Next Generation Films Inc. is making a large investment in its future growth by adding several film lines and opening a warehouse at its Lexington, Ohio, site.
The producer of specialty film and bags wants to reach $50 million in sales next year, said owner and Chief Executive Officer David Frecka in a March 15 telephone interview. The company expects to surpass the $40 million sales mark in 2005, he said.
Soaring resin prices and competition from China make growth important in the film market, Frecka said.
``If you're less than $15 million in sales, I don't see how a company can continue to compete,'' said Frecka, who started Next Generation in 1995 after working in the industry for about 20 years. ``Unless you do something special, you can't buy resin easily. It's made the situation different than it used to be.''
Next Generation's investment is geared toward giving the company staying power. The firm is installing automated equipment that can produce high-quality packaging films, Frecka said.
The company started the project last year, investing $2 million to retrofit extrusion lines and adding a 40,000-square-foot warehouse. The retrofitting included new segmented, heated dies from Hosakawa Alpine American, allowing Next Generation to produce varying gauges of film, said Jim Campbell, Alpine's regional sales manager based in Green Bay, Wis.
The Lexington-based firm is investing another $3 million this year to add an Alpine blown film line. The three-layer line is the seventh in Next Generation's film division and will help the company make barrier and breathable film, Frecka said.
The line, scheduled to arrive in May, is equipped with gauge controls and a system interface that can communicate with the rest of the plant. The line also includes side-fed dies that allow a high volume of cooler air to pass through to the film.
The film equipment will be used for a variety of modified-atmosphere food packaging and laminations. The company also makes film and bags for protective packaging, including automotive and furniture applications.
In addition, Next Generation is installing a repelletizing line from Erema North America Inc. to increase its recycling of polyethylene and other materials, saving resin costs.
By early next year, the company plans to install its first five-layer film line to go after the market for case-ready meats, a burgeoning area in food packaging, Frecka said.
Next Generation already makes breathable film for fish on store shelves.
``We need a different mousetrap for [meat],'' he said. ``A five-layer line will help us move into that market.''