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March 3, 2006

Narrow Web Europe

From cans to labels: Skanem marks a century

By Barry Hunt

This year the Skanem group celebrates its century. It began as Stavanger Bliktykkeri, a small Norwegian tin printing firm. Today it is one of the world’s largest independent label producers with 1,100 employees and revenues totaling around €170 million ($205.71 million). Its 14 plants include those in Norway, Sweden, Denmark, the UK, Germany, Poland, and Russia. Label sectors served range from foods and beverages to household cleaning products and beauty aids.

A defining moment came in 1973 when the original firm gained the exclusive sales rights in Scandinavia for an easy-opening lid developed by a French packaging group. It adopted the name Skanem and built a new factory. Export-based success eventually led to a takeover by an Oslo-based trading group, who in 1985 appointed Ole Rugland as managing director. A year later, aged 30, Rugland invested the equivalent of $7,200 of his own money and persuaded a local bank to lend him another $3.02 million to buy Skanem.

Global expansion is seen as a key growth factor: “The world is really set on globalization and you need to be able to print labels in many different styles and languages for the multinationals who lead the way in brand marketing.” Eastern Europe is seen as an especially strong region as it increasingly adopts Western-style branding of consumer goods, resulting in double-digit growth for self-adhesive labeling. A major landmark occurred when Skanem acquired SE-Labels in 2001. It sold its metal packaging companies in Denmark, closed another in Norway and concentrated on self-adhesive labels.

Heat transfers, labels from Xeikon and DST

An agreement between Digital Screenprinting Technologies Aps (DST) of Copenhagen and Xeikon allows digital printers to produce heat seal transfers and garment labels. The deal combines DST’s screen printing inks and process knowledge with Xeikon’s digital print know-how to achieve high resolution textile transfers suitable for both short and long run applications.

Users can produce transfers in either roll-to-roll or roll-to-sheet form. A variable data capability for transfer designs means that every transfer produced can include original content, ranging from an individual name or a more complex variation, such as a picture element. The integration of DST and Xeikon technology is said to offer users an environmentally safe system that opens up a significant range of new business opportunities.

The process uses both water based and plasticized inks, allowing the production of transfers capable of withstanding high-temperature machine washing, including industrial washing, and dry cleaning. The range of adhesives available for the process means that output can be transferred to literally any piece of fabric, including cotton, knitted and woven materials, polyurethane, PVC fabrics and films, rainwear, umbrellas, Spandex and other stretch fabrics, neoprene, and polyester.

Scandstick opens new UK label stock coating plant

Scandstick recently relocated its UK self-adhesive label stock plant to Sawtry in Cambridgeshire, about 70 miles north of London. Production of roll and sheet label stocks centers on a new 40" wide and 190' long coating and siliconizing line — based entirely on hot-melt adhesives — with two new slitters. The new coating line enables high-speed conversion of film and paper grades for customers in the UK and Ireland. Scandstick UK’s plant has been set up to run independently of support from the parent company’s facility in Helsingborg, Sweden. The site will also be the sole production point for Scandstick’s TakTik branded sheet label stock — sold worldwide through paper merchants — and for FlatSam lick-and-stick gum paper sheets, used widely in the retail, promotional and postal sectors. For most products, lead times are 48 hours maximum, to customers across the UK.

The move to Sawtry also ended nearly two centuries of coating production at Scandstick UK’s existing plant at St. Neots. It was the former site of the Samuel Jones gummed label business which began in 1810. Scandstick bought the company’s UK interests after the latter’s demise in 2002.

The new plant marks the second and final stage of a €40 million ($49 million) investment program, the biggest in the company’s 25-year history. Phase one, in September 2005, was the opening of a 6' wide roll label stock coating line in Helsingborg.

Raflatac and Rafsec merge as a single brand

Raflatac and UPM Rafsec have merged to form a new business entity, named UPM Raflatac. Its product and service offerings comprise both pressure sensitive label stock and RFID tags and inlays. The move is said to reinforce UPM’s strong commitment to the label stock and RFID business areas and increase brand awareness of UPM as “the world’s leading forest products company.” Heikki Pikkarainen, president of UPM Raflatac, added that Raflatac is already a major global player and bringing in new-generation RFID products under the same roof further strengthens the prospects for global growth. “Customers will now be offered an increasingly extensive product range under a single brand. UPM Raflatac will continue to supply its customers with the same familiar products and services as formerly provided under the Raflatac and UPM Rafsec brands.”

