SCA magazine SHAPE 4 2007

8/7/2019 SCA magazine SHAPE 4 2007

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SHAPESHAPEETT MAGASIN FRN SCA OM TRENDER, MARKNADER OCH AFFRER N 2 200

SHAPESHAPE

todays hottest marketing site

FISH THRIVE ATPULP MILL

A MAGAZINE FROM SCA ON TRENDS, MARKETS AND BUSINESS N 4 200

MATSLEDERHAUSEN

PATENTSMOVING EAST

on goals higher than making money

YOUTUBE

Camera:

Shapeonm

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amera

:Shapeo

nmoosehunt

GERM

ANS

LOVE

DISCOUN

TS

New mill in RussiaCutting emissions on the road CEO has the worNew mill in RussiaCutting emissions on the road CEO has the wor


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Contents N4 2007

6

Almost everyone in

Germany shops at

discount chains.

COVER page 6-14

SHAPE

TODAY

YOU EVEN SEEPORSCHESIN THE PARKING LOT


3/36

04SHAPE UP

China scours Europe for recyclable paper, Googlebelieves in print, and retail extends its reach.

06SHAPE COVER

Beer and business top the bill of fare at Oktoberfestin Germany, where shoppers love a discount butdont forget their local butcher and baker.

14TREND

Smart freight handling can cut carbon dioxideemissions and save money. Marketers switch onYouTube, and patents move East.

20PROFILE

Meet Mats Lederhausen, who invests incompanies that do more than make money.

24TECHNOLOGY

Surprise: fish now thrive in the waste waters of thestrands pulp mill.

26SCA INSIDE

SCA invests in new mill in Russia, and a 16-year-old from Norway wins the Libresse designcompetition.

30CAMERAShape stalks the wild moose, king of the forest.

34SHAPING A VIEW

SCAs CEO Jan Johansson has the word.

[4*2007]SHAPESCA*3

SCA Shape is published in Swedish and English. The

contents are printed on GraphoCote 80 gram from SCA

Forest Products. Reproduction only by permission of

SCA Corporate Communications . The opinions expressed

herein are those of the authors or persons interviewed

and do not necessarily reflect the views of the editors or

SCA. You can subscribe to SCA Shape or read it as a pdf

at www.sca.com.

SCA Shapeis a magazine from SCA Address SCA,

Corporate Communications, Box 7827,

103 97 Stockholm Telephone +46 8 788 5100

Fax +46 8 678 8130 PublisherBodil Eriksson

Managing editor Anna SelbergEditorial Anna Selberg, SCA, and Gran Lind, Kristin

Peva, Appelberg Design Tone Knibestl, Appelberg

Printer Srmlands Grafiska Quebecor AB, Katrineholm

Cover photo Frans Hllqvist

20

30

16

26


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Bightefutu

SHAPE UP

4*SCA SHAPE[4*2007]

PHOTO:ISTOCKPHOTO

Ikea will invest several billion dollars in

new stores over the next few years as its

drive to lower costs continues, Ikeas new

chairman, Gran Grosskopf, says in an

interview with the Swedish business daily

Dagens Industri. Increasing global com-

petition and more intense price pressure

account for the move.

Its because of other furniture chains,

DIY chains like Home Depot and rapidly

growing retail giants like Wal-Mart ,

which are expanding their productrange, Grosskopf tells the newspaper.

We see really great potential for growth

and will invest heavily, among other

things in a number of new stores in both

existing and new markets, he says, men-

tioning India as a possible market.

While many major players report-

ed lower earnings than expected

in September, the retail market

overall grew more than expected

during the month. Statistics from

the US Department of Commerce

indicate a growth rate of 0.6 per-

cent, double the forecast.

Concerns about housing loans in

particular had raised doubts about

demand, but American consumers

still appear to be willing to spend.

The pulp and paper industry, together with the

chemical and metal industries and the energy

sector, accounts for 70 percent of all environmen-

tal protection investments in manufacturing, the

Swedish National Institute of Economic Research

reports in an analysis.

The analysis also shows that the companies invest

in both corrective and preventive measures.

FOR US

PAPER INDUSTRY GOODAT ENVIRONMENTAL

PROTECTION INVESTMENTS

The Swedish pulp and

paper industry invests in

green research.

IKEA INVESTINGBILLIONS IN NEW

STORES

THE FRENCH COMPANY Carrefour, Europeslargest retail chain, is opening a hypermarket in theBulgarian city of Varna on the Black Sea. The storewill occupy 100,000 square feet. Carrefour is leas-ing the space for 30 years from the Scottish propertydevelopment company Miller Group.

Carrefour to openhypermarket in Bulgaria

BightefutuRETAIL SECTOR


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[4*2007]SHAPE SCA*5

CHINAS DEMAND FOR recycled fi ber has increased

dramatically over the past seven years. This year, the country isexpected to import more than 20 million tons of recycled papercomponents, up from 3.7 million tons in 2000. The reasonfor the increase is an expansion of Chinas cardboard andpackaging industry. Chinese containerboard makers like NineDragons and Lee & Man Paper have strengthened their pres-ence in Europe with their own purchasing organizations. Theus, which was previously the main supplier of recycled paperto the Chinese, can no longer satisfy the demand for recycledcontainerboard in China. The increase in Chinese demandmainly affects Britain and the Netherlands, which now have topay higher prices for the raw material.PH

OTO:ISTOCKPHOTO

Polands retail sector grew 14.2percent in September compared

to the same period in 2006. De-

spite the sharp increase, growth

was still lower than the 16.5 per-

cent forecast. Analysts predict

that the strong growth in Polish

private consumption will slacken,the news bureau Interfax reports.

Reco roth Pandless than expected

SOURCE:SPCI/SVENSKPAPPERSTIDNING

RECYLED FIBER

IMPORTS TO CHINA

2 000 2 002 2 004 2 006 2 007

6.9

Million tons

12.3

19.6

21-23(est.)

3.7

CHINASC

OURING

EUROPEFO

R

REC

YC

LABLEPA

PER

GOOGLE, the pub-licly traded search engine,surprised the market when

a company representativesaid the company sees majorpotential for traditional printadvertising. Speaking to alarge gathering of apprecia-tive newspaper managers atthe Newspaper Associationof Americas annual meeting,Googles Tom Phillips, head

of the companys print adver-tising, said he saw a numberof opportunities in newspaperadvertising.

Print today is an under-valued medium, Phillipssaid, noting that newspapers

are consumed more intenselythan Web pages.

The dominant searchengines, Google and Yahoo,have both developed collabo-rations with traditional printnewspapers, and Microsoftsmsnhas expressed similarambitions.

BELIEVES IN PRINT


6/36

SHAPE COVER

6*SCA SHAPE[4*2007]

AT LIDL

PORSCHES

PARKED


7/36

according to the market

survey company AC-

Nielsen, 96 percent of

Germans shop at dis-

count stores. Aldi is the

leading chain, with an estimated 80 per-cent of all households in Germany shop-

ping there.Today, you even see Porsches in the

parking lot, says one young German.

Its no longer unattractive to shop at dis-

count stores.

At Lidl or Aldi, Germans buy basic

goods like laundry detergent, toilet paper,hygiene products or juice as well as fruit

and vegetables. For goods like meat and

fi sh, its a question of shopping at other

stores. And most people choose to go to

the local bakery for bread.

A few years ago, I went to the butch-ers whenever I wanted to buy meat and

deli items, says Albin Hessler of Aich-tal, outside Stuttgart, in southern Ger-

many. But today I dont do it as often.The quality and selection are really good

in most grocery stores.

Hessler and his wife Elisabeth go gro-

cery shopping every Friday. Usually theytravel a few miles from home to Edeka,

part of a grocery chain with a wide as-

sortment of goods. During the week, theystop by Aldi to pick up anything else they

need, but they buy their bread at the lo-

cal bakery.

At Edekas big supermarket, the fi sh isset out in elegant displays and the meat is

well trimmed. There are plenty of staff

members to provide help, and the light-

ing is pleasantly subdued. The selection

is huge and level of service is high.The contrast is considerable when you

walk into Aldis signifi cantly smaller store.

There is only a limited range of products

here, the stores all look the same, and

things go quickly in the checkout line.

There almost have to be two of you

when you go shopping, Elisabeth says.

The cashier rapidly enters the items,

The German grocery market is divided in two. Today, almost everyGerman shops at discount chains like Lidl and Aldi. At the same time, formany people, shopping at their local bakery and butcher shop is a given.And interest in quality is rising in the German market.TEXT PETRA LODN PHOTO FRANS HLLQVIST & DUNCAN SMITH

Albin and Elisabeth Hessler shop just as often at discount stores as they do at the well-stocked grocery chain stores.

