Polímeros y Tecnología SA de CV (Polytec) has purchased what it claims is the first three-layer WindmÃ¶ller & HÃ¶lscher Varex blown film coextrusion line in Central America.
The machine will allow Guatemala City-based Polytec, one of the region's largest flexible packaging makers, to boost its polyethylene extrusion capacity to 3.2 million pounds per month, according to the company. Its current PE extrusion capacity is 2.4 million pounds per month. It also buys and converts films such as biaxially oriented polypropylene and polyester.
In 2006 and 2007 Polytec invested about $6 million in machinery and real estate. The largest investment was a Comexi gearless FW1508 printing press that cost about $1.6 million. Other purchases included a Bandera coextruder, a digital prepress from Esko, Bimec slitters and a Hudson-Sharp wicketer.
Polytec also purchased more land, expanding its manufacturing complex of 7.4 acres to 9.1 acres, to allow for future growth. About 3.4 acres are roofed.
Founded in 1989, the company has customers in the beverage and food industries, providing shrink film and labels to bottling companies, plus printed film, pouches and secondary packaging to the producers of snacks, confectioneries, rice, sugar and other products. Other lines are agricultural film and consumer trash bags.
Polytec employs 300.
The founders and current owners are Guatemalan entrepreneurs Fernando LÃ³pez, Carlos Barillas and RamÃ³n Parellada.
After visiting NPE in Chicago in 1988, they conducted a study of the different plastic processes and markets in Guatemala.
``We tried to determine the size of the market and sought estimates for the price of machinery and equipment,'' LÃ³pez said.
Then they got lucky. ``We were offered two [used] extruders for film and two cutters by a small, local company. We accepted the opportunity as it allowed us to reduce considerably the initial investment we thought we would have to make.''
They started the business in a 4,000-square-foot warehouse, occupying only half of it and employing themselves and six others. The company's production was 66,000 pounds per month.
Three years later they decided to expand. As a first step the men bought the land in Guatemala City, which the company occupies today.
``Yes, the same people are in charge of the company,'' LÃ³pez said in a telephone interview. ``The arrangement is a bit sui generis since we meddle a little bit in everything, but Carlos [Barillas] is mainly concerned with sales and RamÃ³n [Parellada] and I take care of the rest of the administration, with the professional managers in the different areas reporting to us.''
Political instability in Guatemala, where a war between several guerrilla groups and the country's U.S.-trained military lasted three decades until 1996, left hundreds of thousands either dead or displaced. It also forced Polytec's directors to put off growth plans until 2002.
That year the company entered the high-quality impression market after first buying an eight-color central drum printing press, which, according to LÃ³pez, was the best of its kind in Guatemala.
It was a Comexi FJ 2108. A second was acquired in 2004, followed by the Comexi FW 1508 machine in 2007.
The company also invested in solventless lamination, digital prepress and slitting equipment. In the extrusion area, it acquired two three-layer coextruders from Bandera. It is in the process of acquiring a fourth printing press and more laminating equipment.
``Our vision is to become the company of reference in flexible packaging in the region,'' LÃ³pez said. ``The idea is to offer our customers a quality level comparable to anywhere in Europe or the U.S. We know there's a long way to go but the process has started. In the short term, we want to extend our business to the Caribbean and Mexico. We have already started doing business in the Dominican Republic, and Trinidad and Tobago.''
In 2002, noting the scarcity of qualified technical people in Guatemala, the three partners decided to hire people from outside the country to work the machinery and train the staff.
``Both our production manager and technical adviser come from Chile. The quality control manager is from Colombia and our prepress manager from Peru,'' said LÃ³pez. ``At different times we have had [other] people from Chile and Peru, both in prepress and printing, training our floor operators. We are in the process of training local professionals.
``We may have the best equipment, but if we don't have the qualified staff to work it and produce the necessary results, all the investment goes to waste.''
Today Guatemala is Central America's main producer of plastic products. With 12 million inhabitants, it's also the region's most populated country and biggest market. Plastic consumption is a little more than 26.4 pounds per capita in Guatemala and so LÃ³pez believes the growth potential is huge.
Security continues to be a problem in the country, he said.
``We have had few direct problems. It's mainly been some product theft and some workers have had problems with gangs in their neighborhoods. But neither this government nor the previous ones have been able to provide our citizens with a safe country where investment feels welcome. Therefore economic progress has been slower than it should have been and the quality of life is still very low.''
Another hindrance to progress is the price of energy. Electricity is expensive. While in some countries in the region, companies pay less than 7 cents per kilowatt hour, in Guatemala the price is at least 15 cents/kwh.
Resins, such as low density polyethylene, high density PE and linear LDPE come mainly from the United States.
As for price: ``We get the material American companies do not want to dump inside the U.S.,'' LÃ³pez said. ``This means in times of scarcity, we pay higher prices and in times of excess demand, we may get lower prices, although not as a rule. Transferring these prices to our customers has not been easy. There has been a lot of downgauging and margins have been lower than usual.''
On the positive side, bureaucracy at the port of entry is not a problem, according to LÃ³pez.
``Our raw materials [resin, additives, inks, etc.] are duty-free and the process of bringing them into the country is computerized and quite fast,'' he said. ``It may take three days to receive a container in our warehouse after the ship docks, provided the documents are in order.
But a definite problem for the company, according to LÃ³pez, is shipping logistics. Guatemala has only a few, expensive shipping companies, he said.
``Competitive freight charges from the Middle East or the Orient are nonexistent and there are very few available ships from those areas. Export freight charges are also higher than those paid by Chinese companies when they export to the U.S., even though the distance is considerably less''