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In a tough macro as well as industry environment, Sylvamo has knuckled down and created a strong independent entity, says Gerald Demets, the company’s Director of Sales, Marketing and Innovation EMEA. All the while, it’s kept a keen eye on the customer With a razor-sharp CUSTOMER FOCUS

OPI: It’s been about six months since

International Paper’s global papers business became Sylvamo. Can you tell me a bit about this new entity and what it stands for?

Gerald Demets: Sure. We think of Sylvamo as ‘The World’s Paper Company’. We believe in the promise of paper to educate, communicate and entertain and our purpose is to produce paper that customers need in the most responsible and sustainable ways.

We operate in Europe, Latin America and North America. We have a mill in Saillat, France; and export from Brazil to serve our European customers. Our regional headquarters is in Brussels, Belgium.

In terms of products, we focus mainly on our REY and HP brands in Europe. Rey is what we call ‘The Conscious Choice’. It’s sold in more than 40 countries and perfect for customers that value sustainability and social responsibility, both topics which are becoming increasingly important.

Our HP Papers, meanwhile – we are HP’s global supplier of those – are distributed to 75 countries. It’s an ideal brand for the e-commerce and retail channels and we work very closely with HP to link this range to the complete HP value proposition of printers, toners and papers.

OPI: What has been the early feedback from your customer base since the spin-off in October 2021?

GD: It’s been very positive. We have always had a very strong partnership with customers and they appreciate working with us. We are now an independent, publicly traded company that is highly aligned with its strategic channel partners. This is hugely important to us.

We have extremely positive cross-regional synergies and also best-in-class commercial and operational teams. Overall, we are confident we can generate a robust cashflow and create long-term value for our customers.

OPI: You have one operational mill in Europe. What can you say about your current footprint and how well it serves your customer base?

GD: We are a global paper company and we believe we can leverage our international footprint to serve our customers in an efficient way.

OPI: So there’s enough flexibility in terms of getting the product you need when you need it?

GD: It’s something that differentiates us from other players – the multi-mill system and the fact we operate across different continents.

OPI: There have been secular declines in paper consumption over a number of years. How do you address this situation?

GD: In Europe, we have a comprehensive focus on uncoated woodfree papers and those include cut-size brands for the office. This segment has been much more resilient than others.

We concentrate on the many different applications in this sub-category, including in verticals such as healthcare, education, government, finance or insurance.

OPI: One area where your partner HP is very strong is in the printing-from-home market. What’s your perception of home, office or hybrid working as we come out of COVID?

GD: We believe there’ll be a mix of home and office working for some time in the future. We are extremely confident that we have good solutions for both environments.

Just to give an example, we have launched a three-ream box for smaller usages of paper as part of our HP Papers range. And we continue to investigate any opportunities that allow us to better cater to the needs of all customers.

Subscription models for paper is something we’re looking at, for instance. Similar to what HP is doing with HP Ink.

OPI: How has the shift in customer purchasing patterns impacted you?

GD: We respect the different channels and the value they add, and I’m convinced we can reach all customer demographics. We definitely saw a surge in online and retail when the pandemic hit, but we have since also seen a rebalancing of those channels.

OPI: Talking of channel changes, plenty has been going on in Europe over the past couple of years as regards some big operators. Has the demise of Staples Solutions and Office Depot Europe in their previous incarnations affected you substantially? I guess there are now new customers and relationships?

GD: Yes to all of that. I’ve been in the paper industry for about 17 years and there have been a lot of changes across the European landscape. We have to adjust, that’s all. It’s a people business after all, and we are always in the process of creating and reaffirming relationships based on mutual trust.

OPI: As a global operation, you can probably appreciate how difficult it is to operate in a market like Europe. It’s one region, of course, but it certainly isn’t one market, as the likes of Staples and Depot have painfully found out over the years. How does Sylvamo deal with this particular issue?

GD: Like you say, as a global company, we are dealing with a number of customers that have a presence across different countries in Europe. As a general rule, experience tells us that the best approach is a combination of local and pan-European.

Local is important to really understand and cater to the needs of customers which can vary significantly between different countries or even channels. But central is appropriate and makes sense for certain functions too. I believe matching the two is an area Sylvamo is especially strong in.

OPI: I’d like to go back to the topic of sustainability. You alluded to this earlier when you mentioned your REY range and the fact this issue has moved very high up the agenda again. In a nutshell: why is paper sustainable?

GD: Well, the majority of the components in paper are fully renewable resources and the manufacturing processes used are extremely environmentally friendly too. I feel passionate about the fact that the paper industry overall and Sylvamo in particular are making considerable efforts – and investments – towards minimising our all-round environmental footprint.

Our choice of new company name – Sylvamo – as well as all our communications highlight that we hold the environment and the social responsibility we have as a company in the highest regard.

OPI: Let’s finish up with Sylvamo’s priorities for the next few months. What are your plans?

GD: Certainly a continued focus on our customers, that’s very important. We want to provide them with the right services and help them achieve their objectives. Our whole industry is facing a myriad of challenges, and it’s vital for us to add value to our customers.

From a slightly inward-looking point of view, you’ll see a definite step change in terms of innovation and business development.

OPI: Where exactly can innovation go in the paper segment?

GD: There are lots of opportunities in terms of service aspects, routes to market, end-user convenience, etc. CSR with all it entails is a big topic. We are excellently positioned in these areas.