1. CROWN
CORK
AND
SEAL
COMPANY:
THE
EVOLVING
CAN
INDUSTRY
MIN-­‐GYU
CHOI,
TEDDY
TRAN,
GREGORY
VANDERZANT,
MARYORI
VENERO
UGARTE,
MAURICE
WINGO

2. Background
Under
the
leadership
of
John
F.
Connelly,
Crown
Cork
&
Seal
Company
(CC&SC)
was
transformed
from
an
ailing
organization
to
a
metal
can
industry
leader.
CC&SC
became
a
company
that
specialized
in
cost
efficiency,
quality,
and
customer
service.
The
company
leveraged
core
competencies,
capitalized
on
established
industry
trends,
and
identified
reliable
growth
opportunities.
Today,
the
metal
container
industry
in
the
United
States
is
changing
significantly
as
the
result
of
4
factors:
1)
the
emergence
of
new
materials
and
technology,
2)
aggressive
pricing
strategies,
3)
product
line
specialization,
and
4)
domestic
market
saturation.
Over
time,
the
number
of
can
manufacturers
has
decreased
as
a
result
of
several
mergers
and
acquisitions.
Aggressive
strategies
have
led
to
price
wars
amongst
competitors,
which
have
negatively
affected
profit
margins.
Thus,
competitors
have
relied
on
other
factors
to
differentiate,
such
as
distribution
channels,
levels
of
responsiveness,
and
R&D.
Long
ago,
CC&SC
implemented
a
seminal
strategy
that
involved
increasing
the
number
of
production
plants
and
thus
expanding
national
distribution.
This
led
to
transportation
cost
reduction
and
higher
levels
of
responsiveness
for
customers.
CC&SC
has
always
focused
on
targeted
research
to
improve
current
products.
Significantly,
it
has
rarely
engaged
in
innovative
related
R&D
itself.
CC&SC
has
strategically
reduced
its
product
line
to
beverage
cans
and
aerosols.
This
has
allowed
the
organization
to
leverage
core
competencies
and
invest
in
the
most
promising
new
technology.
Another
factor
that
has
differentiated
the
organization
from
competitors
has
been
its
ability
to
identify
opportunities
in
developing
countries.
CC&SC
has
secured
unique
and
exclusive
“pioneer
rights”
abroad,
which
have
provided
the
company
with
first
mover
advantage
in
several
markets.
DIRECTION
&
GOALS

3. William
J.
Avery
has
replaced
Connolly
as
CEO
at
a
time
when
the
can
industry
outlook
has
grown
negative.
New
trends
pose
a
threat
to
the
business
strategy
implemented
by
Connelly.
The
growth
of
metal
containers
and
closures
has
slowed
and
plastic
is
forecasted
to
become
even
more
popular.
Avery
is
considering
whether
or
not
it
is
time
to
1)
diversify
CC&SC’s
product
line,
and
or
2)
purchase
a
Canadian
can
competitor.
Just
like
any
business,
CC&SC
goals
are
to
maximize
1)
short-­‐term
and
long-­‐term
profit,
as
well
as
2)
share
prices.
We
believe
achieving
this
aims,
given
the
specific
nature
of
the
can
industry
and
CC&SC’s
position,
boils
down
to
adaptation
and
diversification.
Analysis
SWOT:
STRENGTHS
Leadership:
Connelly
had
visions
as
CEO,
and
developed
a
strategy
and
specific
culture
to
reinforce
these.
He
pushed
ahead
his
strategies
through
frugality,
demanding
goals,
and
maximizing
the
organization’s
potential.
Here
are
some
specific
actions
that
he
took,
which
had
a
positive
impact:
• Focused
on
beverage
&
aerosol
high-­‐growth
segments
• Committed
to
customer
service,
just-­‐in-­‐time
delivery
• Concentrated
on
cost
reduction,
in
both
manufacturing
and
R&D
• Developed
competency
in
manufacturing
filling
equipment
solutions
• Expanded
internationally
• Decentralized
responsibility
at
the
plant
level
to
empower
plant
managers
• Paid
himself
a
low
salary
Customer
Relationships:
CC&SC
has
a
customer-­‐centric
culture.
Plants
are
strategically
placed
across
the
world,
in
order
to
be
close
to
customers.
This
has
reduced
transportation
costs

