Location: Nakkila, Finland
Sales: $72 million
Description: Key Personnel
Petri Rolig, president and CEO of Suominen Corporation; Paul-Erik Toivo, vice president and general manager of Suominen Wiping; Juha Jokinen, director sales of Suominen Nonwovens; Mads Kiilerich, director operations of Suominen Nonwovens; Margareta Huldén, director products of Suominen Nonwovens Plants
Hydroentangled, thermal bonded
Fibrella, Biolace, Karelin, Novelin
Sales clocked in at €57 million for Suominen Nonwovens, a Finnish producer of thermal bonded and spunlaced nonwovens. The drop in volume was partly due to lower volumes in eastern markets and above average deliveries to the North American market in 2008 compared to 2009. Additionally, the lower cost of raw materials impacted the topline correspondingly as nonwovens manufacturers were not able to use the lower cost of raw materials to their benefit in a manner that contributed to the company’s overall long-term profitability.
Despite this drop, executives described 2009 was a very good year financially as its efficiency improved and working capital was reduced. As Suominen’s active sale work and rapid product innovations allowed it to develop new business during 2009. Nonwovens also improved its production efficiency through various small investments and proactive development work.
Other key efforts included inline and machine upgrades, increased sales efforts and improved employee competencies, said Paul-Erik Toivo, vice president and general manager of Suominen Wiping. “We are supplying the market with emphasis on added value products and these have clearly performed better compared with low quality and lower price products.”
With a good percentage of its business represented by spunlaced nonwovens, success or failure in disposable wipes is largely tied to Suominen’s results. According to Mr. Toivo, customers in this segment have been able to manage their businesses well even as private labels continue to challenge brands, resulting in slowly eroding retail values per pack and the subsequent need for cost engineering and target oriented innovation.
“One could almost say there is a kind of polarization in the market, whereby premium products are doing well, as are low cost ones but products positioned somewhere in the middle are facing difficult times,” Mr. Toivo said.
Looking ahead, Mr. Toivo predicted that pricing pressures in spunlace will only continue in Europe as new capacity additions continue to come onstream, adding to an already existing overcapacity situation in the market. However, demand will continue to increase, solving this issue, as the benefits of spunlace will allow it to target new markets.
One of the ways Suominen is achieving this is through a modernization plan, which not only added capacity to its operation, but also improved its quality and efficiency by cutting energy and water costs, which are sustainable benefits in line with Suominen’s environmental concept.
Speaking of environmental concepts, a few years ago, the company added a Biolace range of sustainable products, which are all the time attracting more interest and demand. Other value added products include embossing, alternative raw material blends as well as a continuous development of new substrates. “This close cooperation with our customers is catering to their needs via specialty products and is one of the key elements in developing Suominen’s nonwovens business further.”
These efforts have also allowed Suominen to expand beyond wipes, most notably in the wound care segment. “We have attracted new customers and are currently working on new products for this market,” Mr. Toivo explained. “The challenge the market faces is the increasing competition from “ready to sell” products supplied from among others China.”
In addition to spunlace, Suominen continues to operate a modest thermal bonded business where it is seeing a rebound with demand for value added products. One recent development, Karelin, includes new varieties for thermal bonded products that satisfy the needs for active skin care performance on top of fulfilling the basic needs of the material.
According to the company, Kareline, which is available in basis weights ranging from 18-35 gsm, is ideal for baby care, fem hy and incontinence products where it can bring softness and textile-like feel to the end products, minimizing the feel of plastic. Additionally, Karelin can be tailored to customer needs. This can be done, for example, by adding soothing and caring agents as well as antibacterial and odor-free features. Karelin can have either a hydrophilic or hydrophobic nature.