Industry Articles

Flexing Muscle: Digital Printing Makes Inroads into Flexible Packaging Production

As digital printing continues its growth throughout the packaging industry, flexible packaging converters are creatively and intuitively implementing the technology.

According to I.T. Strategies, a Massachusetts based printing industry consulting firm, digital printing accounts for only about 1% of all flexible packaging production — but you’d never know it from the pace of flexible package printing at the digital shops ePac LLC and Quality Tape & Label.

Both are using HP Indigo 20000 digital presses to turn out work in volumes vastly higher than the packaging market usually associates with digital printing. They’re also taking full advantage of the equipment’s short-run and variable printing capabilities: assets that let the shops keep up with SKU proliferation and other trends now reshaping the demand for flexible packaging.

At ePac LLC, partner Carl Joachim and his team have divided very large jobs between two HP Indigo 20000 presses so that the entire run can be finished and delivered in a week. The machines are also showing their mettle in smaller quantities. Joachim says that in runs up to about 25,000, and often beyond that, digital printing is cheaper than flexography — the dominant process for flexible packaging — because it eliminates plate charges and other prep costs that his customers are perfectly happy not to see in their invoices.

In June, if all goes according to plan, Quality Tape & Label will complete the final stage of a flexible packaging job so massive that it could almost nudge digital printing’s 1% market share all by itself.
Rob Daniels, president, says it cumulatively comprises a staggering 260 million variably printed labels on 11.8 million linear feet of flexible material. He throws down the gauntlet to flexo with his claim that, depending on the size of the piece, digital printing can beat the cost of the conventional process in single-SKU runs of up to 3 million units — a new order of magnitude for digital production of any kind.

Flexography, however, is in no imminent danger of losing its sway over the flexible packaging market, where I.T. Strategies estimates it prints 75% of the volume.

For production in very large quantities, which is what most consumer-product packaging consists of, flexo still offers unbeatable economies of scale. Marco Boer, VP of I.T. Strategies, notes that high resolution HD flexo plate imaging and hybrid digital/flexo systems are helping the process stay in tune with the market’s requirements for high print quality and responsive production.

So far, this has left little for digital printing to seize upon. But, says Boer, the fact that digital’s slice of the pie is tiny “does not mean it is not valuable and profitable. Per piece, digital printing demands a much higher sell price than all of the other technologies.” Flexible packaging customers will pay it, he says, because of the “pain points” that digital printing solves for them as their go-to-market strategies change. “The reality is, run lengths are declining, and this is not an economical hardship for most brands,” Boer says. “Most brands would rather bring a variety of flavors, scents, etc., to market than just one high-volume SKU.”

This is precisely the opportunity that ePac LLC and Quality Tape & Label are exploiting at both the high and low ends of the run length range. But, not without having to overcome some resistance.

Joachim says the perception still exists among print buyers that digital printing is too “slow and expensive” to be competitive for flexible packaging. To change it, “you begin to chip away and eliminate prepress” with a digital production workflow that saves customers money while it gives them the results they want.

“Knowledge and a little more speed” of output will be the tipping points for digital in terms of increasing its market share, according to Daniels. He thinks that when digital presses reach a point where they can print 200 linear feet of flexible packaging material per minute, it will be hard to cost-justify the setup charges that come with printing on flexo equipment.
The HP Indigo 20000 tops out at 135 fpm in a three-color process that HP calls Enhanced Productivity Mode; four-color print speed is 101 fpm. Currently, the device is the only digital press capable of flexible packaging production on the scale practiced at ePac LLC and Quality Tape & Label.

With a 29˝ image format, a gamut of up to seven colors, and the ability to handle film and label stocks up to 10 pt., the roll-fed, electrophotographic press is designed specifically for flexible packaging, pressure-sensitive labels, shrink sleeves, wraparound labels, and in-mold labeling. HP showed the press for the first time at drupa 2012 along with the HP Indigo 30000, a 29˝ digital sheetfed press for folding cartons.

Its print quality may be its clearest edge over flexo, say the printers. Daniels has found that “a lot of brands are willing to pay a penny more a unit to get that digital quality” when they see what the press can do. The quality of reproduction on the HP Indigo 20000 is among the reasons why one of his customers, a chemical producer, has migrated all of its flexible packaging production to digital.

Joachim’s experience is that there are times when superior color from a digital press can be a little too superior. He says that although he can get better color from his Indigo platform than a flexo press can deliver, he often finds himself “dumbing it down” to flexo’s level for the sake of visual consistency between the processes when a packaging customer is printing with both.

