MANAGEMENT 489 REPORT ON

AVERY DENNISON CORPORATION

Prepared for:
Samuel Mursalin (SMM4)
Lecturer, Department of Management
M.Sc., Johns Hopkins University, USA
BBA, North South University

Prepared by:
Syed Muhammad Alam Farsan 162 0757 030

Khandaker Muhtasim Rafi 153 0766 630

Nuzhat Zaman 162 0171 030

Arifa Tabassum 153 0990 030

Farhana Afnan Jisha 152 1530 030

Ettesam Bari Rio 161 0183 030

Ehsan Ibne Amin 161 1232 030

Nusrat Jahan Munia 162 1073 030

Raian Ahmed 132 0427 030

August 22, 2019
Samuel Mursalin
Lecturer, Department of Management
North South University
Dhaka-1229.

Dear Sir:
With due respect, we want to inform you that we have prepared our final group project for summer
2019. The copies of our study entitled "Management Report on Avery Dennison Corporation" are
included herewith, we are requesting for your evaluation and consideration. We tried to integrate
the understanding and experiences acquired at a practical stage in this study. We have tried to
produce as well written and informative a report as possible. We believe that this study will provide
you the data that you are searching for. We had a delightful experience working on this project.
We will be available for any necessary clarification and modification.
We hope you find the report satisfactory.

Sincerely,
Syed Muhammad Alam Farsan 162 0757 030
Khandaker Muhtasim Rafi 153 0766 630
Nuzhat Zaman 162 0171 030
Arifa Tabassum 153 0990 030
Farhana Afnan Jisha 152 1530 030
Ettesam Bari Rio 161 0183 030
Ehsan Ibne Amin 161 1232 030
Nusrat Jahan Munia 162 1073 030
Raian Ahmed 132 0427 030
Acknowledgement

We would like to convey our deep gratitude to all those who have given us the opportunity to
finish this report. A unique thanks we offer to our respected course instructor, Samuel Mursalin,
whose input to stimulating suggestions and encouragement has helped us to coordinate our project
and writing this report. Our group members ' tremendous effort, concentrate and collaboration have
made this project a successful one. Throughout this project, we have learned a very significant
lesson that teamwork can overcome any barrier and yield desired outcomes. We perceive this
opportunity as a big milestone in our career development. We will strive to use gained skills and
knowledge in the best possible way, and we will continue to work on their improvement, in order
to attain desired career objectives.
Executive Summary

Avery Dennison is a leader in adhesive techniques around the world, displaying graphics and
packaging materials used to engage clients and manage inventories. They initiated their journey
in 1990 as a global manufacturer and distributor of pressure-sensitive adhesive materials.
The company is a member of the Fortune 500 with 3 business units under packaging industry.
Apart from these, they have acquired 12 companies, such as- MacTac, Finesse Medical Ltd. In
this report we tried to capture their whole groups’ operation. First, we have discussed about
Avery Dennison’s company overview, history and their mission and vision statement. Then we
focused on each of their business units individually and discussed about their operations. After
that we have analyzed Dennison’s SOWT Analysis. We have focused on their competitors as
well. Furthermore, we have analyzed competitors’ situation and compared those with Dennison’s
and tried to figure out which are those factors that Avery Dennison having distinctive advantage
over competitors and what are their significant drawbacks. In the next part of the report, we
found out some of their corporate level strategies, Business level strategies, Functional level
strategies through which they are operating their business in the market. Finally, we attempted to
make recommendations based on our academic knowledge, which we think make their company
more robust and transparent. We attempted to relate their business practices with our academic
knowledge in this whole study.
Table of Contents
Acknowledgement .............................................................................................................................3
Executive Summary............................................................................................................................4
Overview of Avery Dennison ............................................................................................................1
Mission Statement..................................................................................................................................... 2
Vision Statement ....................................................................................................................................... 2
Brief history of Avery Dennison ........................................................................................................... 2
Detailed Description of the Lines of Businesses .................................................................................3
Pressure Sensitive Label and Packaging Materials ............................................................................... 3
Retail Branding and Information Solution (RBIS) ............................................................................... 4
Industrial and Healthcare Materials ...................................................................................................... 4
Product Samples.................................................................................................................................... 6
SWOT Analysis ................................................................................................................................8
Strengths ............................................................................................................................................... 8
Weaknesses ......................................................................................................................................... 10
Opportunities....................................................................................................................................... 10
Threats................................................................................................................................................. 11
Competitors’ Analysis..................................................................................................................... 12
FLEXcon Corporation, Inc. ................................................................................................................ 12
Ritrama ................................................................................................................................................ 13
MacTac ............................................................................................................................................... 13
UPM Raflatac...................................................................................................................................... 13
Advantages and Disadvantages of Avery Dennison Over its Competitors ............................................. 14
Advantages .......................................................................................................................................... 14
Disadvantages ..................................................................................................................................... 14
Corporate Level Strategies- Corporate Level Strategy ................................................................... 15
Horizontal Integration ......................................................................................................................... 15
Advantages and Disadvantages ........................................................................................................... 17
Business level Strategies: ................................................................................................................ 18
Functional Level Strategies ............................................................................................................. 22
Recommendations........................................................................................................................... 25
References....................................................................................................................................... 27
Overview of Avery Dennison
Avery Dennison Corporation is one of global leading manufacturing company. Founded by R,
Stanton Avery, Andrew Dennison & Aaron Lufkin Dennison. Their main products are label
material, apparel branding labels, tags, tickets, RFID etc. This company specialized in the design
of wide variety of labeling and functional materials which are manufactured by them. The
company founded in 1935 as “Kum Kleen Products”. Then in 1990 it was changed to Avery
Dennison. When it was merged with the Dennison Manufacturing Company. The headquartered
in Glendale, California. The company expend their business with more than 50 countries. Total
employees of this company is approximately 30000. Total revenue of this company for year 2018
is more than $7.2 billion.

