PAX AUSTRALIA “HOW TO SUCCEED IN ASIA BY REALLY TRYING!” Prepared for
PAX AUSTRALIA “HOW TO SUCCEED IN ASIA BY REALLY TRYING!” Prepared for Packaging Council of Australia 28th. February 2007. 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Who is PAX?! • • • • • A privately owned company. Does not market its own products. Specialise in the contract manufacturing business for 42 years. Specialist high speed aerosol & liquid product fillers. Presently manufacture & fill personal care & pharmaceutical products for multinational companies. • Manufacture under the guidelines of Good Manufacturing Practice (GMP.) • Have a Therapeutic Goods license for manufacturing sunscreens, topical lotions, medicated shampoos liquid antiseptics & mouthwashes. 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Who is Pax Cont. • Started in Botany, it now has a modern facility in Ingleburn on 6.5 hectares. • Pax manufactures some 85 million units of aerosols & liquids of which 40% is exported throughout the Asian Region. • Approximates $600 million in retail sales. • Employs 380 people. • Produces 700 different products: - using 5000 different materials, - for 30 different clients, - across 20 different countries. 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Pax Customers! • • • • • • • • 28/02/07 PROCTER & GAMBLE ASIA COLGATE PALMOLIVE LEVER REXONA BRISTOL MYERS (NOW P&G) GILLETTE AUSTRALIA AND ASIA SCHWARZKOPF HENKEL SHISEIDO AVON Version 01 Shaping Shaping Australia’s Australia’s Future Future Pax Customers! • • • • • • • • 28/02/07 JOHNSON & JOHNSON WD-40 PHARMACARE GOLDWELL KAO REVLON ALBERTO CULVER WELLA SABRE Version 01 Shaping Shaping Australia’s Australia’s Future Future Botany! 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Popular Opinion! Perception Manufacturing in Australia: • Is not competitive. • Is regarded as an “Old World” Industry. • Has no part to play in an advanced economy. • “Clever Country” 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Circle of Change LOCALISATION REGIONALISATION DIVERSIFICATION LOCAL INNOVATION REGIONALISATION RATIONALISATION GLOBALISATION 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Move to Ingleburn. • • • • 1985 – Appointment of a Microbiologist 1990 - Relocated from Botany. Change of company name Upgraded facilities to meet the increasing Government legislative requirements & quality standards. • Recession. • Looked at Asia for growth opportunities. • Procter & Gamble. 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Ingleburn 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future World Manufacturing Influences. • America – The Americas • Europe – The Russias • Japan – Asia – Recognition of Japan’s desire & influence in Asia. – Sought an association with a Japanese company to develop Regional supply. – Opportunity of producing a replica of P&G World Standard Styling Aids Plant in Shanghai for the Daizo Corporation. – Development of the relationship with the Daizo Corporation over the last decade. 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Alliance formed with Daizo! 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Birth of One Asia! • Pax Australia and the Daizo Company of Japan have joined forces to create One Asia. • One Asia is a manufacturing strategy that simplifies manufacturing of aerosols and liquids in the Asia Pacific Region. • One Asia facilities currently cover: – – – – – 28/02/07 Tokyo Japan Kyoto Japan Sydney Australia Bangkok Thailand Shanghai China Version 01 Shaping Shaping Australia’s Australia’s Future Future One Asia Strategy JAPAN • One Asia provides Pax Australia and its suppliers Tokyo CHINA to grow through: the opportunity Kyoto Shanghai – Direct Exports from Pax. THAILAND Bangkok – Supply to other One Asia facilities. AUSTRALIA Sydney 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Formation of One Asia! Con Ryan Shigeoki Togo PAX Chairman DAIZO President 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future What is One Asia? • Partnership of two very successful manufacturers (DAIZO & PAX) who understand the different needs of the Asian Region. – Merging of Asian & Western cultures. – Able to manufacture aerosol and liquid products throughout Asia. – Are Internationally Competitive in Quality, Service and Price. – “One stop shop for production in Asia” 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Partnership Strengths DAIZO • Superior Quality • Company Size • Experience • Asian Culture • Multiple