The two shops operate on business models that depend heavily on digitally printed flexible packaging. In ePac LLC’s case, the reliance is total. Joachim describes the company as a “100% greenfield” startup that came into being “with no building and no customers” less than a year ago. Its first HP Indigo 20000 came from partner Emerald Packaging, a California-based flexible packaging printer that had been beta-testing the device.

The entire production workflow, including job input, file preparation and postpress, is keyed to the high performance of the two HP Indigo 20000 devices that the shop now operates. There is no non-digital production. Most runs are from 5,000 to 25,000 units, but Joachim says that by maintaining a low-cost infrastructure and eliminating plate charges and inventory, ePac LLC can also compete with flexo in the 50,000-piece range. He claims it can even play in six-figure territory when multiple-SKU jobs are involved.

Pouch making in various formats is a specialty, and the company prints and converts them for producers of snacks, cheese and dairy items, pet food, lawn and garden products, natural foods, and nutraceuticals. Joachim says that he’s been seeing strong interest in flexible packaging from dispensaries of medical marijuana, a pouch-friendly product, if there ever was one.

Daniels, who thinks it will be “only a matter of time” before the flexible packaging industry makes a wholesale shift from flexo to digital, now prints 80% of his volume on digital equipment. The complement includes three HP Indigo presses that process 2 million linear feet of flexible material per month for labels, pouches and shrink sleeves, sometimes handling 30 jobs per day.

Runs average 20,000 to 40,000 linear feet and 30,000 to 50,000 units, but as Quality Tape & Label’s giant job-in-progress demonstrates, quantities can go much higher than that.

Daniels speaks of a nutraceutical producer with a hot product selling so fast that the customer needed 1 million shrink sleeves per week as just-in-time inventory. Quality Tape & Label has also turned out frozen-dessert wrappers and stick packs — skinny pouches for single-serve quantities of liquids and powders — in digitally printed batches of millions. “Customers are surprised we can do it at the price we do it at,” Daniels says.

Atypical success stories like Daniels’ and Joachim’s don’t necessarily contradict Boer’s assertion that flexible packaging remains a tough nut for digital printing to crack. “The flexible packaging market is still a high-volume market, and digital printing will take a long time to truly penetrate the market,” Boer says.

Technical issues such as substrate performance remain to be solved. Another impediment, according to Boer, is the fact that “there is still only one true digital production flexible packaging printer in the market.”

The HP Indigo 20000 will not have the field to itself indefinitely. Rivals are on the way, most notably the 41.3˝ wide, 200 m/min. inkjet web press for flexible film being brought to market by Landa Nanographic Printing.

At drupa 2016, Fujifilm unveiled EUCON, a 21˝ wide inkjet press featuring specially formulated, LED-UV curable inks and an oxygen purging system that is said to make printing with the device safe for flexible packages containing food. Xerox showed a prototype of a 20˝ wide inkjet press for UV printing on plastic packaging substrates. Inkmaker Kao introduced a water-based, VOC-free inkjet ink for high-quality printing on flexible materials; a partner, Think Laboratory, has built a 21˝ wide roll-fed press on which the inks can be run.

But for now, the formidable HP device gives a good solo indication of what digital technologies will be able to accomplish in a market that they have been all but shut out of until now.

That’s more than enough encouragement for Joachim, who intends to order two more HP Indigo 20000 presses and says he “probably won’t stop at four.” He envisions a network of ePac LLC branches in as many as 15 locations around the country, all of them dedicated to the same kind of production he is pursuing at the founding site.

“There is nothing but upside for digital printing in the label and flexible packaging space,” he says.

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Getting Down with Digital

As digital package printing continues to improve, brand owners are exploring the technology’s benefits and opportunities.

By Ashley Roberts

There’s a problem many brand owners are facing: They need high quality short-run packaging at a desirable price point. The solution could be digital printing, but the biggest hurdle for converters is educating brand owners on the technology’s benefits. With price being one of the biggest driving factors behind production runs, some brand owners have resorted to sending jobs overseas, unaware of the possibilities that are available domestically. As more converters adopt digital technology, it’s imperative that they demonstrate the advantages it could provide to brand owners.

It’s not as though brand owners are hesitant to try a new printing process. Jennifer Dochstader, founding partner of LPC, Inc., explains that brand owners aren’t picky about how converters are printing their packaging, as long as it matches the expected quality and a desired price point. Robert Ludlow, owner and chief chocolatier at Fleurir Chocolates, is one example of a brand owner who was able to achieve these benefits through digital.

“If someone told me they could produce the same quality product for cheaper [with a different printing process], then sure I would give it a shot,” explains Ludlow. “I don’t exactly see that happening with everything I’ve learned about digital. It’s so personal and simple. … Having something that works and you don’t have to worry about is invaluable.”

