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As 2013 draws to a close, suppliers and partners from across the package printing industries, including those involved in flexible packaging, folding carton and labels, give their predictions for the next 12 months.
2013 has been a year of big technological developments, attention-grabbing applications and seismic corporate shifts.
Take the development of in-line solventless lamination by Mark Andy, the Coca-Cola 'Share…' campaign and creation of Coveris, initially Exopack, as examples of such developments.
And if the record-breaking Labelexpo Europe 2013 is used as a barometer of business confidence, where package printing received its best response yet at a Labelexpo Global Series event, the next few years should be similarly interesting and exciting.
Ahead of the dawn of the new year, Packprint World asked a number of suppliers and partners across the package printing supply chain to look forward to 2014, and highlight some of the trends and topics they expect to influence business in the next year.
(Below is a list of contributions listed by the author's name - click their name to go directly to their comment)
Gary Seward, Pulse Roll Label Products
Looking forward to 2014
One of the major driving forces behind the growth of labels and printed packaging over the years has always been a requirement by brand owners to best market their products and grow sales using creative design, innovative ideas and maximum shelf-appeal. These attributes have now become available to marketers and brand managers in ways that have never been freely offered by printing companies in the past – whether its personalization, variations, multi-versions, serialization, QR codes, augmented reality, interactive or smart labels and packaging.
As the label and package printing industries learn how to better provide these new marketing opportunities, and brand owners continue to discover the benefits of these latest digital printing, interactive and web-based technologies, then the role of print providers will move even further towards that of service providers, consultants, project managers and web solutions specialists.
Those printing companies that embrace this new and exciting future will undoubtedly become the dominant providers of the future.
Folding cartons are getting more and more recognition as the preferred packaging choice for customers who value performance together with product safety, sustainability and, of course, aesthetics.
New trends develop like e-commerce, new sorts of product designs by the brands, high-end private labels, convenience shopping etc. The folding carton industry is in the middle of all these market developments, and cartons are increasingly recognised as the preferred packaging and also as a very powerful tool for boosting a product.
The shelf appeal and marketing possibilities folding cartons provide is immense. And when purchased, the packaging still plays its role. Another fact is that cartons add to the ‘product experience’, for example the enhanced experience to open up the carton box of a newly bought gadget, a nice bottle or special chocolates.
It is important that the performance of the cartons is based on the various demands in every respect of customers and end users. Working together closely in the industry for both converters and suppliers is of the utmost importance, and allows the industry to raise the bar and to be able to meet the on-going process of sharper demands from customers and end users.
The requirements on food safety are eminent and will probably grow even further in importance, which also applies for the pharmaceutical market where cartons have to deliver product safety at a very high level.
The important role of cartons is absolutely recognized, but every day will be challenging. Flexibility to meet all the different customer demands is very important and accounts especially in a market that is developing rapidly from local, to European to global. This applies for the world of production and consumption, and for new customers but also for new competitors.
ECMA is the voice of the European folding carton Industry and is the platform for industry collaboration. ECMA supports networking, knowledge sharing and is based on active engagement of the members. At this moment ECMA has approximately 40 converting member from both pan-European groups and SMEs, together with 13 national folding carton associations and about 30 direct supplier memberships. ECMA represents approximately 500 carton producers in nearly all countries in the European economic area and represents around 70 percent of the total carton market volume in Europe, with a current workforce of about 45,000 people.
In 2013 we started up a biomass boiler in Workington, where Incada is produced, that means that we have eliminated all fossil carbon dioxide emissions from the mill. The reduction, 190,000 tonnes, is equal to taking more than 65,000 cars off the road.
This makes Workington a unique folding box board mill, and judging from how all UK retailers claim that they want to lower their carbon footprints, Incada should have a fantastic 2014.
In 2013 the global packaging industry experienced some common business concerns and consumer buying trends that may continue in 2014. Pressure on margins, customer price sensitivity, volatility and increase in input costs, and a shift in consumer spending and behaviors were the leading business concerns for the global packaging industry in 2013.
Brand reputation and environmental records that were a focus for many brands and suppliers may become less important in the coming year, while delivery lead times, service levels and price will be considered the most important factors for supplier selection in the global packaging industry in 2014.