• UPM Raflatac is to provide Rafsec tags for the first RFID library implementation in China. Working with Shanghai RFID System Technology, the company will supply 300,000 RFID tags to Jimei University Library in Xiamen. The aim is to automate the borrowing and returning of library items, as well as facilitate the sorting of library items.

UK label market growth highly selective, says report

In its latest UK label industry report, Plimsoll Publishing identifies 167 emerging label converters that have increased sales by a minimum of 3 percent in the last 12 months and expect more growth in 2006. However, overall market growth is erratic. It averaged 3.9 percent in 2004, but is thought have reached only 1.7 percent in 2005. Of the 491 companies analyzed by Plimsoll, the performances of 170 of them were overshadowed by the activities of 167 higher growth companies. Many of the poorer performing companies saw sales fall by 12.4 percent in the same period.

“This is absolute evidence of how most of the growth in the market is going to a select group of companies,” said David Pattison, senior analyst on the project. However, it is not simply a case of the larger companies forcing out smaller competitors. Some of them are doing well, although this has less effect on the overall market.

Companies turning over less than £3 million ($5.32 million) grew on average by only 0.3 percent, compared to the industry average of 1.7 percent. Of those reviewed 51 percent increased their sales, while 86 companies saw average increases of 30 percent.

“There seems to be a buoyant market among the smaller companies, but the competition is more focused. They tend to be less concerned with the overall market and more concerned with their immediate competitors,” says Pattison. “However, the analysis contains a note of caution for those who saw sales drop. The average was -15.3 percent, which suggests the effect can be severe when a decline begins.”

The 720-page report contains a four-year financial analysis of each of the 491 companies surveyed. It is intended to help managers spot trends in the overall market, identify threatening competitors, or aid those seeking acquisition prospects. It costs £305 ($540), but Plimsoll will give Label & Narrow Web readers a 5 percent discount when ordering. Contact Melissa Aston at +44-1642-626400; e-mail at, or visit for more information.

Domino beefs up RFID supply chain capabilities

Domino Printing Sciences in the UK is the latest coding and marking company to take the RFID and smart tag/label markets more seriously. It has formed an Integrated Solutions Group to increase its share of the global business for product and asset traceability systems, including RFID and similar coding technologies. The aim is to help manufacturers to assess and integrate track and trace technology into their supply chains, perhaps as part of turnkey packages. The group will operate through Domino’s international network of subsidiaries and distributors. Domino recently appointed Gary Page and Tony Walsh as business development managers in the US and Europe respectively.

Domino is based in Cambridge and has a US subsidiary, Domino Amjet, located in Gurnee, Illinois. Its coding and marking systems not only incorporate RFID, but also variable data inkjet and laser technologies, mainly for the pharmaceutical, food and beverage industries. The company expects increased usage of RFID products in reducing drug counterfeiting. It cites recent Frost & Sullivan report estimates that RFID revenues from the healthcare and pharmaceutical industries will rise six fold, from $370 million in 2004 to $2.3 billion in 2011.

“These moves have created a lot of publicity, but they’re really the tip of the RFID iceberg — the consequences have reverberated up and down the supply chain,” said Simon King, director of Domino’s Integrated Solutions Group.

Smart labels are developed for refrigerators

Labels that accurately measure elapsed time are one of the industry’s more esoteric products. One of the companies involved in this, Timestrip Plc, will supply Bioconservacion SA, a manufacturer and distributor of air purification systems, with its time-lapse labels for use with a device fitted in certain domestic refrigerators to extend the shelf life of fruit and vegetables.

Later this year the device, known as an ethylene absorption filter, will be included in a range of refrigerators sold in Europe by the Fagor Group, widely known in Spain and France for its branded household appliances. The Timestrip smart label will remind users to change the filter every three or six months, dependent on the model.