Flexibility, innovation help manufacturers serve ever-changing custom needs
Success in the competitive world of packaging requires an ability to adapt to rapidly changing markets.
The demands for new, more-efficient, environmentally safe packaging are never-ending. And large retailers are no longer willing to stock a lot of inventory, preferring to remain lean and mean so they can capture the latest consumer trends.
For contract packagers such as Universal Protective Packaging Inc. in Silver Spring Township, the pressures are even greater, said Clay Sheffield, business development manager for the company.
Unlike a package company that, for example, makes a Styrofoam cup knowing the market for Styrofoam cups means somebody will buy it, contract packaging is done to customer specifications.
"We make something that doesn't exist yet," Sheffield said. "And we need to go find the customer and sell them something they don't even know they need yet."
That means UPPI's two salesmen are constantly hustling for business. They keep an eye on federal Food and Drug Administration actions, looking for an opportunity to design new medical packaging. They stay attuned to trends, such as convenience store sales, where specialty packaging might be needed.
"Right now we're working with our design team to create a variety of concepts for smartwatches," Sheffield said.
The ever-changing nature of contract packaging makes for a volatile industry, said John Mazelin, executive director of the Contract Packaging Association, based in Naperville, Ill.
Berkeley Contract Packaging recently announced it will close its doors in Penn Township, Cumberland County. All 215 employees will lose their jobs April 25. Headquartered in New Jersey, Berkeley is a member of the CPA. Berkeley did not return a phone call seeking comment.
"The industry itself is growing at about a 15 to 10 percent annual compound growth rate," Mazelin said. "That said, many individual plants are dependent on one or two customers. ... So if one particular customer tanks, the plant goes down with it."
Quick to respond
For UPPI, in business since 1983, to remain competitive, it needs to maximize research and development and response times, Sheffield said. To help do that, the company purchased a 3-D printer several years ago.
In just a few hours, the printer can make a mold that produces samples of a new packaging design. From there, UPPI can tweak the design as clients request.
"It was such a natural technology for us to turn around quick prototypes," said Tim Ritter, vice president of sales and engineering.
The technology helps UPPI turn projects around as quickly as four to six weeks. But many projects are months in the design and production phases. The company started out producing circuit board packaging for AMP and has since branched out into medical and food packaging.
"It's not a short sale cycle, because everything is custom," Sheffield said.
One of the biggest last-minute, quick-changing markets is the cellphone industry. In particular, Apple is notoriously secretive with its cellphone developments, Ritter said. The fallout trickles down to what many would consider the last supplier in the chain: the packaging industry.
"The cellphone case manufacturers don't have any lead time to develop a product," Ritter said. "So it becomes a race to the shelves."
The cellphone case manufacturers need customized packaging — and they usually need it yesterday.
"You have to be very nimble on your feet, because many changes are last minute," Mazelin said. The client "might not make up their mind on what the printing should be until the very last minute, but the date they want it in the store does not change."
UPPI reached an agreement about 10 years ago to license Geospring technology in its packaging. The advantages are twofold, Sheffield said. First, Geospring plastics are made from recycled materials, including laundry detergent and milk containers. The resulting packaging is also fully recyclable, a big selling point for clients.
Secondly, Geospring is lightweight and smaller than traditional white, polystyrene foam packaging. That means more boxes can fit on a truck.
"Obviously, we're maximizing the profits for that customer," Sheffield said.
Large retailers like Wal-Mart are pushing for green packaging, Ritter said. Although more expensive, new green packaging with plant-based materials in place of petroleum-based materials is proving popular with manufacturers of commercial products such as Coca-Cola Co.
"A lot of our customers are demanding those types of materials as well," Ritter said.
UPPI does its part within the plant to be environmentally conscious, Sheffield said. On the UPPI factory floor, material handlers hover around the molding machines, collecting plastic scraps, which are then separated and packaged for reuse.
A privately held company, UPPI employs between 70 and 80 people.
"We look at trends and see how we can incorporate our packaging into those trends," Sheffield concluded. "Because it's customized, you can come up with some creative solutions."