MMarketing people have developed a fine set of tools to find out what consumers want inside. The problem with this is that the wishes often don’t go well together.
For packaging, for example, individualization is one of the big trends, the Cologne-based trade research institute IFH found out in a survey last year. Original boxes, small series, high-quality appearance – this is well received by potential buyers of sweets, perfumes or gifts.
Another trend is sustainability. It is important for more than 90 percent of consumers what packaging does with the environment. But the smaller the packaging series, the more difficult it is to precisely produce the required quantities of perhaps a few dozen pieces and to avoid waste. Bringing individualization and environmentally friendly packaging together is difficult.
Marco Dembowski and a few of his colleagues try it anyway. With folding boxes, those universal, small and often ingeniously shaped boxes, in which everything from medicines to chocolates to hand mixers can accommodate just about anything below the voluminous corrugated cardboard class.
Dembowski is the chief strategist for the PackEx brand, a company for which a small series in extreme cases consists of exactly one copy. This is more revolutionary than it sounds, because for decades this industry has been focused on large runs of at least a few thousand or ten thousand pieces. Then the small boxes were the most economical. Until PackEx came.
Founded two years ago by the August Faller Group family company from Worms, as an experimental field for digitalization, and has been on the market for about a year, the company is a prime example of how combining modern technology with an established product can open up completely new possibilities.
The classic production process for everyday boxes leaves manufacturers with practically no choice but the large series. The cardboard sheets are punched out, whereby a separate punching tool must be created for each individual box shape and size. Handicrafts play a comparatively large role in their manufacture.
The prices for such semi-manual stamping tools can easily reach 1000 euros or more. These and other costs, such as retrofitting the machines, only pay off if they are distributed over large quantities.
In the traditional way of production, runs above 4000 boxes are really economical, says a thumb bearing. In times of individualization, this throws them out of the running for many purposes, especially since the mega quantities entail additional costs, including storage costs or provisions for everyday risks.
Exit only with a fresh start
It is not uncommon for some of the mass-produced packaging to be re-stamped, for example, because labeling regulations change before use. So the boxes may be out of date before there is anything in them.
Dembowski explains that getting out of these constraints is only possible with a fresh start. Only the end product at PackEx is similar to the classic, but the manufacturing process has been completely changed.
The mechanical punch has given way to laser technology. “We have developed unique software solutions and machines worldwide. The entire production process had to be rethought, ”says the chief strategist. Instead of sharp metal edges, bundled light cuts out the contours and creates the grooves in the material that the folding edges dictate. “Laser technology is not rocket science, but it has never been used in this form in the folding box sector until then,” says Dembowski.
“Another niche provider”
The company built the upstream and downstream production steps around the technological core. Customers place orders digitally via app, color management for printing has been simplified, and small batches are shipped in cardboard boxes instead of the usual pallet and truck.
The average circulation per model is currently just 800 pieces and is expected to increase to 1100 soon. “With our current service portfolio, we are still a niche provider,” says Dembowski.
Customers also included large companies looking for a suitable wrapper for prototypes or market tests, but mainly small and medium-sized companies from sectors such as pharmaceuticals, nutritional supplements, superfood or promotional items – applications for folding boxes because of the otherwise usual large ones No quantities have been considered so far. Under certain circumstances, small editions could be produced within an hour using the digital printing process.
Digital experimental field
According to Dembowski, the Worms parent company has invested around ten million euros in the digital experiment field PackEx. The Federal Ministry for the Environment is funding the business idea with 1.6 million euros because digitization, as a by-product, reduces the environmental impact. According to the company, the use of raw materials can be reduced by up to 87 percent, and so far almost 1400 tons of greenhouse gas emissions have been avoided.
Demboski says that the breakeven point has not yet been reached about a year after the start of production. “We prefer to grow slowly, healthily and sustainably.” With just three dozen employees, PackEx is a dwarf in the folding box industry, which according to the latest figures from its FFI industry association has a production volume of 871,000 tons and an annual turnover of almost 1.9 billion euros (2018) is coming.
Like all sectors of the economy shaken by the Corona crisis, after a recovery the industry should again benefit from the fact that some of the major consumer trends give it tailwind. For nine out of ten consumers, issues such as avoiding plastic waste, recyclability or easy disposal according to the IFH survey are still at the top of the inner checklist when assessing packaging.