CHEP goes to India as Brambles books strong sales

By: Jason Whittaker


CHEP will soon do business in the sub-continent as pallets growth drives parent group Brambles to a 19 percent increase

CHEP will soon do business in the sub-continent as pallets growth drives parent group Brambles to a 19 percent increase in comparable operating profit for the six months to December.

Brambles CEO Mike Ihlein credited the CHEP pallets division for "another period of strong growth", with sales for the group rising 13 percent to US$2.1 billion.

Ihlein told analysts at a briefing in in Sydney that "true organic growth" is responsible for sales increases in CHEP's Americas and Europe divisions.

Sales also rose 18 percent in CHEP's Rest of the World division, with new business in China and "aggressive" expansion throughout the region.

Ihlein has announced the company will soon commence operations in India, based in Mumbai.

"India is a significant long-term opportunity for CHEP and we are very encouraged by the level of interest we have received from companies that already have major relationships with CHEP in other countries," he says.

"There are significant opportunities in other Asia-Pacific countries and growth in this region will be an important focus for Brambles."

Solid demand in grocery products drove an 11 percent sales rise in the Americas. Ihlein says the company is continuing to win "many new customers" in the region.

"We have recently won significant new business in the USA non-carbonated beverage sector, with a major manufacturer converting from 'white wood' to CHEP," he says.

The Europe division recorded an "encouraging" 11 percent sales rise, hit by an aborted reusable plastic container contract.

"In Germany, we are making inroads into a market that has been dominated by the existing cooperative exchange pool by successfully communicating the value and benefits of the CHEP model to potential new customers," Ihlein says.

"...We are expanding this opportunity to other European markets where progress is already very encouraging."

Ihlein says CHEP will focus on "organic plus" growth based on value chain analysis. He says CHEP will help businesses "understand what their true supply chain costs are".

The company is also responding to demand for increased automated production and distribution through the acceleration of automated digital pallet inspection equipment and expanding its radio frequency identification (RFID) track and trace program.

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