9 minute read
SCORING BOXES
OFFICERS
Chairman: Gene Marino, Akers Packaging Service Group, Chicago, Illinois First Vice Chairwoman: Jana Harris, Harris Packaging/ American Carton, Haltom City, Texas Vice Chairmen: Matt Davis, Packaging Express, Colorado Springs, Colorado Gary Brewer, Package Crafters, High Point, North Carolina Finn MacDonald, Independent II, Louisville, Kentucky Immediate Past Chairman: Jay Carman, StandFast Packaging Group, Carol Stream, Illinois Chairman, Past Chairmen’s Council: Joe Palmeri, Jamestown Container Cos., Macedonia, Ohio President: Michael D’Angelo, AICC Headquarters, Alexandria, Virginia Secretary/General Counsel: David Goch, Webster, Chamberlain & Bean, Washington, DC Administrator, AICC Canada: Renee Annis
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DIRECTORS
West: Jack Fiterman, Liberty Diversified Industries, Minneapolis, MN Southwest: Michael Drummond, Packrite, High Point, NC as Southwest Director Southeast: Ben DeSollar, Sumter Packaging Corp., Sumter, South Carolina Midwest: Casey Shaw, Batavia Container Inc., Batavia, Illinois Great Lakes: Josh Sobel, Jamestown Container, Macedonia, Ohio Northeast: Stuart Fenkel, McLean Packaging, Pennsauken, New Jersey AICC Canada: Terri-Lynn Levesque, Royal Containers Ltd., Brampton, Ontario, Canada AICC Mexico: Juan Javier Gonzalez, Cartró, S.A.P.I. de C.V. (CP), Tepotzotlán, Mexico
OVERSEAS DIRECTOR
Kim Nelson, Royal Containers Ltd., Brampton, Ontario, Canada
DIRECTORS AT LARGE
Kevin Ausburn, SMC Packaging Group, Springfield, Missouri Eric Elgin, Oklahoma Interpack, Muscogee, Oklahoma Guy Ockerlund, OxBox, Addison, Illinois Mike Schaefer, Tavens Packaging & Display, Bedford Heights, Ohio
EMERGING LEADER DELEGATES
Cassie Malone, Corrugated Supplies Co. LLC, Chicago, Illinois Lauren Frisch, Wasatch Container, North Salt Lake, Utah John McQueary, CST Systems, Atlanta, Georgia
ASSOCIATE MEMBER DIRECTORS
Chairman: Joseph Morelli, Huston Patterson Printers, Decatur, Illinois Vice Chairman: Greg Jones, SUN Automation Group, Glen Arm, Maryland Secretary: Tim Connell, A.G. Stacker Inc.,Weyers Cave, Virginia Director: John Burgess, Pamarco, Roselle Park, New Jersey
Immediate Past Chairman, Associate Members:
Pat Szany, American Corrugated Machine Corp., Indian Trail, North Carolina
ADVISORS TO THE CHAIRMAN
Joseph M. Palmeri, Jamestown Container, Macedonia, Ohio Al Hoodwin, Michigan City Paper Box, Michigan City, Indiana Joseph Morelli, Huston Patterson Printers, Decatur, Illinois
PUBLICATION STAFF
Publisher: Michael D’Angelo, mdangelo@aiccbox.org Editor: Virginia Humphrey, vhumphrey@aiccbox.org
EDITORIAL/DESIGN SERVICES
The YGS Group • www.theYGSgroup.com Vice President: Serena L. Spiezio Content & Copy Director: Craig Lauer Managing Editor: Jessica Price Senior Managing Editor: Sam Hoffmeister Copy Editor: Steve Kennedy Art Director: Alex Straughan Account Manager: Max Lalwani
SUBMIT EDITORIAL IDEAS, NEWS & LETTERS TO:
BoxScore@theYGSgroup.com
CONTRIBUTORS
Maria Frustaci, Director of Administration and Director of Latin America Cindy Huber, Director of Conventions & Meetings Chelsea May, Education and Training Manager Laura Mihalick, Senior Meeting Manager Patrick Moore, Member Relations Coordinator Taryn Pyle, Director of Training, Education & Professional Development Alyce Ryan, Marketing Manager Steve Young, Ambassador-at-Large Richard M. Flaherty, President, ICPF
ADVERTISING Taryn Pyle
703-535-1391 • tpyle@aiccbox.org
Patrick Moore
703-535-1394 • pmoore@aiccbox.org
AICC
PO Box 25708 Alexandria, VA 22313 Phone 703-836-2422 Toll-free 877-836-2422 Fax 703-836-2795
www.aiccbox.org
ABOUT AICC
PROVIDING BOXMAKERS WITH THE KNOWLEDGE NEEDED TO THRIVE IN THE PAPER-BASED PACKAGING INDUSTRY SINCE 1974
