Companies to Watch: Mercian Labels Group

By Catherine Diamond, Associate Editor | October 14, 2013

Mercian Labels Group
Watling Street, Cannok, Staffordshire, WS11 0BD, UK
44-0-1543-431-070 • www.mercianlabels.com

Established in 1969, Mercian Labels got its start in a small shop in Penkridge, Staffordshire, England. Today, The Mercian Labels Group has grown into an international producer of high-end security labels, including the Label Lock and Gammatex ranges.

The company operates on two sites: one in Cannock, and one approximately 40 miles away in Derby. It employs about 35 people and, in 2012, boasted a revenue of €2.7 million. Under the umbrella of Mercian Labels Group are Security Labels International, AC Labels, and Geoffrey Waldmeyer Associates.

Security Labels International, established in 2007, manufactures in-house from a factory in the Midlands and employs a wide range of techniques to develop products for individual applications. The Label Lock range of non-residue, tamper-evident security seals was launched in 2008. Dual Layer labels and tamper-evident tape followed in 2009 and 2011, respectively.

AC Labels, based in Derby, prints high volumes of primarily bar code labels for logistics and medical applications, such as tubes for blood samples. The Gammatex brand of irradiation sterilization indicators and gamma sterilization indicators are also under the umbrella of  The Mercian Labels Group. They are used as “qualitative process indicators for the gamma irradiation sterilization process.” In other words, they’re used to ensure that things such as surgical equipment have been properly cleaned and are ready to be used.

Geoffrey Waldmeyer Associates, which was acquired by The Group in 2012, is a supplier of plastic and metal C-TPAT security seals, asset labels and tamper-evident bags. The acquisition was made in order to add to the Security Labels International product portfolio, specifically the Label Lock range.

The Group is led by a three-person team of directors: Hugo Gell, who is the company’s sales director; Adrian Steele, who is managing director; and Dennis Marrison, chairman of the group and an independent non-executive director of the board.

“The reason we have three directors is rigorous governance, really,” says Gell. “We like to do things properly.”

For a company with over 9000 business customers – 98% of who get their labels delivered within three days of artwork approval –
proper is important. And that means having the right equipment. The company today has a mostly digital focus, though its roots were in hot foiling.

“In the old days, we had a lot of hotfoil presses here,” says Gell. “So you could have any kind of you label you wanted on any substrate, as long as it didn’t have more than four colors, and no half tones or shading.

“Digital was a great opening for us. We’ve always specialized in short runs and short turnarounds, and speed is very important to us, so you can imagine how digital has helped us in that regard.”

In 2011, the company invested in a Xeikon 3300, which it calls “the fastest and most advanced digital labeling press of its kind.”

“When I first joined in 2005,” Gell says, “we had six hotfoil presses, two flexo, and that was it. Since then, we’ve got two hotfoil left, one four-color flexo, and the bulk of the work goes through the Xeikon.”

In about 2005, Gell says the company realized there was a value-added opportunity in the security sector. Mercian started to invest in and sell security labels, and set up Security Labels International.

“We quickly realized that the old, standard security label materials were inadequate,” Gell says. “They’re mass-produced in China, and very insecure. We invested a lot of time and energy in an R&D project and started to make our own security materials. We then launched the brand that’s now known as Label Lock.”

According to Gell, Label Lock is the company’s flagship brand. Because Gell and his counterparts felt that there really wasn’t a high-quality, non-residue label out there, they set out to develop one.

“I’m always in favor of producing what the market wants, not going out there and telling the market what it needs and having it produced,” Gell says. “You can waste an awful lot of money doing that.”

Gell says the real challenge when developing products for the Label Lock brand was finding something that wouldn’t leave a residue behind. Because these were being developed for aircrafts, vehicles, safes, and the like, it was essential to develop something that would provide security without damaging the value of the product. 

In addition to developing a label that was both tamper-evident, irreversible and non-residue, the company wanted to be sure it could not be replicated. 

“A big problem with security labels is that they don’t have a clear border,” Gell says. “So, what you could do is just photograph the label, print out the photo on a desktop printer, and just cut it out. You can then remove that security label and stick the photocopy in its place and no one would know. You very often can’t tell that a security label has been removed until its been removed.

“The great thing about the Label Lock labels is, you can’t photocopy clear. These have a clear border around the edge and the whole lot is in register. So that’s why this is really much more sophisticated than other products on the market.”

Looking towards the future, Gell says the company is focused on new innovations and investing in smart labels. RFID labels are something they’ve constantly got their eyes on, he says. “There is always emerging technology and nanotechnology, and looking at how you can employ that in labeling, it takes a bit of time before it can become commercially viable,” he says. “We do have a press that is modular, and very flexible, so if we came across the right thing, we could start to manufacture them very quickly. Its just a question of finding it, really.”