 2018, while environmental impact assessor Carbon Disclosure Project (CDP) rated Crown "the best in metal packaging in 2017." According to Veronique Curulla, director for marketing and business development at Crown Bevcan Europe & Middle East, "Crown takes its sustainability role seriously, setting a high bar for targets in a number of key areas."
  • Crown Bevcan Europe & Middle East has a new Bevcan Graphics Studio, located in the United Kingdom, that is capable of advanced computer-to-plate (CTP) imaging. Crown Bevcan Europe & Middle East already saw the studio, which has both an exhibition area and an innovation bar, deliver a 26%-increase in activity.

Weaknesses

  • Compared to its key competitor Ball, which has 22 beverage packaging locations in Europe, Crown has only seven beverage packaging plants in the region. These seven beverage packaging plants are spread across the United Kingdom, Spain, France, Greece, and Slovakia. Ball, in contrast, has locations in Ireland, Spain, the United Kingdom, France, Germany, the Netherlands, Austria, Italy, Czech Republic, Serbia, Denmark, Sweden, Poland, Finland, and Russia.
  • Compared to Ball, which has 18 types of beverage can on offer in Europe, Crown has only 13 types on offer in the region. Crown's cans have volumes ranging from 150 ml to 500 ml, while Ball's cans have volumes ranging from 150 ml to 1,000 ml.
  • These figures indicate that Crown's reach and product range in Europe, compared to those of Ball, are relatively limited.

Opportunities

  • Crown has the opportunity to capture businesses presented by beverage brands that are choosing or switching to aluminum cans. For sustainability-related reasons, brands are increasingly choosing aluminum cans for their beverage packaging, and some mineral water brands have even started switching from PET bottles to cans. New types of customers have also emerged, with energy drink, health drink, craft beer, and even wine brands now exploring cans for their packaging needs.
  • The growing preference of health-conscious Europeans for smaller beverage cans presents another opportunity for Crown. Crown can manufacture smaller cans to take advantage of this trend. Matt Twiss, director for marketing and business development at Crown Bevcan Europe & Middle East, observes a double-digit growth in the sales of some of its smaller can sizes.
  • Crown can also capitalize on the forecast that the European Union market for beverage cans will grow at a compound annual growth rate (CAGR) of more than 4% during the period 2017-2025.

Threats

  • The threat of new entrants can be considered low given how difficult and costly it is to enter the beverage can market, but there is definitely the threat of rivalry or competition. It is possible for Crown's main rival, Ball, to capture an even larger portion of the European beverage can market. Ball is the leading player in the beverage can market, and Crown is second only to Ball.
  • There is also the threat of substitutes. Substitute flexible plastic packaging products are a known threat to metal packaging. Although it is apparent at the Pro2pac event in London that brands are moving away from plastic packaging, PET bottles can be recycled with ease and are thus a viable packaging option.

Research Strategy

To identify the strengths, weaknesses, opportunities, and threats of Crown in the European beverage can market, we scoured Crown's website, press releases, and report for information specific to European operations. We examined how Crown's European business was covered by the media as well. Strengths were easier to determine than weaknesses, opportunities, and threats. To identify the opportunities and threats, we looked at the opportunities and threats that the European beverage can market faces as a whole, and to identify weaknesses, we compared Crown's reach and product range in Europe with those of Ball, the leading player in the market.
Part
04
of five
Part
04

Helvetia Packaging SWOT

Helvetia Packaging is an emerging competitor in the European beverage packaging industry. The company began in 2013 and its first production facility was finished in 2015. There is very little information to be found on the web regarding this company, so information has been pulled from the few websites and articles that can be found.

Strengths

  • According to Helvetia Packaging’s website, they have a brand new state-of-the-art production line.
  • Helvetia is backed by Stolle Machinery Company, LLC and it is one of the leading producers of can making technology in the world.
  • Stolle Machinery Company, LLC not only backs Helvetia Packaging but also provided training for employees and business recommendations to the company.