The first noticeable trend in 2013 was that capital expenditure towards new product development, sustainable or green initiatives, and machinery and equipment purchases increased in 2013, and will continue in 2014 as global packaging companies strive to improve operational efficiency, expand in their current markets and expand their product portfolio.
Luxury brands were in a major flux in 2013 and will continue to be so in 2014 as they try to position themselves with the new 'normal'. There’s a bold new world out there and the word 'luxury' now has different meanings in every language, and that meaning has been stretched almost beyond recognition causing luxury brands to find a common definition.
Is luxury about appealing to only the affluent or has it become more available to a wider demographic? Is about having recognizable status, or is something more personally meaningful? Luxury now means different things to different people and the luxury industry will continue to struggle in 2014 in defining itself to encompass this broader field.
2013 also saw a rise in new luxury brands entering into the market that were without heritage and history. These brands appeared newer, better, faster, fresh, more open and responsive to consumers versus the old, slow, and untrustworthy brands of the past. This trend was seen primarily in developed countries as a result of the lack of trust in big business.
What brands truly stand for, not just what they say, will be the deciding factor in increased sales in 2014. To connect emotionally with customers, brands must remain true to what they stand for. There will be an intensified focus on values, beliefs, and corporate social responsibility.
Going well beyond the functional and emotional benefits of products and services, corporate culture will determine brand loyalty. The luxury brands that will experience the greatest success this coming year will be those that employ sophisticated consumer segmentation techniques, invest in experience-enhancing technology, and exploit digital and social media to connect with customers.
Eco-friendly packaging was a key area of focus in 2013, but the ecological focus and first priority in 2014 will be on packaging that has a secondary use. Doing good for the environment must also mean doing good at the cash register for many brands, so companies will offer packaging with a dual use because it resonates with the environmentally conscious and the budget conscious alike by reducing waste and giving the customer two products in one.
Luxury brands will turn more and more to technology to create engaging experiences for consumers. Luxury brands honoring their heritage while pursuing the latest technology will have the greatest edge. These technologies include green technologies, use of 3D holographic imagery and integrated technologies that enable customers to learn more about the product at retail and preview the experience of the product and social media networks that provide inspiration and support.
2014 will also see an expansion of packaging surfaces that are equipped with multi-dimensional barcodes that enable the consumer to use their smartphone application that read and interpret these codes to gain online access to a wide variety of product or brand related information, which increases the consumer’s knowledge of the product or brand.
The digital age of mobility is changing shopper behavior and doing so very quickly. As consumers become increasingly more impatient and demanding they are drawn to different interests. Consumers are living more in the moment and mass produced analog print runs create stale artwork. Printers need to be aware that brands will in turn make new requests of their suppliers to keep consumers engaged.
Packaging will need to keep pace with the fast evolving mindset and interest of the shopper and consumer. Graphics and messaging that is just several months old becomes stale in this new era of mobility. Brands using digital workflows can create speed to market to keep packaging and products relevant generating engagement and interaction.
Lessons learned from the recent Coca-Cola ‘Share…’ campaign across Europe is that digital printing can create personalization, has the capability for long runs, can respond to social media when requesting the addition of more names and enables brand growth by looking beyond printed item savings
Brand owners have been mis-lead by digital package printing but this will all change with more campaigns such as ‘Share…’ now spreading around the world.
New 30in wide format digital print presses begin shipping in 2014 and these will create opportunity that has not been available before. The market success seen in digitally printed labels with the narrow 12.5in format will be possible in the flexible film and folding carton markets.
2014 will be a year like no other for the package print industry.
Mike Ferrari is founder of Ferrari Innovation Solutions, LLC and package industry consultant. Retired after 32 years of service from The Procter & Gamble Co., he is dedicated during this time of great transformation to educate, guide and inspire brand owners and those in the packaging industry.
2014 will be a big year for Nanography with the shipment of the first presses to our customers in Europe. There are a lot of people waiting to see the results of the work that has been going on since Drupa – our customers naturally, as well as prospective customers, brand owners and of course our competitors.
There is no doubt that Nanography will have a major impact on the printing industry in the years to come and 2014 will be the year that starts the process.
I hope that the UK carton industry goes from strength to strength enjoying a level of business that has been lacking since the bad old days of 2008/9.
