2020 May/Jun

In Memoriam: FSEA Lifetime Achievement Award Recipient Tom Cullen

June 5, 2020

By Kym Conis, managing director, AMBA

Industry innovator and former FSEA Lifetime Achievement Award Recipient Tom Cullen recently passed away. Born in 1935, Cullen spent most of his youth in California and Nevada before enlisting in the United States Army in 1953 and serving for two years. After the birth of their third child, Cullen and his wife, Nancy, relocated the family to Burlingame, California, where Cullen purchased a small printing business. Over the next 40 years, he would turn that small operation – Apex Die Corporation – into one of the leading print finishers in the US. Cullen retired from Apex in 2005, leaving the business to his children. Cullen passed away peacefully at his home on March 12, 2020.

The following article was originally published in the 2006 February/March issue of Inside Finishing magazine. It is reprinted here in honor of Cullen’s life, work and dedication to an industry he helped pioneer.

From successful trade entrepreneur to one of the guiding lights that provided direction to an association in need, Tom Cullen was a pioneer in an industry that had yet to realize the true impact of its combined strength. Through his leadership and unrelenting courage to take that first step, he not only built one of the largest trade print finishing companies in the United States, Apex Die Corporation, but also was instrumental in the structure and development of the Foil Stamping and Embossing Association (the original name of the FSEA) during its formative years.

As a tribute to his dedication and significant contributions to the foil stamping and embossing industry, the FSEA proudly honors Thomas J. Cullen with the 2006 Lifetime Achievement Award. As the first active FSEA member to receive this award, Tom Cullen is recognized for his efforts to educate, standardize and unify the foil stamping and embossing industry and for his efforts to promote industry awareness throughout the graphic arts community at large.

Taking a look back to the early years, Tom Cullen’s long career in the industry can be traced to 1964 when he purchased a one-man paper box operation on the San Francisco Peninsula in Burlingame, California. With a background in sales for a Seattle-based envelope manufacturer (and previous to that, a two-year term in the US Armed Forces), Cullen took that courageous first step and purchased Apex Die & Paper Box Co., Inc. for $1,000 down. As Cullen recalled, “I had an enormous urge to be in business for myself.”

Working out of a small rental space, Cullen learned the trade from the ground up. In those first years, the operation produced letterpress-printed folding cartons, as well as some diecutting, numbering and letterpress printing for the printing trade. A Kluge diecutter, a hand-fed Thompson (26 x 40″) diecutter, a C&P diecutter and a Miehle cylinder press comprised the company’s production operations, along with hand-gluing. During the early formation of Silicon Valley, there was a movement of ad agencies, designers and printers from San Francisco to the Peninsula. Recognizing a great opportunity, Cullen changed the name of the company to Apex Die Corporation, thus dropping the emphasis on boxes and adding embossing – and eventually foil stamping – to its services.

“The thing about growing, though, was I couldn’t run a press and sell at the same time,” Cullen explained. “But, with the part-time help of my two brothers and my wife, Nancy, I was able to find a lot of diecutting work from the printing industry. That’s when business really took off.” Approximately five years later, Apex moved into a 7,000 square foot space in San Carlos, California, where it gradually occupied (and eventually purchased) 35,000 square feet; and by the late ‘90s (just before the dot.com crash), employed some 135 employees.

“Working with those high-tech entrepreneurs led to some exciting times,” recalled Cullen. “We did a lot of prototyping and saw some unusual projects. In the early years of floppy discs, we diecut some of the original prototype cases for Memorex and Ampex – companies that then were barely on the map.” As Silicon Valley continued to grow, so too did the market for foil stamped and embossed materials – namely annual report covers and labels of various kinds. “We also did a monumental amount of diecutting index tabs, which was the way the high-tech companies published all their documentation,” Cullen explained.

At the height of its business, Apex did an enormous amount of sheet-fed wine labels and presentation folders. Among the company’s many first steps were its offerings in the large-format, automatic diecutting and foil stamping arenas. “In northern California, we were the first to offer large-format diecutting with the installation of a Bobst press,” stated Cullen, “and we were probably the first, and only, company for years in our area to offer large-format foil stamping, which we used to produce a lot of labels, greeting cards and direct mail.” In addition, Apex also was the first in its area to install automatic folding/gluing equipment for the production of presentation folders.

As much of the label market in California was predominantly wine-related, Apex was successful in capturing a substantial amount of the business with its large-format capabilities. “Many of the labels were being printed on half-size sheets; however, we specialized in large-format labels for giants such as Gallo and also other trade label printers that didn’t have the stamping and embossing expertise,” explained Cullen. “At one time, we produced over 700 million labels in one year.” Along the way, Apex Die formed several off-shoot business ventures, including the Short Run Label Company and VIP Stationery. “We sold the Short Run Label Company to our partner when it outgrew our space within Apex and used the funds to start VIP stationery, which we later sold,” he said.

However, like (and in some ways unlike) much of the country nationwide, Apex experienced some tough times in the late ‘90s and into the 21st century. Within a four-year period, events such as the crash of the dot.com companies (which greatly affected industry on the Pacific coast), 9/11 and the gradual exodus of much of the company’s wine label business left Apex Die with some difficult challenges.

“Our label business decreased dramatically due to several reasons: overseas competition, the advancement of the rotary market and a struggling economy that forced many companies, such as Gallo’s printing operation, to bring finishing processes in-house,” Cullen explained. “That’s the danger of a trade business. You have to remain diversified to absorb the ebbs and tides.” And Cullen attributes much of the company’s continued success to his three sons (Kevin, Chris and Ted) who, according to Cullen, “have done an excellent job of bringing the company around to its present state of stability and renewed growth.”

Cullen’s participation and firm commitment to association involvement can be traced back to his 25-year tenure with the Master Printers of America and to his involvement with PINC (Printing Industries of Northern California), where he became the first president of the board from an ‘open shop.’ San Francisco was a very unionized area, and Apex continuously felt pressure to join the union – a pressure to which Cullen refused to succumb. “I felt strongly that a superior employee should get paid as such and a mediocre employee, if I had the mind to keep one around, should likewise be compensated,” stated Cullen.

The union provided little incentive to produce highly skilled operators because everyone was paid the same. Cullen further explained, “Master Printers of America had a wonderful program that taught shops how to run an open shop and how to attract and keep skilled employees by treating and paying them well.” Apex also was among the first to participate in the association’s Craftsmanship certification program.

However, Cullen’s involvement with trade associations did not end there, as he was approached late in 1993 to accept the position of chairman of the newly formed Foil Stamping and Embossing Association (launched in March of 1992). Already in partial retirement at the time, Cullen agreed to lead the association in its restructure and development – a challenge he would undertake with the assistance of a dedicated board of industry heavy hitters from companies large and small.

Working in tandem with Cullen during the association’s formative years were FSEA Secretary/Treasurer Bob Gallagher, Ace Inc.; Michael Larkin, Larkin Industries; John Tinnon, Graphic Converting; David Liess, Dynamic Graphic Finishing; Jim Snyder, C&J Graphics; Patrick Derickson, Scarab Inc.; and associate members Hank Brandtjen, Brandtjen and Kluge, and Bill Seymour with The Bobst Group (Early on, Mark Baugh, D.E. Baugh Co., Inc., and Mel Wellstead, Rocky Mountain Embossing, replaced Snyder and Larson, who resigned from the board due to pressing issues within their respective businesses).

Together, this board of directors, under the helm of Cullen, set out to accomplish an enormous task: to bring the association from the edge of obscurity to the forefront of its industry; to unite its members and the industry at large through education and standardization; to create true value for association members; and to heighten industry awareness and thereby increase growth.

The first order of business was to raise the funds necessary to give the FSEA financial breathing room and to give the association the means with which to carry out its mission. “In those early years, companies such as Bobst, Kluge, Astor Universal, Independent Machinery and Universal Engraving should be noted for their initial generosity that made everything else possible,” stated Cullen. “And I’d be remiss if I didn’t mention that we all benefited from the productive and aggressive work of Mary Fuller (former FSEA Director), without whom all of our work may not have been completed.”

By mid 1994, the association had gained momentum and several committees were formed. Under the guidance of these first committees (Education, Industry Standards, Industry Awareness and Membership), several projects evolved that not only impacted the early years of the association and its membership but also helped to dictate the future course of the industry.

Over the course of Cullen’s two-year term as FSEA chairman, many notable projects and events came to light. In the category of education, a Fall Seminar Series was launched in 1994 in three major cities throughout the US. Surveys were devised and distributed in an effort to collect viable production information by which members could compare their current operations. And in 1995, the inaugural FSEA National Convention was held in Chicago, Illinois.

