The photograph speaks volumes. In the foreground sits an elderly woman dressed in traditional garb, her loose-fitting outfit topped off with a triangular shaped hat. Beside her, two large baskets filled with fresh food are attached to a pole, enabling her to carry the goods on her shoulder.
Steps away, a young man sits on a motorcycle. Dressed in a T-shirt and jeans, he punches numbers on his compact cell phone. One snapshot captures two completely different ways of life, existing in the same space and time.
This vignette provides a glimpse of the culture change currently occurring in Asian countries. The old traditions are passing away, replaced by a new lifestyle embraced by younger generations.
"The standard of living has increased and new shopping manners, hypermarkets and shopping malls are coming instead of only … stands. A demand for a higher hygienic level is also coming from consumers and authorities," says Singapore-based Kari Palli, managing director of Raflatac (S) PTE Ltd. and vice president of sales and marketing in Asia Pacific.
Change is occurring everywhere. In India, open markets are giving way to supermarkets. In China, a culture that did not grow up with refrigerators is now realizing that it can't live without them. And in Malaysia, the hypermarket giant Carrefour sells merchandise, clothing and food under one roof.
This new way of living has revolutionized the label industry. Now, food needs packaging. Labels on shelves must vie for a shopper's attention. And bar code labels are necessary for fast checkouts. "Products now require labels, where before labels were less used in this sales setting," says George Lyle, managing director, Asia Pacific, for Akzo Nobel Inks, in Selangor Darul Ehsan, Malaysia.
The label industry grows as Asians purchase products that require labels. It is also spurred on by an increase in exports to countries in the West. Growth is occurring around the region, and countries are grabbing varying amounts of the business.
"The variations from country to country are big, but the clear driving force is China," says Palli.
By all accounts, China is leading the Asian market in label growth. "China is growing at no less than 10 percent," comments Calvin Frost, president of Channeled Resources/ Maratech, a supplier of paper and film products headquartered in Chicago. "There's no revolution. There's more of an explosion."
After Deng Xiaoping took leadership of China in 1978, his government's market-oriented reforms jump-started the sluggish economy. The regime delivered more economic decision-making to local authorities and permitted increased foreign trade and investment. These changes have catapulted China into a phase of continual economic growth. According to The World Factbook 2002, published by the US Central Intelligence Agency, China's gross domestic product has quadrupled during Deng's reign.
"They won't admit it, but they're turning to capitalism," says Ron Harper, chairman of Harper Corporation of America in Charlotte, NC. A manufacturer of anilox rolls, his company has opened a facility in Thailand. "China is putting some muscle into its marketing and is working on its image worldwide," he says.
China currently enjoys a variety of healthy markets. According to Frost, some of the more profitable industries include automobiles, power, housing, appliances, industry and transportation.
"China will definitely continue to grow because of the large number of domestic consumers, lots of resources and the lowest cost of production," says Prasert Vachiraprakarnsakul, technical director of Harper Asia Pacific Ltd. in Bangkok, Thailand.
India, an eager market
India is also seeing a label growth spurt. Food labeling is one reason for the label industry's success. Food is one of the largest industries in the nation, with 60 percent of the country's labor force involved in agriculture.
The nation also claims a large stake in the worldwide software market. Infosys Technologies Ltd. is an Indian software producer with offices around the world. The company's clientele include corporate giants Microsoft and Dell. In 1999, 82 percent of total orders were from the USA. With streams of product exports originating from India, the labels also comply with Western standards.
The nation's printers thirst for knowledge and increased technology. "We possibly get more inquiries from India than we do from all foreign countries," says Harper, "We receive inquiries virtually daily from Indian printers."
While India's economy is growing, some question its stability. "There are still a lot of problems in religions, infrastructure and people. The economy looks pretty good but unstable. However, India is growing and will continue to grow," says Vachiraprakarnsakul.
Despite an overall positive report, given the variety of different cultures and governments encompassed under the Asia Pacific umbrella, it is impossible to generalize Asia completely. There are always exceptions.
One such exception is Indonesia. Indonesia battles political unrest, corruption and weaknesses in the banking system. These factors continue to batter the nation's economy. And until reforms are in place and confidence in the economy is reinstated, the label industry will fare no better.
Japan also grapples with a struggling label industry, and an economic slowdown across the board. For several decades, Japan experienced excellent economic growth. Today, "It seems that the economies of other Asian countries are improving, but not Japan's," says Kazuo Shiwaku, the general manager of the label printing machinery sales department for Tokyo-based LINTEC Corporation, a distributor of Mark Andy presses.
The CIA, according to The World Factbook 2002, attributes Japan's slowdown to "the after-effects of overinvestment during the late 1980s and contractionary domestic policies intended to wring speculative excesses from the stock and real estate markets."
Japan's label industry suffers yet another blow. In many other Asian countries, labor is inexpensive. Worker's wages are dramatically lower than in Western cultures.
According to Palli of Raflatac, a qualified printer in Southeast Asia (excluding Japan, Australia, New Zealand and Singapore) receives $200 to $250 a month for a 48-hour work week. Japan's wages are much higher, and as a result, labels cost more money.
|Nilpeter, the Danish press manufacturer, recently welcomed customers to its new showroom in Kuala Lumpur. From left are Kosol Chotikarn and Detlef Neumann of Intergrafica Print & Pack, Thailand; Jakob Landberg of Nilpeter; Montri Tantontrakun, Suwanee Tantontrakun and Lertsarn Tantisrisuk of Inter Computer Co., Thailand; and Claus Larson of Nilpeter.|
"A large portion of pressure sensitive label production, especially for household electrical appliances and office equipment, is moving out of the Japanese market to China," says Shiwaku.