[4*2007]SHAPE SCA*7


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SHAPE COVER

THESE LOW-PRICED chains, calleddiscounts in Germany, are grocery stores

with a limited number of items. The storesthemselves are rather small, and they often

DISCOUNT CHAINS FOR EXPORT

and there is little space beyond the cash

register, so you have to load your pur-

chases right into the cart. When you

pay, the cashier already has your changecounted out.

Aldi and Lidl offer more than just gro-

ceries. In the middle of the store are longaisles with baskets of clothes, toys andelectronic goods. Every week they pub-

lish full-page ads, and Elisabeth Hesslersays the stores often have lines outside

before they open on the day the new sales

fl ier comes out.The discount chains do incredibly

aggressive marketing, she says. But

you have to watch out. Not everything isas cheap as it seems. Their own brandsare inexpensive, but they also sell name

brands, and these may be more expensivethan in other stores. Customers probably

assume that everything is cheap becauseits sold in a discount store.

GERMANY HAS BEEN called a coun-try of bargain hunters. But recent years

have seen a break in the trend. Last fall,Mercer Marketing Consultants conduct-ed a survey of 2,000 shoppers. The sur-

vey revealed that Germans no longer see

themselves as bargain hunters but instead

place greater value on quality and a wideselection of goods. A full 38 percent, sig-nifi cantly more than in previous studies,

said selection and quality are important.Just relying on low prices will not be

enough in the future, says Sirko Siems-

sen, an expert on issues in the grocery

trade at Mercer Marketing Consultants.Grocery chains that have a wider selec-tion of goods may experience a resurgence

if they consistently make use of their com-petitive edge. But at the same time, they

should keep an eye on prices.Thats because price still comes fi rstin the survey. Half of those surveyed said

that price largely determines how satis-

fi ed they are when they go shopping.Turan Sevimli can provide evidence

that Germans intense hunt for bargainshas eased. He has run a small local gro-

cery store, Markt Ecke, for six years.Its not just about being inexpensive,

Sevimli says. Our store is good. I thinkthe reason for this is that more and more

German discount chains have done well abroad, to the point that

half of Europes largest grocery chains are German. In recent

years, Lidl, owned by the Swiss holding company Schwarz, has

expanded rapidly throughout Europe, and Aldi, the number two

discount giant, is not far behind.

.

At Turan Sevimlis store, customers can buy locally grown vegetables.

people want to support their local mer-

chant. I know my customers, I say hello to

them with a smile, we have small talk and

joke a bit. If an older shopper needs helpcarrying their purchases home, we cantake care of that. In stores that are part

of big grocery chains, the cashier doesnt

even look you in the eye.Sevimli buys a substantial amount

of locally raised vegetables, which cus-

tomers appreciate. Customers are mainly

singles, older people and consumers who

demand quality, and these target groups

are growing.

The discount chainsdo incredibly ag-gressive marketing.

But you have to watch out.

8*SCA SHAPE[4*2007]

sell products under their own brands.According to Frankfurter Markt-

forscher, discount chains are the only

grocery stores that report consistent


9/36

[4*2007]SHAPE SCA*9

growth in sales. Aldi, Germanys lead-

ing discount chain, increased gross sales

by 4.2 percent in 2006 from the year be-fore. Each German household spent an

average of about 1,200 euros at discount

stores in 2006 63 euros more than the

year before. Schwarz had a highly suc-cessful 2006, according to the market

survey company Retail Group. It is esti-mated that Schwarz Group sales rose 12percent on an annual basis.

Discount chains sometimes have their

critics, but the fact is that customers seem

to like their low prices, quick service and

easy access. The discount chains are notgenerally willing to be interviewed, but

in a written statement, Lidl explained itssuccess this way: The cornerstone of our

success is simplicity. Our aim is to haveall our operations, all our work proce-

dures, run in a simple way, with top qual-

ity at the lowest prices possible.

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

I would never buy bread at a dis-

count store, says Elisabeth Hess-

ler of Aichtal, outside Stuttgart.

CarrefourF

rance

MetroGroupGer

many

TescoB

ritain

ReweGer

many

SchwarzGroupGer

many

EdekaGer

many

AuchanF

rance

AldiGer

many

LeclercF

rance

CasinoF

rance

80,000

64,000

6

1,000

45,000

45,000

39,000

37,000

36,000

32,000

30,000

6.0 4.7 4.5 3.3 3.3 2.9 2.8 2.7 2.4 2.2

SOURCE: PLANET RETAIL

FOTO:SCANPIX

FOTO:SCANPIX

Market share in Western and Central Europe (percent)

Approximate sales in 2006 (million euros)

FACTS / LIDL

Started in the 1930s as Lidl & Schwarz

Lebensmittel-Sortimentsgrosshandlung

Lidl is owned by a foundation controlled

by the founder Dieter Schwarz and his

family

Its headquarters are in Neckarsulm,

Germany

Lidl has some 6,000 stores throughout

Europe

Kaufl and and Handelshof are also part

of the Schwarz Group

FACTS / ALDI

Started as a family fi rm in 1913 in Essen.

Today owned by brothers Karl and Theo

Albrecht. Karl Albrecht is the richestperson in Germany with a fortune of USD

17 billion. In 2006 he was ranked 13th

on Forbes magazines list of the richest

people in the world

Aldi is short for Albrecht Discount

In 1961, the chain was divided into Aldi

Nord and Aldi Sd after a dispute over the

sale of tobacco products

There are about 1,600 stores in Germany

and some 1,200 stores outside Germany

in a number of European countries, the US

and Australia


10/36

SHAPE COVER

n February, when six months still

remain before the fi rst beer is

poured at Oktoberfest, most seatshave been reserved. All thats left

are the 20 percent of places that

the city of Munich does not allow

organizers to book ahead.

The festival area, almost half a squarekilometer in size, holds 14 major beer

tents and a number of smaller ones with

a total of some 100,000 seats.

Peter Schottenhamel is the fourth gen-

eration of owners of one of the largest

tents. His great-grandfather started op-

erations 140 years ago with a small tentthat could seat 140 people. His operation

now seats 10,000, with 6,000 in the fes-tival tent and the rest outside. Schotten-

hamels tent is not among those where

breweries supply their own beer. Instead,

it is run by a privately held company that

can choose the beers it serves.This years Oktoberfest ended Octo-

ber 7. After a few weeks of well-deserved

vacation, planning will begin for next

years festival.

MEETINGS FOR

Oktoberfest in Bavaria,Germany, is not just achance to drink beer inlarge tankards. It has

also developed into apopular occasion to holda conference, meet cus-tomers and do business.TEXT PETRA LODN

10*SCA SHAPE[4*2007]


11/36

New! Our most stretchy diaper ever.

www.libero.com


12/36

shape cover

In comparIsons of various Euro-pean regions, two areas in particulartop the lists no matter how they are mea-

sured. Most people probably know one o

them, the southern German state o Ba-

varia. The other, Baden-Wrttemberg,its neighbor to the west, may not be as

Germany was reunifed

17 years ago, yet its still a

divided country when it

comes to growth and job

opportunities. Today the

country is split not just

into east and west but alsonorth and south.

well known but is just as successul.The two southern states have al-

ways been competitors, and theyre al-ways keeping an eye on each other, saysFriedrich Heinemann, head o corporatetaxation and public fnance at the Cen-

tre or European Economic Research inMannheim. The two are close ideologi-cally. Theyre both traditional strongholds

o the conservative Christian Democrats.

Many o the big international industrial

groups have their headquarters in south-ern Germany, and in Baden-Wrttemberg

there are also a large number o small and

medium-sized enterprises that are incred-

ibly successul.Stuttgart, the capital o Baden-Wrt-

temberg, has enjoyed tremendous growth

It takes about our weeks to takedown the tent, and in late November or

early December its time to start plan-ning or next year and taking bookings,

says Schottenhamel. Were usually ully

booked in early February. It wasnt likethis 10 or so years ago. You could stillmake a reservation up until August. ButOktoberest is growing bigger and bigger.

