Winpak cuts workforce at its plastic pouch department in Winnipeg, Manitoba, by 12 workers, says it will focus on stand-up, vacuum-sealed pouches to avoid cut-throat competition with low-cost Asian manufacturers of flat-laying pouches

Graziela Medina Shepnick

LOS ANGELES , July 10, 2012 (Industry Intelligence Inc.) –

Winpak Ltd. will permanently lay off 12 workers at its 75-member plastic pouch department in Winnipeg, Manitoba, at the end of August due to cut-throat competition with low-cost Asian manufacturers of flat-laying pouches, reported the Winnipeg Free Press on July 10.

To boost its competitive position, the Winnipeg-based plastic packaging company aims to focus on expanding sales of higher-end packaging, which is what Winpak is “noted for,” said President and CEO Bruce Berry.

The “more sophisticated printed, zippered, stand-up, vacuum-sealed pouches” are still doing well, he said, the Winnipeg Free Press reported.

The company has put an 80,000-square-foot expansion of its main flexible packaging plant in Winnipeg “on hold” for now, said Berry. This decision was revealed in April and blamed on escalating construction costs in Canada.

Construction costs are “significantly” lower in the U.S. and could cause Winpak to expand one of its four production plants south of the border instead, he said. The company has nine production plants in North America, reported the Winnipeg Free Press.

Provincial government officials are “trying to find ways” to help but haven’t committed to any assistance yet, said Berry.

The company faces stiff competition from Asian manufacturers for the “less-sophisticated” pouches that lay flat and are used mainly to vacuum pack foods such as deli meats and cheeses, the Winnipeg Free Press reported.

Asian-produced pouches have been “flooding” the market and eroding profits for domestic manufacturers, said Charlene Matheson, president of Local 830 of the Communications, Energy and Paperworkers Union, which represents 500 workers at Winpak’s two production plants in Winnipeg.

Overall, Winpak’s business is doing “quite well,” said Berry. Three of the plant’s workers that are being laid off have found jobs at the company’s other local operations, he said, reported the Winnipeg Free Press.

The primary source of this article is the Winnipeg Free Press, Winnipeg, Manitoba, on July 10, 2012.

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