4. and
allowed
the
company
to
react
quickly
to
customer
needs.
Furthermore,
each
plant
has
the
capacity
to
handle
multiple
customers.
Financial
Stability:
After
Connelly
took
over
at
CC&SC
he
steadily
reduced
debt
to
equity
from
42%
in
1956,
to
5%
in
1986.
Also,
the
company’s
revenues
reached
$1
billion
in
1977,
and
earnings
per
share
reached
$10.11
in
1988.
Quality
&
Differentiated
Products:
CC&SC
concentrates
on
specialized
products,
such
as
fiber-­‐foil
cans
for
motor
oil—these
are
approximately
20%
lighter
and
15%
cheaper
than
regular
metal
cans.
In
order
to
meet
the
needs
of
soft
drink
and
aerosol
producers,
CC&SC
began
manufacturing
two-­‐piece
cans.
WEAKNESSES
Limited
R&D:
By
and
large,
CC&SC
has
not
been
interested
in
high
quality
R&D,
except
for
the
development
of
specific
equipment.
Connolly
and
the
company
have
chosen
to
focus
on
enhancing
existing
products.
We
believe
this
mentality
could
cause
CC&SC
to
fall
behind
its
competitors
over
the
long-­‐term.
Lack
of
Product
Diversity:
There
has
been
intense
competition
in
the
metal
container
industry
for
decades.
Additionally,
the
demand
for
containers
made
from
plastic
and
glass,
has
also
increased.
However,
CC&SC
has
continued
to
focus
on
metal,
despite
changing
markets
realities.
Because
the
metal
can
industry
is
heavily
dependent
on
raw
materials
such
as
aluminum,
which
means
that
the
customer
price
of
finished
cans
is
consequently
affected.
If
CC&SC
expanded
their
business
into
plastics
and
or
glass,
it
would
have
a
robust
business—capable
of
weathering
changes
in
raw
material
prices.
This
could
ultimately
translate
into
increased
profits.
OPPORTUNITIES
Product
Diversification:
We
believe
CC&SC
can
leverage
core
competencies
and
consider
diversifying
its
business.
As
a
rule
of
thumb,
companies
should
primarily
consider
relevant

5. products
to
adopt,
and
or
relevant
industries
to
pursue.
Also,
diversification
initiatives
must
create
value
for
shareholders.
International
Expansion:
CC&SC
specializes
in
international
growth.
CC&SC
has
chosen
to
pursue
various
opportunities
in
Africa
and
East
Asia
markets.
By
pursuing
international
expansion
the
company
is
able
to
recycle
obsolete
equipment.
THREATS
Substitutes,
Power
of
Suppliers/Buyers,
&
Competition:
There
are
many
substitutes
for
aluminum
containers;
as
a
result,
the
long-­‐term
demand
for
aluminum
containers
may
be
affected.
In
the
case
of
CC&SC,
the
suppliers
and
buyers
are
incredibly
powerful.
The
suppliers
include
a
limited
number
of
aluminum
sheet
companies,
and
the
buyers
include
large
breweries,
soft
drink
bottlers,
and
food
companies.
Lastly,
can
companies
find
it
hard
to
differentiate,
as
buyers
purchase
based
on
price.
The
industry
is
tightly
packed
and
competitive.
PORTER’S
FIVE
FORCES
There
was
relatively
stable
growth
for
the
metal
container
industry
in
1980’s—at
a
rate
of
3.7%.
To
illustrate
the
size
and
importance
of
the
industry,
consider
that
120
billion
cans
were
produced
in
1989
alone.
Aluminum
has
clearly
won
out
over
steel
as
the
can
industry’s
preferred
material;
demand
has
grown
200%
over
the
past
decade.
Also,
aluminum
cans
much
lighter
than
steel
versions,
which
makes
for
easier
and
cheaper
shipping.
An
impressive
99%
of
beer
businesses
and
94%
of
soda
businesses
use
aluminum
containers.
In
order
to
help
determine
a
company’s
strategic
direction
in
the
metal
container
industry,
it
is
important
to
analyze
competitive,
environmental
factors.
SUBTITUTES
THREAT
It
is
important
to
consider
the
threat
of
substitute
products
and
their
impact
on
the
industry.
This
is
especially
true
here,
considering
the
fact
that
analysts
see
little
potential
for
metal

