Clariant Masterbatches is expanding services and adjusting its product portfolio in response to the Chinese manufacturing industry's need to upgrade products and brand images. As part of this effort, the firm installed a three-layer blow molding machine late last year at its Shanghai location, to support the development of new color effects for plastic bottles.
Additionally, the masterbatches division of Muttenz, Switzerland-based Clariant AG also invested an unspecified amount during 2007 to install six more multilayer blow molding machines at its sites on four continents. Multilayer technology can add color, functionality and facilitate the use of recycled materials, the company said.
Clariant Masterbatches opened a ``Wall of Color'' center in Shanghai in March, allowing customers to experience products and services, said Peter Povorozniuc, marketing manager of Clariant Masterbatches (Shanghai) Ltd.
The various product recalls last year have raised Chinese firms' awareness of ensuring quality and building brands, he said at the recent Chinaplas in Shanghai, and ``color is becoming a more important part than ever.''
Concern about the safety of Chinese-made products has worked in the company's favor. ``[Original equipment manufacturers] and end users turn around and specify paint from reputable suppliers,'' he said.
The company's first-quarter sales rose 30 percent in China. With an improved product mix - less commodity black and white masterbatches and more tailor-made products for special resins - ``the bottom line is better than 2007,'' Povorozniuc said.
Beyond traditional products, the company also touts additive masterbatches such as anti-statics, antimicrobials, and flame-retardants, as well as so-called ``combi-batches'' that combine color and functionality.
In China, Clariant Masterbatches' largest end markets are packaging and consumer goods. Demand in other segments such as auto, medical and fiber also is rising.
The firm operates four plants in Greater China:
* 40 employees and 2.2 million pounds of capacity in Beijing.
* 100 people and 7.72 million pounds of capacity in Shanghai.
* 70 workers and 6.6 million pounds of capacity in Guangzhou.
* And a staff of 120 and 11 million pounds of capacity in Taiwan.
The company is looking into more emerging regions along China's east coast but also is investigating the inland area.
``We are doing a market research for inland penetration,'' Povorozniuc said, and the city of Chongqing is being considered. He added that the first step will be to open color-matching labs and to increase sales and marketing talents.
The biggest issue for the plastics industry customers right now is maintaining their profit margins, he noted.
``Purchasers like low prices - usually conservative colors - but the marketing department leans toward flashy colors. So there are always different opinions on color selection. But we can help them manage colors and cut costs,'' he said.
In addition to the Shanghai blow molding investment, Clariant last year added multilayer blow molding machines in Indonesia, Thailand, Mexico, Brazil, Argentina and France.
It commissioned two-layer machines in Tangerang, near Jakarta, Indonesia, and in Chonburi, Thailand, to serve the major centers of plastics packaging development along the Pacific Rim.
Meanwhile, in Latin America, Clariant started up three-layer blow molding machines in Sao Paulo, Brazil, and Santa Clara, Mexico, plus a two-layer machine in Lomas de Zamora, Argentina.
In France, it installed a three-layer blow molding unit at Cergy St.-Christophe, near Paris, in part because the French market is strong in plastics packaging, particularly for cosmetics.