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Packaging division products (Steel Strappings (1983 Sales, Uses, Grades…
Packaging division products
Steel Strappings
Used to bind products for shipping
Two by fours shipment
Washing machine shipment
Secure a stack of bricks
Small or Frequent users of strappings
Applied strapping with hand tool
Customized tool
Standard tool
If was part of assembly line
and was last
Custom power strapping tool
For ex: Washing Machine production line
Specification
Size
Means Width of Strapping
Signode produced 170 standard sizes of strappings
Grade
Means Thickness and strength of strapping
3 standard grades in strapping industry
Apex
Box Band Magnus (BBM)
Heavy Duty Magnus (HDM)
73% of strapping sales
Across 12 sizes/grades
1983 Sales, Uses, Grades
Apex
Packages and corrugated boxes
33.3%
Box Band Magnus
Bricks and medium weight steel packages
26.8%
Heavy Duty Magnus (HDM)
Rolls of steel and freight car bracing
33.4%
Custom Sizes and Grades
Large Customers
Only supplier of Custom Strappings
6.5%
Engineering department
Provides customer Power strapping tools
Strapping consumable can come from any competitor
Plastic Strapping
Stated in 1962
Market was $10 M
1983
Market grew to $170 M
Signode's Share
$90M (53%)
Growing at 4% per year
Stealing low end steel strapping market
Top Grade Plastic Strapping could replace
Apex and BBM
2% impact per year
Tools and Equipment
Strapping for steel and plastics requires special tools
1983
Signode Produced
550 standard sizes of machines and tools
Simple Hand tools
Customized Power strapping tools
Full range
Custom machines tools to fit customers prodction lines
Accounted for less than 1% or revenue
Steel strapping machines were nearly all custom made
therefore, demand is uncertain
200 units were sold in 1983
Expected to sell less than 100 in 1984
SteelMachined has head tensioned and sealed the strapping
Heads were buits to standard Signode specs
Super structure was built to custmer production line fit
25% of steel strapping were done by this equipment
Plastic Strapping Machines and tools
Can be used only with Signode plastic strappings
Customer buying this machine is automatically committed to buying plastic strappings from Signode
Demand is growing for these machines vs steel which has stagnated