How does a small company compete with the giants of the industry? Argentina's
Valot does it with a wide product range and a high level of personalized service
The current global crisis has far-reaching ramifications. In the case of Argentina's
Valot SA, a small producer of hygiene products, including tissue and toweling
for the away-from-home market, it has put a dent in plans to expand and upgrade
output at the Campana paper mill near Buenos Aires.
The company is not expecting any volume drop in demand for its products.
On the contrary, it foresees 2% growth this year, though perhaps accompanied
by some downgrading in quality. But the increasing difficulty of obtaining
bank financing - even for a well-established and virtually debt-free company
such as Valot - and the soaring cost of money in Argentina make debt-led investment
impractical right now, according to Campana plant manager Fabián Donayo.
The company is still making minor investments - a new shear cutter and modifications
to the electrical systems - but more ambitious plans to increase paper machine
speed and reduce downtime with a major investment package have had to be shelved.
The focus on improving runnability continues, however, with the objective of
reducing waste from the current level of around 11% to 7% in the first phase
and, with further investment, to half current levels.
Donayo blames electrical failures for many of the current problems. The precise
coordination of speed between the different machine sectors needs to be improved
and a new Siemens system and PLC should be a big step in the right direction.
Poor waste quality also creates some problems, as the mill has a contaminants
unit but is without hot dispersion. Of course, the numerous grade changes required
to serve all the plant's customers impose a demanding programme on mill operations.
On average, there are two major changes per week and may be five minor grade
changes per day. Major implies a changeover, for example, from virgin to recycled,
coloured to whiter, or tissue to plain paper. Minor involves changes to grammage,
wet strength, creping angle etc.
The machine celebrates its 50th anniversary this year. It was originally
made by KMW in 1959 and was bought second-hand in 1990. The current unit bears
little resemblance to the original, following extensive modifications carried
out by Valot, though it still features a fourdrinier wet end and open-draw
press transfer.
It trims at 3.7 m and runs at up to 600 m/min making 1100 tons/month or so
of paper of 15-70 g/m2. Stock prep and winders are capable of producing 50%
more so there is considerable scope for the mill to expand when funds can be
allocated to a machine upgrade. In this respect, a highefficiency yankee hood
to replace the current steam-driven unit is a priority, according to Donayo.
Of the machine's output, 400-600 tons/month is used for Valot's own converting
operations in the Campana mill and the San Juan plant, with 700-500 tons/month
destined for independent tissue converters and export (around 120 tons/month).
In Campana, the company has two Perini lines with associated equipment:
- A Perini rewinder model P800 purchased second-hand from Mexico and installed
in 2004. Valot has modified it to use several core diameters and
two designs of embossed-roll interchange on-line. For this there are also
a log saw model P140, with modificactions in power and transmision to run
with increased diameters and very high density logs and a Cassoli Model 110
packer and final wrapper model INH super.
- A second Perini unit P58, also second-hand (from Holland) installed in
2007, with a Perini Rodumat rewinder (start-stop type with central
core cutter on line, also modified to accept several core diameters), and
a special wrapper with thermal tunnel for polyethylene bags.
The main output is for rolls of hygienic tissue and towels, as well as speciality
cleaning papers, converted by Valot itself. The rest goes to independent converters
for napkins and facial, paper bags and special paper packaging.
In San Juan, the company converts industrial paper rolls from Campana into
towels and folded precut toilet tissue. This is also the site for the chemical
plant where a whole line of soaps, shampoos and cleaning chemical products
are manufactured.
The warehouses are located at Bernal, which converts industrial paper rolls
from Campana into towels and roll toilet tissue as well as Vapel industrial
paper rolls for cleaning and protection. There is also an area reserved to
the making of the whole line of dispensers which are marketed by the company.
Producing high-quality paper and converted product is clearly an essential
of the Valot operation, which is competing with giants such as Kimberly-Clark
and CMPC. Its marketing strategy is largely focused on other key attributes,
though. First, a wide range of dispensers, some of them specifically designed
for its own products. Second, and critically, a high level of customer service.
Valot not only runs its own fleet of trucks, large and small, to deliver
product to customer order. It puts heavy emphasis on its ability to deliver
to order, anywhere in the country, in quantities down to one pallet, from 100
tons to one ton, 2 m wide or 10 cm. Supplementing this flexibility in delivery
is a system comprising dedicated managers for each customer, a call centre
and internet ordering.
Equally important, the company focuses all its attention on the institutional
and AfH markets. Developing brands for the consumer market is a costly and
long process where the big players have too strong a competitive edge. At the
same time, big supermarket chains, such as the ubiquitous Carrefour, simply
impose too many demands, according to Jonathan Scher from the company's international
sales department. "We are very little to play against the big guys such
as Samseng and CMPC, but they are too big to offer the flexibility and changes
we do every day," says Donayo.
Despite the difficulties encountered in over 40 years of operation, Valot "continues
to be the leader company in our industrial and commercial sector, fulfilling
with effort and enthusiasm on a daily basis the assignment we proposed
ourselves in 1965: not only never deceive but also to surpass the expectations
of service and quality which are expected by our customers." TW
A SHORT HISTORY
Valot SA has been operating since 5 August 1965. At that time Eduardo Alfredo
Valot, at the age of 22, invented and patented a new soap holder, named Practibon
Valotand, which he started producing and trading. From 1965 to 1978, the company
grew at 20%/yr, meeting the demands of 3500 institutional customers and as
many again served through agents and the support of a nationwide distribution
network.
In 1978, the company diversified into towel and toilet tissue paper dispensers
under the brand name 'Only One', which led to a leap in sales volume. From
3,500 customers in 1978 it rapidly increased to 15,000 direct customers and
25,000 customers assisted by distributors. In 1983-84 Valot moved into the
real estate business when it bought La Bernalesa, 100,000 m2 of covered space.
It developed this as an industrial centre for small and medium-sized companies
that rent sections of 1000-1500 m2.
A year later it set up its first converting plant in the Province of San
Juan and in April 1986 purchased the former Hurlingham Paper Mill in Campana,
some 80 km from the centre of Buenos Aires. This guaranteed continuous supply
of industrial paper rolls. A four-year investment programme followed and the
mill started making highgrade tissue jumbo rolls in 1990.
In the 1990s the company introduced a series of innovations:
- Products for domestic consumption: kitchen paper, napkins, toilet tissue,
face towels, all of them of high quality and with exclusive features:
a range of colours, textures, embossing, presentations, foldings,
etc.
- Toilet paper for septic tanks, which offered high-speed disintegration
and special softness, important in a country where over 60% of
people lived with no mains drainage.
- A complete line of liquid shampoo dispensers.
- Dispensers in a wide variety of colours.
- A fleet of Mercedes Benz 180 trucks. Valot Express Service directed
to gastronomical customers and customers with urgent merchandise
replacements is started.
- Manufacture of chemical products starts in the San Juan Plant. Since
2000 the company has invested consistently in new technology,
focusing above all on increased efficiency and lower costs
