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    Features

    Digital Printing Market Update

    This rapidly-growing technology continues to fill a crucial need for converters.

    Digital Printing Market Update
    StickerGiant’s Beth Smith and Ed Olivo examine digitally-printed labels.
    Digital Printing Market Update
    Lightning Labels produces sharp beverage labels with digital printing.
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    John Abbott (L) and Whitney Watson of Abbott Label have added a Domino N610i digital inkjet press to complement its HP technology.
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    Adflex’s Jacob Andolora (L), Jeff Andolora, and Adam Toates enter the digital printing market with the help of the Dantex PicoColour press.
    11.12.20
    Over the past few years, digital printing has proven to be a highly reliable and profitable label manufacturing process.  In fact, digital press investments are occurring at a breakneck pace. And the global COVID-19 pandemic has only placed a greater emphasis on the value of this technology, with printers striving to meet turnaround times never before thought possible.

    According to LPC, Inc., 75% of future press sales will be digital. That stands to reason, as fewer converters offer digital printing than flexo. The opportunity is there for strong growth in the marketplace.

    “Even in the face of a global pandemic, the label industry hasn’t slowed down,” comments Bill Myers, marketing manager at Domino. “If anything, it has ramped up. Consumers who were panic buying at the onset of COVID-19 have caused brand owners to be busier than ever, especially in the sectors of food, beverage and pharmaceuticals. As a result, brand owners’ suppliers have been busier too. We hear that many label manufacturers are producing record numbers of labels and getting them out the door as quickly as they can. In turn, the adoption of digital printing by many label manufacturers is more important now than ever, with brand owners needing multiple SKUs and variable data printing.”

    Printers have been increasingly embracing digital. For example, StickerGiant, a Longmont, CO-based converter, runs an all-digital print shop – from printing to finishing. HP emerged as StickerGiant’s first partner when it established its own manufacturing line back in 2010, and the company still utilizes all HP presses today.

    “Simply stated, the digital label printing market is still emerging and evolving,” says Ed Olivo, director of manufacturing and procurement at StickerGiant. “I’ve definitely seen more significant advancements in technology recently than ever before, but it is still a market going through the early stages of maturation. The majority of the industry is still printing through flexo, so it will be interesting to see how the market develops as more and more printers and converters move into digital.”

    According to Gary Paulin, VP of sales and client services at Lightning Labels, an all-digital label printer based in Denver, CO, the digital printing market is continuing to thrive.

    “Digital print is very healthy, robust and growing as expected in all sectors of print, including product labeling,” says Paulin. “Digital output/converting continues to grow throughout all regions of the US due to the flexibility of the digital platform, allowing customers to order low quantities across multiple versions of products in their respective line(s). I see no reversal or slowdown with regard to growth and increased market saturation.”

    From the manufacturer perspective, HP has not seen any slowdown during the pandemic, either. “Print volume on Indigo presses continues at double-digit growth annually,” says Eli Mahal, head of HP Indigo Label & Packaging Product Marketing and Management. “Market trends continue to be favorable for HP Indigo digital printing. COVID-19 is accelerating some megatrends such as the need for an agile supply chain with faster time-to-market and the rise of the small and craft brands and local manufacturing. Currently, brands are very focused on stocking the shelves, and we are seeing less focus on sustainability and campaigns. We’re sure that this will return as things stabilize.” 

    Digital printing has also served as a reliable outlet for many converters during the pandemic. Marathon Labels recently teamed with International Label & Printing to fulfill a customer order for hand sanitizer labels. Due to the customer’s urgent order requirements, Marathon Label reached out to fellow FLAG member International Label & Printing’s Mark Turk for assistance. International Label & Printing’s CEI BossJet Powered by Domino helped Marathon meet the time-sensitive order, and the customer was reportedly very pleased with the quality of the labels as well as the responsiveness of all parties involved.

    Meanwhile, Grace Imaging assisted Toledo Spirits with producing hand sanitizer packaged for both consumer and industrial use. Grace Imaging, an Epson customer, was also able to meet urgent demand  for labels from the client.

    “Packaging and proper labeling of the product are critical, and Grace Imaging stepped up to produce labels for our products with a 24-hour turnaround,” states Andrew Newby, Toledo Spirits co-founder and CEO. “Compared to other printers, who needed up to a 20-day lead time, Grace Imaging produced and delivered the labels we needed so we could start providing resources to the public in a time of crisis.”

    Those companies that have already invested in digital printing are at an advantage when it comes to navigating their business during these uncertain times. However, the need for the technology has not prevented converters from doing their due diligence in an effort to improve upon their manufacturing processes.

