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Presentation With Style(HKTDC Packaging,1997)

September 1997

HK Enterprise Internet

Presentation With Style
- Sheer-On Ind Ltd

Leading The Recycling Race
- Starlite Holdings Ltd

Signed, Sealed, Delivered
- Propack Int'l Holdings Ltd

Presentation With Style
Sheer-On Ind Ltd

ON the back of growth that has averaged about 50% per annum since its inception in 1988, Sheer-On Ind Ltd, a specialist in presentation boxes and accessory products, has recently added a third building to its manufacturing complex in Dongguan, mainland China. As well as offering Sheer-On even more production space, now up to 400,000 square feet, the new building features recreation facilities such as television rooms, basketball courts and table tennis for its 1,500 workers.

As marketing manager Rebecca Tong points out, "We care about our workers and put a lot of effort into ensuring that everyone is fairly treated. It's the best way of doing things. A happy worker makes a better product."

Someone else Sheer-On cares about is the customer. Started by Albert Lai and Yen Yau Kee, the company went through a difficult first year before hard work, determination and a real understanding of customers' needs began to pay off. Lai explains: "To begin with, I was too inexperienced in the field, but with time I learned how to make things work. We had to make a choice whether to go on after the first year, but I was convinced that [mainland] China was the right place to go ahead with what is essentially a labour-intensive industry."

There was a time when manufacturers were content to put their goods in mass-produced boxes, but as competition for shelf space has intensified, the need for novel and striking presentation has increased. Sheer-On turned itself around by exploiting this fact.

"We realised that customers wanted boxes that would make their products stand out. The secret wasn't mass production but an ability to have dialogue with the client and produce a tailor-made box that would make their watch or pen or piece of jewellery stand out from the crowd," says Lai.

What this entails is a series of meetings with the client where ideas can be brainstormed. Afterwards, Sheer-On puts together a sample, and then continues to modify the sample until the client is satisfied. "It's a very close relationship we have with the client, and whenever possible we will try to give them what they want, even if it is for a very small order. By working this way we get lots of repeat orders and plenty of referrals," says Tong.

The upshot of this interactive relationship with clients is a growing reputation worldwide. Sheer-On uses wood, plastic, metal and paper to make boxes for any product that needs a stylish presentation. It sources materials from wherever the client specifies. Because the entire production -- from design to final checks -- is done in-house, staff can closely monitor the quality of the boxes and their progress along the production line.

The result is that many famous brands like Casio and Swiss Army use Sheer-On's boxes to display their products. Lai expects to see the company build on the kudos that comes with dealing with such top-brand clients. "I would say that within the next five years [mainland] China will be the centre of display-box production in the world. By using electronic communications tools like the Internet and increasing investment in our design facilities, I would hope to see us at the forefront of this revolution," he says.

Written by Martin Snape

Leading The Recycling Race
Starlite Holdings Ltd

THE story of Lam Kwong Yu, chairman and CEO of Starlite Holdings Ltd, is one that Hong Kong dreams are made of. He started out in 1970 with a lone rented printing press, producing a single product. By dint of hard work and innate business acumen, Lam gradually built up his enterprise until it was in a position to go public. This it did back in 1993, at which point the group took two major steps towards diversification and globalisation.

First, in September 1993 Starlite took on ODM responsibilities by signing a licensing agreement with US-based greeting card and gift manufacturer Hallmark Cards Inc. Then, in June 1994 Starlite teamed up with US giant Warner Brothers Consumer Products to represent, develop, manufacture, distribute and sell paper products in 10 countries in Asia.

Starlite was no stranger to big-name clients even before signing these two major deals. Avon, Black & Decker, Conair, Hasbro, Hewlett- Packard, M&M, Panasonic, Philips, Sanyo and Tyco are just a few of the companies which have chosen to use Starlite's services as a printer and manufacturer of packaging, manuals and instruction booklets.

That Starlite has been an unmitigated success is hardly news, but what is news is the company's recent foray into what it calls "responsible packaging", the design and manufacture of pulp moulded fibre. It is a venture that Lam is extremely excited about. He explains: "The idea came to me while I was wandering round a supermarket. I was looking at some eggs in their cardboard egg boxes and I thought, surely if something as delicate as an egg can be transported that way, then it would work for other products."

Lam took the idea back to his technical staff at Starlite and soon, research into setting up a pulp moulding plant on mainland China was underway. "What excited me about pulp moulding was the fact that it is so environmentally friendly. I have been very successful as an industrialist and I felt that it was time for me to give something back.

