by Federico Reguzzi
With a production specializing in four different types of paper and a wide range of weights, DS Smith Paper mill from Porcari (Lu) serves the market of corrugated cardboard that seeks for packaging quality achieving also through an unexpected added value: safety.
DS Smith Paper Mill is located in Porcari, a small town in the province of Lucca, in the Italian region Tuscany, where since 1970 it has been producing paper for corrugated cardboard. Evolution of the market and precise strategic choices that occurred over the years – not least, in 2012, the acquisition by DS Smith plc British multinational, which has purchased it from Swedish SCA – have led to production specialization which currently focuses on four product lines. Transformers who are looking for high quality packaging paper have four variants with high added value at their disposal: white cover, testliner 1 (tobacco-colored for recycled cover), standard testliner (tobacco-colored), medium HP – high mechanical performance.
Focus on packaging
Michele Bianchi, managing director at the paper mill, explains the reasons of the rationalization process undertaken by the manufacturing site: «we made this choice to be even more reliable and give consistency to supplies; to manufacture less but more dedicated products and ensure high quality level has allowed us to further improve the reliability of supplies and the satisfaction of our customers. The consolidation of this process has been affected by the recent change of ownership that has brought the sector to be highlighted in the company’s strategy, making the production of recycled boxes be the core business of DS Smith Group. Reducing the number of products has resulted, at the same time, in the enrichment of the range of weights that, explains the managing director, by determining the mechanical properties of paper, allow the mill to meet the various market demands.»
Serving Italian market
The paper mill from Lucca first develops within national boundaries and, once again, finds in rationalization, as well as in quality, part of its motivation. «We focused in particular on the Italian market which, among other things, makes it possible to reduce transportation costs, that are very high in a country where infrastructure and logistic systems are still largely structured on rubber,» explains Bianchi. «Also in Italy we are competing on raw materials with purchases coming from the East of the world, basically from China. This resulted in the development of a market where, despite alignment of raw materials prices with the rest of Europe, the same phenomenon from the point of view of the finished product has not occurred. In Italy the price of the latter still suffers significant gap with the rest of Europe, which is not covered by the costs of transformation or energy, raw materials or transport». In order to face these structural difficulties it is important to be locally present to better serve the market, not always an easy task, «to remain localized means, in fact, to have lower volumes, smallest orders and make stock by rising warehousing».
Of course this doesn’t mean to exclude cross-border markets; «cyclicality of markets and weak demand for relevant volumes inevitably leads to expose ourselves to potential exports. Our papers, excluding standard testliner that is specifically required in Italy, are widely used abroad, especially in Germany, France, Spain and Austria, countries which, also because of proximity, allow easily supporting export».
An important added value
Beyond products and services, there are other factors that contribute in turning a supplier in a reliable partner. Bianchi is convinced and explains how one of the prides of the paper mill from Porcari contributes to this aim; this is the safety record reached last February from the company from Lucca: a year without injuries.
While it is true that such a record is positive first of all because of the undoubted value from the point of view of the protection of workers’ health, safety is also an important index of production site management. And it is a perception that affects both employees and the company, «the result in safety is symptom of the company’s management credibility and is therefore an important indicator for the selection of future investment directions» highlights Bianchi.
To get similar results it should be known how to intervene on different levels, «on a regulatory level the Italian law regulates safety under many aspects, providing a detailed series of measures in favor of workers, industrial site and machinery attention, protection and management. When properly applied, it is sufficient to ensure a good level of security. Much also depends on the level of inspection and supervision by local authorities – primarily ASL. The constant state of observation to which we are subjected, being the largest site in Italy in the field of paper industry and reference point for other factories in the area, has been for us an opportunity to be at the forefront in different management aspects, including that of security».
The contribution of workers to achieve safety results is crucial. For this purpose, the paper mill has mainly invested in communication and involvement, «we placed safety above any other result» continues Bianchi. For four years the site has been following the principles of lean manufacturing, a management philosophy in order to minimize and if possible, to cancel waste, exposing in paper industry achievements from each department and constantly discussing with operators and supervisors. «The challenge is to translate business strategies into practical terms for operators in their own single departments; specifically, the business plan in Porcari includes ten points that are related to practical life in factories and among which there is a point related to security. In the paper mill, explains Bianchi, a close monitoring has been carried out, through DO’s (dangerous occurrence) i.e. risk potentials which allow checking and comparing the number of alerts and occurred incidents, resulting in a statistical report which has allowed highlighting the path. «Major stimulus came from the direct involvement by workers, who, feeling really responsible for their actions and alerts, requested an immediate response by the company on certain issues. This means, among other things, to increase workers’ confidence towards the company».
If you think that none of this has to do with the product which is then supplied by the paper mill, you are wrong. The perception of dealing with a healthy and well-managed company results, in fact, even on the market. «The security level of a company is a powerful means of marketing and communication, especially in this economic period, because it minimizes investment risk, demonstrating its correct management and thus guaranteeing a return in economic terms and results». And although it is still too early to verify consistency on the market, Bianchi stresses that the paper mill’s safety results demonstrate the supplier’s capacity of «giving constancy in production, quality and performance of products and services».
The paper mill from Porcari has been involved in another record: production record, reaching a goal of 10 million tons of paper produced in its 42-year history, from 1970 to 2012. A result achieved also thanks to the evolution of the factory over the years, marked by numerous investments aimed at continuous update of productionlines. Among all Bianchi recalls the complete makeover of continuous machine no. 2 between 2007 and 2008, «it was an investment of more than 60 million euro which allowed the reconstruction of continuous machine dedicated to the production of cover papers and papers that require special surface finish, directed to press and aesthetic result. The white papers market for quality packaging boxes made from recycled is very specialized and has few producers in the country. Continuous investments and choice of production specialization have enabled us to be the second producers in the country, with 35% market share.
And for the future, concludes Bianchi «production targets consist in manufacturing 400 thousand tons produced in the year 2013, share that has never been achieved till now».