6. container
future
growth.
Industry
observers
forecast
plastics
are
the
strongest
container
growth
segment
for
the
1990s.
Throughout
the
1980s
plastics
have
led
growth,
with
market
share
increasing
from
9%
to
18%.
The
plastic
industry
still
has
relatively
small
players—only
seven
companies
have
sales
over
$100
million.
Because
of
declining
resin
prices,
the
cost
of
plastic
had
become
comparable
to
glass,
taking
away
glass’
advantage.
Although
plastic
poses
a
formidable
threat,
aluminum
still
prevails
in
many
areas.
Firstly,
plastic
is
more
difficult
to
recycle
than
glass
or
aluminum.
Secondly,
plastic
is
not
a
good
fit
for
beer,
as
it
is
unable
to
preserve
beer
long
enough
to
meet
a
strict
90
day
shelf
life
requirement.
Lastly,
it
is
incompatible
with
some
existing
production
processes
due
to
its
inability
to
take-­‐on
certain
shape
requirements.
Plastic
containers
have
also
shown
to
preserve
less
carbonation
than
aluminum
containers;
4
months
as
opposed
to
16
months.
Even
though
11%
of
domestic
soft
drink
sales
have
utilized
plastic
containers,
this
has
been
mostly
at
the
expense
of
glass,
not
aluminum.
Glass
continues
to
be
a
reliable
substitute
for
metal,
but
only
in
certain
cases—glass
bottles
dominate
a
particular
segment
of
the
beer
market.
Ultimately,
many
bottlers
prefer
cans
for
logistical
efficiency
and
lower
cost
of
delivery.
NEW
ENTRANTS
THREAT
In
addition
to
plastic
and
glass,
it
is
important
to
consider
the
threat
that
new
entrants
pose
to
enter
CC&SC,
and
the
can
market.
As
noted
in
the
case,
in-­‐house
manufacturing
of
cans
has
noticeably
been
on
the
rise.
In-­‐house
manufacture
represents
approximately
25%
of
total
can
output;
in
most
cases
it
is
the
nation’s
major
food
producers
and
brewers;
the
beer
industry
supplied
55%
of
its
own
can
needs
in
this
year.
Notably,
the
beer
market
is
conducive
for
in-­‐house
manufacturing,
since
many
brewers
are
single
label
bottlers.
POWER
OF
SUPPLIERS

7. Suppliers
in
this
industry
are
limited.
The
three
largest
aluminum
producers
seem
to
dominate
market
share.
Two
notable
suppliers
were
mentioned
in
the
case—Alcoa,
the
world’s
largest
aluminum
producer,
and
Alcan.
They
supply
over
65%
of
demand
for
domestic
aluminum
sheet.
Reynolds
Metals
is
the
next
largest
supplier,
and
in
fact,
is
the
only
supplier
in
the
US
that
also
produces
its
own
cans.
The
company
poses
a
unique
threat
to
CC&SC
in
that
it
is
both
a
supplier
and
competitor.
Anytime
few
suppliers
dominate
an
industry,
there
is
a
risk
of
those
suppliers
having
excessive
bargaining
power
or
leverage
over
customers.
POWER
OF
BUYERS
The
bargaining
power
of
buyers
has
shifted
dramatically.
Many
soft
drink
companies
have
consolidated,
which
has
resulted
in
the
emergence
of
a
handful
of
large
entities;
consider
that
the
number
of
bottlers
has
fallen
from
nearly
8,000
to
only
800,
over
the
span
of
less
than
10
years.
The
large
companies
that
remain
control
a
significant
amount
of
beverage
volume.
These
companies
are
not
loyal
to
any
single
can
manufacturer.
When
the
beverage
industry
switched
to
2
piece
cans,
manufacturers
were
forced
to
react
quickly.
They
had
to
either
ship
and
reuse
obsolete
equipment
overseas,
where
technology
wasn’t
as
cutting
edge,
or
sell
off
three-­‐piece
lines
at
incredible,
unprofitable
discounts.
Considering
that
soft
drinks
make
up
42%
of
the
can
market
today
as
opposed
to
29%
10
years
earlier,
we
believe
these
companies
will
begin
to
exercise
leverage
to
get
what
they
want,
for
example,
things
like
packaging
price
discounts.
One
positive
for
can
manufacturers
in
1989
is
that
the
vending
machine
market
is
built
around
cans
specifically,
and
accounts
for
20%
of
soft
drink
sales.
INDUSTRY
COMPETITION