Alexandria, Va.-based Fleurir has worked with Cleveland-based Tap Packaging Solutions to create customized folding cartons for its line of regional chocolate bars. Being a small chocolate company, Fleurir only requires short runs of packaging and Ludlow explains that after experiencing six-to-eight-month lead times and color inconsistency when sending jobs to China, which he describes as an “atrocious” process, it was time to find an alternative solution.

Ludlow traveled to Tap Packaging Solution’s facility to see the capabilities of the company’s HP Indigo 30000 digital press. Although he admits he doesn’t understand the intricacies of the printing process, the quality, turnaround time, color flexibility and price point of the digital press were what won him over.

“I love the fact that digital printing allows me to say, ‘This is what I imagine, can you produce it for a reasonable sum?’” he says.

Ludlow isn’t alone as a brand owner who has turned to China for a cheaper solution. Nuts About Granola, a York-Pa. based granola company, also sent production runs to China, but found that with plate charges, freight expenses and lead times of 10 to 12 weeks, the more economical price didn’t last.

Nuts About Granola had used flexographic technology to meet its short-run needs in the past, but was up against challenges resulting from its high volumes of inventory and waste from packaging design and product changes.

The company was introduced to Middleton, Wisc.-based ePac, a digital only joint venture of Emerald Packaging, that runs two HP Indigo 20000s. When Nuts About Granola approached ePac, it was the price, print on demand capabilities, low minimum order quantities and a lead-time of two weeks that cinched the deal.

“We were a little apprehensive at first, but as the technology evolved and we started to launch new items … we wanted to test the market,” Sarah Lanphier, CEO of Nuts About Granola, explains. “We were looking at digital from an aggregate cost savings to where it saved us thousands of dollars because we didn’t have to invest in plate charges or minimums.”

As Nuts About Granola works to transition all of its packaging to digital, Lanphier says that the turnaround and setup times have been reduced to the point where products are launched to market faster and more efficiently, changes can be made to its packaging based upon consumer input and there is greater flexibility in color choices leading to increased creativity.

Fleurir has experienced similar benefits. “When we were first starting out, we had to choose from limited colors, so to be able to do full-color at reasonable rates and short runs has allowed Fleurir to get really creative with design,” Ludlow says.

A Growing Demand for Digital

Expedited delivery times, shorter run sizes, high quality, low inventory and a low price point are the key drivers in the shift to digital. Additionally, brand owners not currently utilizing digital capabilities want to have the option in the future.

“We have seen a tipping point in the last six to 18 months where we have seen an increase in the percentage of brand owners [specifically in labels] demanding or requiring their label converters to have digital press production capacity in-house, even though they’re not buying digital labels from them,” Dochstader says. “It’s a huge shift.”

Labels are currently the most embedded in digital packaging growth, but there is a market for flexible packaging, folding cartons and corrugated. Although in general, she says flexible packaging growth rates are the highest, she points out that less than 2% of the segment would be justified for digital because the run sizes are still so large. However, she says that drupa 2020 may turn out to be a pivotal point for the burgeoning technology.

“We are going to see some inroads made in flexible packaging and folding carton technology,” she says. “It’s going to get faster.”

Ludlow cites versatility and the ease of ordering as a catalyst to shift to digital. The company currently has seven different varieties of chocolate bars for which it has seven uniquely designed packages of the same shape and size. Ludlow explains that the company only needed to order approximately 20,000-25,000 packages.

“What I love about it is that when we order bars, we have seven different designs, but because it’s digital, I just order a particular quantity of each type and they’re all counted as part of a lump sum because they’re all the same shape,” Ludlow says.

From a converter perspective, Carl Joachim, CTO of ePac, says there has been a rapidly increasing demand from CPGs since the company began commercial operations in May 2016. As brand owners begin to learn more about the advantages of digital technology, they are excited by the myriad possibilities.

“Several customers have gone through the process of contacting us, asking for a quote, sending artwork, and when they deplete their inventory, we have it ready to print on demand,” he says. “So the ramp up time from initial contact to production is pretty quick.”

Spreading the Word

As beneficial as digital packaging could be for some brand owners, it’s not universally understood and accepted yet. There is an opportunity for printers and converters to reach out to brand owners and describe the advantages to going digital.

“We have a job ahead of us to articulate the value proposition of digital, why and where it is a more economical solution and how it can benefit a brand owner from a marketing perspective,” Joachim says.