We could fll another 10,000 seats.Many companies invite their custom-

ers or employees to Oktoberest. I acompany plans a meeting or May and

invites 500 customers, perhaps 50 willcome, Schottenhamel says. I they plan

a meeting or Oktoberest, 490 come.Hundreds o dierent companies

come rom every industry imaginable.Some industries have a more noticeable

presence in certain years, depending on

where the most money is being made.This year saw a lot o it companies,banks and insurance companies. The

companies invite customers rom acrossthe country and even rom abroad. One

o Germanys largest banks invited 400

customers to the Schottenhamel tent.We also have hospitals that come here

with their sta. Thats another type o cus-

tomer that oten keeps coming back.Reserving a table doesnt cost any-

thing, but there is a commitment to buy

ood and drink. The minimum order istwo liters o beer and hal a chicken.

During Oktoberest, not a single hotel

room can be ound within a 150-km ra-dius o Munich. Oktoberest is the eventthat brings the most revenue to the stateo Bavaria, and many positive side eects

spill over to companies in the region, such

as stores and taxi services.

Im here every single one o the 16days Oktoberest is under way romabout 5:30 in the morning to 11 atnight, Schottenhamel says. The wait-

resses and other sta make good money,

but they work hard or their pay.Next year Oktoberest is celebrating

the 175th time its been held. On Sep-tember 20 its time to open the frst keg o

beer with the words Ozapt isch. Book

your seat in time i you want to be sure to

get a seat in one o the big tents.

oktoberfest

6.2 million visitors came to this

years Oktoberfest.

6.7 million liters of beer were

consumed.

12,000 people work during the

festival.

Visitors spend almost one billion

euros during the 16 days that Ok

toberfest is under way. Almost

half is spent in the actual festival

area, with about 200 million

euros spent on shopping in and

around Munich and 300 million

euros on hotels.

Oktoberfest originated with the

wedding of Crown Prince Leo

pold on October 12, 1810, when

he married Princess Therese. The

place on the outskirts of Munich

where the festival is held is calledTheresienwiese.

12*SCA shape[4*2007]

photo:gettyimages

Cannstatter VolksfestThe cannsTaTTer Volksest orStuttgart Beer Festival is held just out-side Stuttgart at almost the same timeas Oktoberest, starting a week later.While it is not as large an event as Ok-

toberest, its not all that much smaller.About our million visitors come over 16

estival days, consuming beer and ood at

long tables. There are also a large num-

ber o attractions in the estival area.The Volksest was held or the frst timein 1818. King Wilhelm o Wrtenbergthought the people deserved a estival a-

ter two years o amine brought about bya natural catastrophe in 1815. The esti-val was planned or the kings birthdayon September 28.

Money piling up in bavaria


13/36

for a number of years. Daimler has itsheadquarters here, as do sap and Bosch,

but many small and medium-sized com-

panies in the electrical, engineering,chemistry and it industries have enjoyedamazing success. A new exhibition center

recently opened next to the airport, andby September it was already fully booked

through Christmas.

The rules for how research funds areallocated among the different states were

recently changed. Competition has inten-

sifi ed, and the latest allocations resulted

in the eastern states receiving no fund-ing at all while Baden-Wrttemberg and

Bavaria wound up with the bulk of themoney. This will naturally favor south-

ern Germany even more.

Bavaria and Baden-Wrttemberg com-

pete not just economically, but also in the

entertainment fi eld. Munich has its Okto-

berfest, but Stuttgart has the CannstatterVolksfest, a beer festival that is almost as

large. When the last beer was poured onthe evening of October 14, a record 4.5

million visitors had attended the festival

yet another sign that times are good.On October 3, 1990, the German

Democratic Republic ceased to exist, and

the Federal Republic of Germany nowconsists of 16 states. Integrating the east-

ern states into the Federal Republic is still

a costly process. Dizzying sums, over a

trillion euros, have been invested in uni-fying the country so far, but unemploy-

ment in the former East Germany is stilltwice as high as in the west.

People living in the west like to saythey feel solidarity with the east, but they

cant understand why its taking so long,

says Mai-Brith Schartau, a professor at

Sdertrn University College.

However, Heinemann of the Centrefor European Economic Research doesnt

think the differences between east and

[4*2007]SHAPESCA*13

west or between north and south willgrow. The eastern states are catchingup to the rest of Germany, although its

going very slowly, he says.

Despite major regional differencesand an international economy that has

been shaky this year, things are goingwell for Germany as a whole. After anumber of years of stagnation and an-nual gnp growth between 2001 and2005 of only about 0.7 percent, gnp in

2006 rose a healthy 2.2 percent over the

previous year.Nonetheless, Heinemann is concerned

that the government has lately expressed

a willingness to backtrack on the exten-

sive reforms carried out in the labor mar-ket, pensions and taxes. That may have

adverse effects on the economy, not im-

mediately, but over the medium term,he says.

GERMANY HAS A STRONG reputation

as an industrial nation with large compa-

nies like Siemens,bmw, Daimler, Bayer,basf and sap. But the country also has

many mid-sized and smaller industries.

Like other industrial nations, Germany

has undergone numerous restructurings,

but the industrial sector still constitutes

the backbone of the German economy.Germany has enormous exports, almostone trillion euros, and has been described

as an export champion. Roughly one-

third ofgnp goes to exports. Baden-Wrttemberg is the state that is most de-

BERLIN

HAMBURG

HANNOVER

DORTMUND

LEIPZIG

BONN

FRANKFURT

KAISERSLAUTERN

NUREMBERG

STUTTGART

MUNICH

In September

2007, unemploy-

ment in Germany

was 8.4 percent.

The lowest rate,

2.7 percent, was in

Biberach district,

Baden-Wrt-

temberg, and

the highest was

in Uckermark,

Brandenburg, in

the former EastGermany, 21.1

percent.

BREMEN

Schleswig-Holstein

Baden-Wrttemberg

Bavaria

Mecklenburg-Vorpommern

North Rhine-Westfalen

Bremen

Brandenburg

Hamburg

Berlin

Hessen

Niedersachsen

Rhineland-Palatinate

Saarland

Saxony

Saxony-Anhalt

Thringen

UNEMPLOYMENT IN GERMANYS FEDERAL STATES(percent)

4.7

4.8

14.9

13.8

12.3

8.7

7.2

14.8

9

6

13.9

15

12.1

7.8

8.4

8.1

SOURCE:STATISTIKDERBUNDESAGENTURFRARBEIT-ST

ANDSEPTEMBER2007(DZ/AM)

Germans arefeeling a new senseof pride abouttheir country.


14/36

SHAPE COVER

pendent on exports, which also means

that it is more vulnerable than other parts

of Germany in the event of a major slump

in the international economy.

The German labor market can be de-

scribed as a social market economy in

which labor confl icts are rare. Through-out the 1990s, workers went on strikean average of 12 out of 1,000 workdays.

The corresponding fi gure for the whole

of the euwas 84 days.

Germans are feeling a new sense of

pride about their country. The black-

red-and-yellow fl ag now fl ies atop many

a fl agpole, something that never hap-pened before. Chancellor Angela Merkel

has received positive reviews in interna-tional contexts, and Germanys tenure

as EU president was a great success, aswas its hosting of the World Cup in soc-

GERMANY IN BRIEF

Capital and largest city: Berlin

Population: 82 million

Population density:

236 inhabitants/km2

President: Horst Khler

Chancellor: Angela Merkel

GNP growth (forecast 2007): 2.4 %

Infl ation (2006): 1.7 %

National holiday: October 3

Country code +49

TISSUE

Tempo, those highly familiar hand-

kerchiefs, is today one of SCAs tissue

brands. For many Germans, the Tempo

brand is synonymous with handker-

chiefs.

Were proud of having the Tempo

brand in our portfolio. Tempo was

along with other product names

included in the purchase of Procter &

Gambles European tissue operations,

says Bernhard Riede, vice president tis-

sue sales and marketing.

The acquisition was announced back

in March, but only in September did the

EU approve the deal.

The deal was closed on October 1

and we are gradually integrating the

operations. One step was taken on

December 1, when all systems were

transferred to SCA.

Its still too early to say what the

future will look like.

Were still doing the work to de-

velop our strategy for our new brands,

Riede says.

SCA IN GERMANYGermany is by far SCAs largest market.Sales totaled USD 1.9 billion in 2006, and some5,600 people are employed there.

He also says that the industry in gen-

eral is being pressured by higher costs

for things like energy and raw materi-

als, which SCA has to compensate for.

PERSONAL CARE

In Germany, the market for diapers and

sanitary napkins is dominated by retail-

ers own-brand products.

Roughly 50 percent of diaper sales

consist of own-brand products, saysSvein Ryan, regional head of personal

care, Central and Eastern Europe.

Compare this to Scandinavia, where

90 percent of diapers come from Libero

or Pampers.

