Crown Cork & Seal Company, Inc
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: Crown Cork & Seal Company, Inc.
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Vertical Performance & Gap Analysis by ICG Affiliate.
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Company Perspectives:
We owe our success to a legacy of leadership and invention that began in 1892 when our founder, William Painter, invented a better way to package soft drinks and beer. Painters vision revolutionized the bottling industry. His ingenuity, and the leadership of those who came after him, helped to build Crown Cork & Seal into the world-class company it is today.
Key Dates:
1892: William Painter invents the crown cork, and soon
1927: Company is incorporated in New York City as Crown Cork
1936: Acme Can Company is purchased, marking entry into can
1957: John F. Connelly takes over presidency and turns the
1958: Company moves its corporate headquarters to
1962: Company spends $121 million on a capital improvement
1970: R. Hoe & Company, a metal decorating firm, is
1977: Net sales reach $1 billion.
1989: William J. Avery takes over company leadership.
1989-91:Continental Cans Canadian, U.S., and overseas plants are
1992: Company pays $519 million for CONSTAR International,
1993: Cleveland-based Van Dorn Company, a maker of metal,
1996: $5.2 billion acquisition of Frances
Type: Public Company
Address: One Crown Way, Philadelphia, Pennsylvania 19154-4599, U.S.A.
Telephone: (215) 698-5100
Toll Free: 800-523-3644
Fax: (215) 698-5201
Web:
Employees: 38,459
Sales: $8.30 billion (1998)
Stock Exchanges: New York Paris
Ticker Symbol: CCK
Incorporated: 1927
NAIC: 322214 Fiber Can, Tube, Drum, and Similar Products
SIC: 2655 Fiber Cans, Drums & Similar Products; 3085 Plastics Bottles; 3466 Crowns & Closures; 3469 Metal Stampings Nec; 3411 Metal Cans; 3412 Metal Barrels, Drums & Pails
Crown Cork & Seal Company, Inc. is one of the worlds leading packaging manufacturers, making one out of every five beverage cans used in the world and one out of every three food cans used in North America and Europe. In addition to making metal food and beverage cans, Crown Cork also produces other metal packaging, including aerosol cans, specialty packaging, can ends, and closures and crowns. The company also makes plastic containers for beverages, food, household and industrial products, personal care products, cosmetics and fragrances, and medical and pharmaceutical products; composite packaging, such as that used for frozen juice concentrate; and can making equipment. With 223 plants located in 49 countries, Crown Cork derives about 60 percent of its revenues from outside the United States, with almost three-fourths of non-U.S. revenues derived in Europe. The companys position as a global packaging powerhouse was largely gained through an aggressive program of acquisition launched in 1989, which increased net sales from $1.9 billion to $8.3 billion by the late 1990s.
The company traces its origins to 1892 when William Painter invented the crown cork, a metal crown used to package soft drinks and beer in bottles. Painter soon started the Crown Cork & Seal Company of Baltimore. He quickly expanded the company overseas and by the time of his death in 1906 the company had manufacturing operations in Germany, France, the United Kingdom, Japan, and Brazil. After recovering from the disruptions of World War I, Crown Cork survived the Prohibition era by shifting its production from beer to soft drinks.
In 1927 the company was incorporated in New York City as Crown Cork & Seal Company, Inc. following its merger with New Process Cork Company Inc. and New York Improved Patents Corporation. The following year the company formed the Crown Cork International Corporation as a holding company for subsidiaries engaged in bottle crown and other cork business outside the United States. Crown Corks early entry into the foreign market gave Crown Cork an advantage over its competitors in the container and closure fields.
Crown Cork did not even venture into the can making business until 1936 when it purchased the Acme Can Company and began building its first large can plant in Philadelphia under the name Crown Can. While the middle of the Great Depression would seem to be the worst possible time to enter a capital-intensive industry, Crowns can operation was successful right from the start. Processed canning was quickly taking the place of home canning as the preferred way to preserve and store perishable goods. For this reason the container industry–for most of the 20th century–remained immune to the economic cycles that plagued most other types of businesses, industrial or otherwise.
Crown Cork & Seal was an enigma within the container business because it had achieved financial results that contradicted industry logic. Profit margins in can manufacturing had been small and shrinking for decades, and can makers like American and Continental had been relying on diversification and economies of scale to create profits. Crown Cork & Seal, on the other hand, had neither expanded into noncontainer fields nor sought to augment its own can making program by purchasing other small can operations. Yet it managed to maintain an earnings growth rate of 20 percent a year. How did it do this?
The answer can be traced back to 1957, when John F. Connelly, an Irishman and son of a Philadelphia blacksmith, became its president. At that time Crown Cork lacked strong leadership and was dangerously close to bankruptcy.