PCCS Group Bhd plans to turn its wholly-owned China subsidiary, China Roots Packaging Pte Ltd, into a one-stop centre for packaging materials.
Deputy group general manager Gan Hoe Lian said demand for plastic and corrugated boxes in the republic was high due to the bustling manufacturing sector there.
He said although there were many packaging companies there, most could not meet the high standards stipulated by multinational companies.
These companies are plagued by high wastage, inferior quality, late delivery and bad sales services,'' Gan told StarBiz in an interview.
PCCS had in July 2003 acquired 100% in a loss making packaging company, Blopak China Private Ltd, for RM4.12mil and turned it around within a year, he said, adding that it broke even in June 2004 and would probably make a profit by the end of the year.
He said Blopak currently supplied bottles to a leading global direct-selling company with operations in China.
Gan said PCCS would invest US$14mil in a new plant in Huang Pu, Guangzhou, with construction to start soon and to be completed early next year. Upon completion of the plant, operations at Blopak currently in rented premises would be transferred to China Roots.
Gan said Blopak was the fifth largest plastic bottle supplier in China, and that it was aiming to be among the top three upon joining China Roots.
The company would set up a labels and stickers section by the middle of next year to complement the packaging activities of China Roots.
By then, customers could have the labelling on their packages done at the same time, instead of having to go elsewhere like what they had to do now, Gan said.
He said PCCS had decided to diversify its activities from just apparel making to the non-apparel business, as it did not want to be dependent on one core business.