SCAs sales of baby diapers in Ger-

many are between EUR 40 and 45 mil-

lion. Customers include Aldi, Lidl and

Drogeriemarkt.

There has been a sharp increase in

pant diapers, with growth of about 20

percent annually.

SCA has a market share for pant

diapers of between 65 and 70 percent,

Ryan says.Sales of TENA incontinence protec-

tion are also increasing, but mainly

among retailers. The German state has

become more restrictive on the sale of

incontinence protection by prescription

PACKAGING

SCA Packaging recently launched

X-tra Services in Germany, a concept

whereby customers are offered a com-

prehensive solution for packaging and

related services and operations.

The trend is toward more custom-ized solutions for customers with more

services being provided by our com-

pany, recalls Marc Stabernack, head of

marketing for Middle Europe.

The fi rst nine months of 2007 were

very good for SCA Packaging in Ger-

many.

Last September , we exhibited

at the major German packaging trade

show FachPack in Nuremberg with a

400 m stand which attracted a lot of at-

tention. This has meant really positive

feedback for our operations as well,

says Stabernack. Things are also going

well for the whole country right now,

both for businesses in Germany and for

exports, which are on the rise.

FOREST PRODUCTS

SCA Forest Products has no production

in Germany, but its an important mar-

ket for printing paper from Laakirchen,

Austria, and Ortviken, Sweden. In addi-

tion, one of the business areas largest

sales offi ces is in Mettmann, in North

Rhine-Westphalia.

cer. Obviously, Germans were proud

of their country before, but they didnt

show it, says Schartau of Sdertrn Uni-

versity College. Now they dare to ex-

press it because Germany has done things

that have played an important role in in-

ternational contexts.


USD 719 millionEmployees: 2,919

USD 632 millionEmployees: 2,409

USD

225million

Employees

:277

USD 292 millionEmployees: 32

FOREST PRODUCTS

TISSUE

PACKAGING

PERSONAL CARE

Total sales: USD 1.9 billion Empoyees: 5,637(Dec. 31 2006)


15/36

[4*2007]SHAPE SCA*15

TREND

MILLIONS OF PEOPLE have done itwithout leaving any lasting impressionon history miming or playing air guitarto a favorite song in front of the mirror orat a party.

But trade the mirror for a webcam

and a handful of partygoers for that gi-gantic living room known as the Inter-net and the concept is suddenly loadedwith completely new potential.

Wei Wei and Huang Yi Xin know allabout it. These two Chinese studentsfrom the Guangzhou Arts Institute re-corded and edited favorite songs to en-tertain themselves and their friends us-ing their universitys intranet.

But the results were so comical thattheir enthusiastically mimed version of

the Backstreet Boys As Long As YouLove Me spread across YouTube and be-came a hit among the Web sites visitors.

At the same time, people at the Shang-hai offi ce of Ogilvy, the internationaladvertising fi rm, were on the lookout forsmart concepts to market their customerMotorolas inexpensive phones in China.

It took just a few weeks to go fromconcept to fi nished ad.

The only change the Motorola/Ogil-vy team made in the Chinese students

fi lm was the addition of a short break.One student gets a call on his cellphonefrom his girlfriend.

You barely see the phone, saysChristian Nord, a specialist in digitalmedia marketing at Ogilvys offi ce in

Stockholm. Its not the product thatplays the leading role but the guys. Thead was a huge success not just in China.

THE PHENOMENON of YouTube, aWeb site whose users upload materialtheyve produced themselves or their ownfavorite clips, has become the hottest In-ternet Web site for marketing which iswhy Google, the publicly held Web giant,paidusd1.65 billion for the site last year.

Companies and organizations are

now lining up to market themselves onYouTube which makes competition,already tough, very intense.

The audience is fussy, and yourecompeting with Saturday Night Liveand other material from the best enter-tainers in the world, dramatic videosfrom accidents and catastrophes, origi-nal home-grown productions and nu-dity, Nord says.

To get viewers, you have to give theaudience what they want.

Its a world ruled by nerds, activists and teenagers with a taste fornudity, accidents and heavy irony a place every marketer in the analogworld should have gone out of their way to avoid. But today companies

are lining up to be seen on the video Web site YouTube.TEXT MATTIAS ANDERSSON

PIONEERS ON

THE WEB

As early as the late 1990s, SCA

was on the Internet with a Libero

Web site for pregnant women and

the parents of small children.

Long before Facebook,

MySpace, here was a site that

mixed ads for baby strollers with

advice about breast-feeding.

We were able to get online soearly and be right on target be-

cause weve always had a dia-

logue with thousands of par-

ents, says Sofi a Hallberg, head

of communications for Libero.

Today, Liberos yoga video, with

its baby in diapers taking over her

mothers yoga class, is among the

favorite commercials on YouTube.

Libero.se has 150,000 unique visi-

tors a month and a social function

that goes beyond marketing diapers.

One relevant example where

SCA actively uses new meth-ods and channels in its market-

ing is the Tork revolution.

Basically, its a question of rebrand-

ing three different brands mainly in

the US into one global brand, Tork.

In a series of commercials, which

are also found on YouTube, the pa-

per revolution is being launched

using humor as its weapon.

See it for yourself: libero.se, you-

tube.com and torkrevolution.com

YOUTUBESEVENTH HEAVEN FOR AMATEURS

Wei Wei and Huang Yi Xin actingout infront ofthe webcam, andmarketingon YouTube begins.


16/36


TREND

ENVIRONMENWORK SAVESMONEY

ACCORDING TO

the Stern report, theBritish governments review of the eco-nomics of climate change, about 14 per-cent of all emissions in the world comefrom the transportation of freight. Roadtransportation accounts for 10 percent.However, there are no statistics on whatpercentage of these road transportationemissions in turn comes from freighttransportation. An estimate based onEuropean conditions and statistics, withpersonal automobiles accounting for 60

percent of carbon dioxide emissions fromroad transportation and freight account-ing for 40 percent, suggests that roadfreight transportation accounts for some-thing on the order of 4 to 5 percent of allcarbon dioxide emissions in the world.

Greater growth leads to more freighttransportation, and there is no single so-lution to the carbon dioxide problem,says ke Sjdin, transportation special-ist at the ivl Swedish EnvironmentalResearch Institute. Rather, what is

needed here is a series of measures tobreak the trend. He thinks one of themost important measures for quicklylowering emissions is to reduce the useof fossil fuels like gasoline and diesel.

Today, carbon dioxide cannot beeliminated, so whats needed is the in-troduction of new technology and newfuels to reduce the emissions of fossilcarbon dioxide by freight traffi c, Sjdinsays. To speed this introduction, whatsneeded most of all is the establishment of

effective means of control, because thetechnical solutions already exist.Most countries in the world have signed

on to the United Nations goal of reducinggreenhouse gas emissions. The long-termgoal means in practice that global emis-sions must be cut in half by 2050.

In the business world, there has beengrowing awareness of climate problems,and an increasing number of companieshave not just adopted an environmentalpolicy but have also turned their words

European highways are carrying an increasingamount of freight, causing environmental changeswe see today. Businesses are focusing on the prob-lem of carbon dioxide emissions, which is reduc-ing the environmental impact and saving money.TEXT MIKAEL GIANUZZI PHOTO GETTY IMAGES


17/36

[4*2007]SHAPE SCA*17

ing, albeit from a low level, and aware-

ness is increasing among customers that

their own companys actions have envi-

ronmental consequences.

For instance, we get more and morequestions from customers about ouremissions reports, he says.

IN GENERAL, Scandinavian com-

panies are at the forefront in terms of

environmental work, but those spear-

heading the movement are found inter-

nationally. Thats the view of Magnus

Swahn, a consultant in sustainable lo-

gistics at the company Conlogic.

The companies that have come far-

thest are those that have integrated en-vironmental issues with business logis-

tics, he says. Environmental work can

be very profi table if its done the right

way. For instance, Nike really pushes

the idea of optimal fl ows on the types of

traffi c that use the fewest resources.

As for transportation, there are great

environmental and economic gains to be

made in every type of transportation.Its a question of making transporta-

tion as resource-effi cient as possible,

Swahn says. It means fi lling trucks to

the max, lowering the speed of ships by

a few knots and making sure there is a

berth available for docking instead of be-

ing forced to wait to enter the harbor.He thinks eco-driving, which is a

method of driving cars in an environ-

mentally friendly way, and planning

can save 10 percent in operating costsfor rail transportation, but also for oth-

er methods of transportation.