8. The
intense
rivalry
among
mature
competitors
is
critical
to
consider.
The
case
explains
“competing
cans
are
made
of
identical
materials
using
identical
specifications
on
practically
identical
machinery”.
CC&SC
is
hardly
the
biggest
player
in
the
industry.
American
National,
which
was
recently
acquired
by
France’s
Pechiney
International,
is
the
world’s
largest
beverage
can
producer,
accounting
for
25%
of
the
market.
Peter
Kiewit
Sons—the
next
biggest
competitor—recently
purchased
Continental
Can,
with
18%
market
share.
Continental
Can
has
also
been
involved
in
the
production
of
plastic
bottles,
and
has
heavily
diversified
into
other
areas.
Reynolds
Metals,
as
mentioned
earlier
as
a
supplier,
represents
7%
of
the
market,
the
same
as
CC&SC.
Reynolds
is
a
world
leader
in
can
making
technology.
Ball
Corporation
at
4%
market
share
is
another
substantial
competitor.
Like
Reynolds,
Ball
is
known
for
technology,
as
well
as
specialized,
high-­‐margin
products.
With
its
planned
purchase
of
a
Canadian
joint
venture,
it
will
become
the
number
2
producer
in
Canada.
There
are
approximately
100
remaining
smaller
firms,
including
Van
Dorn
and
Heekin.
Van
Dorn
is
known
for
plastic
injection
molding
equipment,
and
the
company
is
currently
building
2
plastic
production
plants.
Interpretation
SWOT
and
Porter’s
Five
Forces
have
allowed
us
to
consider
CC&SC’s
strengths
and
weaknesses,
as
well
the
dynamics
of
the
external
environment.
Let’s
summarize
the
key
themes
of
our
analysis,
which
we
will
use
to
build
our
action
alternative
recommendations.
Firstly,
the
company’s
strengths
seem
to
include
a
history
of
superior
CEO
leadership,
a
commitment
to
exceptional
customer
relationships,
a
strong
emphasis
on
financial
accountability,
and
aggressive
expansion
in
international
markets.
Conversely,
the
company’s
weaknesses
include
a
lack
of
product
diversity
and
limited
budget
for
R&D.