He explains that there needs to be a shift in how packaging is perceived and purchased. The brand owner should be aware of its uses, such as promotions, test marketing and sales samples. For example, if a brand reaches out to a big retailer, such as Costco, to pitch a new brand to execs, it’s helpful to have the product’s packaging to show them, rather than a mock-up.

However, even though customer demand is growing and brand owners are learning the benefits of transitioning to digital, adding digital packaging capabilities isn’t for every converter. ePac’s all-digital model began when Emerald Packaging installed the first HP Indigo 20000 in North America, but soon realized that developing the market for digital would require a clear strategy, focus and dedicated resources. Emerald’s infrastructure, specifically its downstream processing, was set up for long runs. Emerald Packaging then turned to Joachim and his partners at Arion Partners LLC, an investment advisory services firm focused on the flexible packaging market. ePac was launched a short time later, with the intent to serve an untapped digital market. With a focus on digital, in addition to CPGs, ePac has developed relationships with converters seeking a partner to outsource short run jobs.

“Since we are 100% digital and have no plans to move upstream into longer runs, the converters that work with us see ePac as a true partner as opposed to one day serving as a threat,” he says.

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The Lure of Digital Packaging: A Printing Industry Growth Area

As Consumer Packaged Goods (CPG) companies continue to look for new ways to get to market faster and connect with consumers on a personal level, digital packaging printing offers new options. A new whitepaper, “The Lure of Digital Packaging: A Printing Industry Growth Area,” by Dr. Harvey Levenson, explores all printing methods and how digital technology will revolutionize print for packaging.

Digital printing has forever changed the flexible packaging landscape. No longer does a CPG company need to utilize gravure or flexographic printing to achieve high quality, attention-grabbing packaging. At ePac, custom digital flexible packaging is created using the HP Indigo 20000, eliminating the expense of plates and inventory while delivering jobs in less than two weeks. With variable data capabilities, ePac is able to personalize every package that is printed, laminated, formed into a pouch, and shipped.

Levenson goes even further in his article by exposing print industry growth predictions, and why he thinks that digital printing will revolutionize the print industry. Check out the full article and case study of ePac written by Levenson wrote here: URL, and start thinking of new ways digital printing can help you and your business take flexible packaging to the next level.

Download White Paper

Greenfield and 100% Digital, ePac LLC Sets Its Sights Exclusively on Flexible Packaging

Digital printing for flexible packaging has been slow to take hold, but a start-up company in Madison, WI, says it is equipped and ready for a fast break into this potentially lucrative market.

By Patrick Henry |
Published: June 28, 2016

Digital printing’s share of packaging production remains small—a recent drupa report put it at only 7% of the total. Within that narrow slice is the still smaller subcategory of digitally printed flexible packaging. Machine limitations, substrate issues, and the iron grip of flexography have all played their parts in keeping digital printing processes mostly at the fringes of the film-based packaging market.

This doesn’t mean that the segment doesn’t have a digital future or that ambitious digital printing entrepreneurs don’t want to be in on it. Smithers Pira says that the global market for flexible packaging will grow by 3.4% per year through 2020, by which point it should be worth nearly $250 billion. Convinced that it has both the technology and the business model to seize some of the opportunity with digital production, a start-up printing company in Madison, WI, is going after a piece of the action.

Meet ePac LLC, a small but striving shop that opened its doors in May with one digital press, about 10 employees, and a strategic plan that already calls for more devices and additional locations. Carl Joachim, one of the founding partners, describes it as a greenfield operation built entirely from the ground up around wide-web digital printing for flexible packaging.

This means that the business has no legacy presses to support nor any analog production routines to adhere to—just a determination to do everything that can be done with the HP Indigo 20000 Digital Press on which all of ePac LLC’s flexible packaging jobs will be printed.

Greenfield and 100% digital though it may be, the company isn’t without roots in the mainstream flexible packaging printing industry. ePac LLC is an outgrowth of Emerald Packaging, a Union City, CA, converter that prints tens of billions of food bags, pouches, and other film-based products using high-volume flexo presses. When Emerald Packaging agreed to beta-test an HP Indigo 20000 for smaller runs, the possibility of starting an all-digital flexible packaging operation began to take shape.

It crystallized during an open-house event where Kevin Kelly, CEO of Emerald Packaging, first discussed launching ePac LLC as a joint venture with Joachim and his co-principals at Arion Partners LLC, a two-year-old strategic investment consultancy to the packaging industry.

Joachim has a 25-year background in digital printing with Xerox, Ocè, and Ricoh. Arion’s Jack Knott, serving as CEO of the new company, also has an extensive track record of building revenue in the sector, as does the third Arion partner, Virag Patel. Knott and Patel respectively are the former CEO and vice president – global market development of Coveris, the sixth largest global plastics packaging company.