The forest and paper industry start-

ed early and acted professionally, he

says. They realized early on that there

was big money to be saved by being fru-

gal with resources.

into deeds. In Sweden, companies like

Preem, Trelleborg, Sdra and Perstorp, in

collaboration with the Swedish Road Ad-

ministration, are now developing tools to

help transportation purchasers place de-

mands on their suppliers in terms of safetyand the environment. The focus of envi-

ronmental demands is on fuel consump-tion and emissions of carbon dioxide, ni-

tric oxides and particles. The work will be

ready in February 2008.

Ulf Hammarberg, environmental

manager at the logistics company dhl,

notes a considerable increase in the

number of customers who want help in

their environmental work. Demand for

the companys green services is grow-

MINIMAL ENVIRON-MENTAL IMPACT ISTHE GOAL

At SCA Transforest in Sunds-

vall, Sweden, a test is now be-ing conducted on synthetic die-

sel made from natural gas.

In the long term, we expect itwill be possible to produce synthet-

ic diesel from biomass, like forestwaste, and completely stop pro-

ducing carbon dioxide, says PeterEriksson, logistics and environmen-

tal manager at SCA Transforest.Erikssons goal is to reduce de-

pendence on fossil fuels and thus cut

the environmental impact of SCAsshipments to a minimum. Synthetic

fuel made from biomass producesno carbon dioxide, while the con-

tent of other substances that havean impact on the environment is less

than that of regular diesel. During thetest period, a truck is being driven

in-house between SCAs plants andfreight terminal in Sundsvall on syn-

thetic diesel. If the outcome of thetest is satisfactory, more cars will

run on synthetic diesel over the longterm. SCA Forest Products is test-

ing synthetic fuel on one of its lum-

ber trucks in the Sundsvall region.The advantage of synthetic

diesel is that it can be used in thesame engines as those using regu-

lar diesel, Eriksson says. The costis about one Swedish krona ($0.15)

more a liter, but there are loweremissions of most substances.

Seventy percent of all freight trans-ported by SCA is by sea, and trans-

portation here has been made moreeffi cient. Ships that sail fully loaded

from ports on the coast of northern

Sweden down to Germany, Britain

and the Netherlands return almost ful-ly loaded with items like return fi berpulp, which is recycled into produc-

tion in SCAs plants in Pite and Ume.We also ship freight for oth-

er companies, Eriksson says.Twenty percent of SCAs trans-

portation is by truck. Environ-mental work here involves steps

like optimally fi lling trucks.The remaining share of SCAs

freight, about 10 percent, is by rail.

Environmental work canbe very profi table if its

done the right way

AL


18/36


TREND

PATENTS

AMONG THE 20 COMPANIES that

applied for the most patents in 2006,seven were in Asia, much more than inthe past, says Boel Lagerwall, head ofmarketing at Awapatent, one of Europesleading consultancy fi rms in intellectualproperty rights.

In both Eastern Europe and East Asia,where products from the West have longbeen copied illegally, interest in interna-tional patent systems is growing. Peoplethere are increasingly careful about fol-lowing international conventions be-

The number of patent applications is increasingrapidly in Eastern European countries and EastAsia. Since 2000 the number of applications fi ledin a year has increased 9 percent in South Koreaand 26 percent in China.TEXT PER QVIST

100 PATENTS A YEAR

At SCA, we apply for around 100

patents a year, with 50 or 60 of

these in Personal Care, says Paul

Winblad, head of patents at SCA.

We get temporary protection via

the Patent Cooperation Treaty for

30 months. Then we continue in a

few strategically important

countries.

SCA applies for patents in 14

countries a year on average. Simple

inventions that are easy to copy on

a broader level may be covered by

patents in 30 or 40 countries.

Expensive, complex inventions areprotected in only four or fi ve major

markets, often Germany, France,

Britain, the US and Japan or China,

and sometimes in Australia as well.

Nine out of 10 applications result

in a patent because these have been

so carefully prepared. Some 30

patent engineers and administrators

are employed full-time to handle

patent applications and related

fi elds like pattern protection.

cause they want to attract foreign capital,

and also because they are now more andmore at the forefront of developmentsthemselves and want to protect their ownproducts from illegal copying.

More Chinese companies productscan compete internationally. Amongthe big Chinese brands are Lenovo, theworlds third-largest pc manufacturer,andtcl, the worlds largest tvmanufac-turer by volume.

More than 200,000 patents were ap-plied for in China in 2006, most of them

by Chinese companies, Lagerwall says.In South Korea, 166,189 patents wereapplied for.

China says it wants to be in the lead inpatent applications in a couple of years,says Solgun Drevik, a product developerat scawhose name is on more than 50 ofthe companys patents.

A growing number of patent applica-tions in growth markets are being fi ledby Western companies, who now wantto protect their patents globally. Thesecompanies applied earlier for patentsonly in Europe and theus.

The us accounts for one out of threepatent applications in the world, almosttwice as many as second-place Japan. Eu-rope is still strong, with six of the top 10countries in terms of patent applicationsin 2006. Next, in descending order, come

Germany, South Korea,, France, Britain,the Netherlands, China,Switzerland andSweden.

Growth markets account for only 8.3percent of patent applications, but thenumber is quickly rising. Besides Chinaand South Korea, other countries experi-encing increases include India, South Af-rica, Brazil, Mexico and Singapore. moving east


19/36


20/36

PROFILE


Customers and employees favor companies with heart and

soul that stand for something more than just their products,

says MATS LEDERHAUSEN, who pursues investments that

do more than make money.

TEXT JONAS REHNBERG PHOTO EVA EDSJ/VOL

o Mats Lederhausen, a former head of

global strategy at McDonalds Corpora-tion, corporate social responsibility (CSR)goes way beyond positive image building:

All human beings have a responsibility

to help make our society better, and business is no

exception. I also think employees and customers

increasingly want their companies to be part of so-

lutions and not part of problems.Lederhausen recently left his senior management

position to devote more time to his newly founded

company Be-Cause. The company identifi es and

supports entrepreneurs who share his own visibly

heartfelt passion for businesses with a purpose big-ger than their products.

Entrepreneurs and companies have an important

role to play in todays world, he argues.

For better or for worse, businesses have be-come the most powerful institutions on this plan-

et, he says. More than half of the worlds 100

largest economies are businesses, and people all

over the world trust them more than they trustpoliticians.

AS A BUSINESS SCHOOL graduate with an en-

trepreneurial soul inherited from his father Paul,

who started the fi rst McDonalds franchise in thefamilys native Sweden in 1973, Lederhausen is con-

fi dent that CSR in no way precludes sound business.He believes the critical point of departure is that westop thinking about doing well and doing good as

mutually exclusive dimensions of life.

They are not, and we have to do both, he says.

We will never solve our challenges if the solution

is that companies go bankrupt in the process. The

only way forward is to fi nd small steps every day

to integrate good, smart, intelligent solutions that

help companies grow, people thrive and societies

prosper.

Globalization and climate change are two trends

t

A PASSION

FOR PU


21/36

[4*2007]SHAPESCA*21

WHY A COMPANY SHOULD

ACT RESPONSIBLY AND TAKE

A STAND:

It is the right thing to do.

You attract smarter, betterand higher-energy people.

Eventually, customers will

reward you for it.

THE FUTURE OF CAPITALISM:

I passionately believe that if we

all made investment decisions

with a long-term perspective,

we would have a more human

and more attractive form of

capitalism. But we tend to be

short-sighted because we want

good deals quickly.

I think there are promising

tendencies. Many private equitycompanies, for example, adopt

a time frame of at least three to

fi ve years on their investments.

Since they are not public, they

can often disregard the short-

term impact of a decision.

Looking ahead, I would

hope we could introduce some

type of incentive that puts

a premium on wealth that is

created by creating real jobs,

real products and real brands

with lasting values rather

than short-term investing.

MATS ON :

POSE

For better or for

worse, businesses

have become the most

powerful institutions

on this planet.

NAME: Mats Lederhausen

AGE: 44

LIVES: Oak Brook, Chicago

FAMILY: Wife, Dr. Jessica

Lederhausen and their four

children 18, 17, 15 and 11 years old.

CAREER: Began his career with

McDonalds in 1979. The Boston

Consulting Group in London 1988

- 1990. Managing director and

joint venture partner for McDon-

alds Sweden 1990-1993. Head of

global strategy for McDonalds

Corporation 1999-2003. During

the next four years Mats played a

key role in shaping the agenda

that helped McDonalds complete

one of the most successful

corporate turnarounds in recent

history. McDonalds Ventures

2003-2006. His newly founded

company Be-Cause 2007-

www.be-cause.com

Our governments are too largefor the small problems of life and toosmall in spirit for the large ones.


