Experience Sharing: How to deal with the Enconomic Crisis in Packaging Industry?
March 25, 2010 (Germany) - Perfume, medication or candy- all these products need a folding carton, even during a crisis. However, there are still enough challenges for folding carton manufacturers as Dierk Schröer, spokesman for the Edelmann Group management team, reports.
How is packaging printing affected by the current crisis?
Our business reflects the situation in the industries we serve. With cigarettes and candy for instance the decline in volume is hardly noticeable. What we notice much more however is restrained consumer spending on articles such as premium-quality perfume. As a globally active packaging producer with 10 production plants we are seeing that consumers in China are spending more than ever which also has a positive effect on the demand for folding cartons. On the other hand, our production facilities in France and Mexico and the companies there are affected by the temporary decline in consumption.
What trends are you noticing?
Clearly noticeable in recent years is the trend towards smaller batches. Our customers are no longer prepared to have inventory but now demand just-in-time deliveries. In our role as a producer of folding cartons and package inserts we are part of the supply chain and an active value-adding partner for our customers. There is also a growing trend towards individualization meaning batches of special packaging for a certain market or seasonal products such as for Easter, Christmas or Mother‘s Day. Temporary product launches for test markets also play a part. More frequently demanded is special packaging for campaigns- often with one-shot character. These are products that are only offered for a short period and then disappear from the market. Only recently we produced packaging for season products for the Japanese market. The nature of such test and season products ties up a lot of capacity in a company and also demands a high degree of development expenditure.
What part does brand protection play?
Brand protection is a big issue, especially in the pharmaceutical industry where counterfeit products can endanger health. The thing here is to be always one step ahead of the counterfeiters. The requirement for innovation is enormous and meanwhile the repertoire of printable security features available is also very extensive. At Interpack 2008 we presented a folding carton with no less than 30 security features including a combined printing and embossing feature taken from banknote production. Normally two or three features are used. In order to achieve the highest possible level of security, the pharmaceutical industry combines hidden security features that can only be detected by the manufacturer with visible elements. This latter enables the consumer to clearly identify the product as original. Another measure is closed-loop production. Every folding carton is counted and every waste sheet documented. By contrast, manufacturers of premium-quality perfume bank on individual coding with consecutive numbering. By documenting the place and time of manufacture, the packaging becomes in effect a certificate of authenticity. I believe it is important that security features used on packaging are produced industrially and thus cost-effectively.
What developments are you seeing in design?
We notice that integration of multisensory effects in packaging is used more and more often. The 5 Senses study carried out by the Millward Brown Institute clearly shows that appealing to multiple senses increases brand loyalty from 30 to 60 percent. At Edelmann, adding metallic effects through hot or cold foil stamping for different projects is almost daily routine. We have also applied holograms and used scented coating. We use the flocking method to give touch and sight a new dimension. Very important is the so-called Best-Ager packaging. The pharmaceutical industry in particular orients itself more and more on the needs of older target groups. Key features here are simple opening and closing mechanisms and good readability. Incidentally, this latter feature is also required for package inserts. Wallet packages, which are clearly arranged packaging bags, are frequently requested by the pharmaceutical and consumer goods industries.
How have you positioned yourself to respond to the trends you have mentioned?
At the Edelmann Group we refer to High Q Packaging. This quality statement must be backed up by a machinery which is state-of-the-art. Our presses are equipped with all enhancement technologies such as inline or double coating modules for dispersion or UV coating or cold foil enhancement. The average age of our presses is less than five years. Meanwhile we are only working with the 3B and 0B formats.
Assuming you could wish for a press that doesn’t even exist, how would it look?
The greatest economic and technical challenge we face is the smaller batch sizes. A folding carton has to be ever more elaborate and upmarket but we can’t get much more for it. Therefore a press with 0 makeready time and waste rate for batch size 1 would be perfect for us.
(This article is taken from manroland "expressis verbis" 2010 Edition, written by Mr. Dierk Schröer, spokesman for the Edelmann Group management team. The Group has 10 plants in Germany, France, Poland, Mexico, and China where premium-quality folding cartons are produced. Their most important customers come from the pharmaceutical, cosmetics, candy, and cigarette industries.)
