Pallet-Management-Services - AFM

MAJOR GROWTH OPPORTUNITIES IN
EUROPE AND THE UNITED STATES
Our RPC rental business is the market leader in Europe with an
estimated market share of 44% of foldable RPCs. According to
our estimates based on available market data, European retailers
conduct 4.8 billion fruit and vegetable packaging units annually,
with approximately 2.9 billion packaging units addressable with
our RPCs. However, we estimate that European pool operators
only conducted approximately 570 million annual trips with
foldable RPCs. IFCO SYSTEMS global RPC-Management-
Services business segment generated US $285.1 million
revenues in 2006. Through increasing the penetration of RPCs
with our large existing customer base and by bringing new food
wholesalers and retailers into the system, we will continue to
develop this market potential.
Today in Europe, some 6,000 fruit and vegetable producers,
as well as more than 45 retailers such as Edeka, Rewe and
Metro in Germany, COOP and Migros in Switzerland, ATAC and
Système U in France, Rinascente and Eurospin in Italy, Consum
and El Arbol in Spain, COOP and BAMA in Norway and Waitrose
in Great Britain already place their trust in our logistics services.
The significant growth opportunities for RPCs are even more
pronounced in the US market, with an estimated annual volume
of 2.6 billion packaging units for fruit and vegetables, it is one
of the world’s largest individual markets. IFCO SYSTEMS is the
dominant market leader in the US, with an estimated market
share of approximately 60%. Although the US RPC poolers
continued to pursue market development during 2006, the RPC
business has not yet been widely adopted by the US grocery
retail industry. However, Wal-Mart, the world’s largest retailer,
as well regional grocers Stater Bros Markets and HEB have
adopted the RPC system in their grocery businesses and have
selected IFCO SYSTEMS as one of their system providers.
Finally, one of the divisions of The Kroger Co. performed a
| RPC-MANAGEMENT-SERVICES |
significant RPC pilot project during 2006. We are excited about
the development of the RPC model within new retailers, both
regional and national, in 2006 and look forward to continued
growth in 2007.
We are convinced, particularly in light of the strong supply chain
focus of the US retail sector, that this market will experience
strong RPC penetration in the future.
The significant investments we have committed to our RPC
pool and to our logistics infrastructure, along with our increased
marketing and sales activities, have created a strong foundation
to continue to grow our market share over the course of 2007.
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