22/36


ProfilE

stakeholders and become a place that employees

simply view as somewhere to spend time between

nine and ve. This will not inspire anyone, which

eventually will be elt by the customers.

Consequently, it is critical or a successul com-pany to have a purpose in order to inspire custom-ers and sta. I lost, how can you recover it? Start

by identiying your roots, says Lederhausen:

Most companies are born rom inspiration,

he says. Very ew entrepreneurs start businesses

just to make money. Rather, that initial spark was

oten the result o a need they saw people truly had.Unortunately, over time this idea gets buried in

bureaucracy and process and loses its power. My

job is to help companies awaken the power o thatoriginal inspiration again.

Lederhausen aims to pursue this task as heado the newly ounded company Be-Cause, which

invests in entrepreneurs who both make a proft

and contribute to society.

Im not really a corporate guy, refects Leder-

hausen. I preer being an entrepreneur than a bigshot in a big company, and I have always regard-

ed mysel as a kind o business philosopher whois more concerned with the whys instead o the

whats and hows.

In addItIon, he remaIns a senior adviser to

McDonalds, particularly on asset managementand corporate reputation issues such as CSR andbrand trust. This role is likely to touch on the

growing concern over whether the ast-ood in-

dustry contributes to obesity and poor health. Le-

derhausen acknowledges the problem but claimsthe initial ocus on ast ood was misdirected anda bit narrow.

Americans eat less than one percent o their

meals at McDonalds, he says. Simple math sug-gest that almost everywhere people eat contrib-

utes to obesity. McDonalds has actually done a

remarkable job in this area. I you look at their

menu today and all the products, inormation andinvestments they have made trying to help peopleeat better, I get really inspired.

As a visionary thinkerin the corporate world,

Lederhausen is certain to inspire a lot o people,

and his Be-Cause baby does its share. To inspire

investors and other stakeholders, he quotes Re-

naissance artist Michelangelo: The greatest

danger or most o us is not that our aim is too

high and we miss it, but that it is too low and we

reach it.

Organiza-

tions withoutsoul lackenergy andwill ultimate-ly ail toconnect withtheir mostimportantstakeholders

and becomea place thatemployeessimply viewas somewhereto spend timebetweennine and fve.

that have added tremendously to the complexity odoing businesses, particularly considering dier-

ences in stakeholder readiness or these challenges.Lederhausen agrees that the trends are as signifcant

as they are dicult.All countries operate rom dierent perspectives

with distinct habits, cultures and norms. Acting re-

sponsibly in one culture can sometimes be seen as

irresponsible in another, he says, yet he believes

globalization is a good thing.

Like everything else in lie we have to help oset

some o its problems, but we cant throw the baby out

with the bathwater by proclaiming it is all bad, he

says. Look at all the people in the world that have a

chance to permanently be lited out o poverty in thenext generation. Thats a beautiul thing.

In addItIon, globalIzatIon and techno-

logical advances have made companies almost com-

pletely transparent, says Lederhausen. He sees com-

panies taking on a bigger role because they have

to and because people expect them to.Our governments are too large or the small

problems o lie and too small in spirit or the

large ones, he says. People want organizations

to stand or something. They are hungry or real

companies that are both smart and eective but

also show they have a heart and soul and care about

more than themselves.

as a result, lederhausen says, more

and more people are looking toward companies

that demonstrate heart and soul by acting respon-sibly. From a strict business perspective, respon-

sible companies do better both in terms o sales

and in terms o being able to recruit better people,he argues, while admitting the correlation is hard

to quantiy.

The results o CSR activities are almost impos-

sible to divorce rom other normal business activi-

ties, he says. A company could or instance havea great environmental program that its customers

liked, but it could still have poor customer service.Ultimately, its hard to say which o the two actors

would have a bigger impact on nancial results.

Lederhausen argues that its vital or a company

to identiy its soul, which oten gets lost as small

companies grow into big corporations.

Any organization must be clear about who it isand defne its raison dtre, he cautions. Orga-nizations without soul lack energy and will ulti-

mately ail to connect with their most important


23/36

[4*2007]SHAPESCA*23

SCA grows more than 80 million

new forest seedlings every year. It is an

investment in oxygen and raw material.

SCA is one of the worlds largestsuppliers of FSC-certifi ed products.

SCAs products mainly contain renew-

able raw materials.

No paper company in Europe collects

or uses more recycled paper than SCA.

SCA plants three trees for every

one felled.

All of SCAs publication papers are

produced from pulp that is bleached

without using any chlorine chemicals.

SUSTAINABILITY SOME

EXAMPLES FROM SCA:

Mats Lederhausen does

not see himself as a corporate

guy. He prefers being

an entrepreneur.


24/36


hlorine bleaching, sulfuremissions, foul-smellinggases over the years, thepulp industry has not had

the best environmental reputation. Thepast few decades, however, have seen

enormous progress, in terms of bothprocess improvements and additionalcleaning techniques to minimize harm-ful emissions.

A number of major efforts are now un-der way at sca. At strands kraft pulpmill outside Sundsvall, Sweden, a newtype of biological water purifi cation thatimitates a natural ecosystem has beenused for several years.sca Forest Products environmental

director Roine Morin describes the large

number of process improvements thathave been implemented since the early1980s. The most signifi cant change isa sharp decrease in water consumption.Traditionally, the main problem in pulpproduction has been getting lignin, thecompound that serves as glue betweenwood fi bers, to dissolve in water. In thepast, enormous quantities of water wereused to wash this out. The pulp pumpedinto the bleach plant had a high lignincontent, and chlorine was still used to

make the lignin water-soluble so it couldbe washed out from the system.

Before 1980, 120 cubic meters of wa-

ter were used for each ton of pulp pro-duced, Morin says. In an intermediatephase, when oxygen bleaching was intro-

duced, even though some chlorine wasused in post-processing, we managed tobring that fi gure down to 45 cubic metersper ton of pulp. Since 1996, when chlo-rine was completely eliminated, wevesucceeded in getting it down to 7 cubicmeters per ton of pulp.

ORIGINALLY, ONCE CHLORINE waseliminated, the idea was to make thebleach plants water system totally closed.

Because the washing water does not con-

tain chlorides, the water could in theorybe recycled and all the substances in theprocess retained.

But the low volume of water result-ed in such high concentrations of somechemicals that the compounds were nolonger water-soluble and caused scaling,

Morin says. Therefore, we had to openup the system again so we had to allow alittle wastewater anyway.

There were still marked improvements.

The adjustment to chlorine-free bleaching

led to sharp reductions in wastewater vol-

umes. Moreover, the water was less toxicthan before and more easily biodegrad-able. As for the lignins and other organiccompounds carried in the wastewater,there was still more work to be done. The

problem with these is that they consumeoxygen. Of course, major progress hadbeen made since the 1980s, when chemi-cal oxygen demand (cod) reduction inwater purifi cation was only between 30and 40 percent.

When oxygen bleaching was intro-duced, the results were better 50 per-cent ofcod could be eliminated, Mo-rin says. Now in the 2000s, we cant doanything more about solutions for bleachplants in terms of the processes involved

in production. Furthermore, the environ-mental requirements have become strict-er. So weve introduced a completely neweffl uent treatment technique.

He explains how the new effl uent treat-ment plant imitates a natural ecosystem(see illustration). The fact that the modern

effl uent treatment system handles suchlow volumes of water means its also eas-ier to control the process.