Facilities • Creativity & Innovation 28/02/07 PAX • Commercial Skill • Batch Making Expertise • Experience • Western Culture • Large Modern Facility • International Price Benchmarking. Version 01 Shaping Shaping Australia’s Australia’s Future Future THE ONE ASIA MISSION To develop a manufacturing network that provides the finest products and services for regional and local customers 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Encourage Complexity. • Recognition that Asia has different product requirement to America & Europe. • Pack sizes are usually smaller. • Formulations are sometimes different. • Differing Government regulations for labelling. • Language specific to country. 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Quality is the Driver! • Recognition that quality is the driver of the Pax strategy. • Service • Price 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Quality Standards! • Recognition that Japan has the highest quality standards world wide. • Hair Care AQL’s are: Region: CRITICAL USA 0.15 EUROPE 0.40 ASIA 0.04 JAPAN 0.04 28/02/07 MAJOR 1.50 1.50 1.50 0.65 Version 01 MINOR 4.00 6.50 4.00 2.50 Shaping Shaping Australia’s Australia’s Future Future Quality Standards! • Formation of Quality Assurance Department. • Introduction of Procter & Gamble QA system. • Government sponsorship of Japanese QA officer for a 2 year period at Pax. • Staff Exchange Program between Daizo & Pax. • P&G Pinnacle Award. • ISO 9000:1994 certified. • TGA Licensed. • Regular International Customer quality audits. 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Pax & P&G • • • • Pax is designated a P&G Strategic Site. Current QA Rating 100 Achieved in October 2006. Pax is now rated the highest quality producer of personal care products for a contractor in the P&G world 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Pricing Strategy: Elements for Regional Success. • Internationally competitive TDC. Local – Open Costing. – International Pricing Strategy. $ Export 28/02/07 Time Version 01 36 Shaping Shaping Australia’s Australia’s Future Future Delivery USA & Europe: • 4 month delivery for standard product. PAX: • 8 week delivery for standard product. • Long lead times for nonstandard products. • 8 week delivery for nonstandard product. • High costing for pack or formulation variations. • No costing penalty for pack or formulation variations. • High shipping costs into Asia. • World competitive shipping costs into Asia. 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Delivery USA & Europe: • Minimum order quantities 6-12 month’s stock. PAX: • 1 pallet minimum order quantity. • Weekly delivery not available. 28/02/07 • Weekly delivery available. Version 01 Shaping Shaping Australia’s Australia’s Future Future Shipping Costs. FREIGHT TO: FROM USA FROM AUSTRALIA KOREA $2336 $720 SINGAPORE $2064 $680 MALAYSIA $2304 $660 JAPAN $2618 $900 HONG KONG $2336 $700 TAIWAN $2347 $780 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Australasian Aerosol Industry Development • Asian Focus. • Promotion of Regional Supply ex Australia. • Inclusion of Government Agencies. – Austrade – Department of Foreign Affairs & Trade – Invest Australia • Australian Aerosol Industry Awards. – Inclusion of company Regional decision makers. – Inclusion of Asian Aerosol Industries. – Development of an Asian Aerosol Association. 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Strengthening of the Alliance • Paul Curryer has been appointed to the Daizo board • Nobuyuki Minami has been appointed to the Pax board • Management succession plan implemented 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Where To From Here? • Focus on the Elements for Regional Success. • Continue to promote One Asia with Daizo to International Companies. • Build closer relationships with aerosol associations in Asia. • Support Japanese government initiative of forming an Asian trading market. • Pax $20 million expansion. 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future ! 1 e g a t S Sta 28/02/07 Version 01 ge 2 ,3 &4 Shaping Shaping Australia’s Australia’s Future Future Pax stands as a tribute: • To the efforts of our suppliers, employees, customers & Government, who have shown what can be achieved when people work together for a common goal. 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future Reality 28/02/07 Version 01 Shaping Shaping Australia’s Australia’s Future Future
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