Freeing cash trapped in the supply chain
Linda Casey, linda.casey@reedbusiness.com -- Packaging Digest, 9/18/2009 5:00:00 PM
Ken Stack, GM manager of EFI Jetrion, has a confession to make. "Is our ink more expensive? Yes, that's absolutely true," the refreshingly candid executive tells PD during a booth visit at PackPrint 09.
But Stack says those who concentrate on ink price are missing out on bigger savings. Some of these examples are in recurring supply costs, such as savings from not having to make plates; eliminating the need to coat sheets thanks to the hardiness of the Jetrion's UV-cured prints; and the fact that the company doesn't use a "click charge" (price per impression) to collect the cost of the machine from the buyer. He states that all these things save money and have helped EFI push the breakeven point between digital and convention printing technologies, such as flexo, to dizzying heights from 50,000 to 100,000 sheets with the introduction of its new Jetrion 4830 ink-jet.
He states that these savings are great, but where the real money lies is in the supply chain and digital printing can set those dollars free.
As many in the food packaging industry know, labeling is of major importance to the safety of the consumers eating your foods and one of the major costs of running labels is in press setup, which can be recouped by leveraging that cost across many labels. Yet, longer runs can mean fewer jobs are run per day. This can result in a longer turnaround time for jobs, and many brands need to capitalize on product demand when it's hot and not be waiting for a label job to come through.
So label printers, Stack explains, often will print a large amount of labels. sell part of the print run, store the rest at their expense until their customers are ready to order additional labels. In the meantime, the printer is stuck with the costs of printing, storing and managing this inventory of labels that he or she hopes the customer will purchase.
If the customer changes ingredients, graphics or any other messaging on the labels, the printer has to eat these costs and destroy the labels. Brand owners that are working so hard to make their packaging sustainable also are hurt as this process can result in potentially thousands of labels being destroyed thus increasing the true carbon footprint of their products.
He contends that digital label and package printing can help "green" packaging by eliminating wasted labels, free up warehousing space used to store the labels, and offer just-in-time ordering and printing.
"If the turnaround time for labels is six weeks, with digital it can be six hours," Stack remarks. Digitals' shorter turnaround time, along with the elimination of setup costs such as printing plate processing and mounting, enables label printer to offer shorter-run jobs. Stack rhetorically asks: "How much interest would you have if you had that cash in the supply chain in the bank instead?"
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