9. As
we
have
mentioned,
CC&SC
has
adopted
the
philosophy
of
“late
mover,”
in
terms
of
R&D.
The
company
is
averse
to
spending
money
on
basic
research,
and
instead
allows
competitors
to
take
on
the
risks
of
bringing
new
technologies
to
market.
CC&SC
has
focused
on
improving
niche
skills
and
partnering
with
customers
to
address
specific
requests.
Not
surprisingly,
it
has
maintained
a
relatively
small
share
of
the
aluminum
can
market.
Secondly,
we
see
that
the
company
may
wish
to
consider
pursuing
alternative
materials
(e.g.,
glass,
plastics),
acquire
other
container
businesses,
and
further
expand
into
the
international
marketplace.
As
we’ve
mentioned,
growth
in
the
domestic
metal
container
industry
appears
to
be
stagnant.
As
a
substitute
for
metal
cans,
plastics
have
accounted
for
the
greatest
area
of
growth
this
decade.
Also,
glass
maintains
its
status
as
a
reliable
substitute
for
aluminum
in
the
beer
industry.
The
domestic
metal
container
industry
is
transitioning
from
the
maturity
stage
to
the
decline
stage;
the
international
industry
has
remained
in
the
growth
stage.
The
international
marketplace
has
been
a
particularly
strong
arena
for
Crown,
representing
44%
of
its
sales
in
1988.
Action
Planning
As
Avery
takes
charge
of
CC&SC,
he
senses
that
the
tide
is
shifting.
What
actions,
if
any,
need
to
be
taken
in
order
for
him
continue
the
success
of
his
predecessor?
As
we
have
discussed,
there
are
several
issues
to
consider.
The
following
are
a
selection
of
some
of
the
most
important.
The
container
industry
is
experiencing
a
period
of
consolidation.
Would
acquisition
of
Continental
Can
strengthen
CC&SC’s
operation,
or
would
it
be
problematic,
because
of
the
incongruous
cultural
match?
Also,
analysts
have
forecasted
that
plastics
will
experience
significant
growth.
Should
CC&SC
commit
financial
resources
to
“new-­‐age”
material
R&D?
Lastly,
drink
company
vertical
integration
will
continue
to
intensify
competition
within
the
industry.
Should
CC&SC
now
break
from
its
traditional
product
lines
and
diversify
outside
the
industry?
CRITERIA

10. While
Connelly’s
strategy
proved
successful
for
many
years,
the
can
industry
is
undeniably
changing.
CC&SC’s
position
may
be
in
jeopardy
if
appropriate
action
is
not
taken.
Avery
must
attempt
to
strike
the
right
balance
of
preserving
core
competencies
and
implementing
necessary
change.
The
company’s
long-­‐term
profitability
rests
on
Avery’s
ability
to
navigate
the
current
economic
climate.
We
believe
Avery
should
make
decisions
based
on
certain
criteria,
which
we
have
prioritized.
Firstly,
we
feel
Avery’s
actions
should
not
affect
CC&SC’s
short-­‐term
profitability.
As
discussed,
aluminum
suppliers
and
drink
bottlers
both
possess
significantly
greater
leverage
than
can
companies.
It
would
be
detrimental
to
CC&SC’s
supply
chain
activities
and
overall
business
if
it
were
unable
to
match
competitor
prices—both
in
terms
of
those
it
pays
for
raw
materials,
and
those
it
extends
to
drink
companies.
We
believe
the
second
priority
should
be
long-­‐term
profitability.
The
third
priority
is
preserving
key
tenets
of
Connelly’s
reign,
specifically
product
quality,
customer
service,
and
workplace
culture.
If
changes
are
not
implemented
with
thought
and
diligence,
then
standards
may
suffer.
This
would
negatively
affect
CC&SC’s
brand
equity.
ALTERNATIVES
We
believe
additional
options
exist
to
Avery,
beyond
material
diversification
and
acquisition
of
Continental
Can.
Chief
among
these
are
1)
pursuing
a
general,
industry
wide
consolidation
strategy,
2)
pursuing
a
gradual
divestment
of
aluminum
industry
assets,
and
in
turn,
investing
in
new
ventures,
and
3)
pursuing
domestic
and
or
international
market
expansion.
For
brevity
and
clarity
purposes,
we
have
chosen
to
summarize
our
interpretation
of
Avery’s
options
into
4
general
categories:
1)
exploring
new
container
materials,
2)
acquiring
or
merging
with
other
firms,
3)
divesting
assets
and
exiting
the
industry,
4)
increasing
business,
perhaps
in
specific
markets.
Naturally,
each
course
of
action
will
result
in
positive
as
well
as
negative

