From the SCM 1980 Annual Report
The Allied Paper division is headquartered in Kalamazoo, Michigan. Allied Paper manufactures pulp, paper, business forms, copy paper and paper products for office, home and school. SCM's Business Equipment operation, now a part of Allied Paper, is a nationwide distributor of office copiers. The paper industry is capital intensive. It has been growing at about the same rate as the U.S. Gross National Product, although some segments of the industry have higher growth. Business forms, for example, is growing at about 8 percent a year. Although earnings have tended to be cyclical, industry profits have been good since 1972. Pulp and paper operations are especially sensitive to the level of industry operating rates. As a general industry rule, demand for paper and pulp must be sufficient for operating rates to be close to 90 per cent of capacity to earn an adequate profit.
concerns have had a heavy impact on the industry. It is estimated
that air and water pollution control equipment and facilities have
added $60 million to the cost of building a 600 tons-per-day pulp
and fine paper plant in the past 10 years. At the same time, higher
overall capital costs of new plants have caused a reduction in the
rate of capacity additions. The combined effect of these factors is
expected to cause operating rates to be comparatively high in future
years, assuming average GNP growth. The industry tends to be fairly
well segmented both in product and markets served. Major products
such as commodity printing grades are produced in integrated mills
and have a large number of producers. Technical and specialty papers
tend to be more highly segmented and a single firm can establish a
leading position in one or more segments.
Allied has upgraded its product line into lighter weights and more specialized papers, and its research efforts, intensified in recent years, are aimed at further development of such papers. These tend to have more demanding technical requirements but fewer competitors, and more customer loyalty. The Kalamazoo mills still, however, have some dependence on commodity-type grades of printing papers and converting grades. Allied is a significant factor in book publishing papers and is the leader in lightweight "Bible" papers, used in Bibles, encyclopedias and text and reference books. Other examples of specialty paper are electrostatic papers, tipping and white tipping papers.
business forms operation, Allied/Egry, is headquartered in Dayton,
Ohio. Forms are manufactured by Allied/Egry in plants in Leipsic,
Ohio; Gainesville, Georgia; Petersburg, West Virginia; Denison,
Texas; and Columbus, Ohio.
Last Edited by JMW 08/19/07