Some Converting Curmudgeon bullet points of interest:
- Release liners’ diverse end-use markets have seen demand increase across most of the world’s developing economies, creating growth opportunities in almost all segments. And while almost two-thirds of all respondents consider their companies to be truly global, about 60% believe that globalization is not considered the only way to achieve business growth.
- At the same time, almost half of respondents expect that product standards will become global
Mergers & Acquisitions
- Sixty-six percent of respondents anticipate M&A activity will affect their business in the next five years. As with past surveys, companies find it easier to grow via acquisitions rather than just organically.
- Five years from now, 61% of respondents say M&A activity in the release-liner industry will increase, and a full third think it will decrease.
Costs & Profitability
- All respondents experienced a mix of cost increases last year – spanning labor, energy, transportation, and materials – totaling between 0-3%. Most expect similar increases this year, with labor costs leading the way. In the next year, 75% of survey respondents foresee all cost categories will impact their businesses equally.
- Among all respondents, 42% said their stocking levels (for inventory management) increased, about one-third said it stayed the same, and about a quarter said it increased in 2016 vs. 2015.
- Over 80% replied that their investment in new product development increased last year. Seventy percent boosted their R&D investment, and 61% increased capital-equipment investment. By 2020, 86% anticipate greater R&D investment, and 76% expect to invest in new products.
Business Sentiment & Innovation
- The release-liner industry in general feels it has made incremental improvements in products and services in recent years. A few areas mentioned as being particularly innovative are linerless labels, silicone PSA coating on PP film, tinted and colored silicones, and special films that deliver release properties without silicones.
- There appears to be an increased level of forward or backward integration to achieve cost savings largely driven by UV silicone. The three most quoted areas for potential innovation are coating or surface treatment for release base material, new products where release liners were not used in the past, and release coatings.
Sustainability & Environment
- Sustainability is a major concern for businesses today, and the release-liner industry is no exception.
- Half of respondents say sustainability/recyclability/eco initiatives are important to their business today; 60% say they’ve taken measurable efforts so far; only about 10% think issues about recycling release-liner waste are affecting their business; and 40% say these issues will have a major effect on business by 2022.
- While only 28% of respondents (up to 25% last year) say they are involved in a program to recycle/reuse spent release liner, their answers were surprisingly non-specific regarding how to accomplish this.
- Survey respondents in North American and Asian markets seem most optimistic about growth in their individual businesses in 2017, followed by Europeans.
- The drive for cost competitive business in combination with perceived market-price pressure had the highest ratings among various factors influencing the release-liner industry.
- Among higher growth rates expected this year, half of Asian companies surveyed say business will be up 5-8% over 2016; 45% of North American and 30% of European businesses foresee the same rate.
- On the downside, 5% of North American companies anticipate their business to fall by up to 2% compared to last year; 2% of European and Asian companies expect the same drop.