Avery: expands to give labels a new look

Avery Dennison came to India in 1997 with a label stock manufacturing plant in Gurgaon. Today, the company has two sophisticated plants with five coating lines in the country. The newest line is an emulsion coater, which was inaugurated on 12 March 2015. On the sidelines of the inauguration, Avery’s Anil Sharma and Georges Gravanis tell PrintWeek India how the company is keen to invest in capabilities, assets and people in India

21 Apr 2015 | By Rushikesh Aravkar & Noel D'Cunha

PWI: Tell us about this new investment...
Anil Sharma (AS): The new coating line is the third coating line at the Pune facility and fifth for India. While the first four lines are hotmelt coaters, the latest is an emulsion coater. It enables us to expand our basket of offerings and explore niche opportunities in the market, which have not been explored so far. The new emulsion coater allows us to produce filmic products, which have far superior performance than paper products. It allows our customers to make products, which gives a ‘no-label’ look and is UV stable and therefore, can be used in external conditions. It brings in capabilities that complements the hotmelt platform and thus allows us to expand the market. 
PWI: An investment in emulsion coater, why?
AS: Over the years, the conversations in the country have been about making products locally. The PM of India has very well articulated the Make in India platform. Why I see that as an important message is that, for Avery Denisson, we have been following that for a long time. When we started our first facility in 1997, a lot of the business was just about trading and getting in products and moving things around. We took the decision of getting in our first manufacturing setup in Gurgaon and ever since have continued to invest in new plants. This new machine represents significant expansion and not just capacity but also capability that allows us to service a wider set of customers and it gives us an opportunity to grow and expand the market.
It will also allow us to improve service to the market. Thanks to our distribution network, we reach deeper corners of the country and therefore drive penetration. Once you give this opportunity in smaller tier-2, tier-3 towns, there are people who can create their livelihoods out of this.
Georges Gravanis (GG): The new coater is strategically important for the graphics business for the capability it brings and from the packaging business from what it really allows our customers to do across the spectrum of the industry. We continue to invest ahead of the curve. We are a firm believer in the ‘Make in India’ platform and largely because it allows us to respond to our customer’s needs faster. I think graphics is an area that is growing and we are seeing how we can help our customers to grow that category and business. We want to be a serious player in the graphics space, take clearly the digital as a format that is growing. I think this is the step in the right direction for us. 
PWI: Can we expect new product launches for the retail or the graphics segment?
AS: We will launch a range of products that are in our portfolio but we would be interested in localising them to improve our service levels to the market as phase-1. With the work that the R&D team is doing with our marketing team, identify niches where we think we can help our customers do more and better would be the second phase. This will also be complemented on this side of the penetration in the markets through distribution and channel partners. New products will come but not immediately.    
PWI: Now that you have hotmelt as well as emulsion coating lines, please explain how will the end-users be benefitted with this?
AS: This asset allows us to bring a new liner production to the market and that is where graphics comes into play for us. It allows us to solve problems, because now we have a complete set of products that we would be able to give and essentially gives our customers the opportunity to leverage of what they have not been able to do. Over the years, with our presence here, we have realised that customers are now gaining trust and confidence and they are coming to us with their problems. We are trying to convert these problems into opportunities and help solve significant issues in the industry.
PWI: In terms of capacity how much would be emulsion and how much would be hot-melt?
AS: We produce significantly more than what the market requires today, from an Indian perspective. If you look at the per-capita consumption of pressure sensitive, then India would be at the ballpark of 0.3-0.35 per sq/m. Our capacities are in far excess of that and our capacities are built to serve the Indian market and also to be able to use this as a sourcing base for the neighbouring markets which we are covering from here, Middle-East and several South-East Asian markets. The capacity and capability will serve a larger need and India will be the hub for us to really make that happen. 
PWI: Are you the first one to produce that in India?
AS: The emulsion technology that we are using is far more sophisticated technology than what is typically used in the market, which is vinyl acetate monomers, which is the technology of the past. Two decades ago, we stopped using this technology because it had its own limitations and we have moved onto acrylites and different chemistries. That is the chemistry which is useful for creating food products which have superior performance on the filmic substrates. So we need to understand what is called water-based in India, is probably a technology that is not ready for the leap the market needs to make. We have to be clear that what we have launched in the market is a new platform which brings that capability. 
PWI: Can you elaborate this with an example?
AS: For instance, consider blood bags. We all know that blood is a precious commodity and there many lives lost because of blood not being made available on time. And working with the blood bank industry, we discovered that a considerable amount of blood is wasted because it has lost its identity. So we worked with the industry and created a solution which allows to create labelled packages in a manner which reduces the risk of loss of bags because of wrong tags.
From the point where it’s about shelf-appeal, I think there is a lot of functionality coming into picture and it is the maturity of the industry that’s being shown here. Customers realise that there are solutions beyond just decorating a package. That is where we are playing.
GG: Another example is point-of-purchase tyre label. Tyres are one of the most difficult of all labeling applications because of their ‘low-energy’ surfaces, which are inherently resistant to labelling. We developed this portfolio in close consultation with tyre manufacturers, who helped us understand their pain points and identify effective new solutions. This kind of collaboration is a key part of our innovation process. The POP tyre label features a film and adhesive construction with production-friendly gum patterns that increase conversion speeds. The POP label material incorporates a special back coating on the polypropylene film, which resists the migration of low molecular-weight components and processing aides from the tyre surface — a common problem in the industry. The barrier prevents materials from bleeding through the surface of the label, preventing label curl and maintaining outstanding print quality and brand appeal. 
PWI: When we talk to converters, reliability is one factor and the other is cost. When they service the print buyers, cost is the more dominant portion. Would you like to comment?  