We are a growing membership association that serves independent corrugated, folding carton, and rigid box manufacturers and suppliers with education and information in print, in person, and online. AICC membership is for the full company and employees at all locations have access to member benefits. AICC offers free online education to all members to help the individual maximize their potential and the member company maximize its profit.
WHEN YOU INVEST AND ENGAGE, AICC DELIVERS SUCCESS.
Grip It and Rip It!
My first order of business is to tell you how honored I am to be your AICC chairman. This Association not only means a great deal to me, but most people reading this as well. It is an honor to represent such a phenomenal group of people. I am grateful to Akers Packaging, not only for their support of my chairmanship, but their support of AICC and of our industry. It is wonderful to be a part of an organization like Akers.
As we exit a very challenging year, which Jay Carman successfully guided us through, it’s time now for us to reevaluate and rethink what we’re doing in our business to create a sustainable enterprise. The dynamic of living off the energy and enthusiasm of the owner is robust, but how do you build a sustainable enterprise on a go-forward basis? What I would like to focus on during my chairmanship marries my passion for strategy and execution with my love for golf. Simply put, it’s a “Grip It and Rip It” philosophy.
In golf, preparation, practice, and focus all are handled prior to the shot. When it comes time to hit the golf ball, it is time to stop thinking and execute. So when preparing strategically, first ask what can be done in your organization to bring your team together. Expanding on the concepts discussed by Pete Watson, CEO of Greif, during his SuperCorrExpo keynote, this is culture and core values. What are you doing inside your business to create a clear set of core values that you can hire, fire, reward, and recognize your people by? The result will be a consistent, solidified team that will help you get to that next level. Next comes focus. It is time to put a stake in the ground so that everyone in the organization understands where they are going and how they are going to get there. Finally comes the practice, or in this case the execution. When the team can focus on the three to five things to realize the vision course of the next year, five years, and 10 years, the team spends time working on the big things that get you where you need to go and less time on the small things that get in the way.
There are so many analogies with golf; it is interesting to me. In that sense, success comes in the form of one thought or philosophy that we can drive in the business as leaders, similar to one swing thought when you are heading out for your round for the day, keeping it simple. I am personally partial to a certain strategic model, but it’s more about using any model in your business that can help bring focus, alignment, and, importantly, results. As the leader of your organization, that’s your ultimate responsibility: Develop talent, identify and live by your core values, and drive strategic growth and execution.
People tend to misconstrue the well-known phrase, “Culture eats strategy for breakfast.” What that means, and what that does not mean, is an important distinction. Without culture, you cannot execute. Conversely, a “no strategy is required” philosophy does not work simply because you have a good culture. How this phrase should truly be interpreted is that with a great culture, you can successfully create, develop, and execute a clear strategy far more successfully than a business with no clearly identifiable culture or core values.
I want to thank my wife, Megan, and my children, Emma, Grace, and Claire, for their support. I’m going to enjoy this year getting to know many of you a lot better. I appreciate the partnership of my fellow board members, the AICC staff, and most importantly, you, the members of AICC. Thank you very much.
