THE DATA FRONT

72 | l&l
Federal
Etiquetas Electronicas is ISO 9000
certified and is continually working
to achieve more certifications or find
other ways to improve quality. In 2008
the converter earned the PROFEPA
certification – Procuraduria Federal de
Protection al Ambiente – a federally
backed certificate given to Mexican
manufacturing companies that meet
a benchmark for clean processes.
SA 8000 certification
Enforced by Social Accountability
International, the SA 8000 standard sets a
global benchmark for working conditions that
awards certificates of compliance through
a third-party auditing service. The countries
with the most certifications to SA8000
include Brazil, India, China and Italy.
For two years prior to this accomplishment, Etiquetas Electronicas gathered and
documented detailed information on its manufacturing methods, focusing on air,
water and toxic waste issues. Etiquetas Electronicas is required to compile and
submit updated reports each quarter while the PROFEPA is valid. After three years,
the company will need to re-apply.
‘This certification process has pushed us to have even more order and to be more
efficient in our manufacturing,’ explains the owner Casillas Sanchez. ‘We invested
in this process improvement, firstly because our customers began to request
information, and secondly, we saw there would be financial benefits to our bottom
line. We have reduced our waste and commit fewer mistakes.’
Sanchez says that employees have been eager to participate because they like to
be a part of it. ‘It gives them ownership,’ he says. ‘And a sense of working together.’
Alliances
The switch from local buyers to a single appointed international buyer has driven
the increase of acquisitions and strategic partnerships within the label and
packaging industry. To bolster its competitiveness in the midst of this evolution,
Flexoprint established an alliance with Brazil-based Baumgarten Group and the
Swiss converter Banfix, part of the tesa group, in 2002. Together the converters
share production for the Nivea brand across three continents. ‘We formed this
alliance in an attempt to follow the structure of these multinational companies,’
Flexoprint’s Fernando Aranguren says.
‘One approval is easier for our customers.’ In their attempt to standardize
their labels worldwide, CPGs will look for other alternatives if they cannot find
consistency.
With the Nivea brand, the three alliance partners exchange color targets and other
technical information to ensure that packaging is identical no matter where it is
sourced from.
‘We have become a better supplier through learning how to service these big
global CPGs,’ Aranguren explains. ‘It has helped us to focus on efficiency and to
shorten response times with less lead-time. In the brand owner’s transition from
local to global we have learned to be more flexible and provide better service than
our local competition.’
Aranguren comments on the choice of an alliance strategy: ‘An acquisition can be
a headache and no one wanted to spend the money on a greenfield site, so the only
choice left was to put our services together. We have a similar technical base and
share business values on important issues like technology investment and employee
training. For Flexoprint, the alliance was a turning point because the experience and
infrastructure that the experience has brought to our company is invaluable.’
In a less formal partnership, Impresos Uyeda has a joint venture agreement with
Labelhouse, which is capable of producing shrink sleeve labels. Because Uyedas
plans to explore the possibilities of digital printing first, it will not be investing in
shrink sleeve equipment. Masayi at Uyeda says, ‘To service our customers in this
area of product decoration, we’ve chosen to work with Labelhouse; they have the
technology. And once we invest in digital printing, we will be able to share that
technology with them.’
Obstacles
Mexican converters highlighted support from suppliers as the most difficult obstacle
to success; most view globalization as an opportunity to overcome this challenge.
Villar from young Promographics says, ‘Globalization is an opportunity to have
access to new materials suppliers that offer a fresh selection. And in this way we
are able to move past the big suppliers that don’t provide enough support.’
Raw material costs were noted as the next most frequent barrier to growth.
Jose casillas Sanchez of Etiquetas Electronics with
Federal Green certificate
Hernandez from Todo en Etiquetas believes
that, ‘globalization is good because not only
does competition make our company better,
as we grow and continue to consume more
supplies, we are able to get a better price.
And this allows us to compete even better.’
Price pressures were listed as the next
biggest problem in the market. Yet Nueva
Latina says the dynamics have changed
some recently. Comments Juan Antonio
Alducin, ‘Brand owners are no longer buying
less expensive labels from Asia and Latin
America. We have seen them begin to look
within the country because of the recession.’
In the last year, TLMI’s past president
John Hickey of Smyth Companies, and
current president Frank Grace of Multi-Color
Corporation, have both said that the number
one way for North American converters to
diversify is to look outside the region. And,
while this may be true, one closer step
could be a partnership with an eager and
competitive converter to the South across the
Rio Grande. A relationship, at the very least,
would be helpful.
In fact, to foster this notion, the TLMI
has introduced a new Global Committee
that will guide the association across
borders to strengthen the bridge between
the smaller markets within the North and
South American regions. Committee Chair,
John Wurzburger, says, ‘The association’s
converter and supplier members will
benefit from forming relationships with their
progressive Latin American counterparts.
Borders are shrinking and globalization
continues to be a central issue.’
Labels&Labeling