Avery Dennison Corporation focuses on 3 important things such as

1. Intelligent: innovative technology, products, processes and system that accelerate performance
intelligently throughout their global chain of management team to satisfy their customer.

2. Creative: they prefer more on unique and differential ideas that makes their product more
creative and always thinking that how to elevate their brands that appeal to their customer and
create value.

3. Sustainable: they always try to find out responsible and ingenious solution that makes their
delivery system more sustainable which are gives positive economic, social and environment
impact.

They have established four principle which help them to building thriving business.

 One is not extract resources from earth so quickly that can be replenished.
 Two is not make product so fast that can be destroy nature
 Three is not the reason behind destruction of nature very quickly than regrow of nature.
 Four is preserve right for people of their basic needs.

By this principle Avery Dennison create 8 sustainability goal that will help them shape their
industry environmentally friendly. They all work for meet their sustainable goal by 2025. They are
working better change in the world for 80 years to make the world better.

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Mission Statement

The mission statement of Avery Dennison is “To put integrity, enhance customer service, promote
teamwork and achieve excellence.”

Vision Statement

The vision statement of Avery Dennison is “To be the world leader in products, services and
solutions that enable and transform the way consumers and businesses gather, manage, distribute
and communicate information.”

Brief history of Avery Dennison

Dennison Manufacturing Company stared its journey back in 1844 and Avery Adhesives started
its journey almost one hundred year later, in 1935. After the successful merger in1890, European
office products joint venture was created in 1999. In 2002 it acquired Jackstädt GmbH of Germany
for approximately $295 million. Avery International Corporation and Dennison Manufacturing
Company had prior relationship before the get into merger.

Dennison Manufacturing began in a very small scale as a family business in 1844. Eventually it started
doing well and kept expanding its business. During the Great Depression, Dennison Manufacturing
suffered, along with the rest of the nation. The following year the company recovered d started showing a
profit. Profits, still, did not return to pre-Depression levels. This profit was not adequate for making
necessary recapitalization and rendering inoperative the profit sharing plan of 1911. In the 1980s Dennison
stepped forward by dint of its technological ventures. The company held the majority interest in Biological
Technology Corporation. In 1985 Dennison experienced a significant economic decline.

Avery Dennison Corporation started its journey in 1935 with capital of less than $100 with a name
of Kum-Kleen Adhesive Products Co. World War II and the total economic mobilization created
problems for this company. In the 1940, Avery recognized itself as the only company in the self-
adhesive label industry who was able to offer a full line of products. In the 1950, a challenge to
Avery occurred in the form of a patent suit. In 1952 a New Jersey court ruled against Avery. In
the 1960s four different branches made up the loosely defined label industry. In 190, Avery made
huge growth. In 1961 Avery became public and get listed on NYSE in 1967. In 1974 Avery made the

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Fortune 500 list for the first time. In 1980, Avery faced decline but soon handled by diversifying and by
controlling costs, prices, and employment levels.

3M Company has been the biggest rival over the years.

Avery's merger with Dennison was the culmination of 50 years of infrequent negotiations between
the two companies. Finally, industry got Avery Dennison Corporation which is the result of merger
of two Fortune 500 companies - Avery International Corporation and Dennison Manufacturing
Company that took place in 1990.

Detailed Description of the Lines of Businesses

Being listed as one of the Fortune 500 companies, Avery Denison currently has operations set in
50 countries. Keeping the geographic and demographic gains in mind, the company has various
corporate segments globally. They focus mainly on three lines of businesses:

 Pressure Sensitive Label and Packaging Materials

 Retail Branding & Information Solutions, and
 Industrial and Healthcare Materials

Pressure Sensitive Label and Packaging Materials

A Pressure Sensitive material is one with an adhesive back and when applied on top of any
surface, the material tends to adhere. Although the company has businesses in different sectors
across the world, its most important line of business is Pressure Sensitive Adhesives. Such
materials are highly demanded by customers for various uses both at home and the industry. In
comparison to other glue-applied labels and decorating technologies, Avery Dennison’s Pressure
Sensitive Label and Packaging Materials offer specialized pressure sensitive adhesives that work
on almost any surface- metal, wood, plastics and glass. Their applications of high-speed coating,
flexible packaging materials functional coatings are some of the core capabilities of the business.
Their graphic solutions range from roll label materials and digital printing to vinyl and
thermoplastic films which can enhance a product’s and make it more effective in terms of
functionality, utility and visibility to the customers. All these are incorporated using inventive
expertise and engineering with world class automation techniques. They design solutions and
enhance performance of some of the world’s most prosperous brands including Boeing Co. and
Johnson & Johnson.