The Industry Standards committee worked on such projects as a comprehensive glossary of terminology (1994) and the Pantone Foil Selector Guide (1995), which was launched in an effort to develop an industry color standard for the selection, specification and communication of foils for the graphic arts industry. According to the committee chairman of the project, Kevin Cullen with Apex Die, this was a historic agreement for the foil stamping and embossing industry in that it would make the ordering process easier for foil stampers and embossers. Although the project never truly reached its full potential, it did mark the first attempt by the foil stamping and embossing industry to increase industry awareness by reaching the people who would specify the foil.

Industry awareness continued in 1994 with the undertaking of the largest FSEA project to date – A Different Breed: The Designer’s Guide to Foil Stamping and Embossing. Through the efforts and contributions of many industry suppliers (especially Brandtjen and Kluge, which donated the creative services for the project), the educational resource was produced live on the show floor at Print ’97 – gaining great visibility for the association and the industry as a whole. Other industry landmarks produced under the helm of Cullen included a formal membership directory, the inception of the Gold Leaf Awards Competition and the introduction of the association’s magazine, InsideFinishing, in 1995.

In February of 1996, Cullen passed the gavel to Bob Gallagher, who became the new FSEA chairman of the board. In a parting memo to the board, Cullen wrote:

Cullen_FSEALifetimeAchievement — Tom Cullen in 2006

As I near the end of my term, I take special pride in assembling a cohesive and committed board, even though it took some trial and error to arrive at the present makeup. I also take special pride in assuring the association of a strong and stable succession of officers for the next few years. Finally, I take pride in knowing that we worked together to pump new life into an association that was in trouble and, in two years, we’ve molded the FSEA into a valuable industry asset.

Outside of the industry, Cullen has written numerous articles for printing trade magazines (primarily in the west), for motorcycle magazines and for motor home publications. His keen sense of humor in his writing style has won Cullen five awards from the Family Motor Coach Association for newsletters he published over the years. He also served on the Board of the North American Trials Council, a motorcycle competition organization. “My wife, Nancy, and I were the promoters of one of the first world Championship Trials competitions in the US, with entrants from 11 nations,” recalled Cullen. “I was the number three nationally ranked senior rider in the sport for three years.”

Today, Tom and Nancy Cullen enjoy the RV lifestyle in their 40-foot Prevost motor home for several months out of each year. For the past six and a half years, they have traveled full-time to every state in the US (except Hawaii and Alaska), to nearly all Canadian Provinces, and to three states in Mexico. The couple will continue to travel until, as Cullen chuckled, “they take away my driver’s license!”

A man of many talents, Tom Cullen remains on the board of Apex Die Corporation but leaves the running of the business in the capable hands of the second generation… a generation he taught very well. His strong leadership abilities and overall enthusiasm are among but a few of the many traits that have earned him a reputation of the highest regard among industry peers.

As he concluded in his parting memo to the FSEA board of directors, “I will now be happy to watch your continued progress from the sidelines. Keep doing what you do so well.”

Software Can Bring Savings on the Plant Floor

June 5, 2020

By Mark Porter, president, Dienamic Software

Businesses constantly are trying to increase profits by developing new products they can offer to existing customers and finding different ways to attract new customers. But, this only is one side of the profit equation. Profit is sales minus costs, so business owners can improve profits by focusing on controlling costs as well. Software and technology are excellent ways to control the cost component and therefore maximize profits.

Remote access of the front office tasks – such as estimating, order entry, purchasing/receiving, shipping and invoicing – facilitates a constant and consistent flow of information from customers to plant staff to ensure the work coming into the plant runs smoothly and on time. Communication between the office and the plant is in real time and accurate to ensure good jobs do not go bad. Unfortunately, the latest business environment has shown the extra importance of having a remote capability in shop operations. The ability to manage jobs remotely can be a tremendous advantage in current times.

Improving costs on the shop floor can be achieved in many ways with software and technology.

Controlling costs in the plant starts in the office

As a job-oriented manufacturing business, Dienamic is constantly estimating potential jobs in hopes that it wins a percentage of those jobs. It is vital that the process of bringing jobs into the plant accurately reflects the cost of producing the job. Software can help with this. Estimating software must reflect the true cost of resources in the plant and represent their true speed and makeready capabilities.

If a press is estimated at producing 5,000 sheets per hour but only is achieving 3,000 sheets per hour on the shop floor, the business is losing money on every job won. Conversely, if the company is quoting at 3,000 sheets per hour and achieving 5,000 sheets per hour on the shop floor, it is losing jobs it could be producing profitably. Software will allow businesses to track their production statistics and show the average speeds and makeready times actually being achieved on the shop floor.

Most business owners are aware of machine speeds and makereadies, but the true cost of having the equipment on their plant floor is not well known. The cost is based on cost of machine, rent, employee wages and benefits, factory overheads, number of shifts and percentage productivity. Again, ensuring the estimating system reflects the true costs of the equipment on the shop floor is vital. There is budgeted hourly rate software that can help with getting accurate machine hourly costs.

Communication increases productivity and decreases waste

Technology allows for storing and organizing a great deal of information and for distributing that information instantly. By distributing job information, customer information, material information and previous problem information, it is possible to reduce mistakes, improve deliveries and provide better customer service.

Features such as Electronic Orders allow changes from a customer to be communicated to the plant employees the second the change is made on the order. This avoids the cost of mistakes resulting from the plant working with out of date information. It also cuts down on information delay that can lead to extra costs.

Customer Profiling allows companies to record all the ways their customers like to have their jobs produced – things like number of overs (excess product), shipping details, sample requirements and communications procedures. Gathering this information and distributing it to plant employees ensures jobs are produced to the customer’s exact specifications. This reduces errors and makes for happier customers. For example, take the shipping employee who has a job with 11,000 finished pieces but the order only calls for 10,000. The shipping clerk can look at the customer’s profile, which shows the company will accept 5% overs. 10,500 are shipped, maximizing revenue while holding 500 back that may be sold later.

Purchasing modules allows for tracking the purchase orders issued and comparing the goods received to the goods for which the vendor invoices. It also compares the cost agreed to on the purchase order to the invoice the vendor sends. Catching any of these discrepancies can provide tremendous cost savings.

Job Notes can be added to electronic orders and can be accessed by the plant employees on the shop floor. If there are specific instructions for a job that are designated by the order entry staff, they can be displayed to the plant employee at any time. For example, if the job is run on the afternoon shift at 7:00 p.m. the notes are printed out and available to the plant employee to ensure the job is run correctly.

It also is possible to track problems and machine setups for previous jobs. For many shops, a certain percentage of jobs produced are reruns of previous jobs. By recording problems and machine settings for a job, shops are in a much better position to produce the job a second time in a more productive and less costly manner than the first. This also is useful for estimating and order entry. When requoting a job, businesses can account for any mistakes experienced the first time. They then can adjust the estimate and write up the order based on those initial experiences. Reduction of costs on the shop floor starts at estimating.

Software allows businesses to track all materials that enter the shop floor. This includes printing sent by customers and supplies needed to produce jobs sent by vendors. Staying on top of goods that enter the plant ensures that jobs are produced on time. Overtime and pulling other jobs off equipment to meet deadlines can be avoided while eliminating additional shipping costs incurred to get missed items to the plant on time.

Furthermore, many finishers and binders have a large inventory of dies. Software that manages die inventory can save money. Knowing where dies are stored and if they have been disposed of or sent back to the customer can save the cost of looking for dies or remaking them. Knowing if a die needs retooling before the job arrives can avoid the costs of press downtime or missed deadlines.

By increasing communications, software can reduce costs associated with missed information and the costs associated with the inefficiencies of employees having to ask other employees or customers questions. Software automatically can create emails that are sent between managers, employees and customers when changes occur. Once a job is opened or changed, an email is generated and sent to the people who most need the information. This also happens when a purchase order is generated, goods are received, packing slips and invoices are generated, and dies need retooling.

Chargeable changes are costs that someone has to pay

Everyone has those jobs that start as one thing and quickly morph into something completely different. As a result, the original estimate of the cost of that job is out the window. Those changes must be paid for by someone, and too often it is the finisher/binder.

Software can, at the very least, track these costs so they can be recovered from the customer; however, businesses should be making a profit on these services. Customer change management software allows users to open an order, and if/when any changes are made to the order, these changes are date-/time-/employee-/cost- and reason-stamped, providing documentation of communications with the customers as to changes made and costs incurred. At the end of the job, management can get a complete listing of all changes and the dates/times of notifications. By documenting changes, businesses can capture legitimate extra charges without damaging the relationship with the customer.

