Few people outside France have heard of the JPL Group. By all the laws of economics it should have gone bankrupt. This family-owned label converter played double or quits on a series of acquisitions over the years from 2002 to 2008. When the crisis hit, JPL was overstretched and undercapitalized. Then its Paris plant lost a major customer, and started running a loss of $120,000 per month.
“We had to move fast,” says Philippe Leyval, CEO and son of the company’s founder. Almost overnight, the Paris plant and several others were closed, presses were switched to other locations, and the management team was strengthened by bringing in two experienced outsiders. Philippe’s brother Frédéric took a long hard look at all the company’s inputs, with the result that some of JPL’s major suppliers lost out. “We were desperate to cut costs,” says Frédéric, “and we went looking for suppliers who were desperate to get into business with us.”
The company’s main ink supplier is now a German manufacturer, and more than one labelstock supplier got squeezed until the pips squeaked. The group is now out of the danger zone, with sales rising again and a modest profit announced for 2010. Investments during the latter part of the year included a new unit for making multi-page labels (one of the group’s specialty products), and a new 8-color flexo press from Netherlands manufacturer MPS.
Gorilla tactics: A footnote to the JPL story tells how many years ago, in the village in central France where the company has its headquarters, the company’s founder patronized the same bistro as an explorer who had plans to set up a reserve for mountain gorillas. “If my label project works, I’ll support you,” said Leyval senior. It did, and he did. Today JPL is the biggest employer in the district, and the Parc Zoologique, housing gorillas, lions and other endangered species, is its biggest tourist attraction.
German giants open up on digital printing
Heidelberg and ManRoland are among the biggest printing machinery manufacturers in the world. For a decade or more, both have been pussyfooting with digital print technology. Linoprint, though part of Heidelberg, has been developed as an arm’s length project, so much so that a few years ago its senior technician told your correspondent, “Yes, we are part of Heidelberg, but please don’t report that."
Now that DOD inkjet has become respectable, not only has Linoprint come out of the closet, but its parent company is preparing to start selling digital machinery under its own brand. At a shareholder meeting in mid-December, CEO Bernhard Schreier said that in the long-term machinery for package and label printing would represent one third of Heidelberg’s sales. On digital printing he refused to be drawn, saying only that his company would be working with just one external partner and that details would be announced early in 2011.
ManRoland has beaten it to the draw by announcing, in December 2010, that it has signed a deal with another print machinery maker, Océ, to pool the two companies’ expertise, most especially in the inkjet sector. Interestingly, ManRoland was a pioneer of digital printing with its full color rotary Dicoweb press, launched in 2000, but with a sort of modified offset technology with print cylinders that could be digitally re-engraved in a matter of minutes. As a first step, Océ and ManRoland will be concentrating on developing digital inkjet sheet presses for books and catalogues, rather than entering the profitable, but crowded, business of narrow web digital.
Digital helps a UK converter win back China business
China’s trade surplus is now an eye-watering $190 billion, and Britain’s deficit at $145 billion is now so huge that the government in London is thinking of maybe doing something about it. Which brings us to CS Labels. This English converter has just invested in its fourth Xeikon digital press, while at the same time running down its flexo and screen printing capacity. According to Managing Director Simon Smith, digital label printing has even helped the company win back business lost to China for many years. Says Smith, “We produced the decals for a range of children’s footwear. The printed product would be transferred to the shoes as part of the production process. We lost the screen print work on price to a Chinese competitor, but since re-opening discussions with the customer we have been able to convince them to bring work back to us because of the speed of turnaround and the quality of images that we can now produce digitally.”
This good news will not make much of a dent in Britain’s trade imbalance with China, but it’s a start.
Snow and strikes in Paris
What is the difference between Paris and New York? There are many answers to that question, but the one most recently heard is that New York gets lots of snow every year and can deal with it (most of the time), while Paris doesn’t and can’t. A threatened transport workers’ strike on November 23 cut visitor numbers at the Emballage packaging show held just north of Paris, and heavy snow throughout the four-day Cards and Identification exhibition likewise discouraged the faint-hearted. Many visitors arriving by air had been re-routed and arrived minus their baggage, which did not improve their moods.
For Emballage, the organizers in their post-show release stressed that “Growth and business confidence are back,” which we all hope is true, but visitor figures tell a slightly different story: Total numbers are down from 108,000 in 2006 to 102,000 in 2008, to 85,000 in this latest edition. In fairness it must be said that some exhibitors at the show were only just short of ecstatic. Prepress specialist EskoArtwork called the show “the climax of a successful year … with a 30 percent increase in new contacts,” and marking company Domino reported “many more visitors than in 2008.”
