Flexibility in digital finishing
Published: 4 June 2021 | No comments yet
US-based the Boxmaker recently installed two Highcon Euclid 5C digital cutting and creasing systems
Fuelled by the coronavirus pandemic of 2020-2021, there are a number of segments of the packaging market that have benefitted and boomed as an outcome of Covid-19, which has caused irrevocable changes that will shape the industry moving forward.
One of those is digital finishing, as Shlomo Nimrodi, CEO at Highcon, outlines. ‘I believe that over time, as market dynamics of e-commerce and sustainability accelerate, the penetration of digital-based finishing solutions will become a growing part of the overall finishing process.’
Finishing and converting is a core part of any converting process, from simple four-colour labels, up to boxes and cartons for whiskey, fragrances and other high value goods. Correct and efficient converting of corrugated packaging is also important, even more so as one of the ‘long Covid’ effects on the packaging supply chain will be the growth in e-commerce activity. Forced by stay-in-place orders and work-from-home diktats, consumers have relied heavily on online retail for everything from their weekly grocery shop, to non-essential purchases to help them get through lockdowns and periods of self-isolation.
The result of this has been a need for the manufacturing supply chain to rapidly adapt to heightened demand for e-commerce packaging, such as decorated corrugated boxes, and adopt technologies that facilitate agility and flexibility. This has suited Highcon, which was founded in 2009 with the mission to deliver digital finishing technologies that provide agile manufacturing options for the folding carton, corrugated and commercial print markets, so enabling brands to, ‘innovate and differentiate at speed and succeed.’
‘At the heart of our systems is a very innovative digital cutting and creasing technology that drives unique benefits for customers including no minimum order quantities (MOQ), much faster delivery times, and mass customisation,’ he states. ‘With sustainability high on the agenda for everyone, the performance of our systems is key here too, enabling the eradication of die-cutting tools and the materials used to make them, reducing inventories and manufacturing on demand at the right sizing while optimising the end customer experience.’
The technology made its international debut at drupa 2012, with the first generation of the company’s Euclid digital cutting and creasing platform generating strong interest on a show floor that also saw Benny Landa launch his Nanographic Printing, and HP Indigo unveil its 20000 and 30000 mid web presses for digital flexible packaging and folding carton applications.
Since then, numerous machines have been installed worldwide and new iterations of Highcon’s technology have come to market, including the next-generation Euclid machines and the Beam portfolio for corrugated applications. A more recent technical development has seen the introduction of the fifth generation of the Highcon DART consumable set (5thGDC), engineered to improve crease quality and reduce setup time by up to 20%, and support a broader range of boards.
‘Given that it was our first solution, 80% of sales have naturally been for our Euclid systems,’ identifies Mr Nimrodi. ‘Sales of our Beam platform have also accelerated significantly in recent years. This has been driven by the overall growth in packaging, and specifically the rise of the web-to-pack model, where digital converting capabilities via our Beam solution reduce bottlenecks and facilitate an increase in sales.’
This leads him to opine that, today, the majority of the company’s customers are folding carton and corrugated businesses. These come in all shapes and sizes, with different equipment portfolios and expertise targeted at different verticals, although he notes, ‘Our solution is print-type agnostic, but many plants have at least one digital press and are familiar with that market and how to sell digital print. They see digital finishing as their missing link. This has also been fuelled somewhat by the pandemic, with a growing number of customers now web-to-pack businesses too, catering to the small to medium businesses.’
Highcon has more than 70 installations around the world, 15% of which are multiple system installations for the same customers. Geographically, 85% of its customers are based in North America, and Western and Central Europe. These three areas will continue to be a focus, although ‘big opportunities’ have been identified in Mexico and Colombia, as counties where the container and packaging market is showing good and consistent growth. Such opportunities will help Highcon become a $100 million company by 2026.
By print market, commercial print and light packaging account for 40% of the install base as early adopters of the technology, with folding carton and corrugated representing the majority rest of Highcon’s install base. The highest growth is identified as being in corrugated.
‘Following the early adopters comes the next phase, with businesses leveraging financial gains from the introduction of our digital converting solutions to increase overall manufacturing efficiencies in their plants.
‘The web-to-pack business model is accelerating things, with several of the big players now onboard. Of course, the value proposition is now also very strong, with great case studies and clear financial benefits to back-up the value proposition. Also, we benefit from the pull through coming from brands who learn to appreciate the packaging design creativity freedom and opportunities that digital finishing provides to improve their overall supply chain efficiencies.’
Highcon also stands to benefit from the hidden yet inherent costs in traditional converting processes. In terms of equipment, he notes the many types of traditional die-cutting options available and estimates these as achieving annual sales of $1.5-2 billion a year. ‘Dies,’ he adds, ‘depending on which source you rely on, have estimated annual revenues of $3-5 billion annually. A growing number of those dies are then stored and never reused, representing additional and significant expenditure and negative contribution for the sustainability objectives the world is coping with.’
For Mr Nimrodi, the challenge to overcome this and help break the cycle of hidden costs and lost profit potential lies in, ‘awareness and access to the market.
‘Building awareness starts by selling to the right customers, and which that have an existing and identifiable need to increase overall manufacturing efficiencies, i.e. ‘boxes on the floor’. Needless to say, they do need to acknowledge that need. Once they do that, we have to make sure these customers will be successful, and this requires a multi-tier approach, including insuring consistent operation and appropriate training.
‘If you have done these two, all you have to do is move out of the way and let the customers do what they are good at. The more successful our customers are, the more new customers will join this transformation.’
For its part, Highcon is in the process of expanding its sales footprint by adding qualified salespeople, and also signing up additional distribution partners. It is also expanding its service operation. In its management team, Alon Bar-Shany has joined as chairman and Simon Lewis is now leading its marketing strategy.
Mr Nimrodi adds, ‘Clearly since the eruption of the pandemic, the huge uncertainty within the supply chain has helped the realisation of the necessity for agility in production by many customers out there, which certainly supports the benefits of our solutions. Having a first mover advantage, there is a good head start in this transformation journey.’
He adds, ‘We are not alone in this journey and we believe teaming up with the other players in the ecosystem would be key to accelerate the overall market penetration of digital solutions.
‘It’s clear that the digital finishing opportunity is huge.’
Read more about the latest developments in web-to-print/web-to-pack in the next issue of Digital Labels & Packaging; register here to receive the magazine for free
Read more about the latest innovations in corrugated digital printing in the next issue of Digital Labels & Packaging; register here to receive the magazine for free