Labor and production analysis

Labor and machine time are by far the biggest cost to the print finishing industry. Tracking the way employees and equipment are utilized can provide tremendous insight into the biggest cost components. The use of software and biometric (fingerprint) technology allows businesses to track every minute of every employee and machine in the company. An employee’s chargeable vs. non-chargeable time can be analyzed. If employees are performing less than 70% chargeable tasks, managers can evaluate his/her role. It also is possible to analyze time spent running, makereading, repairing and maintaining equipment, as well as determine how much time is spent waiting for approvals, etc.

The software also analyzes the average speeds and times of makereadies and running processes, and it further analyzes how individual employees are doing in relation to those machine standards. This information allows businesses to ensure their estimating accurately reflects the costs in their plant.

Conclusion

Automating facilities with the proper software and technology can save tens of thousands of dollars by helping businesses know true costs, in addition to helping properly manage employees and production time.

Mark Porter is president of Dienamic Software and can be reached at 1.800.461.8114, mark@dienamicmis.com or www.dienamicmis.com.

A Little Taste of Honey

June 5, 2020

By Lara Copeland, contributing editor, PostPress

One of the greatest pollinators on the planet, the honeybee, is known for its production of not only wax but, more importantly, honey. The sweet treat has been treasured by humans for centuries. Capital Bee Company, based in Savannah, Georgia, is known for its rare, single varietal mono-floral honeys. Sourcing local honey in addition to honey from around the US, the company prides itself on finding “the most magnificent honeys” and providing them to customers to enjoy. One such customer, international branding agency Stag&Hare, with offices in New York, London and Atlanta, became enamored with Capital Bee’s honey and decided to share it with clients as part of a custom promotional piece showcasing its creative abilities. To bridge the gap between the product and getting it into customers’ hands, Stag&Hare called on DataGraphic, Commack, New York, to help create an unforgettable presentation and package for the specialty honey.

“Each year, this client provides a gift to its customers,” DataGraphic President Glenn Schuster noted, “and last year, the owner decided to give away artisanal honey he discovered while traveling.” According to its website, Stag&Hare works every year to develop an artful piece to present to its customers, which the company strives to make one part collective expression and one part collaboration with unique, like-minded small businesses. Branding agencies know the power of creating a sensorial experience, and this gift was no exception. Stag&Hare chose to design and produce a flavor experience using “one of the most unique, yet natural creators – the honeybee,” its website offered. In fact, “this box design and the overall aesthetic was built around the honeybee theme,” Schuster recalled.

Stag&Hare designed a custom “jewelry box” to house four jars of honey varieties: Tupelo, Guajillo Acacia, Snowberry and Frosted Cinnamon. DataGraphic brought the vision to life with tactile textures and finishes throughout. The outer box, honey jar cartons, honey jar insert trays and position-mounted inside flap card was created out of a matte black soft-touch paper, 122# Plike. The box is “adorned with layered gold foil, intricate gloss spot UV varnish and small pops of screen-printed, vibrant colors,” according to Stag&Hare’s website.

On the inside of the box, the honey jar insert tray displays hexagonal shapes diecut on DataGraphic’s 41″ Thomson ValueLine Clamshell. The outside cover of the decorative box was first spot UV coated, creating a black over black look with the contrast of the gloss UV over the black Plike stock. Then, it was foil stamped with a bright gold foil from Infinity Foils in perfect registration over the spot UV that included an emblem stating, “Players of Creativity.” The designs on the box were all foil stamped on a Kluge press.

The inside of the box is rich in creativity and awakens the senses as well. A honey jar insert tray holds a brass honey spoon affixed to the box with wire. It sits adjacent to four jars that are inserted into their own decorative carton, each one holding a different flavor of honey. Each jar of honey sits in its hexagon-shaped carton and is covered with a brightly decorated lid featuring a gold foil emblem and different screen-printed dots of colors that indicate the type of honey and reflect the individual flavor profiles. Each individual hexagon-shaped box also includes specific highlights of gloss spot UV over the black Plike stock.

The inside of the front cover of the box includes several hexagon shapes that are spot UV coated over the black stock in the same size as the individual honey cartons. Around the spot-coated hexagons, there is text that ties the different honeys and honeybees to the services offered by Stag&Hare. Lastly, there are several icons around the spot-coated hexagons and text that are foil stamped in the same gold foil as the cover.

Lastly, on the inside base of the box under where the individual cartons are placed in the insert tray, a gold stock (105# Stardream Metallic Gold Cover) is mounted to the rigid Plike board. Underneath each of the hexagon honey cartons, a “bite-sized” fact about the honeybee and honey is screen printed in black.

Once all the decorative boxes were coated and foil stamped, they were individually diecut on DataGraphic’s Thomson diecutting press. Each piece was hand-fed to ensure perfect registration from the decorative processes to the final diecut. The design of the outside box and the individual honey cartons were such that they could be scored and folded together without the use of glue, with a unique design where the insert tray perfectly sat inside the box.

“The registration was critical,” Schuster explained. “We originally planned the job to digitally print but the digital press would not hold the registration required, so we switched to the screen press for perfect registration.” Stag&Hare was thrilled with the final product and featured it on its website. It is hard to imagine a more decorative presentation for honey!

Flights of Fancy: Accordion Book Soars to New Heights

June 5, 2020

By Brittany Willes, editor, PostPress

When the medium chosen to display a work of art becomes a work of art itself, something special has occurred. This is the case for artist Wendy Paton’s limited-edition photobook Flight. Boldly displaying Paton’s undeniably striking photogram-style images, the book is an accordion-style masterpiece as stunning as Paton’s photos.

Designed by Phil Unitek of Unitek Design and produced by Brilliant Graphics, Flight first draws the eye thanks to its bright red cover sleeve, which features an antique finish. Created using 130 lb. Color Plan stock, the sleeve features a diecut opening at the bottom that not only gives a hint of the book within but also acts as a push-tab for removing the book from its eye-catching sleeve. Once removed from its sleeve, the book opens accordion style to showcase dramatic, black and white photos displayed on either side.

To create the unique piece, Brilliant Graphics used offset printing, selecting Opus Dull 100 lb. cover stock. A spot gloss varnish was applied at 400-line screen using two shades of black and two shades of grey to create the brilliant contrast of the photographs. When the printing was finished, the sheets were scored using letterpress. Because the project was designed as a limited edition, only 300 copies of the book were printed.

Given its unique layout, once printed the book required special handling when it came time for the binding to be done. As a result, Brilliant Graphics reached out to its long-time collaborator Roswell Bookbinding. “It was quite a challenge, even for us, and we do challenging work every day,” remarked company President Mike Roswell. “Everything was done by hand because the material was so fragile, so easy to mark or indent. We only had three people that we let work on it, and it was white glove throughout the entire process.”

The accordion style of the book meant that the front and back covers had to be mounted to .100 pt ThruWhite Lamitech Board, lending the book some weight and stability. “The registration with the board had to be perfect,” said Roswell, “The text was cut separately from the front and back boards to avoid the risk of having any indentation on the text. This required extremely precise cutting – we had to diecut each sheet one at a time before it could be mounted.”

Mounting was not the only challenge. As Roswell noted, those working on the project had to use white gloves throughout the process to avoid blemishing the sheets. “The material would pick up any dot of dust,” he said. “The cover being soft-touch laminated with black meant it picked up anything it came in contact with and was extremely difficult to keep clean.”

Naturally, Roswell is no stranger to challenging projects. “We knew what we were getting into,” he stated. “We’ve done quite a few of this style of book over the years. It’s not that there was a learning curve; it was just a terribly slow process.”

Despite the challenges, the finished book is an undeniable work of art. “Everyone is very impressed by this piece,” said Roswell. “It’s beautifully printed, obviously. Brilliant Graphics did a beautiful job as it always does, and the company is great to work with. The design is elegant. It’s just a beautiful piece.”

Given its impressive design, it is little wonder Flight has drawn attention from many in the industry. Trish Witkowski of Foldfactory recently showcased the book on her YouTube series, “60-Second Super Cool Fold of the Week.”

To view the video, visit www.youtube.com/watch?v=CV_ orJwkBM&feature=youtu.be&mc_cid=b0a470f62d&mc_ eid=a0779d0d38.

Going Green: Texas Bindery Creates Uniquely Vibrant Label

June 5, 2020

By Brittany Willes, editor, PostPress

With its extensive manufacturing and production knowledge, Texas Bindery Service, Cedar Creek, Texas, is no stranger to creating unique projects for its clients. “We specialize in implementing unique finishes and print embellishments into our hard- and softcover projects and for any project where quality, memorability and brand awareness is significant,” stated Vice President Sonja Nagy.