I think that UK carton manufacturers have a healthy rivalry that results in the majority of companies seeking new and exciting manufacturing methods and post-press finishes that enable us to wow the brand buyer and in turn catch the eye of the disconcerting shopper.
The majority of our modern day consumers on a budget are cost conscious and savvy, looking for that added value perception at a realistic price on all purchases from confectionery, food and cosmetics.
I am sure that digital is going to be on the tip of our tongues for many months and be a subject both talked and written about extensively. And I am hoping that the digital machine manufacturers are able to deliver on their promises and supply to market a versatile, cost-effective digital carton print solution that will enable Glossop to fill the gap in our digital suite.
In the flexographic industry, I believe we have ridden the storm of the prolonged recession and are now looking forwards and upwards to renewed success for our industry.
Yes, we have seen bankruptcies, site closures and loss of business for several players over the past five years but we’ve also experienced consolidation of companies leading to an increase in their competitive strength, acquisitions and significant growth in the more robust sectors.
We’ve therefore further matured, become more competitive and have renewed innovation vigour which I, and the board of our trade association, are very excited about.
I believe some key trends will really stand out in 2014. Renewed growth in the retail industry will drive packaging innovation and differentiation. Increases in GDP have already been seen in 2013, and as the average consumer regains confidence, we will again see a boom on our high streets or in the digital world, which will increase demand for packaging and drive demand in our industry to new levels. However, this time, as this growth increases, packaging differentiation and functionality will become the new focus.
Driving sales share through packaging that 'pops', packs that grab the consumers’ attention and packs that have new uses, even post their basic use in the protection and preservation of the goods they store. Augmented reality, QR codes, gaming systems – packaging and print will be the fundamental link between the 'bricks and clicks' reality of the retail world in 2014. These trends will of course drive new challenges for the UK flexo printer as well as the packaging designer.
We’ve talked a lot in recent years about the 'aging economy' and this is never truer than in the flexo industry. For many years, lack of recruitment has led to the average age of the UK printer climbing and a lack of fresh blood entering the industry, which will ultimately stifle innovation and fresh thinking. I believe in 2014, as the wheels of fortune turn again, our industry will begin to focus on this challenge and hopefully start to invest in new younger people for all areas of the business and train them effectively to compete into the future.
At EFIA we have invested heavily in the Academy 2 flexo modular e-learning programme to support this initiative and are excited to have recently achieved National Skills Academy accreditation for its use.
With respect to the flexo technology itself in 2014, EFIA just recently held its annual partners’ luncheon debate and the motion for this year was around whether the flexo industry requires further innovation? The resounding conclusion of the day was that whilst innovation is key to competitiveness, much of the innovation in the industry today is really around sharpening up the process, as opposed to step change process development.
My hope in 2014 is that we continue to see an uptake of the latest technologies available, to further drive printing quality, for example, high resolution imaging system, advanced photopolymer plates and the latest novel cell formations for anilox rollers.
These innovations will allow the industry to respond to brand owner trends and changes that may affect us in the long term. Many talk of the advent of digital and flexo printers should certainly be embracing that development for specific requirements – very short run, personalised work for example – but the flexo process with its quick changeover times, ability to run both short and long work cost effectively and increasingly high standard of print quality, I believe will really stand the test of time.
Every New Year brings a vein of re-establishment within a company. But 2013 started like 2012 never ended. Most companies seem to keep the same path of the previous year, in respect of recovering the losses of the previous year and trying to increase results in the next few years to come. But in 2014 this will bring a great difference in behaviour and mentality.
As a small to medium company, Discovery Flexibles envisages demanding challenges ahead with potential restructuring in the flexible packaging sector. Rising costs, growing environmental concerns and recurrent intensity to reduce prices have placed increased pressure on all players, which continues to drive restructuring and strategic change.
As the market leaders and major European converters continue to evolve and grow by acquisition, the greater emphasis is placed on the emerging markets of Eastern Europe and Russia, thus imposing cost-cutting. Going head-to-head in bidding wars against these market leaders is becoming more and more futile. Through their acquisitions, the sheer scale of their armory compared to some SMEs is unparalleled; therefore these typical tender bidding wars are vastly becoming non-events for companies like us.
