Packaging is an essential component of retail, whether it’s business-to-business (B2B) or business-to-consumer (B2C) oriented, according to Brett Kirkpatrick, director of trade business at The BoxMaker. He oversees a new 60,000-square-foot digital print manufacturing facility in Lowell.
The BoxMaker, an integrated customer packing company based in Kent, Wash., acquired Tango Press in Springdale in November 2020. The company invested several million dollars to grow its larger Lowell facility that produces full-color custom corrugated boxes, retail displays, and other packaging solutions.
Kirkpatrick said a second high-velocity printing press and laser digital cutting machines allow for 15 times the press capacity the company acquired from Tango, which is still used for specialty smaller-quantity jobs.
Kirkpatrick said the company makes product displays and end-caps for retailers like Sam’s Club and Walmart on behalf of their suppliers. They also make presentation boxes for small product suppliers that sell into retail and a direct-to-consumer business.
He said the pandemic and ongoing supply chain disruptions require flexibility and create problems for those needing packaging solutions.
“Many times, the product manufacturer will save the packaging work until last. With the sluggish supply chain, we saw our lead time for paper increase three to four weeks as recently as October. Now our lead time for paper is more like seven days and much more manageable,” he said.
However, suppliers wanting custom displays for product launches are more challenging. He said the structural engineer often works off assumptions and dimensions they get before the product is in hand. When the product arrives, it may not fit, and the display must then be reconfigured or adjusted.
“There is a lot of this happening for displays in retail, and it’s been more prevalent because of the supply chain disruption and slow movement of goods,” he said. “We would have the product here in an ideal world as we build the packaging and displays. That’s how it was two years ago. Now we are working off a model or dimensions the company gave us six months ago. There is a lot of re-engineering that goes into retail displays these days.”
Kirkland said that since the 1980s, packaging has become more important for selling in retail. From the first wholesale club opened by Costco founder Sol Price, he said that the product box that detailed all the item’s features was born. He said pallet-ready and shelf-ready packaging that helps sell the product has become the norm in a retail world with fewer salespeople and more big-box, serve-yourself retailers.
Graphics in packaging became common because the boxes and shelf displays had to draw the consumer in and give them facts and features that a salesperson would have provided at Sears or some other full-service retailer. He said custom digital packaging has become popular with merchants who sell direct to consumers.
The BoxMaker also has a turn-key web-to-print website known as Fantastapack.com. It’s a way to order custom boxes in small quantities for the B2C merchants. The customer puts in the dimensions of the box and the color choice, then uploads their graphic and pays with a credit card. The custom box order goes directly to the print operator, totally automating the process. Orders west of the Rocky Mountains are dispatched to the Kent, Wash., plant, and those east are sent to Lowell. Kirkpatrick said the Lowell plant gets hundreds of orders daily. They are run in the plant and shipped to the customer within 10 days.
He said the Lowell plant expects web-to-print orders will be up to 50% of the print capacity. The rest will be traditional digital print jobs for merchants and retail suppliers wanting boxes, displays and other packaging solutions.
CHALLENGES & OPPORTUNITIES
The digital printing market is expected to grow from $24.8 billion in 2021 to $34.3 billion by 2026, at a compounded annual growth rate of 6.7%, according to ReportLinker. North America accounted for the most significant overall digital printing market in 2021.
Richard Brown, president and co-owner of The BoxMaker, said the future of packaging is digital.
“We are proud to be a leader in this space, having invested in digital print and finishing equipment for the past decade,” he said at the Lowell groundbreaking in April 2021. “Our expansion into Arkansas will allow The BoxMaker and our e-commerce web-to-print platform Fantastapack.com to more effectively serve companies across the country in need of custom printed packaging with cost-effective shipping and exceptional lead times.”
Kirkpatrick said the biggest challenge for the industry is the workforce shortage. While the company has low turnover, it does require skilled workers such as structural engineers, design architects, and sales and marketing. He said the company is reviewing which positions could be off-premise or a hybrid to widen the available talent pool in a tightening labor market.
Aside from the workforce shortage, he said inflation remains a problem. The industry was hit with three price increases — from the paper mills to the box makers and on to customers — in 2021, and there is talk of another one given the slowdown in e-commerce demand and continued high prices for raw materials and shipping. Another industry concern is that higher interest rates will curb spending, and with paper mills still running at more than 90% capacity, there could be a glut of product.
Editor’s note: The Supply Side section of Talk Business & Politics focuses on the companies, organizations, issues and individuals engaged in providing products and services to retailers. The Supply Side is managed by Talk Business & Politics and sponsored by Propak Logistics.