It is believed that Japan is home to the most printing plants in the region, with estimates reaching 1,800 printing facilities. Best estimates have the total number of plants in Asia at more than 5,000: approximately 1,000 plants in South Korea, 1,000 in Taiwan, 500 in China, 450 in Hong Kong, 130 in Thailand, 100 in Malaysia and 80 in Singapore. Many of these printing plants are small in size and are family-owned. Conditions of printing plants vary dramatically from country to country.
"There are major differences between Asian countries; some are really close to Europe's [capabilities], some will come closer soon. It is difficult to give an Asian global statement," says Christian Menegon, sales manager of industrial products for distribution channels for HP Indigo in Maastricht, Netherlands.
There is no lack of expertise in many of these countries. For instance, "China has the most sophisticated cigarette boxing in the world," says Benjamin Shaw, president of United Printing in Chicago, IL, a company that provides flexography products and support to Chinese printers. To limit counterfeiting in China, cigarette boxes are hot stamped, contain holographs and feature intricate designs. "Cigarette boxes are a work of art," he says.
Japan is seeing an increased interest in shrink sleeve technology. "There is a big trend toward the use of sleeves instead of pressure sensitive labels. Leading brands in the health and beauty sector have already gone from pressure sensitive to shrink labels for new launches… This is most apparent in Japan, where shrink is growing strongly," says Niklas Olsson, global brand manager for Akzo Nobel Inks in Trelleborg, Sweden.
Japan's plants also boast modern machinery. "Recent printing machines are controlled by many computers and digital machines," says Sobue of Chuo Seal Co. Ltd. "Japan is the most technologically advanced country within the Asia-Pacific region."
While some countries have swiftly adopted modern printing technology, other countries lag behind in technological advances. India needs updated equipment. "Everything over there is a lot older," says Jihad Yamout, president of the India operation and director of research and development for Primac Systems in Hyderabad. "They aren't automated and they depend a lot on manpower."
Technology continues to advance, however, and countries that are behind now may not be for long. "Some countries are getting high tech pieces of equipment, after having very old systems. The ramp to development that Europe and the United States had to go through is bypassed, and these companies go directly to high level capabilities with very low labor costs," says Menegon.
A successful Indian label show this past November, coordinated by Label Expositions, was an indicator of the desire of Indian printers to increase technological capabilities. Approximately 90 exhibitors and 15,000 label industry professionals attended the three day event in Mumbai. The event also included a two-day seminar.
Education is playing a role in the evolution of the Asian label industry. Opened in February of 2002, the Avery Dennison Self-Adhesive Label Converting College in Kunshan, China, aims to provide leading-edge expertise and excellence in self-adhesive label printing and converting," notes a press release. The school already boasts 400 graduates from around Asia.
Specifications in many countries are not much different from those found in the Western hemisphere. "In Taiwan, China and Southeast Asian countries, the main players in the market are United States or European national adhesive makers and converters. Because of that, the products are based on United States and European specs and are not much different than those in the United States or Europe," says Makiko Saito, coordinator, international operations of Toyo Ink Manufacturing Co. Ltd., based in Tokyo.
While plants all over Asia have mastered more difficult printing processes, there are no innovations coming from the area. Not yet, at least. "With new generations of machines, they will probably surprise western countries one of these days," says Menegon.
|Gidue's booth at the India Label Show 2002 in Mumbai.|
Updated machinery helps cultivate a new generation of printing, and an influx of foreign corporations continue to push Asian printing companies toward increased capabilities. The label industry is moving forward on many fronts.
Yet at the same time, flexography, while it is starting to take root in Asian countries, is not seeing the amount of acceptance that many had expected. Instead, products are being produced through other processes.
"Flexography increases, but still slowly," says Jame Wang, regional sales manager for Jiu Heng Graphics Limited, located in Shenzen, China, a distributor for Allied Gear in mainland China and Taiwan.
Speculation abounds as to why flexography, a star player in the United States label printing industry, is pushed off to the sidelines in Asia. Benjamin Shaw of United Printing says flexography is not catching on for two reasons: tradition and surrounding conditions.
In China, for instance, "It's not as convenient as letterpress, particularly when it comes to plate making," he says. "Flexo plates are expensive and take a long time to get."
A solid supply network, which any industry needs, is not there. Ollie Song, regional sales manager for Jiu Heng Graphics Limited, says that before the region sees more flexo label growth, the industry needs to "control the cost of label production [when using] flexography."
|Pictured are front and back photographs of a cigarette carton printed in China. The holograms, foil and intricate design on this box demonstrate Asian printers' high level of expertise.|
A weak supply chain isn't the only factor inhibiting flexographic growth. In Japan, Shiwaku of LINTEC Corporation estimates that 80 percent of printing is done by letterpress. He says label orders often come in small quantities and flexography isn't suited to these types of orders. "People have started to become interested in flexography little by little. However, due to the difference in needs — small quantities — it isn't easy to be increased," he says.
While the current condition of flexography for many Asian countries is not strong, the prognosis is more promising. The infrastructure is strengthening, aided by pressure sensitive substrate suppliers like Avery Dennison and Raflatac, that have come to China and other parts of Asia. Their presence "reduces the cost of label printing. We can foresee a growth in the near future," comments Wang.
There are other signs that flexography is on the rise in Asian countries. Gidue S.p.A. is a producer of narrow web printing and converting machines, specializing in flexographic presses and rotary diecutting equipment. After the India Label Show 2002 this past November, a press release issued by the company reported that "the three-day exhibition was full of people attracted by flexo technology."
Like the tortoise in the famed fable, flexography slowly progresses. Will it soon surpass the hares of the Asian printing world? Time will tell.
"The Asian market is growing to match the rest of the world. There is a bit of a lag in the UV flexo arena. However, the interest is there, which should spur continued growth in all areas of printing," says Olsson.