11. consequences.
Avery
should
consider
these
carefully,
and
determine
which
combination
of
routes
minimizes
negative
impact.
Strategy
1—New
Materials:
There
is
no
doubt
that
plastic
has
gained
significant
momentum.
In
our
Porter’s
Five
Forces
analysis,
we
examined
the
competitive
nature
of
the
aluminum
can
market
and
the
lack
of
leverage
over
suppliers
and
buyers.
Delving
into
plastic
could
address
the
pressure
resulting
from
these
situations.
It
could
differentiate
CC&SC
from
its
competitors,
which
may
result
in
an
uptick
in
business.
Also,
CC&SC
would
be
diversifying
its
operations
and
lessening
its
dependence
on
aluminum
suppliers.
This
would
result
in
lower,
raw
material
costs.
It
is
important
to
reiterate
that
the
case
identified
issues
with
plastic
containers.
They
do
not
retain
carbonation
and
prevent
oxygen
infiltration
effectively.
Also,
some
drink
companies
demand
flat
bottoms
containers,
which
apparently
is
difficult
to
achieve
with
plastic.
Another
important
drawback
is
the
required
changes
in
production.
Plastic
containers
could
not
be
produced
using
the
exact
same
machinery
and
processes
used
for
aluminum
cans.
If
CC&SC
were
to
diversify
its
container
line
by
including
plastic,
it
would
need
to
make
capital
investments.
Strategy
2—Consolidation:
In
chapter
5
of
our
textbook,
we
discussed
the
different
stages
of
the
industry
life
cycle.
In
the
declining
stage,
a
firm
may
choose
to
pursue
consolidation,
whereby
that
company
acquires
or
merges
with
other
firms
in
the
industry.
The
benefits
include
gaining
power
and
influence,
as
well
as
valuable
assets.
The
idea
is
to
purchase
firms
at
reasonable
and
agreeable
prices.
Lockheed
Martin
pursued
such
a
strategy
after
the
Cold
War
and
defense
spending
plummeted.
Many
companies
that
had
previously
relied
on
government
contracts
could
not
survive.
Lockheed
Martin
took
advantage
of
this
buyer’s
market
and
purchased
17
independent
entities.
The
company
emerged
strengthened
and
diversified.

12. The
financial
state
of
Crown
lends
itself
to
acquiring
competitor
firms.
It
is
a
top
four,
aluminum
can
producer;
margins,
income,
and
return
on
equity
are
all
strong;
CC&SC
has
a
low
and
healthy
debt
to
equity
ratio;
and
the
company’s
stock
price
has
consistently
risen
since
1981.
We
believe
not
only
Continental
Can,
but
Van
Dorn
and
Heekin
could
be
quality
prospects.
Avery
is
concerned
by
the
fact
that
can
industry
mergers
and
acquisitions
tend
to
end
poorly,
and
that
there
are
differences
in
culture
between
CC&SC
and
Continental
that
could
be
insurmountable.
We
believe
there
could
be
issues
that
arise
from
changes
in
high
level
management,
asset
consolidation,
and
customer
response
as
well.
Strategy
3—Divesting
and
Exiting:
Again,
we
believe
the
can
industry
may
be
in
decline.
If
this
is
the
case,
Avery
may
wish
to
pursue
either
a
consolidation
strategy
or
a
divestment
strategy.
Divesting
could
be
advantageous
in
that
the
company
would
be
exiting
before
operations
became
unprofitable.
With
CC&SC’s
sound
financials,
Avery
could
gradually
wind
down
aluminum
can
operations
and
safely
transition
into
a
new
industry,
or
industries.
We
believe
it
would
be
prudent
to
consider
two
cases.
The
first
is
that
of
Ball
Corporation.
Management
at
Ball
successfully
expanded
beyond
glass
and
cans,
and
into
high
technology.
By
1987,
Ball
procured
$180
million
in
defense
contracts.
The
case
describes
the
company’s
successful
ventures
in
petroleum
engineering
equipment
and
computer
components
as
well.
The
second
case
is
less
encouraging.
National
Can
attempted
to
diversify
its
business,
mainly
through
other
types
of
containers—glass
and
plastic
versions,
food
cans,
pet
food
cans,
and
bottle
closures.
This
diversification
proved
to
be
a
financial
drag
on
the
company.
‘Divesting
and
re-­‐investing’
is
perhaps
the
riskiest
of
the
alternatives
we
chose
to
analyze.
The
biggest
question
is
would
Crown’s
aluminum
can
success
translate
into
a
new
enterprise?
A
final
drawback
would
be
that
Crown
loses
intangibles
that
Connelly
and
the
company
worked
decades
to
achieve.
These
include
brand
equity,
supplier
and
customer
relationships,
and
human
capital.

