Package printing and converting report
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  • 1. Package Printing and Converting ReportPrepared for PMMIJuly 2009Regis J. Delmontagne 1
  • 2. INTRODUCTIONThis Report will explore the case to be made for including a large number ofpackage printing and converting manufacturers in existing PMMIexhibitions. While there has been a limited number of products for packageprinting equipment and systems and converting type products in past andcurrent events, there may be a need for more of those products in futureexhibitions because of numerous factors. They would include the need fordigital package printing equipment to be used in test marketing of products,personalization and individualization of packaged goods, and for anticounterfeiting purposes. Another factor is the cloudy economic climate ingeneral, and trade shows in particular that could lead to the establishment ofPack Expo becoming even more fully representative of the industry.A secondary issue is whether PMMI exhibitions can attract a sufficientnumber of exhibitors which manufacture these products. Respondentsclearly indicated that sufficient dissatisfaction exists as to where packageprinting and converting equipment manufacturers can best display theirofferings to the market. There was almost unanimous belief that CMM washeld for the last time this year, many felt that the CPP pavilion with PACKEXPO did not fill the void, the PRINT exhibitions, while featuring packageprinting and converting products, basically attract commercial printers notknown for being major providers of labels, printed packages, etc, was not theanswer. INFOFLEX, produced by the Flexographic Technical Association,while pointed in the right direction, was known primarily for its educationsessions, and not for its exhibitors’ display of equipment or technology.Finally, interesting enough, only a few respondents mentioned the everyother year event, LABEL EXPO.Therefore, a legitimate question can be raised about PMMI’s ability toattract exhibitors of package printing equipment, especially thosemanufacturing digital products, as well as converting products, i.e. foldingbox and carton products, die cutters and software systems. The secondbiggest question is whether or not PMMI can attract the attendees who canmake the buying decision for these mentioned products and systems.These issues will be discussed further in the Report. 2
  • 3. METHODOLOGY Respondents to both e mail questionnaires and phone interviews includededitors of packaging and graphic arts magazines, on line news magazines,commercial printers, consultants and manufacturers of package printingequipment and systems, both traditional and digital. Contacts were asked several questions such as: future growth of packageprinting, the impact of digital printing presses on package printing, impact ofthe new technologies and their usage in the packaging market.They were asked for their opinion as to which current exhibitions featuringpackage printing equipment and systems, as well as converting productsmet their needs as both exhibitors as well as attendees.The respondents were quite candid in their remarks and, as expected, themanufacturers were quite reluctant to discuss their future marketing plansbut some indicated they would make various announcements at the PRINTexhibition scheduled for Chicago, September 11-16, 2009 3
  • 4. SUMMARY OF RESPONDENT’SCOMMENTSThe one word that almost every respondent chanted in unison wasGROWTH when discussing package printing. All indicated that around theworld packaging, in general, was growing and specifically the need forquality printing methods for packaging was headed upwards.Depending upon the audience, while individual companies’ responsesreflected their company’s business, package printing was viewed as a growthbusiness compared to the printing business, which is in decline. Therefore, atraditional provider of offset printing presses, such as Heidelberg, looked atgrowth opportunities in the packaging business to neutralize the losses intheir previous dominant position in the graphic business. Heidelberg doesnot manufacture digital printing equipment which minimizes their positionin the package printing market but does allow them to compete for thefinishing equipment utilized in the processThis company, for example, exhibited finishing equipment at the most recentINTERPAK exhibition, will stress for the first time its offerings for thepackaging market at PRINT 09 and will exhibit for the first time in LABELEXPO.Other traditional suppliers to the printing industry, such as Kodak, areplanning a major initiative for the packaging industry and are presentlyplanning to make this announcement at PRINT 09. As a supplier of digitalprinting equipment they believe the time is right to focus more attention onthe packaging market.Both Heidelberg and Kodak, both long time suppliers to the printingbusiness are looking at the packaging market to replace their losses in thetraditional commercial market. Many other companies are following suit asa visit to the PRINT exhibition will clearly demonstrate.Some other companies, mostly in the digital arena, have made some inroadsin the package printing market and will be featuring those products alongwith those intended for the commercial market. These companies believethis is the time to fully demonstrate those products albeit to mostly a 4
