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MOVING ON UP

Release Date: 17 December 2015

David Nicklin reviews an impressive 2015 for Nicklin Transit Packaging and looks ahead to what’s in store for the industry in the New Year…


It’s been a hugely successful year for our business. The numbers really do speak for themselves - 15 new employees on our books, live customers extending beyond the 200 mark and sales revenue up by an impressive 11%. Hearty seasonal cheer indeed!


Sector-wise, 2015 has been characterised by continued consolidation across the packaging industry but in particular in the timber pallet and packaging market, where buyer’s choices in regard to supply have become fewer and fewer. We certainly expect this trend to continue throughout 2016 as ongoing M&A activity continues at pace.


As finance directors plan their strategies for the New Year, with capacity and demand continuing to align and businesses increasingly recognising the need to generate a decent margin to re-invest, headline price savings on a ‘like for like’ basis are likely to be very difficult, if not non-existent. For packaging businesses to remain viable on a long term basis and enable buyers to meet budget aspirations, providers and specifiers must embrace a ‘total cost’ concept. Unfortunately, this is alien to many manufacturers and will ultimately lead to their decline if they do not evolve.


Design and performance validation, alongside stakeholder buy-in, is critical to this process. Ultimately, packaging should be about so much more than an afterthought. As such, It is imperative that packaging users engage suppliers at the earliest possible stage in order to ensure the optimum solution has been aligned with the shipping requirement. Ultimately, if you are trying to fit a round peg in a square hole due to budget constraints or your pallets or packaging aren’t available when they’re needed or in a worst case scenario they do not provide adequate protection, it can cost a lot of money!


‘Packaging solutions’ should be just that, i.e. fit for purpose and not driven in the direction of one particular material or product due to internal constraints associated with expertise or manufacturing. This is where we have begun to see considerable results. Indeed, our business has evolved dramatically over the last 102 years. From our humble beginnings as a manufacturer of cabinets and wooden egg boxes in 1913, we now boast one of the broadest product ranges in the transit packaging sector, with core spend packaging items such as timber and plywood cases, timber pallets and corrugated boxes and fittings all manufactured in-house. 


2015 in particular, has been a significant turning point for the business as our ‘single source’ strategy has begun to take shape with partnerships established with specialist manufacturers supplying foam, tape, stretch wrap, strapping, bubble wrap, mail bags, polythene bags, corrugated rolls, edge protectors, VCI and wood recycling, amongst others, all of whom share our vision for value added products and services.


The ‘transit packaging’ sector is rapidly evolving and we recognise that our clients need more from us, whether it be a broader product range, faster lead-times, vendor managed inventory, access to data, performance analysis, validation, cost reduction and continual improvement. In turn, we continue to invest to meet expectations, increase capacity and deliver results. In order to survive and prosper, businesses need to embrace change and for our part, Nicklin is party to a transformational journey with the development of ‘Servitization’ at the heart of our strategy. We need to be revolutionary in order to make a difference and ensure that we maintain our status as a market leader whilst ensuring that packaging plays a key part in the success of our client’s businesses.

 

During the last twelve months we have added considerable expertise to the business in terms of people and product knowledge, and continue to invest substantial sums of money into information technology and R&D in order to develop our product design and performance validation tools and expertise. It is our people, systems and knowledge that have set us apart throughout 2015, delivering time after time for our clients and growing both sales revenue and margin.


2016 promises to be an equally exciting year for the business. The economy is improving, albeit being still a little volatile, and we have a number of significant projects underway with existing customers and potential clients, whilst also working on increased capacity plans in relation to both manufacturing, warehousing and distribution. We will maintain our organic growth strategy and continue to cement our position as the go-to ‘transit packaging’ solutions provider in the UK (we are one of the few businesses that can actually define a ‘packaging solution’ which is entirely suitable for our client’s needs rather than being convenient to ours!)


Ultimately, manufacturing, design and performance validation across a broad range of materials and products will be at the forefront of the transit packaging sector in years to come. This is an area in which we truly excel. Bring on the ‘march of the makers’ in January…




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