When Organic Distribution LLC needed a distinctive label for its line of kratom (an evergreen tree used in some natural medicines) products, Texas Bindery was ready to help. Working closely with the printer/broker who reached out on behalf of Organic Distribution, Texas Bindery set out to create something truly special.

“After reviewing the information presented, we had a clear vision of some options we wanted to offer to provide the highest value and impact for the client and the brand,” said Nagy. To create the label, Texas Bindery first had to determine which stock would be the best. “We tested multiple label stocks to find the perfect fit,” explained Nagy. After testing different label materials, it was determined the best stock for production was Wassau 12 x 18 DP19005 3.4 Mil White Flex Vinyl with permanent adhesive 80# scored back liner.

With the label design and stock selected, it was time to put the project into production. “Our first step to creating this unique label design was to add the application of toner for the digital foil process,” Nagy noted. “Then we placed the label in our Duplo laminator and foiling machine to apply the digital foil to the toner areas.” The foil for the label was provided by two different vendors – a silver foil was provided by Nobelus, along with additional red and silver foils from Infinity Foils.

Once the foiling was complete, CMYK printing was applied to the foiled label using a Ricoh 7210SX Digital Press. “At this stage, we printed CMYK colors to create the black, graphite gray, red and green colors on the Wasauu label stock,” said Nagy.

Because three different labels were produced – each a different color – the next stage for the gray and red label was adding a soft-touch lamination to the label sheet. “We chose to use Nobelus Karess Lamination,” said Nagy, “applying the lamination to the label sheet after the final CMYK layer was completed using our Duplo laminator and foiling system.”

The green kratom label required an extra step in the production process. “We wanted to achieve a more vibrant green color,” said Nagy. “After performing multiple tests, we determined the best way to get the result we were looking for was to run an additional press pass on the green color only.”

Currently, the digital foil is limited in the color selections available. Texas Bindery found that by laying down a silver foil and overprinting CMYK on top of the silver, it could create additional custom colors to achieve a wider color variety. “Combining the extra pass on the green layer only, along with opacity and density adjustments on the printer, provided us with added flexibility to create slight hue changes to generate the best final piece possible,” Nagy said.

The final stage of print and embellishment design for all three labels consisted of applying a raised spot UV coating. “We used our Duplo DDC-810 UV equipment to apply UV coating to precise areas in the label design,” said Nagy.

Along with achieving a more vibrant color for the green kratom label, Texas Bindery also faced an additional challenge when it came to registration. “We knew registration line-ups through multiple passes would be our biggest challenge with label creation,” Nagy stated. “Once we established the precise settings needed on our Ricoh printer, we were able to fine tune everything to create the registration needed throughout all the printing, foiling and spot UV processes.”

Despite the challenges, the end results are stunning, as noted by nearly all who have seen the label. “Our client was thrilled with the final piece,” said Nagy. “We have shown the labels to other clients and vendors, and people have been very impressed with the results we were able to achieve. They haven’t seen anything like it before.

CARES Act Provides Relief to Print Finishers

June 5, 2020

By Michael J. Devereux II, CPA, CMP, Mueller Prost

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (CARES) Act – the largest relief package ever passed by Congress almost three times over – was signed into law, thereby ushering in a host of new lending and tax provisions available to print finishers.

The CARES Act made several taxpayer-favorable changes to the tax code that impact print finishers, some of which should provide much need cash during the COVID-19 pandemic. The following provides a brief overview of the business tax provisions of the CARES Act.

Employer retention credit

The CARES Act provides for a refundable payroll tax credit against 50% of the wages paid by eligible finishers to certain employees during the COVID-19 pandemic. The credit is available to finishers whose operations have been fully or partially suspended as a result of a government order or finishers who experienced a greater than 50% reduction of quarterly receipts, measured on a year-over-year basis.

The credit is equal to 50% of the qualified wages paid to employees from March 13, 2020, through December 31, 2020. The definition of qualified wages depends upon the number of average full-time employees in 2019. For finishers who had more than 100 average number of full-time employees in 2019, only the wages of employees who are paid during a shutdown or face reduced hours as a result of the plant’s closure or reduced gross receipts are qualified wages. However, for employers with 100 or less full-time employees in 2019, qualified wages also include amounts paid to all employees due to the reduced gross receipts.

Qualified wages include amounts paid or incurred to provide and maintain a group health plan (on a pro-rata basis) and are capped at $10,000, making the maximum amount of FICA payroll tax credit $5,000 per employee. Finishers receiving Small Business Interruption loans are not eligible for the Employer Retention Credit.

Employer FICA deferral

This provision of the CARES Act allows print finishers to defer payment of their employer share of the Social Security tax (FICA at 6.2%) for payroll tax deposits required to be made between March 27, 2020, and December 31, 2020. The amounts otherwise due during this period will be due in two installments – the first on December 31, 2021, with the remainder due on December 31, 2022.

Finishers receiving loan forgiveness through the Paycheck Protection Program, however, are not eligible for the deferral for amounts due after they receive notification of forgiveness.

Net operating and excess business losses

The CARES Act made two significant changes to the Net Operating Loss (NOL) rules and temporarily removed a limitation on business losses enacted by the Tax Cuts and Jobs Act of 2017 (TCJA).

First, the CARES Act removes the 80% of taxable income limitation that was enacted as part of the TCJA. Losses generated in any tax year beginning after December 31, 2017, and before January 1, 2021, (tax years 2018, 2019 and 2020 for calendar-year taxpayers) may offset 100% of the taxable income to which the loss is carried. The 80% of taxable income limitation is reinstated for tax year beginning after December 31, 2020.

Second, the CARES Act allows print finishers to carry their NOLs back to each of the five taxable years preceding any losses generated in tax years beginning after December 31, 2017, and before January 1, 2021, (2018, 2019 and 2020 calendar-year taxpayers).

The IRS issued special guidance for taxpayers who have already filed their 2018 or 2019 tax returns and would like to avail themselves of the modified rules for NOLs.

The CARES Act also delayed a provision originally enacted by the TCJA that limited “excess business losses for noncorporate taxpayers.” The TCJA had enacted a new limitation for owners of flow-through businesses (S Corporations, Partnerships or Sole Proprietorships). This provision, as enacted by the TCJA to be effective for tax years 2018 through 2025, limited business losses exceeding $250,000 ($500,000 in the case of married taxpayers filing a joint return) and were not eligible for carryback.

The CARES Act allows excess business losses for tax years 2018 through 2020 and, if net operating losses are generated, allow for a five-year carryback period.

Business owners should note, however, that the excess business loss limitation was just one way in which an owner’s loss could be limited. Taxpayers must still be at risk for and have sufficient basis to claim any ordinary loss. Further, passive shareholders may only offset passive income with passive losses.

Credit for prior year minimum tax (AMT credits)

The TCJA repealed the corporate alternative minimum tax (AMT). Taxpayers that had previously paid the AMT received Minimum Tax Credits (AMT Credits). The TCJA made those credits refundable over four years (2018 to 2021). The CARES Act accelerated the refundability of this credit, allowing the refundable amount in 2018, but making it fully refundable in tax year 2019. However, the CARES Act also provides for an election to take the entire refundable credit amount in tax year 2018.

Business interest limitation

The CARES Act temporarily increases the limitation on business interest expense for those subject to the limitation. The TCJA had introduced a new limitation for tax years beginning after December 31, 2017, whose average annual gross receipts exceeded $25 million, a limitation that is subject to inflations (the limitation applied to companies with average annual gross receipts of $25 million and $26 million in 2018 and 2019, respectively).

Any business interest expense that exceeds the sum of interest income and 30% of adjusted taxable income is not allowed as a deduction in the year paid or incurred, and the excess amount is carried forward as an interest expense to future tax years (indefinitely).

The CARES Act temporarily increases the limitation on the deductibility of net interest expense to 50% of adjusted taxable income for any tax years beginning in 2019 or 2020. Finishers concerned that their adjusted taxable income will be minimal or zero are allotted some relief in computing their 2020 adjusted taxable income limitation. At the election of the finisher, the 2020 interest expense limitation will be 50% of its 2019 adjusted taxable income.

Qualified improvement property

The TCJA modified both the bonus depreciation rules and the definition of qualified improvement property. The TCJA increased the bonus depreciation percentage to 100%, retroactively, for property placed in service after September 27, 2017, through December 31, 2022. Beginning in 2023, the bonus depreciation percentage is phased down by 20% each year, with the accelerated “bonus” depreciation phased out by 2027.