The following week the same exhibition complex hosted the Cards & ID show. A handful of narrow web label press manufacturers also offer equipment for printing and converting cards, or for fixing the chips that make them smart. UK press manufacturer Edale, once known mainly for its small but robust flexo label presses, said this show was “ideal for Edale.” Export Director Bernhard Grob noted, “Our presses are custom made for single pass solutions for making telecom scratch cards, lottery tickets and offline RFID applications, and this show has been a good investment for us.”
German equipment manufacturer Melzer is one of Europe’s main producers of machinery for making, inserting and testing RFID tags and smart cards. At the same Paris show, Melzer, with uncanny prescience, showed equipment for making smart airline baggage tags designed to speed registration and reduce lost luggage.
Another exhibition, but with some of the same ideas, was the Traceability/Supply Chain Technology Show, also held in November. This event featured around 100 exhibitors including Tagsys RFID, a provider of item-level RFID infrastructure. During the show this exhibitor announced that Qantas, the Australian airline, has started to deploy the Tagsys reusable RFID baggage tag. No longer – said Alain Fanet, Tagsys’ CEO – will paper bar code labels need to be applied to passengers’ luggage. With an electronic bag tag permanently attached to their bags, passengers will avoid long queues and enjoy rapid baggage drop at self-check-in points.
If past experience is anything to go by, this miracle of technology will not deter the baggage handlers from going on strike.
Beverages in Russia
Most beverages are labeled. Many industry experts think that it is in the beverage sector that pressure sensitive labels can and should gain market share. If that is so, recent happenings in Russia are important, as those heavyweights Coca-Cola and PepsiCo battle it out for market share.
Last month Coca-Cola acquired Russian fruit drink maker Nidan, giving it a 36 percent share of the market. Meanwhile, PepsiCo has not been idle, announcing (in December 2010) a $140 million project to build a soft drinks factory in Southern Russia, annual capacity 500 million liters. Also in December, PepsiCo announced that it would be paying out the bagatelle of $3.8 billion to acquire 66 percent of Wim-Bill-Dann, believed to be Russia’s leading branded food-and-beverage company. If you think the name Wimm-Bill-Dann sounds un-Russian, you are right. The company was founded just 18 years ago by a Russian entrepreneur recently returned from watching a tennis championship in England. And the rest, as they say, is history.
Back from the grave
With the exception of major automobile firms, companies that go bankrupt usually stay that way for a long while, or reappear discreetly under a new name. The “Nuova” in Nuova Gidue fools no one, of course, and its small but persuasive CEO Federico d’Annunzio seems to be back in business with a vengeance. Having shifted production from Turin to Florence, his resuscitated company is selling Combat flexo presses to label converters as far apart as Indonesia and Argentina.
D’Annunzio himself says he did not anticipate such a positive market response after the “new old” models were re-launched in April 2010. How does he do it? The man is a trained lawyer and a brilliant salesman, which accounts for much of his recent success. Insiders report that, in order to concentrate on his business, he has also given up his political work on behalf of a Very Important Italian Politician. Of course by the time you read these lines that may be an ex Very Important Politician, but chances are that Nuova Gidue will still be around.
Doing Business in Europe
Now that M&A activity is on the upsurge, and not only in Russia, it is instructive to look at the ranking of European countries for “Ease of Doing Business.” The table above, produced by the World Bank, looks at such important criteria as bureaucracy, credit, taxes, and contract enforcement; some of the results are surprising. Overall, number one is Singapore. UK and US come galloping in at fourth and fifth place. In Europe, the Scandinavian countries score well as do, more surprisingly, Ireland and Iceland. Full results of the rankings, in general and in specific, can be found at www.doingbusiness.org/rankings.
Readers of Label & Narrow Web will not need reminding that Roman senators wore purple togas, nor that the color in question was obtained from certain rare sea snails, most notably Murex brandaris. If modern-day ink producers follow the lead of Flint, this color may soon once again be too expensive for anyone below the rank of senator. Jens Zimmerman is a director at Flint Group Europe’s Packaging and Narrow Web division. Explaining a whacking 22 percent price hike effective mid-December for purples, violets and similar ink colors, he put the blame on the “reduced availability” of carbazole, a key ingredient sourced only in China and India.
Maybe they should try farming sea snails.