Bob Hakman recognized the potential for the labels and packaging industry back in 1985. He took the circuitous route to get there, though.
Following his college graduation, Hakman began his career as an accountant. He would eventually wind up working for a company that produced tape products. Even though this particular company would close, working in this field allowed Hakman to envision a future in the industry. He took a leap of faith and opened Diversified Labeling Solutions, Inc. (DLS) in 1985.
Without firm footing in the industry, Hakman needed to overcome several challenges. “Not having a sales background, Bob decided to use the extensive independent print distributor network that existed in the US,” explains Jim Kersten, CEO at DLS. “He felt that, together, he and the distributors could form a solid team to build his business. Over the past 33 years the growth of the company has proven that Bob’s inclination was correct.”
Today, DLS features five production facilities, with headquarters located in Itasca, IL. The company’s other locations include Cincinnati, OH, Atlanta, GA, Dallas, TX, and Reno, NV. DLS now employs 227 team members across 357,449 square feet of space. Hakman serves as the president, while Kersten joined the company in 2011.
With significant facility space, DLS boasts a full arsenal of equipment, including more than 40 presses and diecutters. The company relies on press technology from Aquaflex, Mark Andy, Nilpeter and Webtron, among others. DLS has also strived to make its practices as modern and efficient as possible by automating much of its equipment, with the ultimate goal of keeping the presses running with various roll splicers, plant-wide trim removal systems, turret rewinders, sheeters and fanfolders.
DLS relies on more than traditional converting equipment, too. For digitally-printed short runs, aqueous and UV digital presses from Colordyne and INX International have been added. Diversified also has inline variable imaging devices from Domino, DPI and Scitex to provide high-speed imaging capabilities. Like many other thriving converters, DLS sees digital – and hybrid technology – gaining traction in the coming years.
“While flexo is still the main driver of label printing, digital is gaining ground,” states Kersten. “Flexo and digital technologies continue to advance. In terms of hybrid presses, the allure revolves around several things: First, being able to utilize existing presses and frames to add the new digital technology is quite beneficial, and you can deploy digital at reduced costs since the press infrastructure is already in place. Being able to add variable imaging to presses in full color is a key benefit, as well, and it’s possible to run digital print at higher speeds with the flexo press backbone.”
DLS has noticed a decrease in production costs by utilizing flexo as appropriate and adding digital when necessary, as flexo ink is less expensive that digital ink.
In the finishing area, DLS has a large fleet of rewinders, mostly from Rotoflex, and numerous inspection systems, including ones from BST, Lake Image Systems, Gremser and Cognex. DLS’ high definition platemaking system does an excellent job of producing high-quality, detailed printing plates, Kersten notes.
DLS’ wide range of equipment and five facilities allow the company to reach locations across the country. This nationwide manufacturer cites consistent growth throughout the decade, with no plans of any slowdown.
“Overall, the company has enjoyed solid year-over-year growth for more than eight years,” says Kersten. “Diversified is forecasting another excellent year in 2018, with continued growth into 2019 and 2020. This is mainly driven by strong distributor relationships and a commitment on the company’s part to invest in equipment and technology designed to improve efficiencies and increase capacity for long production runs. In the current robust economy, the firm enjoys minimal turnover and has been able to attract quality candidates to support its ongoing growth.”
In keeping with Hakman’s foresight, the company has found a way to effectively handle waste management. The initiative prevents two million pounds of label matrix annually from reaching landfills while providing a clean burning fuel source for energy companies.
“The process is actually very simple,” explains Kersten. “Label trim waste is baled and sent to a converter that chops it up and compresses it into small pieces that are about 5/8" in diameter and 2" long. The nature of the adhesive in labels, along with the paper and film components, creates fuel that is high in BTU’s and low in emissions. The company’s logic for the recycling program was simple: eliminate waste from going into landfills. Just the Chicago plant alone was disposing of over two million pounds of waste a year. Recycling for fuel is a much better option, and Diversified wanted to be a good steward of the environment.”
DLS teamed up with Channeled Resources Group, waste hauler Republic Services, and Convergen Energy, a waste converter and power company, to facilitate the project. The pellets are burned as a substitute for coal, which decreases the need for fossil fuel and subsequently reduces CO2 emissions by 40%.
Kersten adds that this a top-down initiative at DLS, as the company needed to change its internal practices to become more environmentally responsible. DLS was required to alter its waste processing practices within the plant. Previously, all waste was sent to a large compactor that Republic picked up and processed several times a week. Now, only label waste goes into the compactor. Other recyclable materials are collected and recycled separately, whereas general waste is separated and disposed of in a different process.
According to Kersten, there are other benefits downstream to these recycling efforts. Distributors of DLS products can now offer more environmentally friendly solutions to their customers. The company is now striving to find a way to continue this process with its four other US facilities. Such an endeavor is expected to save over one million additional pounds of label waste from going to landfills each year.
As the company continues to grow and innovate, DLS has added key personnel to a range of areas within the organization, including production, operations, estimating, order processing, accounting and marketing. The healthy state of the market has fueled this growth.
“The overall label market is forecast to grow several percent a year over the next seven years, and Diversified feels they will continue to gain its share of this growth through efficiencies, marketing, product expansion and technical support,” says Kersten.
To future-proof the company, DLS has also made a substantial investment in a new ERP system that automates and streamlines it’s data collection and handling. Recognizing a need for such software, DLS made the investment two years ago, which helps in many areas, including inventory management, production control, estimating, order processing, marketing (CRM), information technologies and financial reporting.
“The company has a much better grasp of its costs, efficiencies, inventories and production metrics than what was available through the legacy system,” adds Kersten.