In addition, the TCJA consolidated three types of improvement category assets into a new category called Qualified Improvement Property (QIP). For finishers, QIP includes any improvements made to the interior of the facility that are placed in service after the date the facility was first placed in service. Improvements do not include enlargement of the building, elevators or internal structural framework.

In writing the TCJA, a general 15-year recovery period was intended to have been provided for QIP. However, due to a drafting error, that specific recovery period did not make it into the final statutory language of the bill. As such, under the TCJA, QIP fell into the 39-year recovery period for nonresidential real property, and, therefore, is ineligible for 100% bonus depreciation.

The CARES Act provided a technical correction to the TCJA and specifically identifies QIP as 15-year property for depreciation purposes. This also makes QIP eligible for 100% bonus depreciation. Given that it is a technical correction, the provision is retroactive, and finishers can write-off any QIP placed in service after December 31, 2017.

Concluding thoughts

Numerous other provisions, including the Paycheck Protection Program, the Economic Injury Disaster Loans and Emergency Grants, and individual tax relief, were enacted as part of the CARES Act, and Treasury seems to be issuing new guidance as quickly as issues or ambiguities arise. As it may be suspected, these provisions don’t exist within a vacuum. Many provisions impact others, as well as existing tax incentives. As such, careful planning is advisable.

Michael J. Devereux II, CPA, CMP, is a partner and director of Manufacturing, Distribution & Plastics Industry Services for Mueller Prost. Devereux’s primary focus is on tax incentives and succession planning for the manufacturing sector. He regularly speaks at manufacturing conferences around the country on tax issues facing the manufacturing sector. For more information, contact mdevereux@muellerprost.com.

3 Hottest Print Design Trends of 2020

June 5, 2020

By Sabine Lenz, president, PaperSpecs

“The book’s design is beautiful but look at the production values – it’s basically falling apart.”

Designers always want to know what is fresh and impactful – trends are indeed an essential part of design – from typography to logos to the big reveal of Pantone’s Color of the Year. It is vital for designers, printers and finishers to maintain a working knowledge of what is currently trending, especially when it comes to out of the box designs and styles. For example, exposed binding for things like event programs and booklets currently is very much on trend. But, for those who are unaware of the trend, it could mistakenly be dismissed as bad craftsmanship.

This article explores this year’s top three print design trends to better help designers, printers and finishers shape their client’s vision from the very beginning.

Trend 1: Naked and exposed

matchbook — Visible thread and an exposed spine have become additional design elements in book sewing projects.

In the last few years, it has become more common to see books and booklets that proudly show off the thread that holds them together, resulting in exposed spines. From Singer sewing to Smyth binding, creatives have embraced the visible thread as an additional design element. Instead of trying to hide it or have it blend in, they use it to show off brand (and other contrasting) colors.

Some may question: Hasn’t this been trending for a while now? If so, why are people still talking about it? Looking at the way any trend develops, first there are the early adopters, then it becomes more popular, then it peaks and slowly fades away. That is, unless someone adds a twist to that trend.

While Singer sewing and exposed Smyth binding still are popular, what is trending now is a twist on the exposed spine – a combination of the naked spine and a hardcover book: meet Swiss binding.

While the text block in a normal hardcover book is attached to the case at the spine, in Swiss binding the text block is mounted onto the inside back cover, leaving the spine and its colorful thread exposed. Swiss binding can be used in combination with various text blocks. While Smyth sewn ones are among the most popular options, perfect bound and even side-stitched text blocks
can be used to create the same effect.

Trend 2: Vivid colors

color-foil — Bright, bold colors are achieved with 5-, 6- or even 7-color printing to expand the color gamut.

As the value of design rises, brands are going crazier than ever with colors in an attempt to stand out from the crowd. While bold colors have been trending in the online world for a while, thanks to enhanced print technologies designers are going bolder, louder and brighter than ever in their printed pieces. The secret sauces (or, in the case of printers, inks) are neon or fluorescent inks.

Naturally, they can be applied with traditional printing techniques – offset, letterpress or silk screen. But, what is fueling the popularity of this trend now is the ability to print these colors digitally. Depending on the press provider, printers can add neon yellow, pink, orange, violet, green… using these vibrant neon colors as spot colors is a great way to encourage clients to crank up their design’s “look at me” factor.

But, it is not just about the neon effect. It also is about extending the overall color gamut that can be achieved. When talking about 5-, 6- or 7-color printing, it means adding more colors to a conventional 4-color process setup.

This is popular for two reasons:

Printers can increase the overall range of colors, which allows for really rich hues.
The extra colors (and, thus, enhanced gamut) can be used to reproduce a special hue that is out of range of the normal CMYK mix; meaning around 99% of Pantone colors can be matched.

Thanks to those expanded color options, expect color schemes in 2020 to get even more vibrant and luminous, even in the digital printing world.

Trend 3: Shimmer and foil

Zoma — Foil stamping lends attention-grabbing shimmer to print and packaging projects.

Granted, foil and shimmer have been on trend for a while now, but as a number of newer technologies are becoming more widely available, foil now is an option for super short to medium to very long print runs and even for variable data.

The key is knowing when to choose which option to add that extra shine, as well as when and how to steer clients in the right foil direction. Just because you have a hammer does not mean that every one of the client’s projects is a nail.

Hot foil stamping

When it comes to a true tactile experience, there is not much better than hot foil stamping. By choosing the right paper and pressure, a nice deep impression is achieved that designers and clients alike love. As the gold or silver foils are completely opaque, they can be used on white paper or go super dark; the sheen will never falter.

Cold foil

When it comes to longer print runs and the foiled image is quite large on the sheet, hot foil stamping may not be the best option. Cold foil can be the printer’s best friend in this case, especially when it comes to applications with large-run folding cartons or magazine covers. In addition, cold foil can be applied on the first station of the printing press and then overprinted inline, creating a range of metallic colors without multiple passes on the press.

Cold foil is run inline with two extra stations on an offset press. As the foil is put down first, this allows for a multitude of shiny colors when printing CMYK on top of the foiled areas.

Digital foiling

Enhance an offset and/or digitally printed piece with that extra-super shine with this offline option. As the process is digital, this means:

No die, plate or film is required.
There is no pressure used, thus no bruising on the back of the sheet.
It is ideal for short to medium print runs.
It offers the opportunity to use variable-data foiling.

Foil substrates

Printers also can turn their approach upside down by utilizing a foil substrate. Use offset or digital technologies to print CMYK right on top to enjoy the same multitude of shiny colors as with cold foiling. Remember though to underprint white in the areas where colors need to stay true.

Conclusion

Designers love the creative freedom the combination of foil substrates with digital printing and digital foiling allows. It gives them room to test different options, to push the envelope that extra bit further, to tweak and compare and decide which version matches their vision best.

No matter which of these trends speaks to designers, printers and finishers most, knowing what is trending allows them to guide their clients that much more expertly. It also gives them a chance to be part of the design conversation early on, helping to shape the client’s vision.

One of the most useful tools for designers, printers and finishers is The Foil Cheat Sheet, developed and produced by FSEA and PaperSpecs. It is a single, go-to source explaining the different techniques available for creating metallic foil finishes. From hot and cold foil to toner-based and varnish-based digital foiling, the guide describes each technique, showcases examples and provides the advantages and disadvantages of each. To order the Foil Cheat Sheet, visit www.fsea.com (FSEA member and quantity discounts
available).

Sabine Lenz is president of PaperSpecs.com, an innovative space for highly committed creatives who are in love with the tactile and interactive experience provided by paper and print. PaperSpecs inspires, shares insights and provides access to crucial, hands-on tools and resources to bring print creations to life. For more information, visit www.PaperSpecs.com.

Quality Control Systems Key to Folder-Gluer Production Success

June 5, 2020

By Richard Pallante, president USA and Canada, Baumer hhs

Quality control systems are not new to the folding/gluing and finishing industry, but there have been continued improvements in recent years, and the need for these types of systems is as important now as ever before. PostPress asked the experts at Baumer hhs for their input on the importance of quality control systems and what customers should look for when including quality control on new equipment or adding it to existing equipment.

What benefits do advanced quality control systems provide folder-gluers?

Verification systems might use sensors or cameras to process data for quality control.

