German Film Maker Keeps Its Focus On Value Markets

Film processors in Eastern Europe and the Far East have ramped up exports of low-cost commodity products into Western Europe, which have made it challenging for traditional suppliers there to compete. RKW A.G. Rheinische Kunststoffwerke, headquartered in Worms, Germany, is one processor that is proving that high- volume films can still be produced competitively in high-wage Western Europe. But Werner Feistkorn, chairman and ceo, warns, "You won't find t-shirt bag production at the 15 RKW plants. We're targeting high-value commodities."

Indeed, Feistkorn is keeping RKW concentrated on value-added volume products. The processor has five core businesses. In industrial packaging, it produces heavy-duty bags, films for form-fill-seal applications, and shrink and stretch hoods. It makes films for lamination, embossing, surface protection, and labels, spunbonded and carded nonwovens for diapers, incontinence and hospital products, and tapes. These products make up the largest portion of the company's product mix at 32%. Consumer items include printed and barrier films, lidding, and collection bags. Agricultural and construction films include silage, bale-netting, and construction webs.

Last year, RKW, with a staff of 2400 — spread among plants in Germany, Spain, Belgium, France, Finland, and Sweden — processed 300,000 tonnes of polyolefin films and had sales of (500 million. The company processes all types of polyolefin grades, but uses metallocenes and other higher-end resins in many applications. One way Feistkorn is keeping costs in line is by negotiating with suppliers to lower or stabilize pricing for materials.

Feistkorn says niche markets do not appeal to RKW. They require expense and time to make them profitable, and then, he notes, "a successful niche quickly becomes a commodity. The time window for niche markets is [continually] getting smaller."

That's why RKW, which has more than 150 blown and cast lines producing 1- to 5-layer films, and forty 6- to 8-color printing lines, hones itself to large-volume applications and spreading risk among many customers. "Large customers tend to have a large influence on supply and [they] demand to be sheltered from price movements," Feistkorn adds. "While it would be nice to operate with a mix of medium- to small-sized specialty-market customers, this is not a business reality, although RKW needs some of those [types of] customers for growth opportunities."

RKW became an independent company in January. The processor, along with blown film equipment supplier Kiefel Extrusion, thermoforming hardware producer Kiefel GmbH, and pvdc film processor Renolit-Werke, were spun off from Renolit AG into separate entities by the parent owner. Feistkorn moved from his positions as executive board member of Renolit AG and ceo of Kiefel Extrusion to take the helm at RKW, which, in recent years, has grown through both acquisitions and internal growth.

"Our challenge is to consolidate these into a unified operation and use our synergies wisely," he says. Although he doesn't rule out further expansion — Asia is a possible target — he expects that improved use of facilities, manpower, and equipment will facilitate further growth. "We're a family-owned company. We're not listed... [W]e don't care about financial analysts and their quarterly reports," Feistkorn asserts. "For us, stakeholder value — when all parties involved in a project (customers, suppliers, investors, employees, and lenders) profit from that involvement — equals shareholder value."

Feistkorn, who is 48 and the father of two teenagers, doesn't have much time to relax. He travels on business at least 100 days each year, so his time for hobbies — gardening, reading, and sailing — is limited.

But one event he couldn't miss out on was being knighted by the plastics division of the Association of German Engineers (VDI-K), in Düsseldorf, in May 2001. At Castle Altenburg in Bamberg, Germany, Feistkorn became the 28th Knight of Plastics Technology, an honor that has been awarded for the past 30 years.