Q: How would you characterize the state of the North American label market?
A: These are certainly unprecedented times. The COVID-19 crisis has changed the landscape of the market and label converters have been deemed an essential part of our culture. The current market appears to be stabilizing after the initial surges in the spring. In the beginning, there was a natural tendency to gather and protect that drove consumers and converters to stockpile and prepare for the unknown. Then, there was a soft fall as things began to stabilize at the beginning of summer. Now, it appears that the market has leveled out somewhat as we enter the fall months. Overall, the narrow web market has proven how resilient it is and its ability to adapt during challenging times. Flexibility is ingrained in our industry’s culture, and our response to the recent crisis has shown this.
Q: How has the industry adapted to the challenges associated with COVID-19?
A: The ability to adapt to these challenging times demonstrates the strength of our industry. Converters and brand owners alike have been able to pivot from traditional products to essential products in order to support consumers and front-line workers. Converters have adjusted work schedules to accommodate social distancing and offered remote activities for non-production related tasks. And while commercial and industrial labeling has slowed, there has been an increase in the personal care and food and beverage industries. Converters are keeping the store shelves full, even to the extent of outsourcing or sharing overflow production with fellow converters.
A: lot of credit needs to be given to the industry associations, as well. Associations like the FTA and TLMI have provided endless streams of information guiding our converters and suppliers through this crisis, from PPP loans and grants to health and wellness advice for our industry workers and facilities, through virtual forums and meetings. Although these are not new technologies, the COVID-19 crisis has exposed the strength of the virtual world and its place in the “New Normal.”
Q: How do you think COVID-19 will impact the North American label market in the future?
A: The short-term impact of COVID-19 may be a little longer than expected. It continues to drivefundamental changes within our companies, accelerating the need to streamline operations and resources.
I believe this will drive a new level of efficiency, available through a more systematic approach to production and supply chain management.
In the long term, we will see converter facilities having a more acute awareness of outside visitations and meetings. The health and well-being of their employees and visitors will be paramount. In addition, there will be a demand for doing more with less by utilizing IIOT (Industrial Internet of Things), virtual supply chain management, and working with partners that can offer innovative single source solutions. This approach will help drive overall efficiency and greatly reduce the foot traffic of multiple suppliers through converter facilities.
At Anderson & Vreeland, we are in a unique position to support our partners through these short-term and long-term changes. As a single source supplier of plate room, press room, consumables and IIOT inventory management systems, we can streamline complete operations from accounting and purchasing to workflow and production.
Q: How would you say the North American market has evolved in the last 5-10 years?
A: The last 10 years have brought tremendous change to our industry, both on the converter and supplier side. New innovations in technologies, recent mergers and acquisitions, and the digital revolution have all reshaped our industry going forward. We have seen both a generational shift in technologies and human resources. In today’s digital world, everything we do is managed by some sort of software and clean-hand operation. Our craft has evolved into a work by the numbers science performed by automation and IIOT management. This falls right into the hands of attracting a new workforce raised on disruptive technologies. Although workforce concerns are still apparent and will not get any better as the silver tsunami hits, investing in new technologies and streamlining the production and procurement process will lead to increased production and a stabilization of these workforce challenges.
The aggressive M&A activity has created multi-rooftop converter groups that are reshaping how we deliver our solutions and how they deliver to their brand owners. The strategic consolidation of facilities and equipment allows them to take advantage of their offerings nationwide, which is driving industry-wide production efficiencies to new heights. The digital revolution of both toner and UV inkjet presses continues to proliferate, allowing converters to be more efficient in production, reduce costs and provide quick turnaround offerings to their regional customers. Digital printing is a perfect complement to flexo printing and converting, and the two combined together offer full production runs of combination printing and embellishments that have created a very high-end value stream of label production.
Q: Are there any other challenges approaching as we deal with this “New Normal?”
A: Black swan events like COVID-19 usually occur once in a generation. They directly impact the geopolitical and geo-economic climates and as a result, there will be many who experience financial distress and find themselves in unrecoverable situations. But these events also create hidden opportunities to strengthen your organization through change and adaptation.
A big part of the “New Normal” will be a virtual IIOT management environment. Adapting to these changes will better support converter concerns of facility health and wellness, as well as outside visitations. At Anderson & Vreeland, we are positioned well to support our partners by utilizing solutions, such as a supply chain with IIOT management, that will reduce administrative and operational costs, improve efficiencies and drive profitability. As we adjust to the “New Normal,” these hidden opportunities will help us all drive the future of our industry.