RANCHO MIRAGE, CALIF. - Manufacturers of audio and video tape products and compact discs find themselves squeezed between rising resin prices and a consuming public that will not accept higher retail prices. ``We've seen incremental pricing increases totaling about 19 cents a pound on polystyrene during 1994,'' said Gene Hull, executive vice president for International Packaging Corp., an injection molder based in Fort Wayne, Ind.
``These exorbitant increases have squeezed the standard jewel box business to the point of no margins at all,'' Hull said in an interview at the International Tape Association meeting, held March 8-11 in Rancho Mirage.
Hull said IPC just completed its third expansion in four years, indicating that business is good for the injection molder of jewel boxes and other packaging.
That doesn't keep Hull from wishing prices would stabilize.
To protect itself, IPC has sought out niche markets for its products because there are better opportunities for profit. Also, the company tries to stay competitive with better, faster and newer molding equipment. The oldest press IPC operates is a 1991 model, and that will be replaced soon, Hull said.
Filam National Plastics Inc. in Paramount, Calif., is also a molder of jewel boxes and media packaging. President Vic Flores agreed with Hull.
``We have to get more efficient and try to get some of the margins back in this business.''
Flores said he wants the tape and CD industry to accept a price increase, something it has been reluctant to do so far.
``The [tape and CD] industry has to see us as valuable suppliers to them, and recognize that we have to have a profit,'' Flores said. Business for both firms is good. Like IPC, Flores has been expanding his jewel box capacity to meet ever-increasing needs of the replicators.
``Demand for CD-ROM packaging has increased tremendously in the past year,'' he said.