Location: Atlanta, GA
Sales: $133 Million
Description: Key Personnel
Mike Burandt, president, Consumer Business, North America; John Lundgren, president, European Consumer Business; Paul Farren, vice president & general manager Nonwovens; Remi Perin, sales manager, French Operation; Massimo Conforti, sales manager, Italian Operation; Mike Sprangers, sales manager, North America; Tom Kalupa, senior sales representative; John Rank, sales representative
Green Bay, WI (two facilities); Glen, France; Avigliano, Italy
Both U.S. plants ISO 9002 certified; Italy plant ISO 9002 certified; France plant ISO 9002 certified
Baby wipes, industrial and food service wipes, feminine hygiene, absorbent core, tabletop, medical, moist toilet tissue, meat packaging.
Despite myriad problems in its core market of airlaid materials, Georgia-Pacific, Atlanta, GA, is one company with plenty of reason to smile. The company has a loyal customer base, strong research and development practices and a new technology to guide it into the future.
In 2002, nonwovens sales decreased slightly to $133 million. This was caused mainly by tighter margins rather than decreased volumes. All of G-P’s 40,000 metric tons of North American airlaid capacity continue to run at full operation, fueled both by internal and external sales, and the company has been increasing production capacity through efficiency measures to support its future customer’s growth.
“We have the advantage of being able to sell to our commercial and retail businesses, which gives us a real captive audience,” explained Paul Farren, vice president and general manager of nonwovens. “On the external roll goods side of our business, we really have established an excellent business with strong customer intimacy and consistency in our speed to market.”
Currently about one-third of G-P’s nonwovens output feeds its internal efforts while the remaining two-thirds is sold externally. The internal business includes such brands as Quilted Northern Moist Toilet Paper while external markets are wipes, feminine hygiene products, medical, tabletop and food packaging.
One area of recent interest is multibonded technology, a process G-P added in July when it adapted an existing airlaid line. Multibonded technology uses less latex bonding and more thermal bonding and requires fewer binders to create a loftier, softer fabric. This emerging technology, which is not exclusive to G-P, is preferred by many wipe converters because of the absence of stiffness.
With 100% of its capacity centered around airlaid technology, G-P recognizes the importance of diversifying its technology in keeping customers happy and satisfied. While no plans have been announced, Mr. Farren did admit that the adoption of complementary technologies, either through capital investment or partnerships, would certainly be part of G-P’s business plan in the future. “As a large consumer products company we realize that we need to be involved in more than just airlaid,” he explained. “We are currently examining how we have to prepare our business to meet the needs of both our internal business and our roll goods customers.”
Key to G-P’s business strategy is a strong intimacy with its customers. Rather than supply one-stock product across the board, G-P caters to the needs and wants of its customers. This allows it to be more flexible to the needs of the entire market as well as prepared to shift with the marketplace.
G-P is largely driven by new product development, and the nonwovens industry has given it a great deal of room for initiatives in this segment. With two of its key markets—wet and dry wipes—seeing growth in the 6-7% range, G-P has been zeroing in on the needs of its consumers. While specifics were not given, Mr. Farren did say that the next six months would see significant new product introductions by G-P. These products will be both line extensions and revolutionary new products.
“We will continue to work to develop our nonwovens business,” Mr. Farren said. “We certainly have overtures and are working toward a number of new business opportunities. Nonwovens is definitely a business that Georgia-Pacific believes in.”
Georgia-Pacific acquired the nonwovens business when it purchased Fort James, Deerfield, IL, in early 2001. In January 2002, the company reaffirmed the importance of its nonwovens division when it designated it a separate business unit of the company. This unit includes the company’s nonwovens, retail, commercial and roll goods operations and is a part of the consumer products side of the company.
G-P’s consumer products division was separated from the building products side of the business in June 2002. The separation provides clear identity and focus for each business to develop strategically consistent with the fundamentals of their businesses while clarifying the makeup and strategic goals of each business to the investment community. At the time of this split, G-P indicated that the consumer products division would be spun off from the company in an initial public offering. In September, however, the company cancelled these plans, citing weakened market conditions as the catalyst for its decision. While these plans have yet to be revisited, executives are not ruling out a spin-off in the future, particularly when market conditions improve. Nevertheless, the nonwovens division, as well as the rest of G-P’s business, has not been impacted by these plans and operations are running smoothly, according to Mr. Farren.