The Arion trio provides management oversight for ePac LLC. Emerald Packaging contributed the HP Indigo 20000, which it transferred from Union City to Madison along with its key operator. Premedia, converting, laminating services were added, and the start-up was ready to find out how well digital printing could mesh with the demands of the flexible packaging market.

Joachim believes that with the right manufacturing approach in the appropriate run length ranges, the fit can be highly advantageous.

“All workflow and downstream processes are engineered around the HP 20000 platform for maximum efficiency and productivity,” he says. This includes optimizing not only internal procedures for printing and converting but also the channels through which customers do business with ePac LLC. To that end, the company is creating an automated web-to-print ordering system that will be phased in over the next six to 12 months.

As for quantities, Joachim says that he and his partners modeled digital and flexo run lengths “100 ways to Sunday” and found that the sweet spot—the range in which the HP Indigo 20000 prints most cost efficiently—lay between 1,000 and 25,000 copies. Produced in these volumes, and sometimes in batches as high as 75,000 units with multiple SKUs, are laminated roll-stock and multi-format pouches including those with three-side sealing; pillow and flat pouches; stand-up pouches with plowed-in bottom gussets; side gussets pouches; and zipper pouches.

ePac’s business model focuses solely on quick-turnaround, short-run flexible packaging for consumer product goods (CPG) suppliers. The product markets of primary interest are coffee, natural and organic foods, pet foods, lawn and garden supplies, snacks, and cheese. There is going to be plenty of work to do for these customers, says Kelly, because of three strong trends favoring an all-digital approach:

“First, the trend towards very short runs as SKUs explode. Second, the ability to exploit a web-to-print model thanks to the agility of the Internet and digital printing. Third, the desire of brands to reach out to their customers in ways that engage, for instance by personalizing packages with pictures consumers submit.” Joachim cites CPG producers’ increasing reliance on targeted product variations, promotions, and test marketing as additional factors that should drive business ePac LLC’s way.

Committing to digital printing for flexible packaging also means excluding things that don’t conform to the model that the company has adopted.

For example, there’s currently no room in the plan for labels (although Joachim sees variably printed shrink sleeves as a future opportunity). And, it definitely rules out having conventional equipment for long runs, an option that was considered but ultimately rejected as the model evolved. Joachim says that instead of trying to compete with large-scale producers in this space, “we are open to working with converters that see the benefits of working with ePac as their short-run, quick-turn partner.”

It’s uncommon for a printing business to stake its credentials wholly on a single piece of equipment, but that’s the degree of confidence that ePac LLC has in its HP Indigo 20000. Introduced four years ago, the device is a 30″ wide, electrophotographic web press designed specifically for printing flexible packaging, pressure-sensitive labels, shrink sleeves, wrap-around labels, and in-mold labeling. It can do so in up to seven colors at a top speed of 135 fpm.

HP says that with the help of an inline priming unit, the press can print nearly any standard flexible packaging substrate. This is the feature that aligns the HP Indigo 20000 most closely with ePac LLC’s business model.

The device is, according to Joachim, the only wide-web digital printing press capable of handling the full range of substrates used in flexible packaging. As a result, when it came to choosing a platform for ePac LLC, the HP Indigo 20000 was “the only game in town.” In the market space that the company occupies, he says, “you go HP, or you go home.”

Packaging films imaged on the device are sent to a Nordmeccanica Super Simplex SL solvent-less lamination system and Mamata Vega 410 servo-driven pouch maker for finishing. These machines, says Joachim, match the output of the digital printing platform and let ePac LLC offer customers complete one-stop-shopping for production services. Design and premedia services that optimize the capabilities of the HP Indigo 20000 are provided through a partnership with the Oshkosh, WI, branch of OEC Graphics, a multi-location firm that bills itself as the largest and oldest privately-held premedia company in North America.

Start-ups usually have to take tentative steps forward, but ePac LLC already appears to be pulling on its seven-league boots. Joachim says the company will put in a second HP Indigo 20000 in July and has two more on order for installation at sites to be announced. He believes that the success of the model in these locations eventually could lead to “a national footprint” for short-run flexible packaging printing the ePac LLC way.

Joachim says that for now, he and his team are happy to be getting the ball rolling in Madison, a university town that incubates a good supply of the kinds of technical talent that a business like ePac LLC will need to recruit as it expands. It’s inherently propitious to be a packaging printing company in the Midwest, he adds, because of the region’s strong infrastructure of CPG producers and the printers and converters that serve them.

“Operations are rapidly ramping up,” he reports. “We’re open, it’s focused, and it’s working.”