The Increasing Influence of Digital in Package Printing
The rise of digital printing in the package printing segment should come as no surprise. Package printing is a major subset of printing — an industry that has been foundationally transformed by digital, and which has found new opportunity. Across the sub-segments of packaging — labels, folding carton, flexible packaging, corrugated, and containers — the degree to which digital has gained a foothold varies from quite a lot to just a bit.
This article looks at the state of digital adoption in the packaging segment — what is strong, what is not, and why; and examines the new capabilities, opportunities, and environmental implications of what digital brings to the fore. Further, it shares the experiences of two packaging printers who are realizing the promise of new technologies.
Segments and Verticals
For the packaging segment, says Kevin Karstedt, founder and CEO of Karstedt Partners, the label segment is where digital printing has its strongest presence. Stating that the technology is “no longer the new kid in town,” he estimates digital capability is present in half of the companies serving the label segment.
“It’s established and has a niche,” he says, “and it’s not uncommon for companies to be on their second, third, or fourth generation of equipment.”
In the corrugated market, he says, digital has also gained a significant foothold. He adds that the other packaging markets are in varying stages of early adoption.
Adam Peek, founder of Golden Rule Consulting, and who hosts the People of Packaging Podcast, adds a broader perspective, saying digital is just like any other form of printing, in that it is a methodology to achieve a goal; beware of those trying to sell any specific method as “better,” he warns.
In the flexible packaging segment, Karstedt says digital printing is still in its infancy. He reports that while some major players, including HP, Fujifilm, and Kodak, have designs on game-changing printing systems, digital technologies “comprise just a small
part of the broader segment, but
they are still the outlier.” Many of the current challenges to fully realizing digital for flexible packaging, Karstedt says, are technical, related to ink and substrate issues.
Folding cartons, says Karstedt, can be viewed as being produced by two specific communities. The first is among converters, where it hasn’t really taken off yet, though some operating in that space have begun to embrace the possibilities of digital. The other community is commercial printing, where companies are using, for instance, HP Indigo 10000 and 12000 systems to run lite board.
“So little of it is being done,” he says, “that it can’t be tracked — it’s almost anecdotal.” Karstedt adds that those commercial printers doing this work “are not the big commercial printers, but the $10M-20M middle-sized shops.”
Aside from a reduced need for printed inventory, Peek says the folding carton segment “has done a very good job leveraging FSC (Forest Stewardship Council) and soy-based inks.” He adds, “They’ve homed in on this already. It couldn’t get more sustainable,” meaning digital, at least on press, does not hold an environmental advantage. Makeready, however, is another story.
As stated, opportunities and production in digitally printed labels has reached critical mass in recent years. Karstedt states that the technology has been in the segment, in some way, for a long time, and that roughly two-thirds of the equipment in the label segment is HP Indigo. The remaining one-third comprises dry-toner systems, like those from Xeikon, and a “ton of inkjet, including systems from Domino, Durst, and SCREEN.” He says the use of digital solutions in packaging amounts to “12 to 15% of volume — and that’s a lot of volume.”
Karstedt also notes that the label segment is an area of package printing that holds the largest number of small users, citing the wide use of desktop or bench-top label printers used by small brands, as well as mom-and-pop businesses. Because of this, digital label printing has become highly popular with breweries, wineries, and in the cannabis industry, where less sophisticated companies (at least in terms of printing) are seeking quick turns, short runs, and the ability to make frequent changes, all within limited budgets. “This is one of the reasons label producers are able to sell their digital solutions,” he says.
Providing an environmental angle, Peek says that while the label segment has seen the largest level of digital conversion, “providing iterative nature and speed to market, which has been critical, it has been problematic for sustainability.” He says that the very same labels and shrink sleeves that have delivered short-run, high-variability production to, for instance, the craft beer industry, can also contaminate recycling streams in ways traditionally printed aluminum cans do not.
Having done a lot of research into the corrugated space, Karstedt says he has found that “adoption of digital in converter shops using digital is for more than just short runs.” He says that these converters are also using the technology to alleviate pressures in the plant — using the digital systems to operate near or across the analog/digital crossover point to address short-term capacity challenges. “They’re looking for the right asset for the job being done at that time,” Karstedt says. For instance, he says converters can create easier flow, putting more boards through their analog equipment by moving more troublesome jobs toward their digital equipment.
Peek says that printing digitally onto corrugated, because of its ability to produce affordable short runs, has served as an access point for smaller, specialty brands. Through the production and placement of retail point-of-purchase displays, he says, “they are given the opportunity to present themselves as players.”
Stating that the container market is rife with opportunity, Karstedt says that, for the most part, digital container printing is “in its pre-birth stage.” He says one part of this segment that has seen the most movement has been in the printing of beverage containers, where “they’ve spent hundreds of millions of dollars developing these solutions.” He adds that there is much more work to be done to significantly increase the use of digital technologies, and that what is printed today is a “tiny fraction of total volume.”
In the meantime, many of those seeking container solutions are using shrink sleeves and labels, adding additional fuel to the fire that this is today’s digital label market.
Peek adds to this discussion, saying that the widespread use of direct container printing — when it fully arrives — “is going to solve a lot of recycling problems.”
