Narrow Web Europe

Spreading waste-lines, and British bolshiness

August 27, 2010

Spent liner… landfill… sustainability… impossible to open a label or packaging-related magazine these days without being bombarded with articles telling us to do something about waste. The problem is not the same for industrialists as for the private citizen. However, when someone comes up with an idea that makes allowance for human nature and uses RFID tags and apparently works, maybe it is time for Europe’s packaging industry to take notice.

For several years local authorities in Britain and other parts of Europe have tried to enforce recycling by putting RFID tags on garbage cans, then weighing them on collection and fining offenders who fail to toe the line. In Britain, in particular, this measure brought out the endemic bolshiness in the British character, with the result that otherwise law-abiding citizens enlisted in “bin wars” to resist what they saw as petty governmental interference in their daily lives. Enter a white knight in the unlikely form of RecycleBank, a US company which partners with local authorities and provides a wealth of incentives to encourage the citizen to sort recyclable waste and have fun doing it. For eco-shy Britons at least, it seems the carrot is mightier than the stick.

Could label converters and end users in the European Union be motivated in the same way? And if they can, will the bureaucrats of Brussels be listening?

Cutting setup times
In Europe, people use GPS in their cars to tell them where to go. A major press manufacturer is using the same acronym for its Graphic Positioning System which it hopes will point the way for flexo printers to cut waste and reduce setup times. Fischer & Krecke (Germany) reckons it has found a way to make accurate impression and print register settings while the press is at a standstill. According to F&K, which is now part of the Bobst Group, “The Graphic Positioning Process uses a measuring system that enables the topography of the print-ready package (i.e., sleeves + tape + plate) to be scanned to an extremely high precision level.” Fischer & Krecke are not present in the narrow web sector (although other parts of the Bobst group are), but it is likely that this positioning system, or something very like it, will be on offer to narrow web converters soon.

Flint: Eastward ho!
The US-based Flint Group is one of the top three suppliers of label inks worldwide. Over the past five years it has developed rapidly by natural growth and more especially by acquisition. The recession has clearly not blunted its appetite, and last year it acquired Russian manufacturer Premo Inks. In January of this year it expanded its production facilities in Poland, and just recently swallowed Torda, a Swedish ink manufacturer. With its sales network in Southeast Europe and the Middle East and its manufacturing plant in Dubai, Torda will reinforce Flint Group’s presence in these markets.

French label converters look for the light
A detailed study of the French label market just completed (by your correspondant, no less) shows a bleak picture of the label business in 2009. An abnormal number of French converters refused to disclose any figures for their latest financial year, and we must draw our own conclusions from this. Of the 50 or so converters who did give figures, two-thirds showed falls in sales compared with their previous year, with a median fall of just 3 percent. The figures for profitability showed much wider gaps between best and worst performers. Ten percent of the sample reported pre-tax profits in excess of 10 percent of sales; at the other end of the scale were three converters whose 2009 losses were an eye-watering 10 to 12 percent of sales. One of these, clearly an adept at gallows humor, was asked if he saw light at the end of the tunnel; he replied that business prospects were so dark he could no longer see the tunnel.

One clear result of the recession has been the increased concentration of the French label converting sector in the hands of a few big groups. The market leader, after a spate of acquisitions, is Autajon, a French packaging and label company manufacturing in six countries (including the United States). In the label converting sector Autajon now has 10 label converting plants in France, and total label sales of $120 million. But France is still a country of small label firms, with an estimated 300 converters chugging along with sales of less than $2 million. Wine labels are the life blood for many of these smaller companies, whose customers buy local, because that’s the way business has always been done.

Heidelberg – capital transfusion
Autajon’s sales of $120 million are quite large for the label industry; it is a sobering thought that printing machinery manufacturer Heidelberg lost more than that in its last accounting year. This year is looking better as cost-cutting measures take effect. The group’s order books are filling up, with business reported as being particularly brisk in Eastern Europe and, after a successful IPEX show, in Britain. The company is issuing €420 million of new shares, and major shareholders RWE and Allianz have indicated that they will take them up, no doubt on the now familiar reasoning that the company is too big to fail.

Digital Summit: a wind of change? Or just a change of wind?
The Digital Label Summit returned to Barcelona, Spain, for its second installment in June of this year. Organized by the Tarsus Group, the event has been carried high on the wave of interest in narrow web digital print processes. Bob Leahey, associate director of Infotrends, partnered with Mike Fairley in an opening presentation of where the digital label sector is going: essentially towards higher breakeven run lengths, better prepress and more and more inkjet.

What motivates converters to invest in digital presses? Fairley says there are three reasons: to compete on short-run business, to free up conventional presses, and to offer new solutions to customers. Leahey also noted the rise of inkjet, which he estimated at 15 percent of total digital label billings, and rising fast. Looking at end-user sectors, he pinpointed wines, cosmetics and private label foods as giving the most potential for digital labels. He warned that digital technology, so foreign to many label converters, gave opportunities for end users to bring their digital label printing in-house (Swiss-based Pago, a major converter, has already admitted losing business for this reason).

One good reason for going to conferences of this kind is to get honest, and sometimes unflattering, opinions from converters about their experiences. Tony Trommel of Altrif Label in the Netherlands had problems of color consistency with his new WS6000 press, and called in EskoArtwork to put things right. Birtle Kjaerholm of Labelco (Denmark), who recently installed a Nilpeter Caslon press – said to “offer the best of both conventional and digital” – questioned whether the number of inkjet units on the press was optimal. Several speakers at the conference mentioned problems encountered when printing white digitally. Adrian Lookwood of MD Integration predicted a day when low-energy LED becomes the preferred drying technology for the narrow web sector. LED is at present held back by the need for special inks, not generally available (except for digital inkjet).

Panel discussions brought representatives of HP Indigo, Xeikon, Jetrion, Nilpeter and Agfa onto the podium to receive (and mostly answer) questions from the 250-strong audience. An interesting question raised but not answered was whether narrow web digital printing would turn out to be the kind of disruptive innovation (like digital cameras or quartz watches) which could turn the whole label sector upside down.

Maybe, maybe not.

Russian label show: News, of a sort
Etiketka, the Moscow label show, is scheduled to be held October 19-22. There is, however, a curious lack of detailed information about this 15th edition of the show, which in the 1990s attracted most of the big names in the label business as exhibitors. No list of 2010 exhibitors seems to be available, and your correspondent, who has been a regular visitor to the show in the past, has this year decided to wait and see.

Chinese in Poland
The name of the Shanxi YunchengGroup is not one that springs to mind when label specialists meet, but this Chinese manufacturer of printing cylinders has started construction of a plant near Lodz in Poland. In its first stage the plant will make rotogravure cylinders for the packaging sector. With its growth rate of over 10 percent, China is a first-rate market for label making equipment and substrates, with the most intrepid Western manufacturers setting up production plants in the China. If Shanxi Yuncheng is anything to go by, the business will not be one-way.
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