"Polystyrene packaging causes an awful lot of pollution. As a substance it is non-biodegradable and difficult to recycle. I am very aware of environmental issues and I really felt that this would help the growing problem we have in this part of the world."

Pulp moulding produces a substance known as moulded fibre, a form of cardboard that looks just like the cardboard that egg boxes are made from. Engineered into the appropriate shape for a given product, it can offer cushioning that easily equals that of foam and plastics. Fax machines, external disk drives, phones, printers and other delicate products can be shipped using moulded fibre.

Fibre packaging is also comparable in price to other types of packaging. Due to the fact that like egg cartons, it can be stacked in nest fashion, considerable savings in space can be made during shipping and storage. Best of all, from a green point of view, this packaging is biodegradable, recyclable and made from recycled paper.

"The beautiful thing about this is that as a printer, we produce a lot of waste paper. Well, now it no longer goes to waste. We simply pack it up and send it off to the pulp moulding factory in Guangzhou, [mainland China]. This means that our moulded fibre packaging is made from 100% recycled paper taken out of the waste stream," Lam says.

But it doesn't stop there. Starlite's Guangzhou manufacturing facility also reuses waste fibre and even recycles the water used in the moulding process. As Lam says, "I think awareness of the environment is increasing in Asia and, as a good corporate citizen, we want to be at the forefront of that growth of awareness. We have invested in the best design, tooling capability and the most efficient equipment in order to offer our clients a competitively priced, top-quality product that will help preserve the environment for future generations."

Written by Martin Snape

Signed, Sealed, Delivered
Propack Int'l Holdings Ltd

THE strength of Propack Int'l Holdings Ltd's contacts is what makes the company a success, says deputy general manager CK Chan. "We know the game," he says. "In Europe or Japan, all the suppliers will come to you. In [mainland] China, if you want to find quality products, you have to find them by yourself."

Propack also has the advantage of strong connections in Europe. The film packaging company is a joint venture, formed with investment from Hong Kong, the mainland and Italy. Much of the equipment used in Propack's two mainland factories has been imported from Europe, where it is able to find the most up-to-date packaging technology. "Most of the machinery is imported because we have to guarantee our quality," says Chan.

The company's connections have helped Propack gain a strong position in the market in a relatively short time. Founded in 1991, the company opened its first factory in Guangdong on the mainland in 1993. In the first year, turnover reached HK$2m.

"That was hard, very hard," remembers Chan. "But right now, in Hong Kong, our monthly business is over HK$2m. We have four sales offices in [mainland] China and each does more than HK$2m a month." In total, Chan says the company has reached an annual turnover of HK$150m.

Propack has since opened a second factory near Shanghai and updated its equipment, enabling it to produce a wide range of flexible packaging products. Chan says the company has invested US$20m in importing equipment for the factories to ensure the quality of its products, although it is possible to buy lower-priced equipment locally.

By continually investing in new, state-of-the-art machinery, the company has been able to keep one step ahead of its competitors. Eight-colour printing technology enables Propack to produce high-quality designs, and maintain consistent quality for the company's many multinational clients. A dry lamination machine and a tandem extrusion machine have been added as the factory has developed.

Film can be produced with high levels of moisture resistance and low sealing temperatures for frozen food, such as ice-cream, or with strong seals for liquids. High-barrier laminates are produced for food that needs to be kept fresh and multi-layer film provides safe and practical packaging for snack food. Propack also makes retort pouches that can withstand high pressure and temperature, making them an energy-efficient substitute for cans.

As the business has grown, Propack has attracted many clients, including PepsiCo, Nestlé, Quaker Oats and Amoy. But Chan says the company's growth has not been at the expense of its rivals in the region. "The business is not coming from fighting against our competitors. Most of the food companies have been introducing new products and expanding their business," he explains.

He says the company has also worked hard to ensure its staff on the mainland are well-qualified and experienced. "Most of the branch managers worked in the factories for one or two years before moving into management, so they know the products very well." He adds that the company ensures its delivery is prompt. "To deliver on time is very important."

Propack's rapid growth is set to continue for the foreseeable future, as its competitors continue to see high levels of growth. "They are all building many new factories in [mainland] China," says Chan. Propack is to open two new offices on the mainland by the year-end, in Xian and Fujian. It already has sales offices in Beijing, Shanghai, Dongguan and Chengdu.

Written by Helen Johnstone

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