Suppliers that offer advanced quality control systems are providing a key competitive advantage to OEMs and their end customers. The ability to confirm to customers that their production runs have been checked for product accuracy and gluing accuracy reduces stress on all sides. With reduced access to trained labor, there are simply not as many experienced folding/gluing operators as in the past. Additionally, operators have many more responsibilities than just running the folder-gluer. A quality control system will catch issues that can arise from unintentional operator errors in set-up or operations and prevent incorrectly manufactured cartons from being shipped to a customer.

This is extremely important for the pharmaceutical industry where quality control validation is required as there can be severe legal and human ramifications if a product is mislabeled or improperly packaged. Additionally, manufacturing has changed. Long carton runs on the same machine no longer are the norm. Shorter runs with multiple set-ups per day are the new norm and can allow for more opportunities for possible errors. An advanced quality control system can provide that additional level of security to protect the operator, reduce waste and provide ultimate customer satisfaction. It truly becomes more economical to have a quality control system than not to have one, and consulting with a knowledgeable, experienced glue dispensing and verification system manufacturer can help customers find the best technology for their applications.

What features should customers be looking for when installing a quality control system?

It certainly is recommended that customers do their homework and talk to others in the industry who have purchased a QC system or have one that was included with their original folder-gluer. A reputation in the market is a good first cut on who to consider working with before purchasing a quality control solution. If the QC system is difficult to use, then end users are not going to get the full benefits from it and operators are going to try and bypass it instead of using it. Companies should be looking for ways that they can validate that the products are properly manufactured.

The following are some key questions to ask before investing in a quality control system:

Who offers the most solutions (glue detection, code detection, camera-based detection)?
Can verification data be downloaded and shared
with the customer?
Can the faulty product in the production process be traced?
Can the sensors differentiate between wet glue and
cured glue?
Is the operator able to validate presence and placement of adhesive or a code?

Customers need to know how the system works and how it processes the data. Just knowing that the product did not kick out does not always mean it is good. How the operator sets up the system and what parameters are being measured need to be understood. Verification systems only are beneficial if the user finds value in using them.

Are different types of systems and sensors needed for hot melt glue vs. cold glue?

Cold glue and hot melt both are adhesives but have different makeup and characteristics. Cold glue is an emulsion where the glue is carried in another medium, such as water. When detecting cold glue, quality control companies will try and detect the water medium or will add another ingredient, such as an ultraviolet (UV) tracer. So, for a cold glue system, the glue itself is not really being detected but rather the carrier or additives used for it. A cold glue QC system could use a moisture sensor to detect the amount of water. These are small sensors and widely used in the industry. Typically, the sensor shines a light into the glue bead and measures the spectrum of light that reflects back to the sensor that is not absorbed by the cold glue. It compares this absorption with the background. If the background is damp or wet, it can skew the readings, resulting in inaccurate verification results. Fortunately, wet or damp cartons are not the norm.

UV tracers have their own challenges. With the increased use of UV inks and specialty UV coatings, the UV additives make the board indiscernible from the UV tracer in the glue, so the UV sensors cannot tell the difference between the two. This can create all types of challenges on the folder-gluer.

Hot melt detection is done with a thermopile detector. The sensor is looking for the temperature difference between the paperboard and the glue and is typically placed close to where the hot melt is dispensed from the hot melt applicator to achieve the largest temperature difference possible. The sensors need to be kept at least 30 mm away from the heated hot melt gun in order not to affect the functionality of the hot melt sensor. Some hot melt sensors can limit the line speed of the folder-gluer machine as it can become saturated and no longer process the temperature difference. This limitation needs to be discussed before choosing a hot melt sensor.

Besides cold glue and hot melt sensors, camera systems can be used as well. Cameras can take a digital picture of each product and compare it with a baseline picture where the patterns or codes have been verified. If a picture varies from the original picture, the product is identified as non-conforming and is marked or mechanically removed from the production line. Camera systems also have traceability capability, so if a product is found to be faulty after delivery to the customer, if marked or time coded, it can be traced back to time of production, the machine it was processed on and the operator involved. These additional capabilities bring a great deal of value, and, therefore, camera-based quality control systems are more expensive than standard sensor-based systems.

When is adding a camera system on the glue line suggested? What added advantages does it offer?

When choosing a camera vs. a sensor-based quality control solution, it comes down to the following issues:

Economics/number of glue lines – A beverage carrier can require 16 cold glue guns to glue the carrier. This means there are 16 separate lines of glue patterns that must be verified. In a sensor-based system, 16 individual sensors are required, where a single camera could provide the needed verification. So, in this scenario, a camera system can be determined to be a very feasible option for quality control. Considering the opposite scenario with a single gun, straight-line system only requiring a single sensor, a camera-based system could be an over-investment. Because of the wide variation in patterns, cartons, operator preference and set-ups, there unfortunately is not an easy way to say there is a general tipping point where the decision goes from sensor to camera. The decision is best discussed with a gluing and QC specialist.
Set-up time/makeready – Adhesive sensors are quick to set up. They usually are mounted directly to the dispensing guns and follow where they are mounted on the machine. They require a simple teaching function where they memorize the correct pattern and tolerances and monitor them through the run. A camera system will require proper lighting and mounting that allows it to see the entire pattern. If a new carton is run, a completely new set-up needs to be undertaken, adding time to the set-up. So, the length of the normal runs by the customer can have an impact on the decision between a camera system and using sensors. If a customer is changing over continuously, a camera system may not be very feasible. However, if a machine is running a particular job over and over, it may well be worth the investment.
Traceability – A camera system will store a picture of each carton and can allow the operator to trace a potential issue all the way back to the actual creation of that carton. A sensor system will not be able to provide a visual output of what was good or bad about the carton. If the customer received a series of bad cartons, a picture can show what the cause was while a sensor-based system will require the manufacturer to tear open the carton and play sleuth to figure out what happened.

What projects or industries are best suited to take advantage of a quality control system?

Almost all types of cartons or other folding/gluing work can benefit from a quality control system, but it really comes down to who is willing to pay for it. It is similar to buying insurance in that hopefully it never needs to be used, but it is good to have if something goes wrong. How much does it cost to get a semi-trailer full of pallets of cartons back because some of them were not glued? Doing this once may not equal the amount invested in a quality control system, but how much is the manufacturer’s name worth? Is it worth the risk of having the quality of the shop questioned?

There are specific industries that benefit the most from a quality control system. Pharmaceutical, food processing, and health and beauty are good candidates. Each company could be critically impacted if a product were mixed, not sealed or incorrectly packaged. A mistake could prove fatal. While it is unlikely to happen, it is not worth the risk.

Baumer hhs is a leading supplier of glue extrusion and quality control systems for the folding carton and print finishing industries. For more information, visit www.baumerhhs.com.

Evolution of Sustainability and Circular Economy and Their Influence on Printing Operations

June 5, 2020

By Gary A. Jones, director, EHS Affairs, Specialty Graphic Imaging Association

Despite what many may think, the concept of sustainability is not new and has been evolving for decades. To some extent, the roots of sustainability were born with the conservation movement that was spearheaded by President Teddy Roosevelt, who worked hard to establish the national parks system. Since then, the focus of sustainability has grown to encompass an examination of just about all aspects of daily life and a search to find approaches, products and services that have a positive impact on the planet.

Sustainability background and emergence of the circular economy

Modern sustainability emerged in the mid to late 1980s with the publishing of a report titled “Our Common Future,” also known as the “Brundtland Report,” in 1987 by the UN’s World Commission for Environment and Development, chaired by former Norwegian Prime Minister Gro Harlem Brundtland. The report defined the principle of sustainable development as, “development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”

There was a period after the release of “Our Common Future” before the sustainability movement became a hot topic for the printing industry. The question about what is a “green printer” began in earnest in the mid 2000s and reached a crescendo near the end of the decade. In response, the printing industry created and launched the Sustainable Green Printing Partnership (www.sgppartnership.org), an independent third-party certification program addressing sustainable print manufacturing.

During the last decade, sustainability in the print industry focused on the packaging and point-of-purchase displays market, with many print customers requiring their products to be both sustainable and manufactured in a sustainable fashion. Then, in 2018, a sustainable tsunami hit the world, with tremendous ramifications.

Two events focused targeted attention to the issue of sustainability. First, National Geographic launched a campaign to reduce waste from plastic products, such as single-use bags and straws, called “Planet or Plastics?” The National Geographic initiative not only included an awareness campaign about plastics pollution but also addressed investments in research programs and partnerships.

