Is there room for labels boom with digital?

Going by numbers. The global label market is valued at USD 41.75-bn and is expected to grow at 4.9%. The consumer landscape is changing, and so is changing the focus of converters of labels and packaging converters

30 Jan 2024 | By Aditya Ghosalkar

The online post-press investment for digital labels is high, which forces label converters to go in for offline finishing and any additional process means additional wastage


“Gone are the days of price wars in the packaging industry and clients changing printing partners at the drop of a hat for marginal price differences.” Go that extra mile and ensure the purchasing experience for the customer – is the mantra for S Kumar.

Aarjav Hansoti, director, S Kumar bets big on print solutions for startups. He shared an example of one of the startups whose business, three years ago, began with 2,000 labels and rose to two-lakh each SKU currently.

What is driving digital, short-run printing? Amol Lambe, founder director of ArtNext, says, “The startups are nearing the flexible packaging space with multiple SKUs, whose count shoots up to thousands during the festive season.”

Umesh Kagade, segment manager - Labels & Packaging, HP sheds light on the problem faced by startups and emerging brands. These do not have the bandwidth to engage with multiple packaging suppliers and need a one-stop versatile packaging provider. 

“The ability to print diverse packaging formats (including labels, pouches, cartons, sleeves, and lamitubes on a single machine) positions HP Indigo users as holistic packaging solution providers,” adds Kagade.

Kagade believes that there is fuelled consumption of not only labels but also other forms of packaging as brands seek innovative and diverse packaging solutions to capture the attention of this evolving consumer base. “With rising disposable income and evolving consumer preferences, a vast market is emerging for brands to thrive in India's evolving lifestyle and FMCG sector. This trend is expected to catalyse a potential boom in the packaging industry.”

Although digital printing is a visible change-maker, it has its drawbacks. “The market is not ready to pay for the exponentially high cost of print compared to conventional methods of flexo or offset. Manufacturers have to work on quickly bringing down the cost of consumables to make digital printing more affordable,” says Ranesh Bajaj, managing director, Vinsak.

Bajaj adds that there is no point in printing a label in 30 minutes if you still will need to wait two days for a varnishing plate, a cold foil or a hot foil die, and then a flatbed or flexible die to half-cut your labels. Processing expensively printed digital labels with conventional finishing processes makes the whole process even more unviable.

As an optimist, Bajaj says, “Certainly, there will be growth of labels. There is a place for a boom with new functional and aesthetic advancements. The embellishment and finishing have to keep pace with the digital print. The whole ecosystem needs to develop over the next few years for digital to become mainstream.”

Backing Bajaj’s affirmation, Ajay Aggarwal, CEO and MD, Insight Print Communication shares what keeps the label printing industry going. First, the label size is smaller. Plus, technically, a small-sized digital press is considered to be a cheaper, capital investment.

Aggarwal mentions that the digital printing of labels, currently, runs at very low, single digits in comparison to conventional labels. And, the reason for this slow growth is attributed to the cost of printing. Also, since most labels are mass-produced, the flexo plate cost becomes negligible. 

In addition, the online post-press investment for digital labels is high, which forces label converters to go in for offline finishing and any additional process means additional wastage.

“Most digital label presses that are installed are mainly four-colour plus white, while the conventional presses usually have six-, eight- or ten-colours. Hence, premium labels are a challenge as of now,” adds Aggarwal.

However, bullish about digital printing, Aggarwal suggests the way ahead is: Just-in-time printing, introducing multiple SKUs and variants, the environment-friendly printing process will help the label converters and end customers to move en masse to digital.

Latest Poll

The packaging industry is confused by recycling and sustainability rules in India. What is the biggest challenge?

Results

The packaging industry is confused by recycling and sustainability rules in India. What is the biggest challenge?

Shortcomings in EPR policy

 

22.22%

Inadequate infrastructure

 

11.11%

Shortage of recycling firms

 

16.67%

Lack of consumer awareness

 

50.0%

Total Votes : 18

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