  • 5. commercial printing audience. This fact points out the dilemmamanufacturers face when trying to reach the market for their packageprinting products which go far astride the commercial printing market.More about this situation further on in the Report.These providers include companies such as EFI-Jetrion, Xerox,EskoArtwork, Xeikon, and most definitely, HP Indigo. The latter companyhas been featuring its press designed for package printing around the worldand is the unquestioned leader in that regard. The company had a goodreception for this press at the recent CHINAPRINT this past May. Thereare many other companies, some digital, others traditional suppliers, seekingto do more business in the package printing market and represent a nucleusfor a stronger presence in PMMI exhibitions. Companies such as Canon andOce can not be ruled out as future providers of digital equipment for thepackaging marketWhy the sudden interest in digital printing. First of all, it eliminates manyof the products and systems used in the traditional printing process; fastermake ready time, the ability to personalize each and every product, andquality comparable to offset and flexo. It’s unlikely that digital will replaceother processes such as offset, flexo and gravure because of their ability toproduce huge quantities of high quality products at a reasonable cost. Buttheir inability to produce short runs economically, and individualization,basically keep them out of those markets and that’s the niche the digitalprinting suppliers aim to fill. A digital press can produce 1, 100 or 1000copies of a quality label; for example, changing colors, size andpersonalizing it while running, something another type of press can’t do atall and at a reasonable cost. According to some respondents, the biggestopportunity for digital press manufacturers is to print secure labels for highend luxury products such as wine and clothing. Their ability to print microlines and utilize UV technology are ideal for anti-counterfeiting purposesaccording to one editor.Between the traditional suppliers and the digital providers, there are aconsiderable number of companies seeking to enlarge their overall businessby making serious attempts to serve the packaging industry.Companies manufacturing converted products such as Bobst, Brandtjen andKluge for foil stamping presses, Prime UV which manufacturers UVequipment, du Pont and its flexo plate making equipment are prime targets. 5
  • 6. Gravure press and offset press manufacturers are also important providers tothe packaging industry.EXHIBITIONSIf one were to ask 10 exhibitors in any exhibition in any industry if the showthey recently participated in was a success, you may get as many as l0different answers. Of course, the answers will depend upon the results andthey may vary all over the lot. Some will say excellent, some might say itmet expectations and others will say “time will tell”.The question of which show best serves the overall interests of the packageprinting industry met with a more unified answer: None!Comments ranged from: “CMM is dead…once and for all.”, “CPP is not ashow but just a pavilion.” and, PRINT/GRAPH EXPO while good forcommercial printers, “doesn’t attract the packaging and converting markets.”According to the respondents all of the previously mentioned exhibitionswere, in some way, good for the market, and at the same time did not deliverthe critical mass required to establish them as “must exhibit…must attend”events.What were the reasons cited? First of all, there was general agreement thatat one time CMM was the show for converting and flexo printing. Today,that event was probably held for the last time in Chicago or elsewhere. CPP,while it attracted some new companies to the overall presentation offered byPACK EXPO, lacked the major suppliers to the converting and packageprinting businesses. PRINT is the largest exhibition for commercial printers,some of whom do package printing. The exhibitors of which many offerproducts for the converting and package printing sectors generally do notfeature those products in their booths. These shows do offer aconverting/package printing area but many companies which serve thatmarket also are major suppliers to the commercial printing market so theyhave to make a difficult choice: display your packaging/converting productsalongside commercial offerings or take another booth which will exclusivelyfeature their packaging/converting products. 6
  • 7. Splitting a company’s presence at any exhibition poses difficult questions asto staffing and costs. For example at this year’s PRINT exhibition, majorcompanies such as HP Indigo, Xerox, Xeikon, EFI-Jetrion, EskoArtworkwill not have a booth in the PackPrint area but on the main floor. Thesecompanies will then have to display package printing equipment alongsidethose intended for the commercial market. This is not ideal for thoseattendees who have a major focus on products for the packaging market.Another event mentioned was INFOFLEX, organized by the FlexographicTechnical Association, and, it too, was cited as an event pointed in the rightdirection but for many reasons, failed to excite the industry. First of all, theexhibits have a size constraint, virtually no running equipment and theaudience, too small, about 1000, includes many vendors. Further, theattendees spend most of their time at the technical sessions and time on theexhibit floor is limited.Conclusion, at least among the editors, consultants, manufacturers andprinters, is that there is a need for an exhibition which focuses on packageprinting and converting. Most stated that PACK EXPO would be the logicalvenue because of its long standing reputation in the U.S. and abroad, as themajor packaging event held in