The second action, and perhaps the one that had the greatest impact, was China’s implementation of its Blue Sky program that set strict regulations about the scrap material imported into the country. Over the last decade, China has accepted a wide variety of wastes from many countries in the world – including the United States, Canada and Europe – for recycling. It only was able to use a small fraction of the material received, and the rest was either landfilled or left to accumulate. To combat the overwhelming amount of waste that could not be recycled, China outright prohibited certain materials from being imported, and for those they were willing to accept, it set an extremely low contamination rate of 0.5%. The targeted materials for ban included plastics, scrap paper, certain metals and textile materials. China continued to set bans around additional materials and may completely ban all materials.

This positive leap for China to achieve its national environmental health goals has caused major repercussions for the rest of the world. The ramifications for the US have been particularly impactful as approximately 40% of the total materials collected for recycling were being exported to China. While other countries such as Indonesia, Vietnam and Korea are willing to take some wastes, the amount they can process is not large enough to absorb what China was accepting. These countries, along with other Asian countries such as Malaysia and the Philippines, have been closing their doors to these waste products.

Push for a circular economy

The actions taken by China and other countries highlighted the limitations of the linear economy. The linear economy is characterized by the take-make-dispose approach to producing products and services. This approach tends to consume finite resources to produce products which end up in landfills or incinerators. The launching of a new model was seen – the circular economy.

The circular approach, as envisioned by the Ellen Macarthur Foundation, entails gradually decoupling economic activity from the consumption of finite resources and designing waste out of the system. The circular economy incorporates renewable energy and is based on three principles: designing out waste and pollution, keeping products and materials in use, and regenerating natural systems.

Sustainability_chart — Figure 1. Linear, Reuse and Circular Economic Models (Source: Government of the Netherlands, www.government.nl/topics/circular-economy/from-a-linear-to-a-circular-economy)

The illustration in Figure 1 offers a clear illustration of the differences in material flows between linear, reuse and circular economic models.

Achieving a circular economy is not an easy path to take as it is difficult to fully eliminate waste. Some products, such as those made from renewable resources, readily are adapted to the circular economy model while others are more challenging. There are many practical barriers to establishing a closed-loop economy. However, changes toward closed-loop or circular economy operations are achievable within specific sectors, companies or product categories.

One business strategy for closing the production-use-disposal scenario includes shifting from selling products that the consumer owns and eventually disposes of to providing a service with an agreement in which the products remain the responsibility of the manufacturer to repair, replace, refurbish or repurpose. This shift in ownership incentivizes the manufacturer to design for less waste, produce a more durable product and create loyalty with their customers.

For example, a recent assessment by Ricoh concluded that by 2050 there will be an insufficient supply of many virgin materials at a reasonable cost to support its manufacturing needs. As a result, Ricoh has revised its business model using life-cycle analysis as the basis for decision-making and establishing a series of “Resource Smart Solutions” for product design and manufacturing, re-use, collection, maintenance and materials recovery. Since the company owns 60% of what it sells, it can engage its customers in new business solutions derived from a circular economy approach.

Government action

Many argue that government intervention is needed to both encourage and instill a more sustainable environment. Several approaches have been proposed, using the circular economy model, to address reaching this goal. Approaches under consideration involve the imposition of mandates to use a specified amount of recycled materials in products, banning the use of certain products and implementation of Extended Producer Responsibility (EPR) programs. EPR programs are designed to shift the waste management cost or physical collection partially or fully from local governments to producers.

EPR as a concept is not new in the US, with almost every state having some type of producer responsibility laws covering consumer products such as automobile batteries, electronics, mobile phones, paint, pesticide containers, carpet, thermostats and pharmaceuticals. Several states have enacted landfill bans which have had an increasing positive impact on product recycling.

Packaging and paper have not escaped the grasp of EPR. Many provinces in Canada and many countries in the European Union have had EPR programs extending to packaging or printed paper for many years. So far, none have been enacted by a state or local government. However, that may soon change with the states of Maine, Massachusetts, New York, Oregon and California.

Maine’s legislation has come the closest to being enacted. It was debated in this year’s legislative session, but failed to pass. Maine’s legislation would see producers with more than $1 million in annual gross revenue paying into a managed fund, with participating municipalities then eligible to be reimbursed for recycling and disposal costs. The costs imposed would be done on a sliding scale of how “readily recyclable” a material is and those that are difficult to recycle would be charged a higher fee. Unless there is a special session called, it will not be considered again until next year.

While there has been activity, virtually all government legislative and regulatory activity has occurred at the state and local level. The combination of the National Geographic focus on plastics, including ocean plastics, and China’s Blue Sky program and its ramifications spurred many state and local government entities to ban the use of certain types of plastic-based products.

Many states have implemented bans on plastic bags, plastic straws, polystyrene food containers and other single-use plastic products. Likewise, some corporations have initiated their own programs. A good example is several large hotel brands are eliminating the use of individually packed toiletries such as shampoo, conditioner, etc. in guest rooms.

Some states have taken the approach of focusing on setting requirements for certain types of packaging. For example, California has established, through legislative action, a program that sets requirements for state-controlled food service packaging. This new program requires state-owned food service facilities, those operating on state-owned properties or those under contract to a state agency to dispense prepared food using food service packaging that is reusable, recyclable or compostable.

Marketplace responses

There are bright spots. Emerging trends around both the use and manufacturing of alternative substrates that are easier to recycle is on the rise. While there is a movement to increase infrastructure recycling using existing technology and new technologies such as chemical recycling, it will be some time before it comes online and sufficient capacity exists to relieve the downward pressure.

Some brands are shifting away from plastic to paper-based products. Several examples include using paper-based material to replace six-pack rings or the recent announcement by Procter & Gamble Beauty that it will start offering both Old Spice and Secret brand deodorants in all-paper, plastic-free, tube packaging. There is no mention if the paper tube is recyclable.

For textiles, there is movement to use cellulosic fibers, recycled poly, organic cotton and Better Cotton Initiative (BCI) cotton, which is a cotton sustainability program. For labels that are being used on PET-based containers, there is a move to use labels that are compatible with the recycling process and for other plastics, work is being done on polymers that are more compatible to both mechanical and chemical recycling.

It also is important to understand that, in addition to new substrates and recycling technologies, there are companies exploring reductions in packaging and package-free options. Lightweighting a package is not necessarily new, along with concentrating certain products to reduce package size. The new options being explored involve selling a single product where the package can be reused multiple times with the subsequent purchasing of super concentrated product that is reconstituted by the consumer.

A corollary to this approach is refillable packaging, where the consumer returns to the store to refill their individual container from bulk dispensing units. Package-free options already are being explored by smaller grocery stores where products are not sold prepackaged.

How this impacts the printing industry

For those facilities involved in packaging and labels, the sustainability and circular economy movement is real. Companies such as Wal-Mart, Target and Unilever have adopted sustainability goals related to the reduction of packaging materials. While attention has been focused on the use of plastics and packaging, increasing attention has been turning to the fashion industry. The drum beat to reduce the impact of “fast fashion” is increasing and getting louder every day. The effect is hitting both the products being produced for customers and the manufacturing operations.

The pressure on brands to address the waste associated with their products has been growing and will only continue to increase. A second, and possibly most important, impact of China’s Blue Sky program is felt around the country as municipalities have stopped or suspended local recycling programs.

With China no longer accepting most of the US-generated recycling, the market has disappeared. With the approaches that many brands and other companies are taking to address these issues, those that are producing products, packaging, labels and other supporting material need to understand they could have their businesses severely interrupted and threatened. Imagine the impact if someone’s primary business was producing packaging or labels and the company’s number one customer decided to offer its products as package free.

With the focus on textiles, packaging and paper waste increasing, printing operations need to become engaged on several fronts. They need to become educated about the changes occurring with respect to new substrates, advances in recycling technologies and recycling services, such as those offered by TerraCycle. This education provides the ability to offer solutions when requested by the customer.

Establish a dialog with customers to educate them about the current and future changes being driven by pressure from consumers, consumer groups, environmental organizations and government regulation. Given the economic pressures being applied to local municipal recycling programs, it is almost certain that there will be additional government regulation imposed on those that produce products, even if they are currently readily recyclable.

The benefit of having this type of dialogue is it allows the printing operation to gauge the understanding and options being considered by the customer. Customers are not monolithic. Some are proactive, while others will wait until circumstances dictate action on their part. If some of the ERP laws come to fruition, understanding the impact of various substrates and alternative options that are more readily recyclable would enable customers to pay less of a fee due to their ability to be recycled.

The education about the changing landscape also allows printing operations to understand the possible changes occurring and potential shifts by their customers to new substrates or the abandonment of current substrates. There are a host of issues that need to be considered, including performance, cost, printability, waste, etc. Understanding how to work with these new or “new to you” substrates will allow for a competitive advantage and allow for a fast response to changes in demands from customers.

