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Date 30th August 2010 / www.procarton.com

The customer as driving force


Interview with Virginia R. McLain, Managing Director Europe, on the current status at MeadWestvaco, global economics in general and the packaging industry in specific. Her summary: “The important challenge is the ability to define Innovation through the lens of one’s customer. To be competitive in today’s environment, one must remain flexible and have depth and breadth of resources.”

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Virginia R. McLain took over responsibility for MWV packaging materials in Europe, the Near East and North Africa a year ago. Despite the recession and with a number of markets facing radically changed conditions, she welcomed the opportunity of working in this dynamic and highly disciplined environment.


How does the current crisis affect MWV?
We are very fortunate to have a strong portfolio of premium packaging materials, a service delivery model supported by appropriate levels of local inventory and a seasoned sales and customer service organization which allowed us to maintain our volume and revenue at a stable level.
Whereas 2010 has been strong during the first quarter, outside forces such as the Chile earthquake, the Scandinavian paperworkers’ strike and the subsequent rising costs and tightness of pulp and waste paper markets have perhaps created an artificial and temporary tightness in the market. We believe that it is much too early to forecast the balance of the year at this stage. The recent weakening of the Euro and subsequent negative impact on stock markets around the world have added to uncertainty.


What is your opinion on price increases?
Price increases are always a challenge to implement because converters tend to sign yearly or multiyear contracts with their customers. However, the reality is that there must be price increases to provide funds to ensure the long term viability of papermills which includes research and development, safety and maintenance investments as well as meeting and exceeding environmental regulatory requirements. Whereas, we understand that converters want to protect pricing long term, there must be flexibility built into the relationship to accommodate necessary changes.


What are the current market trends?
As many others in the market, we see the trends toward reducing packaging in consumer goods. Whereas we understand the desire to do so, we also believe we must educate our customers as to when and where it is appropriate. If the integrity of the package is compromised, it could result in greater losses through the supply chain before reaching the retail shelf. On the other end of the spectrum, we have seen a greater emphasis on packaging as an integral part of the brand. It is only by truly understanding the needs and desires of the consumer regarding specific products that one can help the brand owner and converter make appropriate decisions around packaging materials.


What importance is attached to innovation?
Innovation is a word in vogue. Depending on a particular situation, it can take on a variety of meanings. In my experience it covers the spectrum of specific product attributes to new structural concepts which provide consumers with a specific benefit to changes in processes which fundamentally change existing cost structures. In my opinion, the important challenge is the ability to define Innovation through the lens of one’s customer – and every customer can have a different definition. To be competitive in today’s environment, one must remain flexible and have depth and breadth of resources with which to meet these challenges.


What can we expect next year?
As with every difficult economic environment, there will be winners and losers. Our industry has some very good assets which are well maintained and our research scientists are continuously exploring process improvements which will result in better products with more competitive price structures. Today, there are a broad number of high quality paperboard products, with a range of performance, to meet the most demanding applications based on specific customer needs. Paperboard producers have capacity, either in place or planned, to accommodate current and future growth of packaging.

Virginia R. McLain

Virginia R. McLain


Richard Dalgleish +44 777 613 8510 dalgleish@procarton.com
Suzanne McEwen +43 1 218 6918 mcewen@procarton.com
Background Pro Carton is the European Association of Carton and Cartonboard manufacturers. Its main purpose is to promote the use of cartons and cartonboard to brand owners, the trade as well as designers, the media and politicians as an economically and ecologically balanced packaging medium.