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               l If you have been reading The Inside Scoop for very long, you will know that stretch film can be made
                 up anywhere from 1 to 9 layers, utilize a wide variety of resins types and grades from off spec butene
                 to better grades of hexene or octene, to even higher performance resins such as metallocene and
                 polypropylene, and in a variety of combinations.  But an even more important factor in the manufacture
                 of value added stretch film is the formulation, the process equipment, the quality controls in place,
                 and most of all the person or system that makes it all come together.

               l Reverse auctions on stretch film typically ask for your bid on a yearly usage of stretch film lumped
                 together.  For sake of this discussion, let's say it is for 100 pallets of 80 gauge 12" x 1,500' hand wrap
                 and 100 pallets of 80 gauge 20" x 5,500' machine film.  Ok, there it is, so what's your best price?
                 Sounds simple and staightforward enough doesn't it?  Not on your life!


               l First, all 80 gauge films are not the same.  Some manufacturers put resin seconds so low in quality into
                 their hand wrap that you would think they were floor sweepings.  The film has no guts or holding
                 power, but it is 80 gauge, and costs a whole lot less to make than 80 gauge hand wrap that is made
                 with a hexene/butene co-extrusion etc.  If you accept his low bid you deserve what you are going to
                 get in the way of shipping damage and handling problems.  Yet you are asking the ethical manufacturer
                 who is furnishing you a quality product to compete on price with the manufacturer who does not worry
                 so much about quality because he knows that you are more interested in the price per pound than you
                 are in how the film performs.  You may take the "out" of specifying in the bid that all films quoted
                 must meet your quality spec.  But your quality supplier does not know who the low ball pricing is coming
                 from and has to assume it is from another quality supplier like himself.  Hey, here's that ethics thing
                 again.

               l Another of my observations about reverse auctions is that many times the film that the auction is
                 specifying is not the stretch film that the customer is actually using.  Last year a grocery company on
                 the west coast ran an auction for 70 gauge hand wrap when they had been using 47 gauge hand wrap
                 for a year or more.  Their logic was that if the 70 gauge bids came in low enough they could force the
                 current 47 gauge supplier down some more on price.  We have seen this type of thing play out several
                 times in the past year or two.

               l Reverse auctions greatest failure is that they assume all films are equal and ignore the real cost
                 reduction, not smoke and mirrors, that value added films can bring to your company whether on hand
                 wrap or machine film.  NPS has worked with a number of major, national companies over the past few
                 years to reduce their stretch film requirements from 80 gauge on machine film to 51 guage or lower;
                 and on hand wrap from 80 gauge to 47 gauge or lower.  Literally, our customers have saved hundreds
                 of thousands of dollars in film costs while wrapping their pallets more securely and productively.

            Ok, if reverse auctions are not the answer, how do we accomplish our real objective of controling and
            reducing our stretch film cost? The best way to truly reduce your "cost" for stretch film, and not just a
            few pennies on the "price" is to work with a distributor who has access to the latest new technology value
            films, and is willing to partner with you to use these films to help you control and reduce your "cost to
            wrap", and not just use them to increase their profit.  If you don't know a distributor like that, give us a
            call and we will help you find one.













            file://C:\Documents and Settings\William Jackson\Local Settings\Temp\tmp73.htm             1/28/2007
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