Low Cost

We know achieving low cost improvements is about a day-to-day, continuous focus on efficiency across all aspects of our business: procurement, manufacturing, logistics, administration, and IT. Whatever role you are in, you have an opportunity to do things smarter and leaner. We all must be relentless in our pursuit of low total cost solutions.

What is our goal?

Amcor strives for a low cost position as a way of doing business every day.

We achieve our goal by having the best skilled people with the right tools, including both processes and systems.

In order to achieve our 'Low Cost' goal, there is continuous improvement across all aspects of our business, including SG&A, procurement, manufacturing, logistics, and IT.

Operating at the lowest cost – While all cost elements are important, concerted effort has been made on elements where we spend the most money: material (direct and indirect) procurement and manufacturing operations.

Procure Plus is our evolving program for world-class procurement through simple tools, competencies, tracking and regular cross functional “boot camp” exercises to refresh our approach on the largest spend opportunities.

The LEAN tool set is selectively applied to achieve lowest cost operating expenses, in particular to reduce waste and to reduce change-over time and expense. LEAN is also deployed to improve quality, speed and workflow/space and all these initiatives enable low cost operations.

Supporting the business at the lowest cost - To ensure our overheads are efficient, we benchmark our overhead spending as a percent of sales. Our businesses are individually very complex, and we expect our overhead functions to support the business effectively and efficiently and only standardize where there is opportunity to save significant expenses.

Our most notable success is in the area of Information Technology (IT), where Amcor’s global IT cost position is 1.4%, well below the 2.4% average for manufacturing businesses. The Amcor business group CIOs work together on the Global IT Steering Committee (GITSC) to initiate and execute global projects, standards and savings programs without building a central, costly Amcor Global IT team.

Continuous improvement towards lowest cost – Like most other companies, Amcor’s budget cycle sets the revenues and operating & supporting expense plans for the next Fiscal Year, called the Operating Plan. After the Operating Plan is set and the fiscal year begins, each business tracks profit opportunities and risks which are not included in the Operating Plan, as well as develops a running list of opportunities or "Sufficiency Plans".

The Operating Plan and the Sufficiency Plans are continually reviewed, through our Monthly Management Reporting (MMRs) and our Quarterly Business Reviews (QBRs). This approach to continually thinking about new ideas to improve profitability, proactively engages our people on a regular basis.

Organisational structure – There is not a separate organization structure for Amcor’s Low Cost competency, it is a way of operating that is embraced by all businesses, at all sites and on all teams.