Weaknesses

  • Helvetia Packaging only has one production plant in Germany with an output of only 1.2 billion cans.
  • The company is only six years old and so far, does not seem to have any notable business or prospective business.
  • The company is only going to produce can sizes that fit within a standard mold.
  • Helvetia Packaging doesn't seem to have any significant web or social presence to promote its product.

Opportunities

  • The company has just begun and has a major supplier of can making machinery, Stolle Machinery Company LLC, backing them.
  • According to a report in 2016 from the European Commission, the company is poised to have a 5-10% stake in the beverage canning industry of Germany and Austria.
  • The same report also notes that Helvetia only has one production line and was still able to launch into the industry.
  • Helvetia Packaging plans to use aluminum that is BPA-NI free, which meets the standard set by the European Commission.

Threats

  • The company has only one plant in Germany that doesn't seem to be producing any product according to multiple sources.
  • The European Commission report notes that many customers that use beverage canning services are unsure of how Helvetia will survive in an industry with such strong competitors as Ball and Rexam.
  • Customers are also unsure how a one-plant operation that only produces 1.2 billion standardized cans plans to break into an already thriving industry.
  • Many consumers believe the company is a fake since there hasn't been any production or news output from the company since its inception.

Research Strategy

The company's website, industry reports and trade publications were used to compile information on Helvetia Packaging. The company has very small web presence which made finding information difficult. There is an article that is behind a paywall that might offer more information. The article is from The Canmaker, and appears to be an inside look into the facility, but very little information is visible without a subscription.
Part
05
of five
Part
05

COFCO SWOT

CPMC Holdings or Cofco Packaging is the beverage can manufacturing arm of COFCO. In the European beverage can market, its strengths lie in its know-how and its recent joint venture with Jiaxing Haoneng in Belgium, while its weaknesses lie in its limited reach and product range. It has opportunities to take advantage of the booming beer industry and the growing demand for environment-friendly packaging in the region, but it is faced with threats brought about by alternative packaging materials and more established players.

Strengths

  • China-based CMPC is now in a better position to meet both the European demand for beverage cans and its sustainability goals, thanks to its recent agreement with fellow Chinese company Jiaxing Haoneng to form Benepack Belgium NV, a joint venture in Flanders, Belgium that will locally manufacture and supply two-piece aluminum cans to Europe's beverage and beer industries. CMPC is of the belief that Belgium has the potential to transform into a major beverage can manufacturing base.
  • Jiaxing Haoneng, which is principally engaged in the production of beer labels, was able to enter the European market in 2011 by acquiring Belgium-based Illochroma Group. Both CPMC and Haoneng were already supplying products to Europe prior this agreement, so this joint venture only strengthens both companies' position in the region.
  • CPMC has the full support of the Flemish government, with the latter granting the former €3 million in strategic transformation support. It was even nominated for the Flanders Investment & Trade's Foreign Investment of the Year award.
  • The new beverage can factory will bring CMPC closer to breweries and beverage producers in Flanders, especially Martens, Moortgat, and AB InBev. CPMC has already been supplying AB InBev with two-piece beverage cans even before it entered into a joint venture with Haoneng.
  • Being the largest producer of two-piece cans in Asia, CMPC of course has the bona fides and the know-how to capture a bigger share of the European beverage can market.

Weaknesses

  • CPMC's reach in Europe is very limited, given that its first beverage can manufacturing plant in Europe is yet to be completed. In 2018, only RMB 168.556 million or 2.56% of CMPC's RMB-6.422751 billion revenue came from overseas markets, while the rest came from Mainland China. In contrast, its bigger competitors Ball and Crown have 22 and 7 beverage packaging plants in Europe.
  • CPMC's beverage can selection appears limited as well. CPMC categorizes its beverage cans into two-piece and three-piece only, and the plant being built in Belgium is meant to produce two-piece cans only. In contrast, Ball and Crown have 18 and 13 types of beverage cans on offer in Europe.
  • CMPC does not champion sustainability on its website, whereas Ball and Crown do.

