SPA 63rd Conference - October 2006
Addressing the 63rd Conference of the UK Sheet Plant Association, held at the Holiday Inn Runcorn on 2nd & 3rd October 2006, Mr Mark Shaw of Abbey Corrugated estimated that the UK corrugated market accounted for approximately 4 billion square metres. The sheet plant share of that volume, having dipped somewhat in 2003/2004, had in 2006 recovered to around 28% by volume, and 30-35% by value, making the sheet plant share of the UK market one of the largest in the whole of Europe.
‘There are important differences to note between the UK sheet plant market and that in the rest of Europe’, said Mr Shaw ‘not least because the UK sheet plants demand high levels of both service and diversity. It is worth pointing out that many sheet plants on the continent are fed by integrated plants, and that part of the growth experienced by European sheet feeders’ has come from taking share from integrated plants, and not all from growth in the sheet plant market itself.’
Kraft volatility a threat Mr Shaw pointed out that the importance of diversity and service in the UK sheet plant market means that the integrated sector struggles to match the flexibility of sheet plants. He went on, ‘Sheet feeders and sheet plants have to be realistic about offering service and diversity to box buyers, but equally we need to bear in mind that moving in the direction of product simplification and standardisation will take us closer to the stronghold of the integrated plants.’ Mr Shaw also warned delegates that the relatively high exposure to the kraft linerboard market of the UK sheet plant sector as compared to integrated plants may become ever more costly in future years. ‘Kraft is becoming an increasingly globally priced product’, confirmed Mr Shaw, ‘and as time goes on, as a company we are finding that pricing is closely tied in with mill costs and the costs of transport into particular regions of the world. For us that trend means volatility, and we have to recognise that if we continue to have high exposure to kraft, we need to understand why it is that our customers actually need it.’ Mr Shaw sees the growth in popularity of shelf-ready packaging as a significant opportunity for sheet plants, and says, ‘Shelf ready often means multi-pass manufacturing, and that plays to sheet plants’ strengths - furthermore, for integrateds to make one pass machinery ‘shelf ready capable’ eats into the capacity headroom of those machines.’ There are threats as well as opportunities, not least from packaging materials merchants, who are increasingly adept at persuading packer-fillers to discard non-standard packaging solutions in favour of standard cases used in conjunction with void-fill.
EDI benefits sheet plants Mr Shaw went on to talk about electronic trading, and estimated that according to some sources, if every UK sheet plant were to opt for EDI ordering, invoicing and delivery notes, £5million cold be saved in the sheet feeder/sheet plant supply chain cost to market. In addressing some of the misgivings commonly expressed by those who doubted the value of EDI, Mr Shaw pointed out, ‘People are fearful that EDI will lead to double-keying of data - once into their own system and once into ours. It’s a myth! We are able to take your order details directly into our system. People say that they will miss the human contact, but our Customer Service team is still in place, and it is probable that you will still talk to them, but there will be a different quality of conversation.’ Abbey IT Manager Mr Steve Butler went on to explain in more detail how EDI could improve the efficiency of processing of orders, the tracking and monitoring of order status, load building and dispatch, and invoicing. He said, ‘Forty percent of our order processing is now via EDI, with customers’ order files fed directly from e-mails into our system and automatically added to our forward load, having been washed over a number of checks and balances to eliminate obvious errors. That represents an enormous cost saving for both the customer and us, and enables us to be a lot more flexible in meeting delivery requirements’.
Satellite tracking of loads The dedicated ‘abbeyedi’ web site features a secure log-in, and enables the customer to view existing orders, to track progress through the system, to hold and repeat orders, and even to dictate which orders will make up the next scheduled delivery. Says Mr Butler, ‘The system allows for automatic uploading of invoices, which can facilitate electronic matching of delivery notes to invoices. Customers have on-line access to downloadable price lists, management reporting, and access to Abbey’s recently launched sample service.’ Abbey’s EDI system can interface with Abaca, SPOCS and CDM software, as well as Boxplant, Shuttleworth/Cabell, Rubicon and some third party bespoke systems. 2007 should see the introduction of the option to download invoices in pdf format, and viewable satellite tracking of loads once they have left the factory.
At the end of the Monday evening session, SPA Chairman Mr Graham Sutherland presented the 2006 National Packaging Council Design and Construction Awards, many of which had been won by SPA members. He also presented the SPA Supplier of the Year award to Mr Andy Micklewright, of Western Corrugated.
The second day of the conference began with a Marketing Workshop conducted by newest SPA member Mr Raj Bhardwaj of Knowitall Ltd, supported by his team. This session was followed by a comprehensive review of the new UK age discrimination laws by employment law specialist and SPA advisor Ms Anita Coaster, of Coaster Legal.
The Pitfalls of Age Discrimination - The new laws took effect from October 1st 2006, and Ms Coaster began by warning delegates that failure to take account of them could result in the payment of significant amounts of compensation. Employers should be aware that the legislation concerns itself with far more than hiring and firing, and that hitherto acceptable practices such as office banter or seemingly innocent horseplay could lead to very costly legal proceedings. The new legislation prohibits the discrimination against employees on the grounds of age, and apply to freelance workers, consultants, directors, partners and company officers, as well as regular employees. ‘In the USA’, said Ms Coaster, ‘such legislation only protects the old - the over-forties as a matter of fact - but in the UK, the young and the old will be equally protected. Not only will the company be liable for any breach of the legislation, but it is important to note that the company will have vicarious liability for the acts of its employees and its agents. However, the employer does have some defence against accusations of discrimination by its employees, provided he can demonstrate that all reasonable steps were taken to prevent discrimination, and that despite this, the discrimination still occurred. Liability may be avoided, provided for example that the employer has a company policy in place, that the policy can be seen to have been communicated to its employees, and that disciplinary action has been taken when a breach of that policy has been identified. In such an instance, the offending employee would bear the sole responsibility for paying any compensation. ‘
Lawful Discrimination - Age discrimination can take place in the areas of recruitment and dismissal, and in employees’ terms of employment, and at its simplest, discrimination can be direct or indirect. Anita Coaster again, ‘Direct discrimination can happen when you decide not to employ someone or to dismiss them on the ground of age, or when you decide not provide training or promotion on ground of age, or when you take on a new employee on less favourable terms solely because of his or her age. For instance if you decide to send a twenty-five year old employee on an expensive training course instead of a fifty-five year old you may be open to a charge of discrimination. Indirect discrimination can occur when an employer applies policies or practices which although applied to all staff, disadvantage a particular age group more than any other age group. A younger person might be disadvantaged if an employer, unnecessarily, insisted upon ten years experience for a particular job. Likewise, an older applicant might consider himself or herself to be discriminated against if an advertisement stated that a high degree of physical fitness was required.’ However, Ms Coaster pointed out that it was possible to discriminate lawfully, provided that the employer can objectively justify the imposition of particular criteria, on the grounds that it is a proportionate requirement in the pursuit of a legitimate aim.
The next meeting of the Sheet Plant Association will be held jointly with the British Packaging Association in March 2007, at a venue to be advised.
Don Haines