Esko Uutela, tissue principal consultant, RISI, Germany
New Tissue Supply in the Americas and Impact on Supply/Demand Balance
The North American tissue business is in a mature phase but it continues to be surprisingly dynamic. The ten largest players account for 90% of the total tissue capacity, so the business is rather consolidated. In the United States the three main companies are estimated to hold 80% share in the At-Home tissue sector and slightly more than 70% in the AfH sector. But this dominance seems not to frighten new entrepreneurs to enter the tissue sector. We have already seen the rapid growth of independent converters, and they have gained substantial market share in the AfH sector in particular, and some of them have integrated backward into tissue making, at least partly. And even more companies are seriously considering new tissue projects, for example graphic paper producers trying to save their mills with new investments, or retired industry veterans who would like to return to the business. Imports also show an increasing long-term trend with additional volumes coming from Asia to North America. The battle between brands and private labels has accelerated investments and influenced the supply/demand balance.
Latin America has also shown strong expansion in recent years with Brazil as the leading force. New projects have emerged as mushrooms after heavy rain, and more plans are in the pipeline. But typical to Latin America, many projects have been delayed, moved to the backburner or and some even cancelled, which has helped the supply/demand balance.
Soile Kilpi, VP, Pöyry Management Consulting, USA
Shipping Air – How and Why Can Foreign Competitors thrive in North America
Historically, the tissue industry has remained a largely regional business, with global trade having a small share of total consumption. High freight costs have been the driving force behind this phenomenon. However North America remains an attractive market for tissue exporters due to the large population, consumer spending habits and stable demand growth. Large producers in Asia have pursued aggressive growth plans and at the same time North American players have invested in state-of-the-art technology, altering the regional cost structures. Will Chinese producers continue to pursue a presence in North American markets? Will players outside Asia, such as market pulp producers in Brazil, look to North America for opportunities? How can foreign exports compete in North America? Or is the freight cost barrier simply too high? In this speech, Pöyry will examine how the regional trade and industry competitiveness has changed and discuss the potential impacts this has on North America.
Jamie Rosenberg, Global Household Analyst, MinTel, USA
Factors Influencing the Paper Category e-Commerce: Will They Change How We Shop?
Numerous trends are driving e-commerce growth in the paper category. Expanding urbanisation, the consumer desire for convenience and variety, retailer SKU rationalisation efforts, direct-to-consumer distribution schemes, international expansion efforts, and even mass personalisation capabilities, all point to a changing channel landscape where paper products may have untapped potential for online sales.
This presentation will evaluate category purchase drivers in the context of key consumer and industry trends to understand the future of e-commerce in the paper category.
Esko Uutela, tissue principal consultant, RISI, Germany
Brands vs Private Label Tissue Market Shares in Selected Countries around the World
Brand or retailer label, this is one of the very basic questions for a tissue company strategy worldwide. The success of private labels depends on many factors, but prerequisites include the existence of modern retailing system, consolidation and strong purchasing power of retailers, fragmented supplier industry and weak promotional efforts by brand owners. Central Europe has been the pioneer in retailer label penetration, and now the average private label share is approaching 65% in Western Europe, measured in terms of volume of tissue products, with the highest relative share being around 87-88% in Germany. In North America tissue brands have traditionally dominated the business, but recently retailer label share has increase in the US market substantially as a reflection of retailers’ efforts to position their premium retailer labels closer to the quality level of leading brands. Brands continue to dominate in the developing world, but in emerging markets such as Turkey, Brazil and Russia, private labels have begun to pick up.
Jamie Rosenberg, Global Household Analyst, Mintel, USA
The Value Proposition National Brands Bring to Retailers and Distributors
While an economizing consumer mindset may be putting pressure on the category’s smaller segments, cheaper products may not be the best way to rekindle interest in branded facial tissue and other declining paper category segments. The bigger opportunity for driving growth across the entire category revolves around new products that bring performance enhancements or compelling new benefits to preserve the value proposition of key brands.
This presentation will look at consumer research showing that consumers are rapidly changing their thinking about innovation in these categories to the point where they view premium features like strength, thickness and softness as value-added, and more times than not, worth the money. It will also evaluate how mega-trends like health and wellness, aging populations, e-commerce, automation and globalization point to a changing market.