28 March 2014

Sustainable Growth for Film Leader

For the HMC Connect 1Q edition, we interviewed Dr. Vouravis Veerakachen, Assistant Managing Director of A.J. Plast Public Company Limited, a leading manufacturer of flexible packaging film. Established in 1987, A.J. Plast is the only manufacturer in South East Asia capable of producing all major categories of biaxially-oriented films, namely Biaxially-Oriented Polypropylene film (BOPP), Biaxially-Oriented Polyester film (BOPET), and Biaxially Oriented Polyamide film (BOPA), as well as Vacuum Metallized films.

A.J. Plast’s production facility is located in Laem Chabang Industrial Estate covering over 32 acres. With more than 600 employees and a total production capacity of 232,800 tons/year (BOPP = 142,000 tons/year) by the end of 2014, the company is currently serving their global customer base from this production facility.

“A.J. Plast started as a family business by Khun Narong Suthisamphat, who is now the President of the company. With his vision on the growth of flexible packaging industry, Khun Narong decided to start the business with the first BOPP film production line and then expanded the business gradually to include BOPET and BOPA film production with help from his son, Khun Kittiphat Suthisamphat.

Nowadays, with his engineering and business background, Khun Kittiphat oversees the company’s operations as a Managing Director while Khun Narong and the Board of Directors provides advice on company’s macro strategy.”, said Dr. Vouravis.

Recently, the company has expanded rapidly due to its strong financial position and the rising market demand. “During 2010-2014, we have doubled our production capacity for all our film products from 114,000 MT/year to 232,800 MT/year. At the same time, we focus not only on the production capacity, but also production efficiency, product quality, and innovation to keep up with customer demands for better products at lower costs.”

“Anyway, what is more important than business growth is business sustainability. To ensure that our business will be sustained in the long run, we must be continuously looking for an improvements at every step of our business operations including production, product innovation and customer service.”

Dr. Vouravis mentioned further that “Our corporate vision is to expand our business both horizontally and vertically. By horizontal expansion, we aim to increase our product lines to cover all biaxially-oriented films in the market and position ourselves as a one-stop service provider for our customers (converters). We recently launched our new product, i.e. BOPLA film, which is an environmentally-friendly, biodegradable, and compostable film made from renewable agricultural resources. While BOPLA film was not totally new to the market, we are bringing it to the price point where it could be commercially feasible for our customers so that the market could be expanded. As for the vertical expansion, we have always been searching for ways to add more value to our existing product lines enhancing and diversifying its specification and properties to serve any specific needs in the market.”

Company Growth and Market Situation
Regarding the growth of the company, Dr. Vouravis stated that “We are lucky to be in the flexible packaging business as, based on historical data, the growth of this business has been around 7-8% every year globally, and even around 11-13% in Southeast Asia and China. With our continuous improvement and expansion, we have our target to grow at a 2-digit rate annually”.  

Dr. Vouravis added that “Now we sell 35-40% of our products domestically and export around 60-65%. Our main export market is Japan, which is well known for demanding high quality in the products it sources. We have been responsive in dealing with customers’ requirements which have become stricter over the years. Our customer groups, both domestic and export, have different needs, emphasis and expectations for the product ranges and service package which they receive from A.J. Plast. Also, the international businesses require us to comply with FDA standards, ISO, and Food Hazard requirements etc.” Therefore, we have invested considerable effort and resources to ensure both segments are fully accommodated to meet their particular requirements.”

“Definitely there is a strong competition in the market, but we do believe that such competition would drive every film producer to keep developing themselves and create an innovation which results in customer benefits. Finally, Dr. Vouravis commented that “Now the competition is not among companies, but rather among supply chains. Thus, we must rely on good business partners to stay competitive. A.J. Plast regards HMC Polymers as an essential partner, not just a supplier, who we expect to grow together; and are looking forward to many more HMC product innovations.”