Gene Marino Executive Vice President, Akers Packaging Service Group Chairman, AICC
The Growing Packageable Goods Trade Deficit
BY DICK STORAT
The COVID-19 pandemic has reshaped the U.S. economy in many ways. The generous provision of deficit-financed cash and unemployment benefits is among the most important.
As a result of this and reduced spending for services such as travel, entertainment, and dining out last year, U.S. consumers have amassed an excess of savings of some $2.2 trillion compared to the pre-pandemic savings rate. Much of this will continue to support the record levels of consumer spending that started last year and are continuing into 2021.
While the most rapid growth has been for durable goods, spending on packaging-intensive nondurable goods has also soared. Through the first five months of this year, spending has remained 10% above prior-year outlays. The result should be record-setting domestic production of these goods. That has not been the case, however, as industrial production of nondurable consumer goods has risen by a much smaller 3.2% over the same five months of this year.
Imported consumer goods, and especially the excess of imports over exports, are the main explanation for this disparity. We have assembled a list of nondurable trade products requiring corrugated packaging and examined the trends over the past several years. Imports of these goods have been running at a level of almost $100 billion per month, while exports of the same products have amounted to less than half that amount. As a result, the trade deficit for packageable goods exceeded $50 billion and had risen by 32% through May of this year. The top chart at right shows the trend of the packaging trade deficit over the past three years. The deficit has exceeded its prior-year level every month since May 2020.
Looking more closely at foods, products that consume a disproportionately large share of corrugated packaging, we see that the trade data depicts an even worse
($ Billions/Month)
$60 $55 $50 $45 $40 $35 $30 $25 $20 $15 $10 $5
U.S. Packageable Goods Trade Deficit
$0
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC
2019 2020 2021 Percent Change Year-to-Date
Source: Census Bureau, RSA Inc
40%
35%
30%
25%
20%
15%
10%
5%
0%
Trade Balance for Food and Kindred Products
$4,000 $3,000 $3,194 ($ Millions)
$2,000 $1,000 $0 –$1,000 –$2,000 –$3,000 –$4,000 –$5,000 –$6,000 –$7,000
2017 –$911
2018 –$2,221
–$5,810
2019 2020
situation for domestic producers and their paper packaging suppliers.
In 2017, exports of food products amounted to $64.1 billion, while imports were $60.9 billion. The result was a positive trade balance of $3.4 billion. That meant that U.S. corrugated producers had the opportunity to sell more packaging than was available from only the production for domestic use. However, as the bottom chart on the previous page depicts, that situation has deteriorated steadily and rapidly during the past three years. By the end of 2020, the trade balance descended to a deficit of $5.8 billion. In only three years, the market for packageable food and kindred products available to domestic converters declined by $9.0 billion. Last year, exports of these goods rose by a fractional 0.9%, while imports grew by 6.1%.
Produce, including fruits, vegetables, and tree nuts, consumes a significant amount of corrugated packaging. The chart at right shows recent trade data for these products. Last year, exports of these products totaled $17.8 billion, a decline of 0.9% per year on average since 2017. Over the same period, imports grew, rising by 2.0% per year on average.
As a result, the trade deficit for produce items increased from $11.8 billion to $14.2 billion, further reducing the amount of product available to be packaged in domestically produced corrugated containers.
Packaging of beverages, both alcoholic and nonalcoholic, is a third category of interest to independent producers of paper-based packaging. In this category, the trade deficit amounted to $15.3 billion at the end of 2017 and had deteriorated to $17.5 billion by the end of last year, as shown in the chart on the next page.
Exports of beverages declined by 1.6% last year but were unchanged, on average, since the end of 2017. While exports declined, imports continued to grow, having increased by 2.2% last year and having averaged an annual growth of 3.0% per year since 2017.
