is a quarterly review which summarises current events and technical information about printed packaging.

From the initial idea to the production of the packaging, you will find useful information which is essential for professionals in this industry (such as buyers, decision-makers, buyers, packaging manufacturers and suppliers of raw materials).

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September 2017



Jean-Pierre BRICE -  Partner of the firm Capitalmind


The business of circumstances

Privileged speaker for the entrepreneurs for mergers and acquisitions, specialist in the paper and packaging industry, Jean-Pierre Brice, partner of the firm Capitalmind,  provides an overview of the economy of luxury goods and packaging. What should be the commitment for the last quarter of 2017?

As far as packaging applied to the luxury sector is concerned, we can assess the need for a process of concentration of production and packaging activities. This may be a sensible
operation, since manufacturers of packaging, often small in size (in comparison with Germany in particular) feel pressure and are subject to the laws of competition by the major brands.
The need for responsiveness is another factor that can drive companies to concentrate upon. Responding quickly to the needs of their clients involves having research centres, laboratories or even strong marketing departments. To combine their strengths is paramount in guaranteeing very short lead times and thus satisfying the demanding field of luxury cosmetics that works on a just-in-time basis. The latter will tend to favour a proximity with its suppliers. While many large luxury companies are currently thinking about repatriating their activities in Europe, it is all the more fair for suppliers to think about expanding or regrouping. Is this the right time?
Certainly, the conjunction of positive economic indicators is quite strong. The luxury market knows good growth and the packaging market is doing well, boosted by the internet, foodstuffs, and a global growth of transport networks, which favours the circulation of people and goods. The rapidly expanding duty-free and travel-retail market is also an indicator of the health of our luxury economy. At the same time, interest rates are low, investment funds do not lack money with rather good and beautiful projects. For entrepreneurs wishing to sell their companies, whether it is for retirement or otherwise, it is better to act now, to hope for an attractive valuation of their property. This is a fairly favorable period, especially as foreign investors have been interested in France for a few months, where there is the wind of optimism, relying on possible regulatory improvements such as labour laws, for example.
In terms of investment, it may be appropriate to monitor the evolution of packaging protection solutions. The counterfeiting of luxury goods, such as health products, has created the need for reflection and the work of research. Secure labels should ensure significant progress with advanced technologies. In this regard, we note the acquisition of the Canadian labels and packaging manufacturer CCL Industries by Innovia, the manufacturer of the support for polymer banknotes, which indicates a movement, that is, to say the least, intriguing.

If we are to look to the future, there is little chance that the growth trend of luxury packaging will lose momentum. There are, of course, still unknowns in the equation: will the central bank keep interest rates low? What will be the consequences of Brexit? Will the dollar continue to weaken? ... What is to be feared more, would be a “overheating“ of the economy, resulting in over-investment, a long-term crisis. Let us remain cautious in controlling growth, but let us be ambitious enough to encourage the emergence of French companies on the world market, like PSB Industries, whose proactive approach is interesting since their acquisition of the American company Topline Products.

Jean-Pierre Brice is the author of sector studies carried out by Capitalmind, real economic, financial and decision support tools available on the firm’s website. Entitled “Luxury Packaging? Growing, innovative and attractive!”. The latest study released in April-May 2017 revealed the high potential of this segment after the slight slowdown in growth in 2015 and 2016 due in part to the downturn in emerging markets.