Looking five years into the future, Karstedt sees digital printing growing in the packaging space, but marginally. He sees digitally printed labels gaining a broader share of total label volume — perhaps between 23% to 35%; corrugated to less than 5% of the total; folding carton and flexible packaging will expand to less than 3%; and direct-to-shape to less than 1%. Adding a bit of perspective, Karstedt notes that
even 1% of an $80 billion industry is highly significant.
Haney Packaging: Maximizing the Promise of Digital
According to Dan Haney, co-founder and president of Haney Packaging in Cincinnati, Ohio, while digital printing has been in use for packaging for some time, “the last five years have seen explosive growth, especially in the flexible packaging sector.” Small- to medium-sized companies are using digital as their primary print platform in ways that didn’t occur even four years ago. Big brands are using it for development, promotional applications, or for small SKUs for specialty retailers. Further, he’s seeing digital used for e-commerce direct-to-consumer applications.
The company is seeing the strongest opportunity for digital printing in labels, shrink sleeves, pouches, flexible packaging, and corrugated shippers. Haney says, “As the speed of digital increases and cost per unit declines, the big brands will use it more frequently.” He shares his belief that the packaging segment is three to four years away from “some very big advancements in digital inkjet that will make it very attractive for all brands to use digital for a broad range of their packaging and applications.”
Haney Packaging uses a wide range of digital printing technologies, including presses from HP Indigo, Roland, Canon, and Epson. The company currently has 18 digital presses in operation, as well as digital die-cutting for folding carton and corrugated applications. By combining printers, the company can achieve printing effects including raised varnish and metallics.
Haney says the company “was a very early adopter and somewhat of a pioneer in digital printing technology.” He says the company fell in love with digital and saw its endless potential. “We’ve owned HP Indigo digital presses for 22 years, so we’ve been part of the evolution of digital, watching it get better, faster, and more diverse each year. It’s been an amazing ride!” Today, digital printing is Haney Packaging’s primary print platform, and the company continues to push the limits of what is possible for the needs of its clients.
The company has been in business for 31 years, serving the needs of leading brands that want to “fully leverage the power of their packaging to win at shelf or in-home, delight consumers, and ensure their single-use packaging has less impact on our planet,” Haney says. Describing the company’s Package Microfactory, Haney says it’s a Packaging Microfactory all under one roof, with the purpose of connecting brands to technology to help them understand what’s possible, reduce risk, and create a smoother path for commercial, scale-up manufacturing.
Over the next five years, Haney sees the use of digital printing growing strongly. He says the company sees a lot of opportunity in flexible packaging, especially around new compostable materials. Additionally, he says the company’s folding carton business is also busy, as many brands are exploring fiber-based solutions versus traditional plastic packaging. While Haney expects the company’s investments in roll-to-roll digital print technologies will ultimately outpace other sheetfed and flatbed systems, he says, “it is our clients who determine what’s needed and when.”
AccuFlex Packaging: Maximizing Opportunity
AccuFlex Packaging, which is a division of AccuLink in Greenville, North Carolina, is built off the capability of the HP Indigo 25000, says Tom O’Brien, the company’s owner and CEO. The digitally focused company serves what O’Brien refers to as “typical flexo verticals,” which include snacks, packaging for human and animal foods, and cannabis, with a focus on pouch manufacturing.
One strong differentiating factor for the company is that it is one of a handful of companies using EB (electron beam) curing and laminating. In so doing, O’Brien says, “the company is able to produce its pouches using a bio-based structure that will compost.” Further, O’Brien says EB curing also speeds up the company’s process and allows faster delivery of the competed job. He says that EB also adds extra hardiness to the print, eliminating, for instance, ink issues in the pouch’s zipper crush area.
O’Brien believes digital printing has served to democratize packaging by giving small brands the opportunity to compete for shelf space with brands doing massive print runs. “That, before, has been out of reach to small brands,” he says, indicating the opportunity for better packaging with faster delivery. AccuFlex Packaging has also produced short (500 pieces) runs of five different pouches to be used for focus testing.
The company was started in 1980, says O’Brien, “and we were digital before there was digital.” The company was an early user of toner-based printing systems. Starting in 2015, the company began doing printing work for e-retailers with a focus on photo-based products. In that area of the business, he says, the company will handle more than 10,000 individual orders “on a slow day.”
The company’s strong move into digitally printed packaging, O’Brien says, was inspired by an HP conference track on labels and packaging. This included a demo of pouch production and a discussion of opportunities in that space. For O’Brien, “it seemed like the place to be,” and a business plan was created to help the company achieve its new goal. Today, the effort includes a separate building dedicated for food-grade manufacturing, Color-Logic certification with its HP Indigo presses, and the ability to print a wide variety of predictable foil colors on metallized film.
Looking forward, O’Brien says the company will retain its tight focus on flexible packaging, and on the production benefits of EB curing and lamination. He says there is a lot of room in the digitally printed flexible packaging market and he welcomes newcomers, saying, “The more who come into the market, the more it legitimizes the process.”
While there are many opportunities for digital printing to flourish in the packaging segment, it is clear that digital technologies provide a significant value-add for customers, the ability to access a more granular approach to messaging, and much space for expansion into the segment’s markets. Whether for an existing opportunity or for new ways of producing products, digital printing will increase in influence and value. ●