International Paper Company has a long and interesting history. The company is a global leader in paper and packaging products. International Paper's corporate headquarters is located in Memphis, Tennessee. It has manufacturing and business operations throughout North and South America, Europe, Asia, Russia and north Africa. The company employs 60,552 people and has an annual revenue of $22.3 billion dollars, placing it in the middle of the Fortune 500 list.
The Beginning
International Paper (IP) was founded on January 31, 1898, in Albany, NY. The company was created by merging 17 different paper mills located throughout the eastern United States. The company's first president was Hugh Chisholm, who was promoted upon the death of IP's co-founder William A. Russell. Unlike many start-up companies, IP was a large company from its inception. IP held a 60% market share on newsprint paper in the United States in 1898. However, in 1913, the U.S. government eliminated tariffs on imported newsprint. Low-cost newsprint imports from Canada ate into IP's market share. In 1921, IP was shaken by difficulties with its collective bargaining process and subsequently lost additional market share.
The Great Depression Years
The Great Depression has been credited as helping to shape the company's successful future. In response to dwindling revenues and shrinking market share, the company developed new product lines. IP introduced linerboard, used in corrugated containers, that was manufactured by more cost-effective methods, making the product more affordable. This marked the beginning of a new IP, as one of the first low-cost manufacturers of linerboard in the U.S. This moved the company through the years of the Great Depression. During this period, IP became a pioneer in forging a model for modern company benefits. The company began offering benefits, which included health and life insurance as well as a retirement plan. Many companies did not offer these kinds of benefits at this time. In 1937, IP was able to reopen negotiations in its collective bargaining process.
The War Years
In 1939, the world was plunged into war. In 1941, to support the war effort, the company dedicated several of its manufacturing facilities to wartime products. The added business was much needed after the lean years of the Great Depression. IP designed a new type of container for shipping munitions that was much stronger and more reliable than a wooden crate. The new containers kept out moisture, which helped prevent misfiring and dud munitions.
The 50s, 60s and 70s
Throughout the next few decades, IP continued to build plants, invent and improve new products and grow in both revenue and market share. IP was placed on the Dow Jones Industrial Average in 1956, replacing Loew's Inc. During the 1960s, IP experienced an unprecedented growth through acquisitions, made possible due to the company's vast resources and minimal corporate debt. But the corporate leaders in the 1960s increased the company's debt and acquired one company after another. The company strayed from its business model, acquiring companies that were not easily integrated into the IP corporate structure. Many of these newly acquired companies were sold within a couple of years.
The 80s and 90s
During the 1980s, IP began a major overhaul of its mills. This six billion dollar initiative reduced the cost of producing container board by 18%. IP continued to make large acquisitions and further consolidate the newsprint paper industry. The company purchased the German company Zanders Feinpapiere AG, the Chilean company Copec and the French company Aussedat Rey. IP became the world's largest supplier of plastic lids and cups to the fast-food industry. The 1990s brought more acquisitions and further consolidations within the industry. During the 90s, the company introduced an initiative to broaden IP's product base. These new products included: specialty industrial papers, laminated products, disposable diapers and custom wood products. IP also divested itself of over six million acres of timberland in the United States due to environmental concerns and logging conditions.
International Paper Today
Today, International Paper is still a world leader in the production of paper products. The company operates 85 packaging plants, 16 pulp mills, 4 wood product facilities and hundreds of outlets throughout the world. Although the company divested the majority of its forestland in the U.S., it still holds over 300,000 acres of forest in this country. IP is currently a leader in charitable giving. IP currently sponsors The United Way and Coins 4 Kids, which provides school food programs for underprivileged children. The company also supports the environment through organizations like Earth's Birthday Project and National Geographic Explorer.