As a smaller flexible converter, we have to think carefully about our approach and strategy going forward; we feel we need to redeploy our methodologies when it comes to selecting business targets and buck the trend to gain a foothold in the industry. This will come through innovation and broadening our horizons on what we can offer and what solutions we can provide.
So the year can be new, but the challenges will continue the same but the fact is that good packaging will continue being the one that offers end users a good cost relation and fulfill their expectations. The defining factor will be in which the resources, innovation and technology each company will use to gain the upper hand.
A big trend we see having a strong impact on business is the ongoing trend to short runs – both in commercial printing and in folding carton production. Brand owners and print buyers understand the advantages of versioning with mailings and packaging more and more as they discover how to address – and impress – their target groups with focused activities; these can be seasonal, regional or even individual.
KAMA also believes in the strength of crossover marketing. We see a big potential in combining e-media, print products and also television. We ourselves are going to create our new brochure accordingly.
In November 2014, KAMA will be celebrating the 120th anniversary of its foundation, which started 1894 with the invention of the creasing line. This event shall bring the breakthrough for KAMA in the folding carton industry. We are proud to present a complete solution for the folding carton workflow and will do this together with HP Indigo and their new 30000.
KAMA will present further new products in 2014 – all of them related to short-run production. Developments include machines, handling equipment and JDF workflow solutions.
One of the growth areas we have witnessed is the increase in flexible packaging demands; as label printers diversify into more areas to meet the challenging needs of their customers they are breaking away from just producing self-adhesive labels and being able to offer their customers more options.
This is where Edale have seen such demand for the FL-3 press as it has the ability to print on standard label stocks but also a variety of films as low as 12 micron, meaning customers can buy one press to do all rather than two presses as they may have had to do historically.
The biggest shake ups in the packaging industry have really been in the cartons and healthcare segments. It all started on Christmas Eve 2012 when Graphic Packaging completed the acquisition of Contego Cartons and followed this deal by buying certain assets in the beer and beverage market from A&R Carton. Prior to the Contego Cartons deal Graphic Packaging had not been a very significant player in the Europe but had been the USA’s biggest carton business and is also vertically integrated, producing carton board.
It could be argued that the deal acted as a catalyst for other transactions in the cartons sector announced in 2013 including the sale of A&R’s Specialties packaging operations, consisting of Å&R Carton Lund and Flextrus, to Weidenhammer Packaging Group in Germany and the sale of A&R tobacco and Russian assets to Mayr-Melnhof.
Similarly, in healthcare packaging, including cartons, leaflets and labels, Contego Healthcare was sold to Filtrona, which had previously only had a relatively small labels business in its portfolio. Then, in September Carlyle completed the acquisition of Chesapeake and merged it with MPS. This created not only the leading transatlantic player in healthcare packaging but also a leading carton producer for luxury goods.
These changes are likely to drive further consolidation as competitors who do not have a multinational footprint may struggle to serve key clients and they may not have the economies of scale, negotiating position with suppliers, or the most efficient manufacturing footprint.
Sustainability as a buzz word continues to dominate everything in the packaging world, all the major substrate suppliers and the major brands are including it in their mission statements in some form or flavor and most have them have set themselves some pretty aggressive targets. This will continue for the next few years. I’m sure this will be joined by tougher environmental legislation in the future. I also think consumers are becoming more environmentally aware and the sustainability angle will influence more people’s buying decisions/habits in the future.
Digital is continuing on its drive to go faster, wider and cover a wider range of substrates and packaging markets. In the future I think most hybrid packaging lines will include a digital element. No doubt there will be plenty more Coca-Cola type marketing programs in 2014. The quantum leap here will be if/when the Landa project reaches its quality targets and the first commercial machines hit the market.
There’s also definitely a lot of interest in intelligent packaging and I’m sure that interest will grow in 2014, however it will be interesting to see how much of it makes it through to commercial applications and if we (as consumers) start to see it in our shopping trolleys.
Our customers are generally facing a difficult market situation in many sectors of the industry. We expect that the trend of restructuring in the printing industry will continue during the next years, therefore the demand for excellent service and value for money will continue.
In printing flexible packaging, which is mainly printed in rotogravure and flexo, we see a clear trend towards the use of offset due to the fact that smaller sized orders can be printed more economically and more environmental friendly. We expect to address this increasing demand with the Thallo which will show an unbeatable press platform in terms of price / performance ratio.
