Fundamental Thoughts

Remaining a competitive flexographic printer requires balancing tomorrow’s promise with today’s potential. “This is where many of our customers and others in the industry find themselves in 2018” according to Printron Executive Vice President Jack Fulton, a 40 year veteran and recognized industry expert. According to Jack, the flexographic printing industry is at a crossroads as both conventional and digital capabilities continue to improve.

The flexographic printing industry is at a crossroads as both conventional and digital capabilities continue to improve.

What he refers to as “progressive flexography” is very real and is bringing with it significant benefits to both printers and brand owners. That is a win-win for all. That said, as emerging technologies come to market on both fronts, todays printers are finding it necessary to make some tough strategic decisions to stay on top of this quickly advancing industry and remain competitive. Or more specifically, to increase productivity and profits while focusing on customer satisfaction. Jack believes that the best way to put the future into perspective is to question whether you’re losing or winning as technology shifts. What follows are some key essentials that printers can use as guideposts when looking to the future. Moving into the future, the printer ultimately needs to decide whether new and existing technologies add value or subtract from it.

Progress Or Regress?

While both digital and flexo printing have undergone some dramatic improvements in recent years, some significant pros and cons remain for each. For example, while digital allows for faster change overs, the ability to print variable copy easily, and gives the option of lower inventories, it also can quickly become unprofitable when administrative bottlenecks occur because of the inability to handle an increased number of short run jobs. It is also substantially more expensive than conventional printing on a pure cost- per-unit basis. Jack believes that the “tectonic plates” of print will shift back and forth between conventional and digital technology. Yet it is counterproductive to prejudge the impact one technology will have over the other.

3 Fundamental thoughts to frame the future:

1). Rethink Disruption

The future is rarely what it seems. Despite the fact that Printron produces printing plates for conventional flexographic printing, which are not required with digital, Jack is very calm and optimistic. It’s not that he is complacent about the future, but exceptionally confident about what is taking place in the industry at present. According to Jack “Flexography’s next decade will remain both promising and profitable for at least 5 reasons:

5 Reasons why flexography’s next decade will be both promising and profitable:

• The largest printers in the industry are investing heavily in high end (10 million plus) flexographic presses right now to exploit the economies of scale they continue to offer. Also, Fulton has seen a certain amount of “digital fatigue” as many in the industry are not convinced that digital has reached full development and are therefore not investing in it today.
• Converters investing in flexo are doing so to meet the insatiable demand for “doorstep” packaging driven by direct-to-consumer online retailers. According to Mintel “As more and more consumers embrace online shopping, packaging will play a pivotal role in brands and consumers e-commerce experiences.”
• Quantum improvements in press automation have reduced operator intervention and are neutralizing digital advances while enhancing flexography’s economic advantages. In fact, “The focus on lean logistics is leading some of the biggest innovation in flexography today.” According to Colleen Larkin Twomey, associate professor at Cal- Poly State University.
• Advancements in prepress, software, plate technology and inks and coatings have all seen significant innovation, lessening the likelihood that digital printing will overtake the cost-effectiveness of flexo for medium to long runs.
• Flexography affords key advantages for clients using spot colors and finishing processes such as cold foiling, embossing, perforating and laminating. Continued advancements will likely continue to reduce the costs of these value added processes and make them more mainstream.

2). Capture profits now

Don’t let the future impoverish the present. This is the advice Jack offers to printers who take a “one or the other” view of digital printing over flexo. It is important to note that we are not experiencing the mutually exclusive conversion of analog processes to digital, but instead a rapid merging of them. In fact, hybridization with digital technologies may in fact bring with it a “best of both worlds” scenario and may in fact encourage further advancement of flexo. As a result, printers are presented an opportunity to hedge their bets on the technologies that best meet their needs and those of their customers today. If you don’t want to leave profits on the table, you’ll want to embrace progressive flexography now. Significant demand exists today for both large runs and premium printing. In fact, “The garage is the new warehouse” according to Jack.

Can you remember that we once predicted a “paperless future”?

Explain that to anyone who has seen the demand for packaging explode since 2000. Walk down any street in America and you’ll find garages filled with boxes from Amazon and other retailers as well as subscription services such as Blue Apron and Stitch Fix. Wal-Mart’s advertising during the 2018 Olympics illustrated that it’s all about retailing on the doorstep. The fact is that consumers themselves are as likely to handle packaging today as a warehouse clerk used to. This is because modern retailers are progressively shipping packages directly to households and bypassing brick and mortar retailers all-together. This trend has led to retailers putting a premium on good looking packaging that spends time outdoors.
This is where premium packaging and labeling and the long-run cost advantages of flexography are profitable in the here and now. As leading brands move to more durable and exotic packages in reproducible formats, enterprising printers are meeting the demand-with flexo not digital. Pretty boxes or not, there is simply nothing more cost effective for long runs.

3). Determine your tipping point

This is something that is unique to each converter and has to be analyzed carefully. There is the obvious tipping point when the benefit of reduced change-over time and the ability to provide variable graphics outweighs the higher per unit cost of digital. While each printer’s “allowable” margin will be unique to their business model, this is purely a numbers game and until the per unit cost of digital becomes more in line with flexo it will only remain a viable option for short runs. Other less obvious things for printers to consider, however, are equally as important. Printers need to take a close look at their current customer demands and assess their own reality.

3 Key questions printers need to ask:

• Are your current sales and pricing models in line with the cost of digital?
• Which new markets or opportunities will you be able to tap into to take advantage of the capabilities of digital over flexo and are you willing to do this?
• Is your plant workflow capable of coping with a high number of short run orders?

Jobs can quickly become unprofitable when order processing and pre-press capabilities can’t keep up with the increased demand caused by many smaller runs.
Ultimately Jack recommends looking at things the way an investment manager might look at a portfolio. “I encourage people to make their own calculations and determine when one technology (or a combo of the two), achieves a tipping point that balances profit and loss in their favor.

Is there room for both digital and flexo?

With the advent of hybridization it is clear that in the long run flexo and digital are anything but antagonistic. This means the possibilities for future advancements are endless and very exciting for the printer and consumer alike. With hybridization, convertors can run variable digital, flexo (or a combination of both), color matched to the flexo press and integrated with in line finishing assets. This is certainly an opportunity for printers to leverage both technologies, giving them more flexibility and increasing overall capacity. This is certainly something we will be hearing more about in the future.

Final Thoughts

While no one knows what the future holds, it is certain that the changing economy and customer demands, combined with the advancements seen in both flexo and digital have pushed us all to become better at what we do. This is truly a win win and is something we should all be grateful for. The future is without a doubt very bright for the design adaptation and packaging design industry!