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Retail Branding and Information Solution (RBIS)
Their second unit of business, known as Retail Branding and Information Solution (RBIS) caters
to designing, producing and retailing of numerous product-tagging and brand-identification
offerings which include solutions for both apparel and footwear retails. This segment contains
one of their worldwide famous information management products, which is radio-frequency
identification (RFID) tags. This technology has helped vendors of various clothing and footwear
brands around the world to precisely categorize inventory and replenish goods which has
elevated their brand value and accelerated their performances throughout the global retail supply
chain. The whole process of RBIS starts from the Design & Development unit of the supply
chain and information is encrypted and stored in products throughout the manufacturing,
logistics and retail stages creating sustainable designs. Macy’s and Marks & Spencer are two of
their core clients in this line.

Industrial and Healthcare Materials

Avery Dennison also has a line of materials which cater to industrial and healthcare needs. Under
this segment, they produce a wide range of performance tapes and adhesives which have various
uses and are renowned for setting and maintaining the industry standard for their special
adhesive properties. Their branch of Vancive Medical Technologies develops new tools in union
with healthcare specialists around the world. They offer an assortment of medical applications
such as medical adhesive tape products, advanced wound care and also a range of skin care
products which address critical skin conditions. Mostly, device manufacturers and medical
suppliers are customers of these products.

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The products under each of these segments being offered are listed below:
Pressure Sensitive Label
Materials
 Roll label materials
 Films for graphic
application
 Reflective highway
safety product
 Specialized tapes
 Performance polymers
 Extruded films
Retail branding & Vancive Medical
Information Solutions Technologies
 Graphic tickets, tags and
 Wearable sensors
labels
 Barrier films
 RFID tags, labels and
 Wound dressings
inserts
 Variety of tapes
 Woven and printed
labels
 External
embellishments
 Price management
systems
 Variety of fasteners,
related supplies and
equipment
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 Product Samples

1. Pressure Sensitive Adhesive Tapes

2. Automotive and Swiftach Fasteners

3. Vinyl Films for Graphic Applications

4. Performance Polymers for Packaging

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5. Embroidered/Woven Patches

6. RFID strips & Tracking Tags

7. Graphic Tags, Barcode and Labels

8. Medical Grade Adhesive-Coated Tapes & Surgical Drapes

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SWOT Analysis

Strengths
Largest industrial and service companies
Weaknesses
Globally Acceptable Industries Weak demand forecasting

Fair growth in revenues Weak financial planning

Strong brand portfolio and position High pricing

Strong market presence Weak in tackling new challenges

RFID Weak operating cash flows

High level of customer satisfaction

Opportunities
Strategic Acquisition and mergers
Threats
Emerging markets Government regulation and policy

Online customers Intense competition

Low transportation cost Increase in labor cost

Lower inflation rate Increase in price of raw materials

New taxation policy Imitation of products

Strengths
Largest industrial and service companies

Avery Dennison is one of the largest industrial and service companies in the world. It is
internationally recognized. It operates around 50 countries across the world with 200
manufacturing facilities. Almost 40,000 employees work for Avery Dennison. It produces more
than hundred products which helps end customers to need their demand and meet sustainability.

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Recently Avery Dennison had been shortlisted for Global Environmental and sustainability
Award on JULY 10, 2019 in Netherlands

Globally Acceptable companies

Avery Dennison is globally acceptable company it operates across 50 countries around the
world. It is a global science materials and Manufacturing Company which has specialized in
designing and manufacturing variety of labeling and functional materials.

Fair growth in revenues

It has a fair growth in revenues every year as per 2018 survey. The reported sales of Avery
Dennison were $7.2 billion. It can be assumed that there is a fair growth in revenues compared to
their biggest competitor Raflatac which is subsidiary company and its parent company is UPM.
Raflatac’s reported sales of 2018 was $280 million.

Strong brand portfolio and financial position

All products of Avery Dennison are internationally recognized. They have been serving in this
industry for last 80 years. They have successfully created and strong brand portfolio and position
in both local and international markets. They manufacture and distributes more than hundred
products. Their most demanded products are labeling and packaging materials, display graphics,
retail graphics establishments, RFID tags and so on. Reported by 2017 their sales of label and
graphic materials was $4512 million; retail branding and information solutions was $1511
million and industrial and health care materials was $591 million. Which proved the strong brand
position throughout the world. Strong brand portfolio is extremely useful for expansion.

Strong market presence

Avery Dennison has a strong market presence throughout the world for their expertise in high
speed information display, manufacturing, logistics, branding, graphics and packaging. They are
dominating different industries from apparel to transportation, health care, RFID and architecture
industry.

RFID - It is one of the most demanded products of Avery Dennison. It is dominating the apparel
and other industries. Avery Dennison delivers RFID solution in different fields to reduce cost, it

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helps to accelerate inventory process speeds, shorten the losses, improve efficiencies throughout
the stages of supply chain.