Opportunities

  • Beer presents an opportunity for CPMC to grow in Europe, according to CMPC Chairman Zhang Xin. CPMC chose Belgium as the location of its first factory in Europe because the country has a booming beer industry, according to Huang Jin, CMPC's general manager for strategy.
  • The growing demand for environment-friendly or sustainable packaging materials in the region also presents a growth opportunity for CPMC. The European Union is cracking down on plastics, so the demand for beverage cans is expected to only grow in succeeding years.
  • The European Union beverage can market is projected to grow at a CAGR of more than 4% during the period 2017-2025, as recycling activities of the European Commission and the French, German, and British governments intensify.

Threats

  • Though glass and plastic packaging products are less of a threat now than they were before, they, being substitute products, still pose a challenge to beverage can manufacturers such as CPMC.
  • Competitors pose a threat too. Based on a report published by Goldstein Research in 2019, CPMC competes with Ball, Crown, Amcor, Ardagh, Kian Joo, and Can Pack. These competitors could either eat up CPMC's market share or prevent CPMC from gaining market share. Starting out in Europe and competing with established players would likely be difficult.

Research Strategy

We identified CPMC's strengths, weaknesses, opportunities, and threats by examining all articles or reports that cover CPMC's beverage can business in Europe. To find information specific to CPMC"s beverage can business in Europe, we scoured CPMC's website, press releases, and reports, and we checked as well if media outlets have covered the business in any way. As most of CPMC's revenue comes from China, and CPMC has just started building a beverage can plant in Europe, the information we were able to gather was very limited. To identify CPMC's weaknesses as far as the European beverage can market is concerned, we checked how CPMC's European beverage can business compares with the those of bigger rivals. To identify opportunities and threats, we took into account the opportunities and threats that the European beverage can market faces as a whole, and examined how they relate to CPMC.
Sources
Sources

From Part 03
From Part 04
Quotes
  • "In 2015, Helvetia opened its first plant in Saarlouis (Germany) from which it is supposed to start supplying cans as from 2016. "
  • "Fourth, in the past 10 years, Ball, Rexam, Crown and Can-Pack have each constructed plants which initially had only one line (the plants include Belgrade, Scunthorpe, Kechnec and Mäntsälä). Moreover, Helvetia has recently entered the market with a plant which initially has only one line, demonstrating that it remains economically feasible for a newly-built production facility to have only one line. "
  • "Moreover, Helvetia has recently entered the market with a plant which initially has only one line, demonstrating that it remains economically feasible for a newly-built production facility to have only one line."
  • "Seventh, the new plant recently built by Helvetia highlights both the difficulties in entering the beverage can market in a manner that would enable a new entrant to exercise any meaningful competitive constraint on existing players and that the high entry barriers go beyond the mere building of the plant. "
  • "According to a beverage canning customer: 'it is likely that in three years or less, the plant will either shut down or be bought by one of the major players. '"
  • "The very little progress that Helvetia appears to have made since the announcement of its plans to build a new production facility strongly reinforces SABMiller’s doubts that this potential supplier will succeed in establishing a viable business. "
  • "In the second place, a majority of customers are neither in discussions to become a customer of Helvetia,713 nor are they aware who Helvetia' clients or sponsor(s) are or could be."
Quotes
  • "Helvetia Packaging, the new beverage can plant that started up in Germany a year ago, has revealed its high-tech operations, and why it is committed to using BPA-NI coatings."
Quotes
  • "Helvetia Packaging AG was formed in 2013 with the aim to establish an independent supplier of beverage packaging."
  • "Two production lines, a can line and an end line, have been supplied by Stolle Machinery Company (LLC), the market leader in can making technology. "
  • " Maximum capacity is around 1.2 billion cans and ends per year."
Quotes
  • "So far Helvetia Packaging produces three aluminium products in Saarlouis: 33cl can standard BPA-NI, 50cl can standard BPA-NI and a corresponding end BPA-NI"
  • "Printing can be done using up to eight colours."
Quotes
  • "Stolle is the world’s leading supplier of two piece can and end-making machinery for the global can making industry. "
  • "In addition to supplying individual machines, we design, install and support complete can and end lines for beverage and food cans. "
From Part 05