In this piece, we will take a look at the ten least innovative companies that are still in business today. For more companies, head on over to 5 Least Innovative Companies That Are Still In Business Today.
Ever since Apple launched the first iPhone, innovation has been one buzzword that hasn’t gone away either in the corporate world, the media, or business schools. Every day countless boardroom meetings are held focusing on how to be innovative, publications fawn over this company being innovative or that company being innovative, and business schools rack their brains to crack the secrets of innovation once and for all.
With all this buzz, it seems as if innovation is essential for a firm’s survival. This belief is further cemented by the list of countless firms that have gone out of business because they failed to see emerging trends. Since we started off with the iPhone, its rise to popularity put two companies out of business. Both Nokia and Blackberry failed to see the change that the smartphone would usher in, and despite being among the most popular phones out there, dropped massively in popularity. Another classic example is Eastman Kodak Company (NYSE:KODK). Kodak, which dominated the market with its films yet failed to see the utility that Sony Group Corporation (NYSE:SONY)’s digital point to shoot camera would provide the consumer, and had to lose access to a lucrative market.
Then, Sony failed to appreciate how the smartphone would become the go to camera of choice for people, and the cycle continues. Yet another example is of Intel Corporation (NASDAQ:INTC). Intel lost a once in a lifetime chance to dominate the smartphone market when it turned down Apple Inc. (NASDAQ:AAPL)’s legendary founder Mr. Steve Jobs who wanted Intel to design and manufacture the processor for the iPhone. Now, Apple’s partnership with the Taiwan Semiconductor Manufacturing Company (NYSE:TSM) has made the latter the world’s largest contract chip manufacturer – and Intel’s biggest rival in the foundry space, one which currently holds the technological edge in chipmaking technologies.
Commenting on the thought process that went being rejecting Mr. Jobs, Intel’s then CEO Mr. Paul Otellini explained to The Atlantic that while his ‘gut’ told him to accept the offer, he decided to go the other way because:
We ended up not winning it or passing on it, depending on how you want to view it. And the world would have been a lot different if we’d done it. The thing you have to remember is that this was before the iPhone was introduced and no one knew what the iPhone would do…At the end of the day, there was a chip that they were interested in that they wanted to pay a certain price for and not a nickel more and that price was below our forecasted cost. I couldn’t see it. It wasn’t one of these things you can make up on volume. And in hindsight, the forecasted cost was wrong and the volume was 100x what anyone thought.
However, even though innovation is king in technology, there are industries that don’t change much over time. These industries often deal with commodities such as coal and oil, or basic products such as cardboard boxes, tin cans, and glass bottles. Today, we’ll look at some firms that have been around for decades and are still making the same products.
Our Methodology
We scoured through the business world to sift out industries that have remained static over the decades. This search led us to identify the oil and gas sector, the steel industry, cardboard manufacturing, glass bottles, and tin can manufacturing, pipe making, and the airline sector as sectors that either have little room for drastic innovations (Delta Airways after all is constrained to use the airplane to fly its passengers unless SpaceX opens its doors) or have firms that have not expanded into new industries or product markets on their own and have instead relied on acquisitions to diversify their footprint. The private firms are listed first, and the public entities are listed according to their market capitalization.
10 Least Innovative Companies That Are Still In Business Today
10. Burch Bottle & Packaging, Inc
Burch Bottle & Packaging, Inc is one of the oldest packaging products companies in the United States. The firm was set up in 1983, and since then, it has been manufacturing some of the most commonly used products out there. It serves the needs of almost thirty different industries. Some of these are the food and beverage, cannabis, honey, drink mixing, sauces, personal care, jars, jellies, and peanut butter sectors. Initially, the firm’s factory was located in Watervliet, New York. But Burch Bottle & Packaging moved the factory to Queensbury, New York as part of a $2.5 million purchase of a former print shop.
Along with, Saudi Basic Industries Corporation (TADAWUL:2010.SR), Comcast Corporation (NASDAQ:CMCSA), and Saudi Arabian Oil Company (TADAWUL:2222.SR), Burch Bottle & Packaging, Inc is one of the least innovative companies that has managed to stand the test of time and continued operating profitably.
