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Our Flourishing Business

By Pat Szany

March 25, 2019

width=2182019 appears to be another year of growth and challenges for the corrugated industry. Boxmakers continue to seek new ways for increased productivity and increased sales, to explore new markets, and to determine where best to invest in their plant and equipment. A common theme expressed by many is the need to reduce head count. With near-full employment in North America and increased demand for their products, it’s difficult for box plants to keep up. This has resulted in an increase in demand for material-handling upgrades such as prefeeders, robots, load formers, and motorized conveyors. Machines that run faster and set up more quickly also put a strain on the infrastructure of the plant. There is a need for more efficient scrap systems to provide dust removal and cleaner air. Vacuum transfer machines are now moving mass air through the plant that needs to be cleaned and returned through a system that was designed 20 years ago.

Many are also experiencing unpredictable growth and opportunities. This has led some to enter new markets such as specialty gluing, label laminating, and digital printing, which all require additional equipment, proper training, floor space allocation, and marketing strategies. These are among the many concerns that arise from this growth, but an income stream diversification is one way to counter a possible slowdown.

A corporate engineer of a large U.S. company once shared his concern regarding their box plant operations during peak times. The concern was the avoidance of a situation in which they would be unable to ship products due to an equipment malfunction. He found three critical pieces of equipment that needed to remain operational, ensuring scheduled shipments. They were the compression strapper, the air compressor, and the baler. They did a survey and discovered that many of these machines were more than 20 years old, with little or no viable backup on site. A corporate directive was issued to correct the situation, making sure there was no redundancy.

Sometimes it is easy to focus on the whiz-bang appeal of new equipment and technology and to forget the basics. As business and technology continue to get better and equipment gets faster, there is always a need to stay focused on the basics of production.

The only thing that is certain is change. Thirty years ago, most of our independent customers made boxes with letterpress printer slotters and semiautomatic tapers or gluers. Many realized that this was not going to be cost-effective in the long run, and they started to invest in flexo folder gluers and rotary die cutters. These investments yielded better productivity and higher profits. This also allowed them to focus more on quick turnaround and the value-added market. Most did not see the rise of consumers buying products online instead of going to the mall and its effect on box demand. Huge distribution centers are popping up all over the place and utilizing boxes at a greater and greater pace. Amazon has its own fleet of vans making deliveries seven days a week. That is a lot of boxes. So, as long as there is a need to get products from point A to point B in a safe and cost-effective manner, the box business will continue to flourish.

Pat Szany is president of American Corrugated Machine Corp. and vice Chair of AICC’s Associate Board.