    “We saw that label and packaging converters already in the digital space were able to better manage the chaos that came from the first six months of 2020,” explains Taylor Buckthorpe, director of sales at Colordyne Technologies. “And, although there is increased caution around the expense of capital equipment and ROI, we continue to see companies investing in digital print. These companies handled unexpected changes to their print production at almost every stage, including late stage customization, changes to branding, order volumes, and new products being launched. In many ways, the pandemic increased consumer trends that require shorter runs, like personalization, versioning and customization, especially in the e-commerce space. The pandemic showed that these trends are more efficiently and affordably managed with digital printing.”

    For StickerGiant, the realities of the pandemic have further solidified their belief in digital. “We started manufacturing digitally from the beginning, and we have long experienced the benefits of short run, quick turnaround capabilities, which is what digital provides for us,” says Olivo. “This was even further magnified during the pandemic, as uncertainty forced many organizations to order less. However, the pandemic also allowed many companies to pivot into pandemic-related products, increasing volume in other areas.”

    “The market is doing surprisingly well given the challenges faced by all over the last six months,” comments Steve Lynn, director and general manager of new markets for Durst North America. “In our discussions with converters, the majority have maintained near normal label business levels. Some may have lost some business, but there are a lot of reports of additional label requirements this year as a result of COVID-19 safety-related product needs. We see a lot of activity, investment and research into new inkjet equipment.”

    The uncertainty associated with the pandemic has also pointed to the benefits of digital printing. With supply chains in flux, converters have been able to print lower quantities and avoid excess inventory.

    “With imbalances in supply and demand – shortages and excess – the ability to run smaller quantities of labels more economically has helped businesses manage the many changes in product distribution channels, accommodate new products – especially in the health space – and provide a fast time to market,” says Mike Pruitt, senior product manager of industrial markets, Epson America. “Demand for labels has increased as the slower food market moves product to retail, requiring smaller batches and more branded packaging. As you can imagine, the healthcare space has also experienced a large increase in label demand.”

    Digital printing manufacturers are continuing to dispel the myth that the technology can only be utilized for short runs. Many production presses actually excel with mid-to-long runs. Durst, for example, has realized print speeds up to 328 fpm.

    “Digital helped converters during the pandemic by allowing them to pivot quickly to fast proofing and producing short-run labels for sanitizer, or meeting increased demand for short-run craft brewery labels,” adds Lynn.

    “Digital printing has really shown its merits during this period,” states Joe Sanchez, territory sales manager for Dantex Group. “Urgent jobs have been handled with ease and in many instances, jobs that would have been produced by conventional methods have been transferred to digital. These moves have further confirmed the high level of acceptance of digital quality. Digital printing has shown its flexibility without the compromise of quality.”

    Lightning Labels has first-hand experience with longer digital runs, too. “Gone are the days of low quantity per version/SKU,” says Paulin. “Today, we produce hundreds of thousands per version, across 200-300 versions in many cases. Speed, flexibility of workflow and pricing are just some of the considerations when considering digital over other platforms such as flexography.”  

    Digital is not a one-size-fits-all proposition, either. When evaluating the market, converters will need to decide between electrophotography (EP) and inkjet, as well as a host of other options. Water-based and UV inkjet, plus dry toner, are all topics that need to be explored prior to purchasing a digital printer or press. Various technologies are better suited for specific end uses, such as food labeling or cosmetics, among countless others.

    While inkjet was historically not the most mature market, the technology has made considerable strides in the last few years. Durst’s Lynn believes advancements in inkjet technology will lead to a greater investment in digital in the future.

    “Traditionally, EP has provided higher quality than inkjet but with lower speeds, higher consumable costs and challenges with color consistency and uptime,” Lynn explains. “Converters used to have to decide if they wanted the quality that EP provides or the uptime, lower consumable cost and better color consistency that inkjet provides. Over the last two years, however, inkjet has progressed from 600 dpi to 1200 dpi quality as the new standard, and 1200 dpi inkjet provides comparable quality to EP along with all of the other inkjet benefits. So we are seeing a shift in the market from EP to inkjet  as we head into the future.”

    “Just as the sheet market was 90% EP 10 years ago and now 90% inkjet, the packaging market is making the same transition to inkjet, which is cost effective and reliable,” comments Epson’s Pruitt. “UV is the preferred inkjet ink for print speed, whereas water-based is preferred for food-sensitive materials and a more traditional look.”

    Jay Larsen, general manager and director of R&D of digital hardware for INX International Ink Co., believes many customers look to UV-based inkjet for lower costs, label durability, choice of substrates and less need for pre-treated media. In addition, UV often has less maintenance requirements than other technologies, he says.