Before, there were these giganticponds of hundreds of thousands of cubic

TECHNOLOGY

In the past few decades, a series of environmental measureshave been implemented at strands pulp mill in Sundsvall,Sweden. Totally chlorine-free bleaching (TCF), a high degree

of system closure of the bleach plants white water and effectivebiological effl uent treatment have together produced thebest results for forest industry wastewater ever measured bythe IVL Swedish Environmental Research Institute.TEXT SUSANNA LIDSTRM ILLUSTRATION LEIF BJRNSSON

cFrom environmental culprit

to fi shs best friend


25/36

meters, Morin says. It was a constantstruggle back then to maintain a balance

between all these forms of life, to get them

to work together in such large volumes.In the 1980s, the water fl ow from the

plant. was 100,000 cubic meters a dayand the retention time for effl uent treat-

ment was fi ve days. Today, the volumeof wastewater is down to 30,000 cubicmeters a day with a retention time of 12

STEP BY STEP

TO CLEANER

WASTEWATER

Biological effl uent treatment usingbacteria is in itself nothing new, but thetechnique has become more sophisti-cated as a result of several specializedsteps being introduced to break downharmful compounds. At strands pulpmill, a new type of combination process

called Multibio is being used. The ideais to start with individual cells and fi nishwith large fl occules and multicellularorganisms. In between is an importantstep that involves what is known as abiofi lm a fi lm of bacteria growing on aplastic surface which works as a kindof safety net. The biofi lm withstands dis-ruptions better than free bacteria fl oc-cules and provides protection againstsudden large-scale emissions of toxins.

hours, and cod reduction has improved

to 75 percent.This has a strong positive impact on

the surrounding environment since, after

treatment, the water fl ows into the Sunds-

vall Bay, he says.The wastewater has now been tested

by ivl. In one part of the investigation,

an analysis was done on how the wastefrom the pulp plant affects fi sh and crus-taceans. The species tested was the ze-bra fi sh, a common aquarium fi sh, andmeasures were taken of toxicity, rate of

growth, distribution by sex and abilityto reproduce. The investigation was car-ried out on two generations to determine

if there were any disturbances in second

generation. However, there was no hintof any such trend the zebra fi sh werehealthy and thrived in the wastewaterthroughout the testing period.

The conclusion is that in normal op-erations, no negative effects are to be ex-pected in the ocean environment wherethe waste runs out, Morin says.

ENVIRONMENTAL

MILESTONES FOR THE

PULP PLANT

*COD (chemical oxygen demand)

is one way of measuring the oxygen

consumed chemically.

2004Biological

effl uent

treatment

60

12

20

100

1996Totally

chlorine-

free(TCF)

1982Oxygen-

bleaching

1970sChlorine-

bleaching

COD* (kg per ton of pulp)

[4*2007]SHAPESCA*25

HOW IT WORKS

Air is blown into the collected

wastewater, forming an environment

that, once nutritive salts like nitrogen

and phosphorus are added, is opti-

mal for bacteria to begin growing on

their own. The bacteria then use the

oxygen-consuming compounds in

their metabolism, allowing the com-pounds to be broken down.

Similar processes with different

types of bacteria are repeated step

by step in the wastewater so that

the breakdown of oxygen-consum-

ing compounds is as complete as

possible.

In the fi nal phase of purifi cation,

there are multicellular organisms like

amoebae and bell animalcules. These

consume the smaller organisms that

have formed unwanted sludge fl oc-

cules in the process. As a result, there

is less excess sludge in the end.

Nitrogen Phosphorus

Air

Air

Air


26/36

SCA INSIDE


SORBENT HAS LAUNCHEDa new Australian campaign to

increase consumer awareness

of its Clean & Fresh moist wipes.

Sorbent already maintains

strong market leadership in the

moist wipe segment with a 66

percent value share, compared

with Kleenex Flushables at 34

percent*. However, research

indicates that consumer aware-

ness regarding the use and

benefi ts of toilet wipes con-

tinues to be the key to driving

growth in this segment.

As a result, the Sorbent team

has developed a new adver-

tising campaign specifi cally

targeting young families, who

are the key users of the prod-

uct and make up 50 percent of

moist wipe purchases**.

The campaign features a

four-week outdoor media

advertising schedule that

started October 28.

This initiative aims to cre-ate awareness among young

mothers about the benefi ts

of introducing Sorbent Clean

& Fresh wipes into their

childs toilet routine.

* Aztec Scan Data MAT 23/9/07

** Aztec ShopperView IHP Na-

tional Panel MAT 5/8/07

Sorbent Clean & Fresh targeting little bottoms

LIBRESSE

DESIGN PRIZE

GOES TO NORWEGIANCAMILLA NHU Quynh Bui, a Nor-

wegian, won the Libresse Nordic De-

sign Challenge. Camilla is 16 years

old and will see her design in all 180

stores of the jc apparel chain, locat-

ed across the Nordic countries.Libresse announced the compe-

tition last summer, which gave peo-ple in the Nordic countries who were

interested in design an opportunityto create their own pattern for pant-

ies. The response was huge. Nearly90,000 entries were submitted, and

roughly 50,000 young people tookpart in the Challenge which makesit the largest design competition ever

in the Nordic countries.

The kick-off for the competitionwas the launch of Libresse Design Edi-

tion, a collection of uniquely designed

packages for sanitary pads. Out of thiscame the idea of initiating a creative

competition for young people inter-ested in design. Last July and August,

people were able to use an advanceddrawing program on Libresses web-

site to design their entry by choosing

among templates, ready-made fi gures

and drawing free-hand.

The interest was fantastic andthe quality of the entries was con-sistently very high, says Margareta

von Renteln, who is in charge of Li-

bresse. With the high traffi c on our

Websites, Ive known for a long timethat our visitors were creative, but this

result shows weve found something

that affects many people.


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[2*2006]SHAPE SCA*27[4*2007]SHAPE SCA*27

SCA is forming a joint venture

company together with Jordan-

based industrial group Nuqul. The

new company, in which SCA will

own 50 percent, will manufacture

and sell feminine hygiene prod-

ucts in the Middle East and Egypt.

The operation will span 18 coun-

tries in the region. SCAs purchase

price for its 50 percent stake

amounts to USD 18.5 million.This joint venture gives us

a unique platform for entering

Egypt and the main markets of

the Middle East with our success-

ful feminine hygiene products,

says Gunnar Johansson, president

of SCA Personal Care. These

markets have immense growth

potential , and we expect to grow

our sales in the region substan-

tially. We aim to complement

Nuquls product range, sold under

the Cinderella and Lady Fine

brands, with our own product

range. Our ambition is to eventu-

ally extend our joint venture to

other personal care categories in

the future.

Nuqul is a leading industrial

group in the Middle East, withoperations that include tissue and

personal hygiene products. The

Groups annual sales total about

USD 400 million. Nuqul is the

leading supplier of tissue in the

region and has a substantial and

fast-growing hygiene business

with strong positions in all Middle

East markets.

SCA in joint venture in the Middle East

CORRECTION: In the last issuewe showed a picture of a paper

machine in Ortmann. It is situated

in Austria, not Germany.

change to the next size.

We are very proud of our new Li-

bero diaper, which makes everyday

life easier for parents at the same as

we make adaptable diapers for dis-

covery-hungry children who now canmove freely without leakage, says So-

fi a Hallberg, Libero brand communi-

cation manager at SCA Personal Care

in Gothenburg.A sneak preview of the product be-

gan in the end of August on YouTube.

The fi lm, featuring a baby leading an ad-

vanced yoga class for adults, can also be

seen on TV in the Nordic countries.

NEW

SUPER-

STRETCHY

DIAPERFRO

M

LIBERO

LIBEROS STRETCHIEST diaper

ever has been launched in Sweden,

and other countries are coming

soon. The new stretchy diaper was

designed by Karoline Lenhult, a

mother of three children, and has amore functional design. The diapers

are marked with a smart color codethat alerts parents when it is time to


28/36


IN NOVEMBER 2006 SCA signed

an investment agreement with lo-

cal authorities in Russia to build a

tissue mill in the city of Sovetsk in

the Tula region, south of Moscow.

The design and project work were

completed during the past year,

and necessary permits were ob-

tained. In September SCA signed

a land lease and received permis-

sion to build the mill. The Tula millplans to start production in the

fourth quarter of 2008.

Russia is a fast-growing tissue

market, with 9 percent annual

growth by volume. SCA intro-

duced Zewa to the market in 1997,

and now the brand is a market

leader in Russia with a 40 per-

cent share. SCAs manufacturing

facility in Svetogorsk, in the St.

Petersburg area, has no spare

capacity, and it currently imports

10,000 tons of tissue mother

reels each year to help meet total

annual demand of 55,000 tons.

The Tula region for the new

mill was chosen for its attractive

geographical position, well-

developed infrastructure and

interest and support from thelocal authorities in planning and

completing the project.

The mill will have an annual

tissue capacity of 30,000 tons

at fi rst, and the initial stage is

expected to cost 70 million euros.

The tissue produced in the mill

will be distributed and sold in

Russia, Ukraine and Kazakhstan.

SCA PACKAGING Nicollet wonthe Formes de Luxe Award for its

Rmy Martin cognac gift box in Oc-

tober. Winners were selected based

on the criteria of innovation, design

and technique, and the prize cer-

emony was held during the annual

Luxe Pack trade show in Monaco.

