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issue: September 2004 APPLIANCE Magazine

Packaging Materials & Equipment
Packaging: A Key Player in the Revenue Game


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by Ann Helming, contributing editor

It may be brown and corrugated, 2-mils thick and see-through clear, or a high-gloss photo depicting Little Mikey’s new Xbox. One thing goes without saying (almost) - if product packaging is done right, it can save a savvy OEM thousands a month, and that’s just the beginning.

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Pictured is an appliance that was packaged using stretch-hood equipment from Beumer Corporation (Bridgewater, NJ, U.S.). Inset is what Beumer calls "perfect corner protection," which helps prevent any damage to the appliance. In addition to product protection, the supplier claims that OEMs using stretch-hood packaging equipment can experience up to a 40-percent savings in film cost compared to standard stretch-wrap operations.

Far from an afterthought, product packaging - if it’s done with an eye for boosting profits - isn’t just about disposable shells that protect 700-lb air-conditioning units from bumps, vibrations, and stormy weather during transit. Packaging can aid in product branding - a marketing tactic firms commission professionals to strategize that often doesn’t come cheap.

Branding, basically, is something about a product that gets it some attention, as any advertiser who has strategically placed items like a box of cereal on Jerry Seinfeld’s sitcom breakfast table knows full well. In packaging, branding is what some say happens when an appliance in storage is wrapped in clear poly and its eye-catching color shows through. A customer is disinclined to think of anonymous units when that happens, and is more likely to wonder what brand name goes with that fetching, sunshine-yellow finish.

For this reason and more, the trend of clear packaging is expected to continue. “Converted flexible packaging demand in the U.S. is forecast to expand 2.4 percent yearly to 6.8 billion lbs in 2008, valued at $14 billion,” according to The Freedonia Group, Inc., a Cleveland, OH, U.S.-based industrial market research firm. “...Plastic films will continue to make inroads vis-à-vis their paper and foil counterparts, with particularly good growth increases for polypropylene film.” The firm also notes, however, that paper packaging, despite marginal demand growth, will remain an important player due to its low cost and environmental compatibility.

The Environment and Plastics Industry Council (EPIC) and the Plastics Film Manufacturers Association of Canada (PFMAC), on a recently designed Web site dedicated to plastic film, opine that shrink-wrap and stretch-wrap dramatically reduce packaging weight and bulk, while contributing to lower transportation and storage costs. In addition, the two packaging techniques are said to be more in-line with current European packaging waste legisla-tion, which is pressuring manufacturers to reduce secondary packaging weight.

Although more popular in Europe, film packaging is starting to gain ground in other markets as well. “There are big new markets opening up for stretch hooding,” confirms Allan Thyssen, vice president of Sales for Lachenmeier, a Sonderborg, Denmark-based supplier of packaging equipment. “Packaging of appliances was [traditionally] cardboard boxes, which made handling difficult, and there was a high product return rate because customers could not see the product (and any scratches or other damage),” he explains. “With stretch hooding, the return of products will fall. It cuts costs 40-percent compared to boxes.”

Sven Borghoff, project engineer for packaging equipment supplier Beumer Corporation (Bridgewater, NJ, U.S.), adds that the mere transparency of film offers several advantages. “The films presently used are clear and not only allow for perfect product display, but also the placement of bar code information covering shipping and/or storage data under the film, thereby protecting this data from damage or distortion,” Mr. Borghoff says. “However, should the need arise, these transparent films can also be imprinted with advertising or company identification information.”

Another plus to packaging with film, Mr. Thyssen of Lachenmeier adds, is that it is possible to stack more products for storage in warehouses. Stretch-filmed products can be stacked eight deep, he says, compared to stacks of boxed products, which can go six deep, at the most.

And, of course, the film is clean and environmentally “green,” he adds. “The film used with stretch hooding is low-density poly. You can burn it. It produces only water and air. It’s not sticky on the pallet and doesn’t attract dust, so it’s easier to recycle. Traditional stretch wrapping goes around the pallet, and that film is sticky.”

While enviro-friendly disposal of plastics, in film and other forms, is not exactly a hot-button issue in the U.S. yet, it could become so in short order. “In 2001,” states the Environmental Protection Agency, “U.S. residents, businesses, and institutions produced more than 229 million tons of municipal solid waste (MSW). That’s 4.4 lbs of waste per person, per day.”

Cutting costs, however, is probably a bigger plus to OEMs if they ponder making changes to their packaging systems. To woo that market, Lachenmeier notes that its new generation of stretch-hooding systems achieves lower operating costs by down-gauging the film they use, while at the same time securing optimal load stability. The company says its stretch units are developed specifically to handle thinner film, without overstretching it or destroying its holding power.

Other savvy packaging firms are also keeping cost in mind. “For Orion Packaging Systems, goal number one is the proper matching of equipment. We configure our systems to meet the customer’s need,” says Mark Collins, vice president of Sales at Orion (Collierville, TN, U.S.), which makes stretch-wrapping equipment. “You can actually pay 20-percent less for a machine, and it will cost you 30-percent more to run it.”

He adds: “Other companies’ equipment stretches poly around 200 percent. Our (stretch-wrapping) machines stretch poly from 260 percent to 275 percent at many installations. That means thousands per month in savings.”

Whether branding and the environment are top concerns or an afterthought, one thing is for sure: packaging suppliers are on top of their game, ready to help OEMs save - and make - money in whatever ways possible.


Packaging Materials & Equipment - Sept. 2004
 

Packaging: A Key Player in the Revenue Game

Orion Stretch Wrapper Comes to Friedrich Air

Lachenmeier Helps Electrolux Save on Two Continents

BSH Chooses Beumer Stretch-Hood System for Shipping Integrity

Microsoft Teams Up with SCA Packaging

 

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