Our growth is purely because we have proved and we will continue to prove that we generate added value to our customers worldwide. Therefore we will focus on the delivery of services, used and new presses to the industry.
For 2014, we will keep our focus on meeting the needs of our existing and future customers and will continuously invest in improving our services and creating state of the art (used and new) presses that are fit for the demanding future of our customers. We will increase our investments in services and press development, grow our assembly and refurbishment capacity and implement a new press assembly structure. Next to this, we trust that we can offer great solutions for the label market.
The top three pointers to what I believe will be trends through 2014 are:
Direct-to-pack - With the emergence of the dedicated digital carton presses, printing short-run cartons will be a reality. Ordering what you want when you want it will change the availability of complex dedicated cartons. Small industries ordering online will be a big user of this direction.
Markets merging - A significant move from commercial printers to involve themselves with the carton market will be aided by an existing digital know-how, a tight margin commercial marketplace and new technology that makes carton manufacturing achievable.
Brands extending SKUs - The ever desirable 'first moment of truth' will become stronger and so the need to alter packaging to encompass regionalism, seasonality and campaigns for growth will become wider used and new technology will aid this direction.
My observations as a supplier of continuous feed and specialty plastic pallets to the packaging industry are:
Equipment - Successful printers have continued to invest in the newest presses, primarily 145cm size.
Market -specialty packaging and shorter runs seem to be increasing.
Product - special effects differentiate printers – rubberized carton stock, varnished finishes, hygienic paper and process for health care, etc.
In general, customers are fewer, slightly larger, but successful enough to look at capital equipment (including our pallets) to reduce costs and improve quality.
2013 was an outstanding year for Pulse Roll Label Products with sales up a record 40% from 2012, and we expect this momentum to continue into 2014 and beyond. Sales growth was experienced in both the UK and export markets, as we increased our international presence with distributor appointments made in key markets worldwide. Growth was notable particularly in Northern Europe and Australasia.
There was dramatic growth in demand for our peel and read varnish (also known as piggy-back, release, peel and re-seal), which reflects end-user requirements to provide more enhanced product and detailed consumer information as well as gearing up for forthcoming changes on classification, labeling and packaging to be adopted by June 2015.
Pulse’s RD Series (economy range) of UV flexo inks witnessed a surge in growth throughout the year as label printers and converters margins continued to be under pricing pressure but also as demand for low-cost consumer packaged goods and 'value' products continues. We see that trend continuing into next year, driven predominately by the consumer. Pulse’s metallic ink sales also grew in the UK but even more so in exports markets, as companies use metallic products to differentiate their products on shelf.
Slow but steady progress was seen as some converters moved away from traditional UV inks towards low migration products and we expect this trend to continue in the longer term. Alongside this, we have also seen customer interest stimulated in water-based inks as an alternative to UV. Steady sales of digital varnishes and our flourishing partnership with HP Indigo backs up the industry wide trend of the growth experienced in digital label printing.
Our new UV curable flexo matte varnish range saw unprecedented growth due to excellent runability and superior performance on press. These can be used on wider web applications as well as narrow web for both labels and other packaging types.
All in all, 2013 was a highly successful year for Pulse and we are well-poised to enter 2014 and excited about the many opportunities that we feel lie ahead in the industry.
We are happy – not only as a provider of eco-friendly cleaning systems – to register a distinct trend in the label printing industry to increasingly invest in sustainable production technologies for the benefit of their employees and the environment.
In 2014 we expect to see even more printers going ‘lean’. Everybody is focusing on cutting costs by optimizing production, workflow and uptime on the printing press.
We at Flexo Wash see it as a key task to help our customers ‘leaning’ the process around job changeovers and cleaning. We will focus on selling complete and 100 percent automatic cleaning solutions covering all aspects of cleaning needs with our customers. By having a complete washing solution, the operator does not have to spend time on any work related to washing and he is sure that all aspects of the printing press (chambers, aniloxes and plates) are always clean so the press keeps running and the print quality stays high.
The Labels & Labeling Yearbook 2014 will be published at the start of next year, and provide more detailed insight into key trends and topics to impact the label and package printing markets going forward.
If you work in the label and package printing markets, and would like to contribute your own thoughts to this article, please email David Pittman, group news editor, at firstname.lastname@example.org.