An Interview with LaManna Consulting Group and George Compiani of Significans Automation
Critical shortages of skilled labor have prompted print business owners to explore how end-to-end automation, artificial intelligence, and collaborative robotics could provide the needed flexibility to adapt to changes in both customer and employee expectations.
In this interview, LaManna Consulting Group asks George Compiani of Significans Automation why digital printing represents just one element of automated workflows that can ease labor shortages and help label and packaging companies meet consumer-driven demands for more customized brand marketing.
Significans helps brand owners and packaging companies create sophisticated automated workflows by tailoring existing Esko and Enfocus software solutions to meet the specific requirements of each client.
LCG: What is customized branding and why is it important to label and packaging companies?
GC: Technologies such as smartphones and social media have changed the way people discover and choose products. So has the consumer’s perceptions of brands.
As e-commerce grows, more consumers expect a customized purchasing experience. Whether they are buying home decor, apparel, gifts, or locally grown produce, tech-savvy consumers want the buying experiences to match their specific wants and needs.
So brands now use customer data to sell directly to individual buyers instead of mass-market demographic groups.
Brand owners use automated integrated marketing techniques and predictive analytics to shorten the distance between the research and discovery process and the actual commitment to purchase.
LCG: How does this affect packaging and label printing companies?
GC: As marketing grows increasingly automated and customized, manufacturing processes must also become simplified and streamlined. The only way to ensure profits is through automation.
The adoption of digital printing was simply the first phase in automating printing processes. The next step is to remove redundant tasks. This is particularly important now that it is more difficult to find skilled workers for traditional printing processes.
LCG: Did the growth of e-commerce during the Covid year of 2020 help accelerate the demand for customized products?
GC: Absolutely. Consumers who were forced to stay home changed their shopping habits. For example, consumers looked online for products related to nutrition, health, and wellness. Consumers who previously frequented restaurants and outdoor venues cooked more, streamed videos, and exercised at home. Cooking utensils, groceries, exercise equipment, sales increased dramatically.
These trends helped spark a big increase for automation in packaging, folding cartons, and flexible packaging. The packages became smaller. Ordering became more frequent. And online purchasing increased exponentially.
According to Digital Commerce 360 estimates, consumers spent $861 billion online with U.S. merchants in 2020, up 44% year over year. With 2020 revenues of $296 billion, Amazon accounted for about one-third of all ecommerce in the U.S.
LCG: Are all types and sizes of printing companies experiencing a growth in demand for customized products?
GC: The companies that are involved in growth markets are experiencing an increased demand. This includes packaging, home decor, fashion, and promotional products.
There is tremendous growth in custom brands. The coffee roasting business experienced increased demand a few years ago. Now, specialty pet foods, organics, farm-to-table, and healthy nutritional alternatives are just a few vertical markets springing up from the ‘stay-at-home/work-from-home’ market that came from the pandemic.
Demand for traditional printing is flat. Today, even the printed catalogs you receive in the mail feature products that are very specific to your interests, whether it’s cooking, running, or home decor.
LCG: Has the shortage of skilled labor affected the demand for more automation?
GC: Yes. The average age of employees in our industry is 45 years old. Finding skilled workers has become increasingly difficult. In addition, the rising costs of real estate has forced companies to move to more remote areas. This has made it even harder to find qualified employees.
Printing business owners are now looking to automate more manual and repetitive tasks and repurpose skilled employees to play more valuable roles in the manufacturing process.
Robotics have become part of the planning conversation as well. Robots can pick up boxes, move pallets, and do some of the steps that are performed 1,000 times a workday in some plants.
LCG: Are robotics primarily used by high-volume print producers?
GC: Initially, robotics were implemented in high-volume environments to reduce bottlenecks in the production or the risk of liability for injuries due to heavy lifting and repetitive motions.
Now, many types and sizes of printing environments are seeking to replace old conveyor-belt systems with robotic platforms for material handling.
In the future, expect to see more autonomous robots that can handle a variety of repetitive operations, such as running an inserter or stacking products onto pallets.
LCG: Did the success of start-up print-on-demand businesses such as Shutterfly and VistaPrint demonstrate what is possible in print environments that incorporate e-commerce and automated workflows?
GC: Most definitely. For one thing, these pioneering companies helped prove that automation can be profitable.
The print industry struggles to adopt automation because it is not familiar and requires new ways of doing traditional manufacturing. The transition isn’t easy for most printing companies. Analog processes such as offset lithography and flexographic printing have been the standard for decades. Change is expensive, risky, and difficult.
LCG: If printing companies have automated parts of their workflow, are they having trouble joining disparate pockets of automation in a unified whole?
GC: Yes. What we are seeing at Significans are random configurations of automation. For example, a printer will implement a custom solution for a specific step in their manufacturing. It may be based on a particular piece of equipment they just purchased. Or, it could be centered on a process that a customer requested to integrate with their own business process. In other words, some automation has been implemented because a customer requirement forced the printer to adopt it.
We often see pockets of automation that disconnect the flow of work from one step to the next. For example, website submission of orders doesn’t communicate with job ticketing. Job tickets don’t include layout information. File submissions may lack information for proper color management or file creation. The list goes on and on based on each plant’s processes, equipment, software and fulfilment expectations.
Significans Automation is a software integrator and developer. We help companies improve manufacturing efficiencies through the implementation of integrated software. We start with the “virtual” process through which a customer discovers your company and its products, enable job submission, manage the production, and follow it through to the delivery of finished products to the client.
Digital technology has created a common path of least resistance. It provides previously specialized steps in manufacturing a means of communicating with other steps. We help clients connect the dots in their workflow automation journey. Finding the right solutions is key to continuity throughout your process. We like to say ‘we connect your website to your dock door’.
LCG: Will the increased adoption of automation and artificial intelligence make a company more attractive to potential buyers?
GC: Definitely. Efficient, adaptable, technology-driven organizations have a higher value to equity investors because they are more prepared for ongoing changes in the economy.
The more automated a company is, the more rapidly it can adjust to shifts in the economy.
Once a company uses automation to build the backbone of their manufacturing process, the services they can offer are limitless. Instead of producing large quantities of identical packages, they can offer brands customized versions or seasonal pieces that appeal to each buyer.
Lessons learned from producing custom photo books can be transferred to the production of custom catalogs.
With today’s more powerful digital-printing systems, a packaging company can produce a single packaging design 100,000 times on Monday, and 1,000 custom package designs 100 times on Tuesday. The custom packages typically sell at a higher margin.
An optimized automated company produces higher profits with lower overhead. With automation, manufacturing becomes less about the equipment they own and more about the predictable amount of repeat business they can generate.
One example is a printer with 120 employees was earning roughly 3% profit and decided to implement automation strategies. They now operate at 15% profits with 60 employees.
About LaManna Consulting Group
LaManna Consulting Group (LCG) is an international business advisory and boutique consulting firm. The LCG team provides buy-grow-sell advice to business owners and investors in the specialty graphics, label converting, and flexible packaging sectors. With a 45-year history in the graphic arts, CEO Rock LaManna has cultivated a comprehensive international database and deep network of trusted relationships. Visit www.rocklamanna.com