this country. It was also noted that before theadvent of the CMM show, converting was an important element of PACKEXPO.A conclusion such as above does not immediately translate into agroundswell of support from manufacturers and attendees into inauguratinga new element into PACK EXPO. But, it does raise the question oforganizing a more focused and widespread research project which wouldattempt to formalize a recommendation to PMMI’s Board and staff. I am notsuggesting this approach with the thought of my conducting this program; anexperienced individual or company would be better poised to undertake astudy of this nature because of its wide implications.I will however suggest in the next section some steps that PMMI staff couldconsider undertaking during the next several months to compile moreinformation which might assist them in formalizing their presentation to theBoard. 7
  • 8. RECOMMENDATIONS FOR ACTIONSuggest staff look into an opportunity to have gravure and flexo equipmentmanufacturers exhibit in Pack Expo. Gravure’s ability to print high impactgraphics, color pictorial images and fine text copy are ideal for mainstreamand upscale products. While offset and flexo are widely used for manyproducts, gravure is chosen for many products in flexible packaging, fromhome and personal care items to beverages, packaged foods and tobacco.Some discussions with the Gravure Association of America and theFlexographic Technical Association should be undertaken to determine theirinterest in encouraging their members to exhibit. Both associations areheadquartered in the U.S. with a large number of foreign members; bothmanufacturers as well as packaging companies and individuals.While mentioning foreign companies, PMMI might consider exploringdiscussions with Chinese manufacturers of packaging and package printingequipment. Some of them will exhibit in PRINT and those which are absentcould be contacted by PMMI’s Chinese representative.Since the gravure and flexo manufacturing industry is significantlyrepresented by foreign companies, additional groups to be contacted forsupport include both the Italian and German trade associations for thepackaging and converting industries. These types of companies are notparticipating in large numbers at the upcoming PRINT exhibition.Additionally, suggest PMMI staff attend PRINT and talk to companies, listattached to this Report, to discuss their thoughts about a focused event forthe package printing and converting market. Point out that according tosome data on the packaging industry, flexible packaging in the U. S. isestimated to be about $25.6 billion, two-thirds of which encompasses printedproducts. About 15% of that printing is done by gravure, and the balance isshared predominantly by flexo and offset. In addition to contactingcompanies, PMMI might consider having one of its staff members attend theseveral Technical Conference sessions dealing with package printing. 8
  • 9. I would recommend PMMI purchasing a market research study beingproduced by PRIMIR which is focused on the package printing market.Another study in this area is being produced by the firm INFOTRENDS.Both groups are considered highly reputable and producers of solid researchbased on data obtained by phone interviews and written questionnairesconducted by industry experts.After these visits to the exhibition in September, PMMI might considerhosting an informal session with the key exhibitors and basically advisethem that this is an opportunity to create an event which meets their needs aswell as the attendees rather than the interests of exhibition organizers.At the same time, careful attention must be paid to attracting the maximumnumber of qualified attendees to this proposed event. The commoncomplaint among the respondents was that to truly cover the packageprinting and converting industry, one must attend events such as PRINT,CMM (in the past), INFOFLEX, LABEL EXPO, as well as internationalevents held in Germany and Italy. The most asked question which will beraised from the manufacturers is “how are you going to identify theprospective attendees?” Careful thought must be given before automaticallyanswering “we know how to do it.”The struggling economies of the U.S. and Europe, while a possiblehindrance to the possibility of another event, even if co located with asuccessful show such as Pack Expo, could present this concept as beneficialto companies seeking to maximize their participation either as an exhibitoror attendee. One show serving the spectrum of packaging, one trip toChicago, and lower overall expenses might sound even more promising thanfirst envisioned. With many experts pointing out that the U.S. economywill probably not return to past performance, a well designed exhibition forexhibitors and attendees alike, could be greeted favorably.The time is right to carefully address the issue of what will replace CMM,CPP and other events struggling to present their version of an exhibition forthe package printing and converting industries. A strategic plan foraddressing those questions could provide the industry with one show whichis a must event to exhibit in and attend. 9
  • 10. SUGGESTED COMPANIES TO CONTACTAT PRINT 09 IN CHICAGO (Not in order of priority)Advantage MachineryAmerican International MachineryBobstBrausseBrandtjen & KlugeE C H Will GmbHEFI-JetrionHeidelbergGarridoKBAKerberKernKodakKomoriMGI Digital Graphic TechnologyPencoPrime UV 10
  • 11. Sealed Air Corp.TompkinsWestern Printing MachineryWinkWinkler+Dunnebier AGXi’an Aerospace Huaying Printing and Packaging Machinery 11
  • 12. 12