Conclusion

The building of a circular economy is not going to be easy. There are many considerations that need to be evaluated as the linear model and the mindset associated with it will be difficult to transform. Nevertheless, the physical realities of the linear model have reached a tipping point as the world has quite simply run out of places to put the waste generated by modern society. Landfilling waste is not a solution as it is just long-term storage and more eloquent solutions are mandatory.

The path forward for many products is not clear. The key to expanding the circular economy is the engagement of consumers, business, academia and government to provide the demand and proper incentives to find solutions. With government now adopting circular economy legislation, more consumers demanding solutions and some brands adopting circular approaches across their value chain in order to mitigate reputational, supply chain, financial, environmental and regulatory risk, printing operations will need to adopt new business models that align with an emerging reality that discourages waste and encourages resource efficiency with design and innovation. This means they need to become more cost efficient, incorporate renewable technologies and resources, partner with like-minded suppliers and engage with emerging approaches to remain relevant and competitive.

Gary Jones is SGIA’s director of environmental, health and safety (EHS) affairs. His primary responsibility is to monitor and analyze EHS regulatory activities at all domestic and some international government levels. He provides representation on behalf of the printing and specialty graphic imaging industry. For more info, visit www.sgia.org.

The Finishing Industry Works Through COVID-19

June 5, 2020

By Hallie Forcinio, contributing writer, PostPress

Whether reopening, working at reduced capacity or running full out as the COVID-19 pandemic continues, businesses are striving to make work environments safer for personnel and customers and to maintain positive cash flow.

During a webinar on April 22, 2020, “Working Through COVID-19,” executives from MCD, Inc.; BrightMARKS LLC; SunDance; and Datagraphic + Spectragraphic described how their print finishing and printing businesses have been affected by the pandemic and how they are preparing for the future.

Sales have plummeted, but many projects have been put on hold rather than canceled. JohnHenry Ruggieri, managing director of SunDance, an Orlando, Florida-based full-service printer and finisher, which serves many tourist-related businesses, believes most jobs now on hold will go forward eventually. Sean Hurley, vice president of Sales at MCD in Madison, Wisconsin, a full-service print finishing operation, also feels optimistic. Despite a 50% slide in sales in April 2020 and a similar downturn expected for May, he said, “We feel sales will come back in June and get better after that as confidence builds.”

Located on Long Island in Commack, New York, Datagraphic + Spectragraphic, offering commercial printing and finishing solutions, has been shut down as a non-essential business but was hoping to reopen in mid-May to supply customers that are classified as essential. “Everything has come to a grinding halt,” reported Glenn Schuster, president of Datagraphic + Spectragraphic. Meanwhile, the company has been operating on a limited basis to produce face shields to protect healthcare workers and first responders. A customer that is assembling the face shields knew Datagraphic + Spectragraphic works with plastics and asked for help.

“Within the hour, we were testing the material,” recalled Schuster. “We quickly learned that we needed a special knife called a Viking blade, which is extra hard and sharp, to cut through the 30-mil Lexan [polycarbonate sheet],” he explained. Once that challenge was solved, it simply was a matter of adjusting the knife cutting height on the press. “We’ve stamped out close to 200,000 shields,” said Schuster, noting it is a way to give back. He added, “It’s been a feel-good type of project. That’s the silver lining if there is one in all of this.”

David Hutchison, chief executive officer/managing member of BrightMARKS in Lenexa, Kansas, which offers print finishing and decorating services, reported the company’s direct mail business is down about 50% and, “There is virtually no activity at the moment in greeting cards and social stationery.” Fortunately, he said, “Our packaging business is not off as much.” With packaging serving essential business categories, “We are seeing volume come in there,” he explained.

In direct mail, he noted, “Customers are starting to realize people who are quarantined are excited to get mail. We are quoting some very large projects that will go as soon as the retail environment opens up. We are hopeful that will come about in late June or mid-July.”

Schuster agreed on the trajectory for direct mail and predicted it will bounce back quicker than some other segments. “When the switch is turned back on, people are going to need to communicate with their customers,” he explained.

The outlook for greeting cards also looks positive. Webinar Moderator Jeff Peterson, FSEA executive director and editor-in-chief of PostPress, noted people who won’t be attending spring/summer gatherings like weddings and graduations in person still will send a card. “If people are unable to attend gatherings, such as graduations and weddings, they are more likely to choose a more expensive, foil and embossed card to mail,” stated Peterson.

Staying safe

Face-Shields — Employees at MCD wear face shields as a protective measure.

Every business – whether open, partially open or preparing to open – is implementing changes to keep personnel safe in the plant and office. Common practices include employee education about the risks associated with the virus and the steps being taken to maximize employee safety, working from home if possible – particularly for more vulnerable employees, temperature checks at the start of each shift, enhanced cleaning regimens and maintaining social distancing by closing common areas, installing barriers and staggering shifts. Visitors, if allowed at all, are required to wear a mask and perhaps gloves.

Ruggieri of Sundance reported, “The first thing we did was to implement a quick and effective method of delivering information to all employees, because a lot of employees didn’t have company email.” The next step was reducing the population in the building. He explained, “People who can work from home do so, and the rest work either a Monday/Wednesday/Friday shift or a Tuesday/Thursday/Saturday shift. The headcount in the building is about one-third at any one time.”

At BrightMARKS, operators wipe down equipment at the beginning and end of each shift, and other cleaning and sanitation tasks are done more often. In addition, every Sunday the offices and production facility are treated by Jan-Pro with the EnviroShield system, a disinfectant mist that eliminates more than 99.99% of bacteria and viruses.

Practices vary somewhat to meet state requirements. In Pennsylvania, where a face covering must be worn when entering any place of business, Menasha Packaging Company, a folding carton manufacturer based in York, Pennsylvania, provided employees with cloth masks or bandanas with instructions on how to wear and launder their masks.

“We did not mandate they wear the supplied masks as long as they had the required face covering, so we have a variety of face coverings,” explained Perry Whittaker, graphic finishing area manager at the York facility, who was an attendee of the “Working Through COVID-19” webinar audience. The company also instituted a temperature check for all associates entering the building. He stated, “This was very well received, and the associates are more at ease since we started doing this.” In addition to sanitizing machines twice each shift, he said, “We also have an extra crew cleaning all common areas throughout the day.”

Supply chain challenges

As of April 22, 2020, the day the webinar was recorded, supply chain disruptions were minimal. The only item in short supply was wide-format plastics. “All the extruders are doing clear material for face shields,” explained Hurley of MCD.

“We’ve been fortunate,” said Ruggieri. “We had some delays in flexo dies and label stock but now have a 60-day supply.”

Schuster added, “We’ve been in touch with our suppliers. They have been helpful in extending terms and will be ready to supply us with whatever we need to print.” Maintaining contact with suppliers will be especially important as projects currently on hold receive green lights. As demand ramps up, supplies are likely to tighten, so it is important to plan ahead and place orders as soon as possible.

Meanwhile, Hutchison stresses the importance of communication from suppliers. “We heard from a few, but I expected to hear from a number of others,” he said.

Customer contact

Keeping in touch with customers is equally important even if no projects are active. “It’s a sensitive time right now to ask for business, but it’s okay to let your customer know you’ll be ready when they need you,” said Schuster, explaining that Datagraphic + Spectragraphic has been sending e-blasts. He noted, “The face shield effort was a good [e-blast] message to send. It actually pushed traffic to the GoFundMe page of the vendor assembling the shields.”

Hurley advocates being proactive and is using Constant Contact or Zoom to stay in touch with customers. “It’s a good time for old-school relationship building,” added Hutchison. He explained, “People want to talk about more than a specific estimate, job or project detail. We are finding it a good opportunity to learn more about our customers. We’re surveying 100% of our customers to see who is operational and letting them know we can support them as needed.”

Maintaining positive cash flow

With drastically diminished sales, cash flow can turn negative, and it becomes difficult to pay vendors and meet payroll. To prevent layoffs and help preserve positive cash flow, the four firms represented on the webinar panel promptly applied for a Payroll Protection Program (PPP) loan and have received funds.

Hutchison said, even if the slowdown gets worse before it gets better, the PPP, “gives us the opportunity to retain all of our people.” Schuster agrees the PPP is a godsend but is concerned its eight-week timeframe could expire prematurely if the company is not able to resume full operation soon.

All four firms are encountering slower collection of trade receivables. Collection tactics include extending terms, negotiating a payment schedule or forgiving a portion of the bill. “Each case should be handled on its own merit,” recommended Hutchison. “Goodwill is important,” concluded Hurley.