AS: There’s a difference here. Total applied cost versus cost of the product. I think at this point reducing the total applied cost for the customer is important. You can reduce the cost for the customer without reducing the cost of the product. You can extend the life of the product. So product that was working for six months and you take it to nine months, you got something more for the customer. For graphics this is very relevant. For cigarette kiosks, there is a lot of money being spent by industry to put up paper posters.
One of the ideas that we suggested to the industry was to convert it to filmic posters. People use sheets with strip gumming as a way of cutting cost and putting these posters on kiosks. It was believed that these strip gummings allowed them to reduce costs. So we suggested another solution for this problem. You pay 30-40% more than what you pay for the sheet. But now the paper label which is lasting for 15 days will now last for three months. Also for us as a community to educate our brand owners that cost is not necessarily per kilo or per sq/m but cost is about the total applied performance. 
PWI: When you say made in India, one will expect the costs to come down?
GG: I think the water-based adhesives, typically in the world is 70% and 30% is the hot-melt. Less than 10% is the solvents for some selected applications where very high performance is required. So in India, when we had started, the winter market started to grow and there was no sophistication. So what the people needed was a more versatile adhesive that can stick on dirty surfaces etc. The end-users and customers are becoming more and more demanding and clearly they are moving towards emulsion, it’s a natural thing for us and having local capabilities will give us freedom to adapt our offering to the specific demands of our customer.
Thanks to our size, we are three-four times bigger than any of our competitors. In terms of sourcing, we have the scale to be competitive and in terms of our manufacturing, we have state of the art facility, we can run the assets efficiently and we have a culture of lean sigma. So talking purely of cost, if we produce locally, we save on freight and duty but in India we still don’t have ready availability of raw materials. I think, the key thing to see is that we should be more cost-effective and most competitive player in the market and then we have local offerings, we can tailor-make products for our customers. We are in the market to play. So of course we need to adapt our cost-structure and value proposition to work the market and the customers are willing to play. 
PWI: A bit about linerless labels. Do you think that’s going to be the future or are there some new technologies?
GG: Now for labels for bottles and shampoo, I think we are far away. There are different solutions and ideas. But what works in the industry is something very practical. People will not invest 100 million dollars to get linerless labels and waste thrice more time. So I think we are very active in looking at the opportunities. I don’t think for the bulk container business, we are going to have linerless solutions soon. But the area where we are working more on is recyclable materials. If you recycle 100% liners and use it for other applications, it’s the same result.
We have a lot of solutions, wherein the labelstock has dry adhesive  that can be activated  during application. There are different ways to activate it. So far, the easiest way to activate it is with infrared or UV light. 
PWI: Ink manufacturers are speaking about low migration inks for food packaging. Would this change the way labelstock are manufactured?
AS: I think these are two different things, which complement each other. If the inks are low migration in certain applications is a problem, then substrates and their thickness could also be a limiting factor. But as they become low migration, the ability to improve the thinness of your substrates gets better. So I see them as complementing each other.
Low migration is a functionality requirement in certain spaces, largely in the pharmaceutical space especially in the ophthalmic categories and the injectibles where there is risk of inks migrating or in food packaging where inks can migrate. For this, we have special low migration solutions, where we work with ink manufacturers and our customers to create platforms which prevent that migration of ink. It is our unique low migration platform that is created. As inks become less migration then it allows us to drive more technological advancements.
PWI: What happens at the Knowledge Centre in Bengaluru?
AS: The Knowledge Centre works in three spaces. It helps our converting partners to come and refresh their knowledge and understanding of the technology. It helps brand owners to come and learn about choices of materials, substrates and selecting right materials and right design. For us and the converting partners, this also serves as a centre for training talents. We go to technical institutes and recruit students and train them for a period of 5-6 weeks on different machines, practical hands-on knowledge and have them placed with a converting fraternity. 
So one of the challenges that we have envisaged alongwith LMAI is that, the talent pool required to service this industry, is very small. In order to get more and more people into the industry you need to make that easier for them. Very recently 13 students graduated and they have been placed. In the last four months 18 students have completed the course and the target is 100 students in the next 12 months. 
It is not us who are doing it alone, LMAI and the converting partners are part-sponsoring the programme.
 Dharampal Satyapal (DS) Group has a strong presence in food and beverage sector, hospitality  industry, mouth fresheners, tobacco and packaging. In line with the strategy of diversification, the  group created a new niche product within the mouth freshener category. A perfumed silver-coated  elaichi /cardamom mouth freshening confectionery was developed and launched as Rajnigandha  Silver Pearls. A unique product in the categoiry, it was premium and hence required very special  packaging.
 “We had grown to trust Avery Dennison, so this made them the logical first choice when we wanted  technical advice to help with the creation of the packaging for our new product,” said Priya  Chauhan, manager new packaging development for DS Group.
 The brief was that every millimeter needed to speak volumes about the premium quality of the  product it contained. In response to this tall order, Avery Dennison proposed a luxurious embossed  finishing that utilised its advanced pressure sensitive technology. “We recommended a silver  metallised paper label material that immediately made an association with the silver coating of the  product within the package, while also delivering super premium shelf appeal,” said Vinesh Verma.
 The final result enhanced the overall visual and tactile experience of the pack.
 Once the suitable label material had been selected, the next challenge was the proofing and  prototyping of the packaging designs, in compliance with the artwork provided by the DS Group. A  six-month process of trials and learning’s ensued, involving close collaboration between the DS
 Group’s converter and the Avery Dennison India team. The final step involved testing the label’s  high-speed application performance. Finally, Rajnigandha Silver Pearls were ready for launch in the  market.
 All early indications suggest that the DS Group struck gold with its alluring combination of a  premium product suitably enclosed in premium packaging.