CLEVELAND - M.A. Hanna Co. is consolidating some of its resin purchases, and is looking at using global vendors for some resins as a move to improve efficiency. Douglas J. McGregor, president and chief operating officer, said May 1 that Hanna has its individual business units working together to combine some of the company's resin purchases on a global basis.
McGregor spoke at the company's annual shareholders' meeting in Cleveland.
The combined purchases are being devised by ``buying councils'' that are staffed by Hanna's business units, McGregor said. Hanna devised its buying councils several years ago. McGregor said the concept now is being strengthened within the firm.
``We don't expect to have a central purchasing [office] in Cleve-land, but we are consolidating some resin purchases to gain leverage,'' he said.
However, he added, the company simultaneously is trying to maintain a degree of local control of resin purchases while considering global vendors for key products that could be provided to its operating units in Europe, Asia and North America.
Martin D. Walker, chairman and chief executive officer of Hanna, reported to shareholders he was not happy with his company's performance in 1995, but Walker said his disappointment stemmed from general economic conditions that prevented Hanna from achieving the goals it set for itself.
``In 1995, we delivered terrific financial performance, topped by only one of our peers,'' he said.
In marketing, he said Hanna wanted to increase its sales at a rate of three times the growth in the gross domestic product for the United States.
``Unfortunately, due to a tough pricing environment and a slowing economy, we did not achieve that goal.
``However, despite the difficult economy, we outperformed 11 out of the 12 peer companies. While the plastics industry achieved virtually no growth during this period, our own plastics businesses grew at a 4.6 percent, or two times GDP,'' he said.
He said Hanna successfully moved into less-cyclical businesses, such as industrial markets, packaging, electrical/electronics, consumer and medical products, reducing its reliance on the auto and appliance markets by nearly 10 percent, and that it was successful in moving into specialty compounding, an area in which the company can provide higher value-added services and technologies, and increase its profit.
As part of its effort to improve its working capital performance, Walker said beginning this year, Hanna has tied compensation packages for its business managers to their performance in use of working capital.
Walker noted that Hanna is moving into Asian markets, with ventures planned in Singapore and China that are to begin operations this year, and he said the firm may make more acquisitions in the future.
Such acquisitions likely will be in North America or Europe, he said, explaining that the compounding, colorant and distribution businesses are not as mature in Asia, so Asian ventures likely will be new or joint ventures with established firms.
Finally, Walker announced his intention to retire in June 1997.