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Fat and Happy

October 1, 2006 By: Tom Andel Paperboard Packaging

Converters enjoying a healthy chunk of the food and beverage sector will have to stay in good shape to keep it.


The food and beverage sector is to a folding carton converter what red meat is to a hungry lion: both a significant challenge and an irresistible opportunity. The red meat is attached to a moving target that represents survival. Food and drink are half of a converter's diet. Pharmaceuticals, hardware and paper products are much farther behind that lion's share.



Beverage alone is 17 percent, according to the Paperboard Packaging Council. The challenge?

"While beverage packaging is the single largest tonnage consumer in the folding carton industry, it's also the least like other market segments," says Ed Zumbiel, vice president of beverage packaging for Zumbiel Packaging, an independent folding carton converter in Cincinnati. "The volumes are all very large and the margins are all very small, so you must be both an efficient manufacturer and shrewd supply chain manager."

With the expanded gamut separation capabilities of its seven-color printing operations, Zumbiel hits 95 percent of the Pantone color spectrum. This enables the converter to change copy without changing inks in the press, resulting in quick
With the expanded gamut separation capabilities of its seven-color printing operations, Zumbiel hits 95 percent of the Pantone color spectrum. This enables the converter to change copy without changing inks in the press, resulting in quick

If a Pepsi or Coke customer places an order for beverage carriers today, that means they'll probably want delivery either today or tomorrow. Many suppliers will agree — their big beverage customers don't have words such as "lead time" and "forecast" in their vocabularies.

Allpak helped Dilettante Chocolates improve graphics for its store displays. As a result, Costco increased its order sizes and allowed palletized displays in its stores, shoppable from all four faces.
Allpak helped Dilettante Chocolates improve graphics for its store displays. As a result, Costco increased its order sizes and allowed palletized displays in its stores, shoppable from all four faces.

"They rely on the supplier to anticipate their needs and have product available on a true JIT basis," Zumbiel explains. "If suppliers do not understand customers' usage requirements better than the customers, suppliers will either shut down their customer's line or find themselves perched atop a mountain of excess inventory."

Do You Want a Prize with That?
Do You Want a Prize with That?

Inventory: Good, Bad, Ugly

Inventory is a necessary evil for any converter. However, the converters that can minimize the effects of that evil do their businesses the most good. Zumbiel balances inventory with data. Its database is filled with historical trends related to usage, and the company launches orders based on what time of year it is and how much product a customer uses on an SKU basis. The company's enterprise resource planning (ERP) software is only part of this solution, however, there are still things only humans can do.

"Those systems do not know how to take a calculated risk," Zumbiel says.

Power of Print

Printing flexibility helps, too. More and more converters are investing in the latest flexographic printing technologies — with up to nine colors and inks that are either affordable enough to stock or processes that are automated enough to justify a converter's investment in its own ink kitchen. 

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