    “The advantages of water-based systems are, depending upon the printhead, a lower cost of entry and a print result with a more traditional look and feel,” explains Larsen. “EP systems benefit from their length of time on the market, with many available options to consider. They also are capable of very high-quality prints.”

    Inkjet and EP do not need to be either/or propositions, either. For example, John Abbott, president of Abbott Label, recently invested in a Domino N610i digital UV inkjet label press, even though Abbott already had an HP Indigo digital press in its arsenal. Each press will be geared toward different markets.

    “Digital is a necessity in today’s market,” says Abbott. “We have had an HP Indigo WS6600 in production since 2014, and we have been completely satisfied with the HP press, but we wanted to jump into the inkjet market, as we believe it better serves the markets we sell into.”

    In the future, digital printing should continue to offer a strong value proposition to label converters. “We expect to see more growth and more potential to capture greater market share,” notes Paulin. “Digital best serves the small to mid-size companies, from start-up to fully established experienced manufacturers, retail marketers and resellers. More converters will get into digital and/or grow their digital conversion efforts. Some are late to the game, but they will continue to push into the market to capture share and nurture that end of the market.”

    So, you’re buying a digital press?
    With the abundance of digital and hybrid printing options available (learn more starting on page 62), selecting a digital asset is no small task. Suppliers have optimized these units to be tailor-made to every need that confronts the label converter. From web width and speed to ink requirements, there are a host of factors that must be considered.

    According to Durst’s Lynn, the first factor worth considering is quality. “Not all digital is equal, particularly with inkjet, as some inkjet presses do not provide high quality required for prime labels. So, that needs to be understood,” states Lynn. “The next important considerations are print speed and web width. At Durst, we provide options from 13" to 20" widths, speeds of 170 fpm to 328 fpm, so we need to evaluate a customer’s requirements and the planned investment level to determine the best solution. We would encourage converters to supply some examples of their most challenging customer requirements of quality and color to get samples and determine which digital options will work.”

    After establishing a baseline, converters will then need to decide if they require inline or off-line finishing while also formulating a list of possible finishing partners. Once the checklist has been established, the supplier will then work with the customer on price. Other consumables will affect the bottom line as well, including inks.

    “Once we understand fully the required speed and quality, we work with converters on production cost and total cost of ownership (TCO) to choose the best solution for them based on their current and future production requirements,” adds Lynn. “Realistic ink consumption or click costs, plus ongoing consumable costs and service costs, should be fully understood when evaluating and comparing digital options.”

    According to Dantex’s Sanchez, price should not be the sole consideration. Quality, sustainability of the job, repeat capability, as well as customer service and support, are all critical factors to evaluate when choosing a digital partner.

    “You have to make a list of key production requirements and see which solutions check off the most boxes,” Sanchez explains. “You also have to evaluate the needs and expectations of the customer. Digital does not mean you can press the F16 key and get the perfect prints – prepress still plays a crucial role.”

    A label converter’s book of business is also critical. In order to properly invest in digital, it makes the utmost sense to have a need for the technology. “If converters are printing jobs that don’t have multiple versions, multiple SKUs and multiple changeovers, then it probably doesn’t make sense for them to invest in a digital asset,” states Domino’s Bill Myers. “Long runs with minimal changeovers are typically best handled on a flexo press. We never want to sell a digital press to a converter that would have it just sit idle on their floor. If it’s not running and producing jobs, it’s not making them money. And at the end of the day, it’s all about helping our customers make money. So, we first review their book of business to determine if digital is right for them. That includes doing TCO and ROI analyses to show the converter the crossover points of when to use flexo and when to use Domino digital. And what we find is converters are pleasantly surprised to discover the run lengths and jobs that make more sense for them to put on our digital press,” Myers says.

    Finishing capabilities and requirements are also important considerations. “The first step is to understand both the desired product characteristics, as well as the capabilities of currently installed finishing equipment,” explains INX’s Larsen. “INX solutions are fully integrated and customizable, so by understanding specific converter requirements, a machine can be designed that meets their all-in-one needs. Many times, a new digital customer wants to offer short run, variable data capabilities, and many times an all-in-one machine allows finished labels to be produced effectively for very short runs. This is one of the primary needs to assess.”

    According to Epson’s Pruitt, a manufacturer’s supply chain stability is also a key factor for converters looking to get into digital printing. “Perhaps now more than ever, further consideration into a manufacturer’s supply chain is worthy of note,” he says. “Is the supply chain of inks and parts secure with contingencies and multiple plants or is the manufacturer vertically integrated and under the control of the manufacturer? For instance, Epson uses proprietary Epson printheads and ink. Unique among manufacturers of digital inkjet printing equipment, Epson designs and produces all of its own critical components like printheads, ink and media transport.”

