Page 39 - Packaging News Sep-Oct 2020

September-October 2020 | www.packagingnews.com.au | CONTRACT PACKAGING
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co-packaging sector
“We also take their feedback and communicate regularly with our cli- ents, sharing and learning from their initiatives,” he said.
“LJM is ISO 45001 OH and S-accredited, but it doesn’t prepare you for the challenges and changing nature of combating a situation such as Covid.”
PARTNERSHIPS FOR EFFICIENCY
LJM has seen some major merger and acquisition activity over the past year, with a major tie-up with Multipack in New South Wales, which produced the Multipack LJM company.
“The LJM and Multipack merger has been a huge success,” Miles said. “What was really good around this was that LJM had the scope, the foot- print and the scale, where Multipack was very tech – and systems-driven.
“Multipack has a great working culture; it’s a really efficient busi- ness. And, by merging the two in New South Wales, it wasn’t a one and one equals three, it was more of a one and one equals four or five. It’s been a great partnership; we’ve learned a lot from each other.
“Our CEO in Sydney, Adam Rawson, has done an incredible job of merging the two businesses, and that business is really flying. Adam rolled out SAP, Produmex WMS [warehouse management system] and KLIK Analytics in the New South Wales operations in 2019. On the back of that success we are cur- rently implementing the same suite of products in Victoria.”
Miles said the company is con- tinuing with its approach to busi- ness informed by the way co-pack- ing businesses operate in more mature markets, such as Europe and North America.
“Our director JP Marcel is the company visionary and has visited operations in North America and Europe to plan for the future of LJM and look at industry trends. There is no doubt the model is closer integra- tion around services and systems between co-packer and client.”
“We have also been working with clients to carry out co-packing operation in their 3PLs’ [third- party logistics providers’] facili- ties,” Miles said.
“We now have five co-packing sites located within our clients’ 3PL facili- ties and this will grow with clients who have the continuity and volume to sustain a stand-alone facility.”
In June, LJM acquired Victoria- based OZ Connect Traders (OCT), a primary food packer that produces more than 10 million raw food pack- aged products annually for Australia’s food retailers and food exporters.
Miles said the rationale behind the acquisition was LJM was looking to increase its footprint in primary food and grow that area of the business.
“Over the past three months we’ve been integrating OCT. We built new facilities in our Dandenong plant and we’re now housing their opera- tion within our facility; the OCT team have now moved in full time and we’re really pleased with how it’s coming together.”
And in March, LJM partnered with New Zealand brand activation specialist company Hoop.
Miles said Hoop and LJM have dif- ferent areas of expertise, dealing with the same clients on different levels.
“The idea behind the partnership is we bring our co-pack knowledge to a new site in New Zealand where we’ll provide the expertise, and we’ll train the Hoop crew and initially manage the production process.
ABOVE: LJM employs more than 600 people at its seven sites in NSW and VIC.
BELOW: Beyond the Covid period, consolidation is predicted to be the name of the game.
Conversely, they’re assisting us in Australia with the point of sale and the brand activation market. It’s a two-way street, where their exper- tise and IP will come to Australia, and ours will go to New Zealand.”
A FRAGMENTED SECTOR
Miles said the Australian co-manu- facturing and co-packaging market is made up of many small to small medium-sized businesses. He said operators of that size tend to deal with the big FMCG companies on a trans- actional basis. This is because, Miles said, it’s challenging for the small and medium sized co-packers to scale up or invest the capex often required by the multinational clients.
“At LJM we aim to become that critical-mass partner, you need the scale, size, scope, accreditations and facilities,” he said.
“Looking beyond the Covid period, the co-packing segment is going to be all about consolidation,” Miles said. “It will be about trying to reconnect with the opportunities that have been put on hold.”
“We’re working to position our- selves as a credible partner to our cli- ents. We’re looking to the models used overseas, where co-packers and co-manufacturers are an integral part of the brand-owners’ systems, not just a transaction-based outsourcer.”
When the pandemic subsides and the world gets back to some kind of normal, LJM and its associated com- panies will be in prime position to continue innovating in both opera- tions and business. ■