High level of customer satisfaction with their expertise and strong brand image they have
attained high level of customer satisfaction among the potential and present customers.

Weaknesses
Weak demand forecasting

Compared to the competitors Avery Dennison has very weak demand forecasting process which
resulted in shakeout and loss of inventories. This is one of the major weaknesses of Avery
Dennison which causes a lot of problems for their profitability.

Weak financial planning

They are not that efficient in financial planning because the current asset ratio and liquid asset
ratio shows that Avery Dennison should have worked more efficiently than they are currently
doing.

High pricing their main competitors are 3M corporation Bemis Company Inc., and Esselte corp.
The pricing of Avery Dennison is quite high compared to the competitors. Which is considered
to be one of the major obstacles in the way of their profitability. For instance, Avery Dennison is
selling a monarch labeler 1152 price gun at $174 on the other hand other companies are selling
this product at the price of $132 which is quite cheaper than Avery Dennison.

Weak in tackling new challenges

Avery Dennison is weak in tackling challenges by the new entrants. New entrants are using
innovative ideas to hit the market where Avery Dennison still lag behind to develop new
strategies to hit the market and protect their market share. They should use feedback loop
mechanism from corporate level to sales team to face these challenges. Currently Raflatac is a
new entrant and one of the biggest competitors as well.

Opportunities
Strategic Acquisition and mergers

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Acquisition of Paxar and merger with 3M’s office and consumer products have created a new
dimension for Avery Dennison to hit the market and attain a vast number of new customers. For
Avery Dennison it could be a fruitful step to expand their market and market shares as well.

Emerging markets

Recently Avery Dennison is focusing on emerging markets like China and India. This emerging
could be an effective footstep to expand their markets and market shares. It look promising to
Avery Dennison through which they can increase their profitability.

Online customers

Avery Dennison is getting a vast number of new customers through online. From past few years
they have been investing on online platform to sale their products. Now they are also focusing on
collect the data of the customers through online portal to get better idea about the preferences of
the customers and manufacture products according to the customers.

Low transportation cost

Now a days the transportation cost has become lower as shipping prices are also getting lower.
It’s good opportunity to expand their business to different countries and getting more access to
the new markets and new customers.

Lower inflation rate

Lower inflation rate can have a positive impact on the business. Lower inflation rate assure the
market stability by lowering the interest rate to the customers of Avery Dennison. USA has
lower inflation rate compared to other countries which is one of the biggest opportunities for
Avery Dennison to expand their market shares.

New taxation policy

New taxation policy can have great impact on the business of Avery Dennison by opening new
opportunities for them and increase their profitability.

Threats
Government regulation and policy

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Different laws and policy by government can affect the business of Avery Dennison. Continuous
changes in laws can affect their existing product categories. Recent environment regulation in Paris
on 2016 could be threat for Avery Dennison. In Paris agreement at Paris climate conference
(COP21) in December 2015,195 countries adopted the universal legally global climate deal. In
that deal Is drawn for to keep track on avoid dangerous climate change by limiting global warming
to well below 2 degree Celsius to 1.5 degree Celsius Since Avery Dennison is serving in numerous
countries the laws and regulation of those countries can violate the business.

Intense competition

Number of competitions are has increased drastically in last two years. Profitability of Avery
Dennison has compelled others to enter this industry. Which create downward pressure fir Avery
Dennison. The number of competitors are increasing day by day their existing competitors are
Mactac, Raflatac, FLEXcon, Ritrama and many more new entrants are entering this industry with
their innovative technologies.

Increase in labor cost

Labor cost is increasing day by day Avery Dennison has to pay $15 an hour in China which is a
quite a big amount for a company to pay. High labor cost causes the lower profitability for any
company.

Increase in price of raw materials

Increase in price of raw materials affect the profitability of every company. Avery Dennison is
also facing the same problem this could be another threat for them

Imitation of products

The number of imitations of counterfeit products getting higher day by day. People are forced to
imitate the products to entering the low income markets.

Competitors’ Analysis
FLEXcon Corporation, Inc.
FLEXcon is an American manufacturer of pressure sensitive film products used for
advertisement. They started their business in 1956 as a company focused on laminating vinyl and

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metallic polyester for use in women’s handbag. In the 60’s and 70’s they started to expand their
product line.

One of their product STABRITE is a type of film that absorbs light from low -energy wavelength
and convert it to selected visible light (FLEXcon, n.d.). It is very ideal for warning stickers as it
is visible in low light condition.

Ritrama
It is an Italian company founded in 1962 with product portfolio of 5 main division which are;
Roll Label, Graphics, Offset Sheet, Industrial and Polifibra. They have manufacturing and
logistics in most parts of the world. They are mainly located in countries such as Italy, Spain,
United Kingdom, United States, Chile and China.

One of their competitive advantage is their special composition on their adhesive which they call
“Slide & Tack”, which can be applied easily by professionals and non-professionals (Graphic
Display World, 2019). The adhesive has low initial adhesion and then it slides into position.