    Converters might find that a digital press is not the ultimate answer to penetrate the digital market. They might lean toward a hybrid press, a tabletop digital printer, or even a retrofit.

    “Our goal at Colordyne is to ensure we find a good fit between the technology and the customer’s production expectations,” notes Colordyne’s Buckthorpe. “From there, it is all about validating performance, consumable-running costs, and forecasting a return on investment. Converters looking to get into digital often lean toward Colordyne’s 3800 Series Retrofit solutions. They may have presses with open capacity or systems not being used on their production floor, and our 3800 Series Retrofit is an ideal low capital cost entry point into hybrid printing. This means the user can leverage all of the inline printing and converting capabilities without any loss of existing press functionality.”

    Service is something that cannot be overlooked, either. “Supply chain and service for your press are extremely important,” says HP’s Mahal. “Make sure you have an expert a car ride away. Choose a partner that can guide and support you during your journey to develop a profitable digital operation – ramp up, application know-how, how to sell the value of digital, and brand recognition. Also, is your investment protected? When HP Indigo releases a new model, HP also offers attractive value packs for existing installed units to ensure owners can benefit from the latest innovations.”

    Even as StickerGiant has solidified its place in the digital label printing market, the company still notices room for improvement. In the future, those converters looking to invest in digital can be on the lookout for further enhancements.

    “Hopefully we see a lot more automation with the equipment in the future,” says StickerGiant’s Olivo. “We’d like to see machines and software designed that can automatically adjust to color fluctuations, variable speeds, and custom designs and shapes. This will be even more critical going forward, as clients continue to look for greater differentiation and uniqueness with their product labels.

    “I also believe we’ll see even greater extremes between low- and high-volume work, which will create more diverse needs in the industry, as well,” he adds.

    Working in harmony
    While much has been made about the evolution of digital printers and presses, there is no doubt that flexography still remains the dominant form of label printing. And while some may think of digital taking on a role in displacing flexo, the more likely reality is a symbiotic relationship in which both co-exist in successful fashion.

    Converters have opted to utilize the technologies in different ways, with some choosing separate departments and others running the presses in tandem. Consolidated Label, an award-winning converter based in Sanford, FL, keeps digital and flexo separate. Meanwhile, Columbine Label, located in Centennial, CO, runs the two technologies side-by- side. Columbine boasts almost 2,000 customers, of which 600 represent craft breweries requiring small runs.

    “Digital printing has been a great asset to those label manufacturers that realize that digital is a wonderful complementary technology to their flexo presses,” explains Domino’s Myers. “By having digital, they can choose the best tool for the job. If you have lots of SKUs and multiple changeovers with short-to-medium runs, put it on digital. One SKU, long run – put it on flexo. Need to add embellishments, varnish, cold foil, spot colors? Put it on hybrid. Choosing the right press for the job is key in being productive and efficient, and the state/health of the label industry is being tested. 

    “Those label companies that can pivot quickly and provide labels to brand owners in the quantities they need – when they need them – they will be the ones who are the most successful. And digital technology greatly helps with that,” he adds.

    Label converters are also investing in hybrid presses, which feature  digital and flexo stations that can run in a single pass.

    Additionally, Domino has seen a recent surge in orders for the Domino K600i digital UV inkjet printer for label manufacturers that need to add variable data to their flexo-printed labels. Label converters are utilizing the technology to add bar codes, QR codes, sequential numbers and more for serialization, track-and-trace, security, brand protection and anti-counterfeiting measures.

    “Think of all of the e-commerce taking place now with people home and shopping on their computers, whether it be on Amazon, Sam’s Club, Target, etc.,” notes Myers. “All of those shipped packages require variable data printed labels for tracking through the logistics supply chain. The K600i is perfect for those applications. Label manufacturers integrate the K600i onto their flexo presses, rewinders or finishing systems. Domino offers the K600i in a single-bar or dual-bar configuration in various widths, based on the customer’s need and speed requirements.

    “We believe that digital is a complementary technology to flexo,” adds Myers. “Having both on your floor working side-by-side in tandem, using whichever press makes most sense for the label job. It’s just like having a toolbox – you pull out the right tool for the job at hand. It wouldn’t make sense to use a wrench for a job that requires a hammer. So, why use a flexo press for a job better-suited to run on digital and vice versa? Successful converters realize this and likely have both in their facility, or are realizing that they need to add digital to stay competitive.”
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