The competing products were

presented in Formes de Luxe

magazine, a bilingual pub-

lication devoted to luxurypackaging and issued six

times a year. All read-

ers of the magazine voted

for their favorite products

through a form published in

the special summer edition of the

Formes de Luxe magazine.

sca Packaging Nicollets entry in

the Formes de Luxe competition came

fi rst in the tui pliant (folded pack-

aging) category. The festive gift box

commissioned by cognac producer

Rmy Martin has a decorative pull-

cord closure and an original three-

way opening that folds out to reveal

the cognac bottle inside in a spectac-

ular way. The exterior sparkles, thanksto a holographic effect, and features

the black, red and gold of the

brand. The structural com-

plexity of this innovative

packaging required the useof special cutting tools.

sca Packaging Nicollet

provides advanced packaging

solutions for a vast range of con-

sumer products across numerous

sectors, including food and beverag-

es, luxury goods and detergent. sca

Packaging Nicollet covers the Euro-

pean market and produces more thana billion diverse packages a year.

PRIZE FOR WELL-

FOLDED PACKAGING

NEW MILL IN TULA

Mats Berencreutz (second from the left)

president of SCA Tissue Europe, visited

Tula on October 12, where he toured the

site of the future tissue mill and met the

project team and the SCA Russian and

Eastern management.

1


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[4*2007]SHAPESCA*29

SCA INSIDE

ONE

COLOR

FOR

ALLSCA TISSUES new XpressnapTabletop dispenser now comes

in 10 colors. John Riley, category

director of Tabletop, says the new

range of colors has made these

dispensers particularly appeal-

ing to schools and teams. They

can fi nd an Xpressnap Tabletop

in their colors. Whether orange

for the Syracuse Orangemen, blue

for the Duke Blue Devils or a team

color for a local high school, SCA

has a color that works for them.

The AD-a-Glance feature of

the dispensers is an added bonus.

With AD-a-Glance, the school

can print their school, team or

mascot on the insert and the dis-

penser is immediately customizedfor them, Riley says.

Xpressnap is a unique product

that promises customers a 25 per-

cent decrease in napkin use due

to its one-at-a-time dispensing

technology. Customers also touch

only the napkins they take, keep-

ing the process far more hygienic

than other systems.

MILL IN

ORTVIKEN WILL GROWSCA IS EXPANDING productionof mechanical pulp at Ortvikenpaper mill. The sek 800 million

investment will allow paper produc-

tion at Ortviken to continue to in-

crease, while providing signifi cant

quality improvements.

Through our newly establishedagreement with the Norwegian ener-

gy company Statkraft, we have nowsecured a long-term supply of electric-ity at a very competitive price that al-

lows for this investment, says Ken-neth Eriksson, president ofscaForestProducts. Since our most recent pa-

per machine went into operation in1995 we have increased productionby almost 50 percent through fi ne tun-ing and investments to eliminate bot-

tlenecks. We have now reached a levelwhere pulp production is restricting

the mills continued development.

The major items in the investment

are new refi ners with high capacity. It

is in the refi neries that the raw mate-

rial, fresh spruce pulpwood, is groundto pulp. But the investment also in-volves separating pulp productionand customizing it for the differentpaper grades.

Our present pulp mill producespulp for all our four paper machines,Eriksson says. This means we must

prepare the pulp in different ways, de-pending on whether we are produc-

ing newsprint or coated publication

papers.

With the new investment, the millwill be able to prepare the pulp from

the outset for the product for whichit will be used. This will lead to im-

proved product quality but also meansthat we will save money and other re-sources by doing it right from the start

instead of preparing the fi nished pulpfor each application, Eriksson says.

Work on implementing this invest-ment will start immediately. The newequipment is scheduled to be in oper-

ation by spring 2009.


30/36

30*SCA SHAPE[3*2007]30*SCA SHAPE[4*2007]

CAMERA


TEXTMATS FALCK PHOTOULF BERGLUND

IN THE FORESTS OF SWEDEN, the moose hunt

is an important annual event. In the north the seasonstarts on the fi rst Monday of September, while in thesouth it begins on the second Monday of October.The season then runs until January or February. Ofsome 250,000 hunters in Sweden, more than 90 per-cent are men.

Moose herds expanded considerably in Sweden inthe last century. In the 1940s, fewer than 20,000 ani-

mals were shot, while in the 1980s the number peakedat 180,000. Today some 100,000 of the estimated300,000 to 400,000 moose in Sweden are shot annu-

ally. scas forests alone are thought to contain some

30,000-40,000 moose. Low shooting rates along with

plenty of food due to large-scale clear-cuttings in 1960sand 1970s were the reasons for the strong growth in

moose herds.The king of the forest feeds on leaves, branches and

grass and can live to be 20 to 25 years old. Moose,also known as European elk, are the largest animalin Swedens forests, weighing up to 550 kg (1,200pounds) and reaching a height of 2 meters (6.5 feet).Moose are found in the northern parts of NorthAmerica, Asia and Europe. In Latin, the Swedishmoose is known as Alces alces, from the Greek wordalke, which means strength.

KING OF THE FOREST

O e unt e


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[3*2007]SHAPESCA*31[4*2007]SHAPESCA*31

Plans for the days fi rst drive are drawn up. The hunting guide reviews which

stations are to be manned and where the drivers will walk. After picking

from a deck of cards, the hunters take turns choosing stations.

Early in the morning on the fi rst day of the hunting season, hunters creep to their stations. In the dawn hours,

when the moose are on the move, the hunters wait for an animal to come within shooting distance.

[4*2007]SHAPESCA*31


32/36


33/36

[3*2007]SHAPESCA*33

Hunting involves a lot of waiting.

Using two-way radios, the hunters are

in contact with each other and with the

drivers. As soon as someone sees an

animal, everyone else on the

team is informed.

[4*2007]SHAPESCA*33


34/36

SHAPING A VIEW

GREAT OPPORTUNITIES

Jan JohanssonPresident and CEO, SCA

WE HAVE A UNIQUE CUSTOMER

OFFERING THATS AN INTEGRAL

PART OF OUR LIVES SIMPLE,

INDISPENSABLE PRODUCTS THAT

IMPROVE OUR EVERYDAY LIFE

ver the next decade, an estimated one bil-

lion new consumers will have a disposableincome of over usd 5,000, the dividing

line at which individuals generally begin to

buy products for their own well-being.

Thats good news for sca.

For me, having just taken over as ceo, it makes me al-

most giddy to think of the great opportunities that sca

has for growth in the world. We have a unique customer

offering thats an integral part of our lives simple, indis-pensable products that improve our everyday life. We have

strong positions in markets throughout the world. Im

thinking of our world-leading position in incontinence

protection with tena, our very strong regional positionsin childrens diapers like Libero, Drypers and Pequenin,

or sanitary protection like Libresse, Bodyform and Saba.

scas acquisition of Procter & Gambles tissue operations

will increase the rate of branded sales in Europe of facial

tissue, paper towels and toilet paper.

These are all important opportunities for growth for us.

BECAUSE WE WILL GROW. In my fi rst meetings with

colleagues, the stock market and the media, I have been

clear in announcing that growth, both in sales and profi t-

ability, is high on the agenda. Speed is another item. Over

the last few weeks, Ive visited our business areas and spo-ken with many fellow employees. Ive experienced a very

solid sense of competence and professionalism in all fourbusiness areas. With this as a starting point, I believe we

can raise the bar in terms of speed to the market.

The third item on my agenda is simplicity. To be quick,

we have to simplify our internal procedures and operat-

ing systems so that we ensure energy is spent on the right

thing: The customer! The consumer! Growing! Creating

profi tability!

One of my most recent visits to our operations was to


oForest Products. sca has always considered its forest hold-

ings to be strategic in nature, something we want to havecontrol over. We have great advantages in todays climate

of Russian export duties and a supply shortage. Timber

prices have increased dramatically, and were seeing that

more and more people in the world now share our posi-

tive view on forest holdings. This gives us a secure fl ow

of raw materials, is a renewable resource and helps absorb

carbon dioxide.

In recent years, sca has taken decisive steps in shift-ing from being a commodity supplier to a company with

high-quality value-added products, a company based on

preferred partners. This is a shift I greatly respect and I

will promote further.Keep an eye on our development!


35/36

A revolution has begun. Custodians everywhere are fghting the clean fght

against the legions o bacteria that invade washrooms, contaminate patrons

and generally gross everyone out. Find out whos winning.

Eddie vs. the Germs

The only good germ is

a dead germ!

Eddie The Sterilizer Mundy, Custodian

SCA Tissue is a leading provider o napkins,

towels, tissue, wipers and dispensing systems

or the Away From Home tissue market.


36/36

Documents

SCA magazine SHAPE 4 2007