Building the Next Generation of African Packaging Champions

An Emergent Africa point of view

A successful turnaround creates breathing room. It does not, by itself, create a sustainably superior business.

Once debt has been reduced, costs have been addressed and the portfolio has been simplified, the leadership challenge changes. The organisation must move from protecting value to creating it. The next phase requires a different management agenda: one that connects commercial choices, manufacturing performance, customer needs, working capital and capital investment through a common decision-making system.

For African packaging manufacturers, this transition is particularly important. They operate in markets characterised by constrained consumers, powerful multinational customers, volatile raw-material costs, infrastructure limitations, imported competition and rapidly changing packaging preferences.

In this environment, scale and history are no longer sufficient. The winners will be the manufacturers that can make better decisions, respond faster and demonstrate measurable value to their customers.

The challenge after a turnaround

Turnarounds normally create value through visible interventions: disposals, refinancing, headcount reductions, procurement savings, site consolidation and tighter cost control.

These measures are necessary, but their benefits eventually reach a natural limit. Costs cannot be reduced indefinitely, and an organisation cannot build its future by continually shrinking.

The next stage must answer a more difficult question:

How does a leaner industrial business become a more intelligent, customer-centred and consistently growing business?

That requires management to address five interconnected priorities.

1. Move from cost control to economic-value management

Traditional manufacturing performance reviews often concentrate on revenue, volume, gross margin and operating cost. These measures are important, but they can conceal significant differences in the value created by individual customers, products, pack formats, plants and production runs.

A high-volume customer may be less attractive than it appears once short production runs, frequent changeovers, working-capital requirements, rebates, logistics costs and service complexity are included. Similarly, a product category that appears profitable at gross-margin level may destroy value after the cost of capital and manufacturing complexity is considered.

Packaging manufacturers therefore need a granular view of economic profit across:

• Customers and customer groups.
• Products, pack sizes and stock-keeping units.
• Production lines and facilities.
• Geographic markets.
• Contractual arrangements and service levels.
• Growth and capital-investment opportunities.

The objective is not simply to eliminate lower-margin work. It is to understand why it is underperforming and determine whether pricing, minimum order quantities, run strategies, product design, service models or contractual terms can improve its economics.

This is where decision intelligence becomes valuable. It creates a common fact base through which commercial, operational and financial leaders can evaluate the same decision and understand its full enterprise impact.

2. Treat manufacturing reliability as a commercial capability

Manufacturing efficiency is often treated as an operational matter. In packaging, it is equally a customer and growth matter.

Unplanned downtime, spoilage, quality deviations and delayed changeovers affect more than factory costs. They influence customer confidence, inventory levels, emergency logistics, order fulfilment and the manufacturer’s ability to win additional volume.

The strategic objective should therefore extend beyond measuring overall equipment effectiveness. Management should be able to understand, in near real time:

• What is causing production losses.
• Which constraints are temporary and which are structural.
• Where maintenance investment will produce the greatest return.
• How planned production affects customer service and inventory.
• Whether new capacity is genuinely required or existing capacity can be unlocked.
• How performance differs across plants, shifts, teams and product formats.

Smart-manufacturing investments are increasingly producing measurable results. Deloitte’s survey of 600 manufacturing executives found average improvements of 10% to 20% in production output, 7% to 20% in employee productivity and 10% to 15% in unlocked capacity following smart-manufacturing initiatives.

The lesson is not that every plant requires an expensive technology transformation. It is that targeted analytics can often unlock value from existing assets before additional capital is committed.

A sensible progression begins with reliable production and maintenance data, followed by constraint analytics, predictive maintenance, quality prediction and scenario-based production planning.

Technology should support operational discipline rather than attempt to replace it.

3. Become part of the customer’s growth agenda

Packaging manufacturers have traditionally differentiated themselves through quality, technical expertise, price and reliable supply. These remain essential, but they are increasingly regarded as minimum requirements.

The more valuable opportunity is to move from being a packaging supplier to becoming a source of commercial and category intelligence.

FMCG customers are confronting their own pressures: consumer affordability, product proliferation, retailer demands, shorter innovation cycles, sustainability commitments and the growth of categories such as energy drinks, ready-to-drink beverages and convenient portion formats.

A strategic packaging partner should help customers answer questions such as:

• Which pack formats are gaining or losing consumer acceptance?
• Where could a different size improve affordability or margin?
• Which formats provide the best balance between cost, convenience and sustainability?
• How can packaging extend shelf life or reduce supply-chain losses?
• Which new product launches are likely to require additional capacity?
• How can pack design reduce material use without compromising performance?
• Where can joint forecasting reduce inventory and improve service?

This requires customer management to become more analytical. Account teams need access to customer profitability, demand patterns, service performance, innovation pipelines, contract economics and emerging category signals.