13. Strategy
4—New
Markets:
We
believe
Avery
should
consider
expanding
into
untapped
regions,
either
domestically
or
internationally.
Exhibit
6
in
the
case
provides
a
map
of
Crown’s
facilities.
The
Midwestern
and
Western
regions
of
the
US
are
noticeably
bare,
where
Crown
does
not
seem
to
have
a
significant
presence.
We
believe
the
Northern
California
bay
area,
Las
Vegas,
and
Seattle
could
be
high
value
locations.
As
mentioned,
Connolly’s
overseas
investments
were
consistently
successful,
as
Crown
generated
a
large
portion
of
its
income
from
international
business.
Avery
could
always
consider
a
greater
push
for
international
expansion
as
well.
SELECTION
We
would
recommend
the
following
strategy
to
Avery:
over
the
short
term
he
should
continue
pursuing
new
international
opportunities,
which
we
believe
includes
acquiring
Continental
Can.
We
also
believe
he
should
look
to
consolidate
domestically,
via
acquiring
smaller
and
or
less
profitable
competitors.
Long-­‐term,
we
believe
Avery
should
consider
diversifying,
either
by
incorporating
plastics,
expanding
to
new,
relevant
industries,
or
both.
CC&SC
could
follow
the
examples
of
Ball
and
American
Can.
We
believe
this
combination
of
objectives
best
satisfies
our
action
planning
goals,
suites
the
strengths
of
the
company,
and
considers
external
factors
such
as
competition,
customers,
and
industry
dynamics.
IMPLEMENTATION
AND
ASSESSMENT
We
would
recommend
that
3-­‐5
years
from
now
Avery
employ
SWOT
and
Porter’s
Five
Forces
to
determine
the
company’s
current
status
position.
We
would
hope
that
by
consolidating
and
expanding
internationally,
the
company’s
power
would
improve.
The
company’s
assets
should
grow,
and
so
too
should
its
leverage
over
suppliers
and
buyers.
New
opportunities
and
threats
should
have
arisen
as
well.

14. Avery
should
consider
the
following
questions:
how
much
has
the
popularity
of
plastic
grown?
How
many
drink
companies
are
manufacturing
containers
in
house?
What
other
international
markets
could
be
pursued?
What
other
can
companies
are
acquirable?
Avery
will
also
need
to
consider
whether
or
not
the
change
the
company’s
long-­‐term
plans
and
objectives.
After
3-­‐
5
years,
do
CC&SC’s
diversification
options
still
appear
attractive?
Are
there
other
new,
diversification
opportunities?
ACTUAL
DEVELOPMENTS
According
to
CC&SC’s
website,
the
company
did
in
fact
pursue
a
consolidation
and
diversification
strategy.
The
company,
which
today
is
known
as
Crown
Holdings,
boosted
annual
revenue
from
approximately
$2
billion
to
$8
billion,
in
less
than
10
years.
It
began
its
consolidation
plan
with
the
purchase
of
Continental
Can
in
1990;
that
acquisition
made
CC&SC
North
America’s
can
leader.
Later
in
the
1990’s,
CC&SC
acquired
companies
such
as
Constar
and
CarnaudMetalbox,
and
thus
expanded
its
presence.
It
also
began
a
serious
foray
into
plastics
(“About
Crown”).
Notably,
CC&SC
became
more
interested
in
revolutionary
R&D.
In
2000,
the
company
developed
its
SuperEnd
beverage
ends;
the
company
claims
that
this
was
one
of
the
most
pivotal,
technological
improvements
in
the
beverage
ends
for
decades.
It
is
in
2003
that
the
company
completes
a
$3
billion
refinancing
plan
and
becomes
Crown
Holdings
(“About
Crown”).

15. WORKS
CITED
"About
Crown."
Crown
History.
Crown
Holdings,
Inc.,
2014.
Web.
27
Apr.
2014.
**Please
note
that
all
facts
and
figures
not
accompanied
by
citations
are
taken
directly
from
the
course
textbook,
Strategic
Management
by
Dess,
Lumpkin,
and
Eisner.