Crown Cork & Seal Key Sucess Factor

Crown Cork & Seal Key Sucess Factor

Harvard Business School
378–024 Rev. April 17, 1987
Crown Cork and Seal Company, Inc. In 1977, Crown Cork and Seal Company was the fourth largest producer of metal cans and crowns1 in the United States. Under John Connelly, chairman and CEO, Crown had raised itself up from near bankruptcy in 1957. After 20 years of consistent growth, the company had emerged as a major force in both the domestic and international metal container markets (see Exhibit 1). During those 20 years, Crown Cork and Seal had concentrated its manufacturing efforts on tin–plated cans for holding beer, soft drinks, and aerosol products. By 1977, however, the ozone controversy and the trend toward legislative regulation of nonreturnable containers was threatening ... Show more content on Helpwriting.net ...By 1972 the technique was perfected, and investment dollars had begun to pour into line changeovers and new equipment purchases. Exhibit 2 illustrates the rapid switch to the two–piece can in the beverage industry. In the beer segment alone, almost half of the total cans used in 1974 were made by the new process.
Growth Between 1967 and 1976 the number of metal cans shipped from the manufacturers grew at an average of 3.4% annually. As shown in Table A, the greatest gains were in the beverage segment, while shipments of motor oil, paints, and other general packaging cans actually declined. A 6% decline in total shipments in 1975 turned around as the economy picked up in all areas except basic food cans. For the future, soft drink and beer cans were expected to continue to be the growth leaders.
Table A
Metal Can Shipments 1967–1976 (000 base boxes) 1967 1972 168,868 64,773 75,916 31,660 44,256 6,694 21,485 3,095 6,086 5,877 6,427 1973 180,482 68,770 84,617 35,631 48,986 7,121 19,974 2,756 5,562 6,103 5,553 1974 188,383 73,104 89,435 36,499 52,936 7,083 18,761 2,533 5,202 5,765 5,261 1975 177,063 68,127 85,877 33,284 52,593 6,057 17,002 na na 4,808 na 1976 179,449 64,984 90,084 39,488 50,596 6,121 18,391 na na 5,097 na
Total metal cans By product Food cans Beverage cans Soft drinks Beer Pet foods General packaging cans Motor oil Paints Aerosols All other
133,980 67,283 42,117 14,580

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