MacTac
They started their operation in 1959 in the state of Ohio. They are backed financially by Bemis
Co. Their parent company is LINTEC, who are considered one of the market leaders when it
comes to pressure sensitive adhesive.

Their biggest advantage over their rivals is the financial backing they have from Bemis Co. They
are one of biggest packaging firm in the world generating over $5.3 billion dollars in revenue.

UPM Raflatac
Raflatac is a subsidiary of UPM, a Finnish company started in 1830. They have always
processed paper from pulp. In the 1930’s they started the sell plywood. Raflatac develops and
manufactures self-adhesive label materials and information labels.

Raflatac as a company practices ethical sourcing, a practice where firms ensure that the products
being sourced are obtained in a responsible and sustainable way (UPM, n.d.). They have an
annual check on all their suppliers to see if they are producing ethically.

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Advantages and Disadvantages of Avery Dennison Over its Competitors
Advantages
Pioneer of the industry – They were one of the first companies to enter the market and have
been operating for the last 80 years. Stanton Avery is credited to be the founder of the industry of
self-adhesive label (Walker, 2018). They have only improved since their inception and are still
leading the market in certain ways. They are currently working with automobile company to
reduce weight by replacing mechanical fasteners with structural adhesive.

Very good procurement – There are two fundamentals that the procurement division tries to
fulfil. These are to be a valuable thought partner and to be a strategic business partner. They
want to be close with their internal stakeholders and also want to be a valuable partner to their
supplier (Walker, 2018). They give importance to procurement which is advantageous as most of
the competitors think of it as an afterthought. They heavily focus of recruitment in the
procurement division and try to employee people with broad range of professional experience

Innovative technologies – They implement a feedback loop to innovate on the machine they use
for production. The product manager reports to senior management on how to reduce overall cost
using current machineries, if it is not possible, they look into possible new solutions to improve
their technology (Walker, 2018). Their marketing team tracks the current trend and reports if an
improvement on the product will increase their sales. They collect as many data as possible to
help them with coming up with new technologies.

Very strong free cash flow – They have a very strong ability to generate revenue and thus have
a strong free cash flow. This also allows them to invest more on new technologies.

Disadvantages
High price of the product – They have a lot of upcharges and incremental charges depending of
the fit and finish of the product that their competitors do not charge. They also charge a high
base fee for their vinyl products.

They have a high employee turnover rate – In their offices in United States employees do not
stay for very long. They do not complain about the wage structure however they do not like the
work life balance. Most employees state that the senior management do not care about them and
they do not get credit for their good work.

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Poor inventory management - They cannot hold on to smaller markets due to their lack of
inventory management. In smaller markets the small and medium sizes business often suffers
from late delivery of products. To these businesses this lost time is detrimental. Often, they
switch local producers as they can send the product quickly. Avery Dennison do not use the
same efficient techniques in smaller market to save on costs, which causes them to misjudge the
demand for the product.

Corporate Level Strategies- Corporate Level Strategy

Avery Dennison pursued various corporate level strategies to drive their business toward
success. For example, The Board of Directors of Avery Dennison Corporation has declared a
quarterly cash dividend of $0.58 per share (Avery Dennison, 2019). Which means they have
excess earnings and decides to pay a dividend to shareholders, an amount is declared along with
a tentative payable date. They made horizontal integrations like merger and acquisition as well.
These higher-level decisions vastly affect a company as a whole.

Horizontal Integration
Merger

The company was established in Los Angeles, California in 1935 as Mr. and Mrs. Ray Stanton
Avery's Kum Kleen Products, a partnership. In 1937, the name altered to Avery Adhesives. The
firm was incorporated as Avery Adhesive Label Corp. in 1946, and in 1958 the name was
changed to Avery Adhesive Products, Inc., and in 1964 to Avery Products Corporation. After the
firm merged with the Dennison Manufacturing Company in 1990, the name was altered to Avery
International Corporation in 1976.

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Acquisition

European business of Mactac from Platinum Equity, a California-based private equity firm, was
acquired by Avery Dennison. The company is a major supplier of high-quality, high-pressure
products serving a number of high-value sections including graphics, specialty labels and industrial
bands. The key product lines of Mactac complement the current graphics portfolio of Avery
Dennison. The acquisition of Mactac Europe enhances their competitiveness in high-value
graphics, where they have sustained above-average growth over the past few years. Avery
Dennison is known for high product quality and outstanding service, Mactac complements their
existing business with a strong brand and loyal customer base, expanding their product offering,
capabilities.

Avery Dennison has acquired 12 organizations. Their last acquisition was Finesse Medical on May
22, 2017. Other companies they have acquired are-

Company Name Announced Date

Yongle Tape Co February 6, 2017

Hanita Coatings December 13, 2016
DM Label Group April 1, 2008
Paxar Corporation June 15, 2007
Rinke Etiketten GMBH September 22, 2004
L&E Packaging November 28, 2002
RVL Packaging, Inc. November 5, 2002
Jackstadt GmbH May 17, 2002

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Advantages and Disadvantages
Lower Cost Structure

Avery Dennison lowered their cost structure through merging and acquiring. The overall strength
and resources increased by this integration. The cost curve of the company also went down by
manufacturing in bulk.