9. Georgia-Pacific LLC
Georgia-Pacific LLC is a subsidiary of Koch industries and one of oldest paper manufacturers in the world. The firm was set up in 1927 as a lumber company. In its nearly century old history, the last major change when it comes to product manufacturing and markets came in 1957, when Georgia-Pacific LLC decided to enter the paper and pulp making industry. Since then, the firm has focused on targeting more of its total addressable market (TAM) as opposed to portfolio diversification to target more industries and additional revenue streams. During this time period, Georgia-Pacific LLC has also carried out a string of acquisitions of similar firms, which include a buyout of the Fort James Corporation in 2000, which at the time was one of the biggest paper manufacturers in the world.
The company was acquired by Koch Industries in 2005 for a whopping $21 billion. Koch initially wanted to focus on the construction materials division of Georgia-Pacific LLC but ended up keeping the paper division as well. Georgia-Pacific LLC is based in Atlanta, Georgia and some of the products that it manufactures are toilet paper, napkins, paper towels, and tableware.
8. Silgan Containers LLC
Silgan Containers LLC is one of the oldest companies in America. It was initially set up in 1899 as a condensed milk packaging company. Silgan, in its current form, came into being in 1987 as Silgan Corporation bought Carnation Corporation’s can division. Carnation was an evolution of the Pacific Coast Condensed Milk Company’s can-making division that was set up in 1899. Since then, the firm has carried out a slew of acquisitions to grow its presence in the container industry. These cover 11 different acquisitions since 1987, including the famed Campbell Soup’s can manufacturing operations in 1998. Silgan Containers LLC is headquartered in Woodland Hills, California, and has focused its efforts on making cans for more than a century now.
7. United States Pipe and Foundry Company LLC
United States Pipe and Foundry Company LLC is another century old company and one that has stuck to its strengths since being set up. However, unlike some other companies in our list that start out as different businesses and evolved into their current state later on, the United States Pipe and Foundry Company LLC is one of the few firms that has been making the same products for more than 120 years now. It started out as a water and wastewater products manufacturer in 1899, and it still makes and sells iron pipes, joint pipes, gaskets, and fittings such as ductile iron fittings, and joint fittings. The company has ductile iron and fabrication facilities all over America, in states including Texas, California, and Florida.
5. Peabody Energy Corporation (NYSE:BTU)
Market Capitalization as of January 29, 2023: $3.92 billion
Peabody Energy Corporation (NYSE:BTU) is one of America’s oldest companies. Set up in 1883, the firm is headquartered in St. Louis, Missouri. Like other firms on our list, it is the least innovative when it comes to product diversification. For more than a century, Peabody Energy Corporation (NYSE:BTU) has simply been mining and selling coal – despite America’s shift away from the dirty fuel to the cleaner burning natural gas. Additionally, the firm saw business grow in 2022 as the Russian invasion of Ukraine shook up global energy supply chains. Finally, Peabody Energy Corporation (NYSE:BTU) is finally changing too, as the firm announced in 2022 that it will develop a 3.3 Gigawatt solar energy facility.
38 of the 920 hedge funds polled by Insider Monkey in Q3 2022 had bought Peabody Energy Corporation (NYSE:BTU)’s shares, up from the 30 in the previous quarter – signaling interest in the coal industry due to the Russian invasion.
Peabody Energy Corporation (NYSE:BTU)’s largest hedge fund investor is Paul Singer’s Elliott Management which owns 25 million shares that are worth $641 million.
Peabody Energy Corporation (NYSE:BTU), Saudi Arabian Oil Company (TADAWUL:2222.SR), Comcast Corporation (NASDAQ:CMCSA), and Saudi Basic Industries Corporation (TADAWUL:2010.SR) are some of the top, yet highly non innovative companies which have stayed in their industries for decades and not gone out of business.
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Disclosure: None. 10 Least Innovative Companies That Are Still In Business Today is originally published on Insider Monkey.
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