The President of Cosfibel pleads in favor of the emergence of medium-sized companies as suppliers for global brands.
Alain Chevassus appreciates the real value of the 100 billion € stimulus Plan presented by Prime Minister Jean Castex on Thursday September 3. Starting with the support measures towards companies to help them with the “digital transition.”
According to the Chairman of Cosfibel- a packaging and promotional objects specialist with sales of $83 million in 2019 – only powerful IT capabilities can allow a supplier today to cater to the increasingly complex demands of the major prestige brands with their global presence. These complexities are manifold.
First of all, in terms of offer, the launch of a luxury product involves a range of different elements, from shopping bags to gift boxes including makeup bags, ribbons and other goodies.
Second, in terms of geography, global brands adapt their offer to different markets according to language and consumption habits.
Third, in terms of product lines, a single order can include a hundred units for a box and hundreds of thousands of bags.
Fourth, in terms of production, it is difficult for suppliers to own all the different machines needed for manufacturing and decorating and to remain competitive.
And last but not least, in terms of materials, on this subject, Alain Chevassus is particularly sharp, saying he is scandalized by “plastic bashing,” and speaks very strongly about the “exemplary virtues of rPET, or recycled polyethylene terephthalate.”
True to his convictions, Alain Chevassus has made “make and trade” the cornerstone of a group built as a federation of different capabilities. As such, an exclusive agreement with La Soie provides an offer in textiles while a partnership with HPC reinforces the company’s injected plastic packaging offer.
In cardboard, the company has a similar agreement with Tendero, and again in textiles, with Tissages De Charlieu. “We manufacture and source according to our needs. Managed by a Chief Digital Officer (CDO), our IT tools are essential to precisely coordinate orders, production and deliveries.
Being able to optimize a container being shipped from China is one part of this. In order to manage the flow of products, our project managers are generalists who rely on the skills of specialists with their sometimes very technical and essential knowledge” explains Chevassus, who is a firm believer in the emergence of medium-sized, multi-specialist companies. “The value of a company is linked to the stability of its teams and their expertise,” he says.
The executive is always on the lookout for targeted acquisitions in order to reach “critical mass.” It is necessary to be big enough to evolve on global markets, but not too big to remain flexible towards luxury giants, with a smart combination of human know-how and new technologies.
Very different from the traditional margins of consumer products, the added value of a luxury packaging item is very high.
“The analogy with the automotive industry is very relevant. The big brands are assembly specialists, and the packaging manufacturers are OEMs who supply complete semi-assembled parts. It is vital for brands to be able to count on solid partners capable of innovating while able to handle the imponderable,” he observes.
Cosfibel operates 20 offices around the world that are called “urban networks.” “It is never easy to predict whether a product will be successful. It is sometimes necessary to urgently deliver replenishments in Asia because a promotion has been particularly successful. Only a first-class organization can do this,” Alain Chevassus explains. He plans to “not lose money without losing one’s soul.”
Has the COVID-19 pandemic reshuffled the cards? Alain Chevassus is cautious, but, as a connoisseur of his customers’ strategies, he imagines a restructuring of the market which will see diversified generalist players absorb specialists destabilized by the brutal decline of segments like travel retail.