Leveraging Competitive Advantage

Avery Dennison is renowned for its elevated product quality and excellent service, Mactac
complements its current company with a powerful brand and loyal client base, increasing its
product range, capacities and distributor network. They used each other’s competitive advantage
to grow their business and investing capital and driving operational improvements throughout the
business.

Employee Turnover

Avery Dennison Corp, the world’s biggest label maker, planned to cut 700 to 900 jobs,
significantly more than the company predicted. It would cut the cost $50 million to $65 million.
Most of those costs will be for severance pay and related termination expenses. Avery Dennison
said that it expected to eliminate about 500 jobs, but that was a preliminary estimate and that
“after a thorough evaluation of our operations” the company decided to increase that number.
The firm announced extended layoffs in a filing of the Securities and Exchange Commission and
said it was expecting the cutbacks to "affect most [of Avery’s] companies and geographic areas."
In over 150 manufacturing and distribution centers in 42 nations, including about 300 in

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Pasadena, Avery Dennison uses about 21,400 males and females. Founded as Avery Adhesives
in 1935, the company manufactured the first self-adhesive labels from a rented loft space in Los
Angeles. The firm, which also makes other office products, has a research and development
facility in Pasadena in addition to its corporate headquarters. Coleman said about 15 local
employees had already been notified that they would lose their jobs. Avery Dennison earned
$86.2 million on revenue of $1.36 billion in the quarter ended Oct. 1. The job reductions will
begin before the end of the year and be completed by mid-2006. Cuts will occur across the
board, Coleman said, affecting management as well as production employees. The company
announced the reductions after the close of regular trading. Avery Dennison’s shares fell 96
cents to $57.25 (Molly Selvin, 2005)

Business level Strategies:

Avery Dennison’s product offerings are being served to 14 different industries. (Avery
Dennison, 2019). The company has been performing a broad differentiation strategy, which is
basically what the company has been doing all the time. And it makes a perfect sense to do this
as the company has a diversified portfolio, serving different clients based on different segmented
products.

Segmentation strategy:

Avery Dennison provides different offerings for different markets. For example, in their label
and graphic materials sector, they have label and packaging materials, graphics solutions and
reflective solutions. In retail branding and information solution sector they offer tickets, tags,
labels, and embellishments for retail apparel, radio-frequency identification (RFID) and printer
solutions. Industrial and Health care materials sector provides performance tapes, adhesives,
fastener solutions and medical solutions. (Avery Dennison Corporate profile, 2019)

Broad differentiation strategy:

Broad differentiation targets a big market with differentiating products. The company targets
market with huge product line as mentioned before, they have a huge category of products from
labelling, adhesives, graphic, branding to industrial materials. (Avery Dennison, 2019). Avery
Dennison have its operation in fourteen industries including government and medical healthcare.
(Avery Dennison, 2019)

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Technological advancement:

The company’s products are also being innovative as well. They use latest technology which
serves the best for the customers and which also increases value innovation for the industry.
Like, the company has many different types of printers which all has different uses for different
purposes, for example, the company’s new product, the Tabletop Printers which job is to follow
instruction and design to help food, manufacturing, retail and other offerings increase items and
carton labeling productivity. (Avery Dennison printer solutions. Our Printers. , 2019). Not only
printers, each of their product line has differentiated items. (Avery Dennison, 2019). The
management and innovation sector of Avery Dennison performing their best with their product
to support the industry. (Avery Dennison, 2019) They are always coming up with new product
offerings that supports industry requirements. (Avery Dennison, 2019).

Avery Dennison and Soho Warriors present an exclusive world cup.

Establishing a digital knowledge transformation culture: In recent times, the new Chief
Information Officer (CIO) Nick Colisto, of Avery Dennison who was appointed in 2018, brings
out a new platform called digital literacy, which is a valuable component of Avery Dennison’s
digital transformation strategy (Heller, 2019). Moving towards digitalization helps an
organization to get the perfect ability and desire to utilize emerging technologies for good
business outcomes (Heller, 2019). Avery Dennison has future plan to use emerging technologies
for optimization and business transformation (Heller, 2019). The organizations business portfolio
of digital programs is much more dependent upon digital optimization, so they are switching
towards more transformational programs as the corporation work towards sustainability goals
and targets high value segments (Heller, 2019). Avery Dennison also wanted to keep their
previous technologies, applications and infrastructure as a part of their asset and digital platform

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(Heller, 2019). Under the umbrella of optimization, they have two strategies, digital workplace
and digital commercial advancement (Heller, 2019).

Nick Colisto, Chief Information Officer (CIO) of Avery Dennison Corporation (Heller, 2019).

Digital workplace: The new system reimagines traditional processes of Avery Dennison to
boost productivity (Heller, 2019). It also, protects assets and increase overall efficiency (Heller,
2019). Besides they use cloud base technologies includes Google G-suite for productivity and
ring central for cloud telephony (Heller, 2019). Employees are also able to securely access
information and data from anywhere and on any device (Heller, 2019). For security they have
robotic process automation (RPA) and artificial intelligence (AI) to identify, defend and report
messages sends to employees (Heller, 2019).