McKinsey’s recent packaging research argues that growth in a more constrained market will require commercial excellence, relentless cost focus, stronger talent and value-oriented use of advanced analytics. Its analysis indicates that leading companies have achieved organic growth more than 200 basis points above the market through targeted commercial interventions.

For packaging leaders, customer intimacy should therefore be measured not by the number of meetings held, but by the quality of insight brought to those meetings.

4. Resolve the tension between working capital and resilience

Reducing inventory releases cash. Reducing it too aggressively can weaken an organisation’s ability to respond to volatile demand, supplier disruption or unexpected changes in customer requirements.

This tension is particularly acute where raw materials are imported, supplier choice is limited, lead times are long or quality can vary.

The answer is not simply to hold more stock. It is to differentiate inventory according to risk and value.

Decision models can assess each material using factors such as:

• Supply concentration.
• Lead-time variability.
• Demand volatility.
• Quality consistency.
• Currency and commodity-price exposure.
• Customer criticality.
• Availability of substitute materials.
• Cost of downtime or lost sales.

This produces a more sophisticated inventory policy. Critical materials may justify strategic buffers or dual sourcing, while predictable and readily available inputs can be managed more tightly.

The same approach should extend to finished goods. Stockholding decisions need to reflect customer service commitments, production economics and the probability of demand—not only historic consumption.

The objective is to achieve intelligent resilience: sufficient flexibility to protect customers and production without allowing excessive inventory to consume cash.

5. Turn sustainability from an obligation into a customer proposition

Sustainability in packaging is becoming more complex. Customers must balance recyclability, recycled content, carbon emissions, food safety, product protection, convenience and cost.

There is no universally superior substrate or design. McKinsey’s 2025 research emphasises that sustainable-packaging decisions involve trade-offs across circularity, environmental leakage and lifecycle emissions, and that the appropriate solution differs by product, geography and customer segment.

South Africa’s extended producer responsibility framework also requires producers to take greater responsibility for packaging throughout its lifecycle, including recovery and recycling.

This creates an opportunity for manufacturers that can provide credible, product-level information on:

• Material composition.
• Recycled content.
• Product recyclability.
• Packaging weight and lightweighting.
• Carbon and water intensity.
• Recovery rates.
• Supplier provenance.
• Compliance with customer and regulatory requirements.

Sustainability data should not remain confined to annual reporting. It should inform product design, procurement, customer proposals and capital-investment decisions.

A manufacturer that can demonstrate the cost, performance and environmental implications of different packaging options becomes far more valuable to a brand owner than one that simply provides a price quotation.

The foundation: trusted data

Each of these priorities depends on a common foundation: trusted and consistently defined data.

Many established manufacturers have information spread across enterprise resource planning systems, plant systems, spreadsheets, maintenance platforms, quality systems and customer databases. Different business units may use different definitions for the same product, customer, downtime event or performance measure.

This creates management friction. Meetings become debates about whose number is correct rather than discussions about what action should be taken.

Master data management is therefore not merely an information-technology project. It is a prerequisite for:

• Customer and product profitability.
• Reliable planning and forecasting.
• Manufacturing comparisons.
• Procurement analytics.
• Working-capital optimisation.
• Sustainability traceability.
• Artificial-intelligence applications.

The organisation does not need to perfect every data source before creating value. It should begin with the decisions that matter most and establish the minimum reliable data needed to improve them.

A CEO-level decision system

The next-generation packaging manufacturer will require more than operational dashboards. It will need a CEO-level decision system connecting strategy with day-to-day execution.

Such a system should provide a regular view of five outcomes:

The purpose is not to give the CEO more information. It is to create greater clarity around the few decisions that will materially affect enterprise value.

A practical starting point

A useful first step would be a focused value-acceleration diagnostic covering four areas:

Commercial value: customer profitability, pricing, product mix, contract economics and growth opportunities.

Manufacturing value: production losses, asset reliability, capacity constraints, spoilage, changeovers and maintenance effectiveness.

Supply-chain value: forecasting, inventory policy, supplier risk, raw-material availability and logistics.

Execution value: strategic-project governance, benefits tracking, management information and decision rights.

Within 10 to 12 weeks, this should produce a prioritised portfolio of initiatives, with quantified value, executive ownership, implementation dependencies and an agreed management cadence.

The aim is not to create another transformation programme. It is to identify the small number of interventions capable of accelerating growth, releasing cash and improving operational resilience.

From packaging manufacturer to intelligence partner

The most successful packaging companies of the next decade will still need excellent factories. But factory performance alone will not distinguish them.

They will combine manufacturing expertise with customer insight, innovation, disciplined capital allocation and superior decision-making. They will understand not only how efficiently they make each package, but how that package contributes to their customer’s growth, affordability, supply-chain resilience and sustainability commitments.

The can, closure or container may appear to be a commodity.

The intelligence, reliability and customer value surrounding it are not.