The signs this year have been strong that the local packaging industry is facing a period of consolidation and rationalisation as it gears up to ride out uncertain economic times, and the package printing and labelling sector is no exception.
PKN spoke to a few key players and found many were cautiously preparing for what they described as a “challenging time” for the sector.
“The markets are consolidating, and that means, it’s tough for manufacturers,” the head of the IDS group within Matthews Intelligent Identification, Mark Dingley, tells PKN.
“We see the path for both manufacturers and suppliers as ‘innovate, or perish’.
“Because of the tougher environment, manufacturers are doing a lot of work to improve their internal efficiencies. Lean projects are becoming more common. Companies are beginning to invest time in understanding OEE — overall equipment effectiveness — and how they can implement OEE to help improve their bottom line.”
The director of the print and finish division of Jet Technologies, David Reece, says the challenge for printers and other suppliers to the packaging sector was to supply equipment to help them maintain competitiveness and increase their efficiency and flexibility.
“It is very competitive out there, and it has been a little quiet, for both customers and ourselves,” he says.
“The demand from our customers has been for shorter and shorter lead times.
“At the same time runs have tended to be shorter and shorter, so our challenge has been to help them increase their flexibility to meet these needs from consumers.
“As customers get into shorter runs and lead times, there has been a need for them to be able to make their own flexographic plates quickly and efficiently.”
In an acknowledgement that economic uncertainty was taking its toll on the wide format print market, local printing equipment supplier Starleaton launched a fire sale of some of its top printing hardware lines in April to boost sluggish sales.
Describing the price cuts as the company’s own ‘stimulus package’, Starleaton sales director Gary Smith says the move, in co-operation with three of its largest equipment suppliers, was aimed to kick-start demand in the sector.
“While our consumable media business remains strong, hardware sales have been hard to nail down,” Smith says.
“It’s a buyer’s market, so we have had to respond to the supply-demand equation by making it cheaper than ever to get a new solvent or aqueous wide format printer and laminator from the top recognised brands,” Smith says.
Jet Technologies, by contrast, has expanded its sales efforts within its print and finishing division (one of the company’s three core operating areas) with the appointment of a dedicated representative in New Zealand.
“It may be a gamble, but it is also an opportunity for us. New Zealand has always been very strong for us, but we have never had anyone there permanently,” Reece says.
The managing director of Matthews, Lester Nicholl, says his company’s challenge has been to dissuade customers from engaging short term ‘fixes’ for their problems.
“Suppliers and end users are being challenged with the number of coding and marking options available to them, but unfortunately, the best technology for the customer’s long-term needs can sometimes be lost in the process,” Nicholl says.