Avery Dennison and Outernets create the future of window shopping (Heller, 2019).

Digital commercial advancement: Salesforce cloud craze Business to Business (B2B)

commerce platform are being used by Avery Dennison for acceleration of higher profit from

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existing products and services which improves customer satisfaction (Heller, 2019). In
transformation they have Fresh marx temperature tracker which has the ability to reduce food
waste through internet of things (IoT) solution (Heller, 2019). In cold storages, this device
automates temperature and monitors humidity, which overall increases food safety and
efficiency, more valuable to restaurants businesses (Heller, 2019).

DOC and DICE: The Digital Operating Committee (DOC) of Avery Dennison is responsible
for decisions regarding digital programs, digital literacy, internal capabilities and external
partnerships (Heller, 2019). They introduced “center of excellence for digital innovation” and
created a “technology rationalization and modernization program” for traditional information and
technologies (IT) commodities (Heller, 2019). The Digital Innovation Center of Excellence
(DICE) works together with Digital Operating Committee (DOC) for better business outcomes
(Heller, 2019). In DICE framework, they offer (learn, plan, discover, prototype, scale and
support) and the center focuses mainly on learning, resources and relationships with the partner
ecosystem (Heller, 2019). The senior leaders also get trained about the knowledges of digital
world under their digital newsletter series (Heller, 2019).

Building a digital learning culture at Avery Dennison Corporation.

Adding with this the new RFID machine of Avery Dennison also helps to detect stock inventory
system. (Avery Dennison Corporate profile, 2019). It seems that the overall system turns into the
process of digital economy according to the article name Movers and Shakers written by Martha

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Heller in CIO (Chief Information Officer)’s website on 3rd April 2019. From this point we could
also say that there is a technological paradigm shift in the industry. Moreover, the company’s
commonality of products helps the organization to achieve economies of scale as they could buy
raw materials in bulk which is a massive advantage for Avery Dennison. (Avery Dennison,
2019).

Functional Level Strategies

Functional level strategy is aimed at improving the effectiveness of a company’s operations and
ability to attain superiority through efficiency, quality, innovation and customer responsiveness.

Avery Dennison implements their functional level strategies in each respective department such
as Procurement, Marketing and Sales, Operations, Human Resource Management and Research &
Development. By applying these strategies department-wise, Avery achieves overall superiority.

Procurement

Avery Dennison believes in efficiency through power of procurement, sustainability, collaboration

and harnessing technology. According to Roland Simon, the Vice-President of Global
Procurement Materials Group & Corporate Sustainability of AD, “The root of integrating with the
business is the foundation of how we developed the powers within our function”. People from a
wide array of backgrounds such as Finance, Marketing and Procurement specialists work in the
procurement department. The role of these individuals is to be business thought partners, not just
employees who place purchasing orders. Previously, the focus was on influencing all the
stakeholders but that changed a few years ago, now the goal is also to be influenced, hence the
employees go through “Influence training”. The thought process is that, it shows considerable
maturity to be influenced by other people’s thoughts if it leads to growth.

For example, if a supplier influences the company with a good idea about how to handle the needs
of the customers or what better solutions they could give to the market, they could influence each
other and come up with an innovative material or process.

Marketing and Sales

Avery Dennison uses a marketing automation solution. Before the implementation of the process,
AD had a hard time dealing with prospective buyers as they did not have a clear strategy on how

22
to engage them. Company leadership didn’t understand at first that they needed to be precise in
their targets and just assumed that it was already being done.

Following up was the biggest task for the Sales team. They were able to verify which of the leads
were serious buyers and which of them were just prospects by assigning the targets to the
marketing team.

Due to there being no marketing automation platform the company wasn’t utilizing its CRM
properly; it was just a place where contacts could be found before the implementation. Their
biggest lacking was that they weren’t able to identify key players and so marketing automation
helped to identify them and the best opportunities.

Act-On software became AD’s marketing automation platform provider in 2010 and they have
been working with them for almost a decade now. AD started to develop campaigns and they
involved the sales team from early on to pick out solid leads. There are currently five ongoing AD
campaigns. The model for the campaigns were developed by the marketing and sales team which
enabled AD to control the whole process and find out serious buyers whom would be later passed
on to the sales team. The partnership helped AD to market to segments that they didn’t have access
to before, no longer were they restricted just to their potential buyers, they had access to influencers
as well.

On the third quarter of 2015 alone, AD had a 505% increase in campaign Return-On-Investment
compared to the 485% of just the previous quarter. Just in one campaign Avery Dennison managed
to close 73% of all potential deals and contributed $200,000 in revenue. The changes implemented
resulted in the company getting a 200% increase in closed business in the third quarter in
comparison to the previous one.

Avery Dennison now has a sample roll program as well. This program allows potential customers
to check samples of AD’s vinyl graphics and films before deciding on making a purchase. The
program is completely automated and the follow up is done through the co-ordination of both Act-
On and the Sales team. The conversion rate of the opportunities in the sample role program was
40%, which is three times the average of AD.

23
Operations

Avery Dennison’s operations consists of Plant Management, Quality, Process and Engineering etc.
They have leaders in each of the steps of the operations process. AD produces label and packaging
materials, reflective solutions, digital ink solutions, RFID security tags, performance tapes,
fastener solutions, performance polymers etc. They also give graphics solutions, retail branding
and information solutions, printer solutions and healthcare solutions through Vancive Medical
Technologies. AD has led the industry that it is in by listening to what the customers want and
providing innovative solutions. Assuring top-notch quality and a dependable product is their #1
priority. They offer pressure-sensitive label and packaging materials that combines creativeness
with superior engineering techniques through the Label and Packaging Materials (LPM) division.
AD also sets standards in the graphics industry worldwide through its vinyl graphic design and
automotive wrap graphics. It operates in an array of industries and has an efficient operations
process which sets it apart from any other competitors.

Human Resource Management

Avery Dennison believes in hiring creative thinkers and problem solvers. During the hiring
process, AD just doesn’t focus on the candidate’s background but also verifies how they can be an
asset to its specific departments and divisions. For this very reason, people from diverse
backgrounds could be working in the same department. Take the procurement department for
example, it has employees with finance, marketing and procurement backgrounds. This is done so
that a high level of communication and co-ordination could be reached along with diverse
perspectives on the same issues. Take the Early Career Program: Operations as another example.
In this program, there is a 24-month period structured plan where a new associate is rotated atleast
2 times in 22 months or 3 times in 22 months in the different departments of Operations such as
Quality, Plant Management, Process and Engineering etc. AD believes in an overall exposure
that’s why those aspiring to join the Operations department can have a view from top to bottom.
In this way both the organization and the associates themselves can find out their strengths and
weaknesses. This rotation will not just be an observation approach either, it will be very hands-on
with accountability for performance. Every rotation will have objectives that will ultimately
contribute to business results. The locations will also be diverse as they will be across the country
so that associates can learn the differences and dynamics of working in each region. The manager

24
and someone from the leadership team will always guide the associate but they will be accountable
for business results from Day 1. A review is carried out by the ECP panel every 6 months and it
consists of the Head of Operations, and Head of HR.

Research & Development

Avery Dennison firmly believes in innovation through R&D. They have invested a significant
amount in the department and is consistently trying to find ways to improve their products and
processes. They have a communication system in place which encourages employees to come
forward and give reasoning for the R&D department to find new solutions to problems. A good
example would be that if AD wanted to reduce the aggregated price of any of their adhesive
products to become more competitive in the market, a leader would probably go to a product
manager and tell him about the issue. The manager would then analyze the production process and
tell him that either weight-reduction or a new formulation is required to reduce the price and R&D
would begin working on developing this. R&D also resulted in the development of Smart-Label
RFID technology and Janela™ solution. Janela™ solution, powered by the Evrythng Smart
Products Platform, enables apparel and footwear products to have a unique identity to its item type
which is connected to a digital profile. This is typically linked with experiences and rewards, and
called Born Digital™. By partnering with Everything Smart, AD is giving retailers the opportunity
to enhance the shopping experience of the customers in-store by giving customers the option to
interact with garments to gain access to the unique product information or reviews, self-checkout,
look-up real-time inventory availability, show closest inventory available if not in-store, as well
as extending the brand experience post purchase through personalized digital content. The
different generations of people require different approaches and R&D has successfully developed
a way for AD to target them all.

Recommendations
The personal investigation of the employees needs to be guaranteed with the goal that the
straightforwardness of the enlistment procedure stays unencumbered. It is exceptionally essential
for every single association to lead an individual verification of the recently enlisted workers.
This won't just dispense with applicants with terrible past records, criminal records and so on yet
in addition expanded the organization altruism.

25
There should to be a legitimate planning for demand of enlistment of the representatives. The
concerned divisions should give at least 10 days to HR to report the opening, wait-listing the up-
and-comers and procedure the entire enrollment efficiently.

The large number of experienced workers are leaving from this organization for their
compensation structure, so they should adjust the pay structure to keep their accomplished
representatives.

Being a worldwide association, Avery Dennison products prices are higher than other similar
branded products. So, for nation like Bangladesh it appears to be so high value, which become
trying for B2B business. Here contenders go into market with high innovation at a lower cost by
which clients at business level get pulled in towards those contenders. Also, those contenders are
getting the market progressively which we think Avery Dennison should stress over.

The store network division need to know about their exercises. They should asses the need of
various crude materials and different things before buying it.

As Avery Dennison Bangladesh Ltd. has an interactive corporate culture and the workplace is in
all respects benevolent, intelligent and casual, so they ought to keep up it to guarantee the better
workplace.

As Avery Dennison Bangladesh Ltd. has effectively settled a great notoriety in the naming and
bundling industry of our nation and it is one of the main naming organizations in Bangladesh, so
they should attempt to catch the most extreme segment of the market request.

Since Avery Dennison is doing their business in B2B level, average citizens have poor learning
about this association and in this manner, they can't get gifted individuals to work for them. As
they are not getting the best up-and-comer from the market they could make a group of bests
from various division, who can prepare the new comers in the activity and make them best for
the association, by this they can keep up their presentation level.

26
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