PrintWeek (PW): Tough 18 months…
Rafael Penuela (RP): Well, 18 months ago, the world was dealing with an unprecedented situation because of the Covid-19 pandemic. Increasing rates of infections, overloaded health structures and unfortunately a high level of mortality were responded by reduction of contacts via lockdowns, travel restrictions, face masks and many other measures to bring the situation under control until vaccines would become available. Of course, this environment had a massive impact on social life and economics.
PW: Global economic growth slowed down significantly…
RP: Many countries registered negative growth rates. The climate for investments suffered and the printing industry was not an exception to this general environment.Next to the obvious cancellation or postponements of investments for new machinery, a reduction of the print volume and in consequence a lower demand for after-market (service, spare, supplies) came along with it.
PW: Your learnings from 2021?
RP: We had to implement a better and more intensive use of tele-diagnostics in combination with augmented reality in order to support our local organisations and many of our customers. We had to change the way of human interaction and started the implementation of video conferences for internal as well as for external communication with our customers and suppliers.
PW: What steps did you take?
RP: Different to many other manufacturers of printing machinery we decided not to restructure our worldwide organisations and even to increase our headcount at our factory anticipating a recovery at the beginning of 2021. Our assumption of a quick recovery of the printing industry once the vaccines would become available was confirmed and today we can confirm that the current year was a record year in terms of order intake.
This quick and intensive recovery of our markets happens in parallel to many other industries and in consequence the demand for raw materials, semi-finished and finished goods was much higher than the reduced capacities to produce and deliver those goods.
PW: But there were, and are challenges?
RP: After an unexpected increase of prices, the shortage of goods is currently the main problem of our and many other industrial activities. The globalised supply chains are disturbed or in many cases disrupted. This unique situation will for sure determine for some more months the economic development of many countries, segments and many industries. Combined with rising costs for energy and a general increase of inflation the economic development for the coming year will very much depend on those factors.
PW: How has your company and factory sites responded to the challenges of the Covid-19 era? Anything on the ideas front? Any new research or innovation?
RP: The last 18 months at Manroland have been challenging, but embedded within a financially solid group, Langley Holdings, with a long-term view and commitment to the printing industry. We will be facing the coming year with the highest order backlog in the last 10 years, an increased production capacity and a renewed product range, Roland Evolution, to continue offering new technology to our customers.
PW: The pandemic has impacted India’s prospects to become a USD5 trillion economy by FY25. However, has the last quarter numbers reposed faith in the Indian market?
RP: Our commitment to the Indian market does not depend on short-viewed fluctuations of the economics. Our direct presence in this market is based on the growth potential of the Indian print industry. There is still a tremendous potential to increase productivity via technology in India. But this requires more capital expenditure for automation and digitalisation.
The import statistics shows that India is still buying mostly used equipment and this very often puts pressure on efficiency of production in combination with print quality.
PW: Does this scenario apply across all printing segments?
RP:In some segments, such as packaging, we see more change and only recently we have seen new machinery business improving. Many packaging printers, especially those serving international print buyers, have successfully adapted to the requirements of those markets. At the end the permanent need to reduce the “cost per sheet” by applying modern technology, adapted workflows and processes is driving the industry in a globalised environment.
Next to that the sustainability of our industry will determine its future. Lower energy consumption, waste reduction, eco-friendly substrates, inks and other print consumables are linked to newest print technology.
PW: Brands (FMCG and non-FMCG) are seeking more and more from print and packaging. As a global manufacturing brand, how can our industry cater to the new normal of - gaining speed; more flexibility; profit-centric approach; and lower carbon footprint?
RP: We as a manufacturer have the innovations and technology available, which are well accepted in the worldwide market and is contributing to higher efficiency, lower emissions with renewable energy and lower energy consumptions.
PW: How should print adopt marketing strategies that promote the print brand beyond the function of product or service…
RP: The approach of just meeting consumer’s needs seems short-viewed to me despite being quite often a challenge in today’s competitive environment. However, a long lasting strategy requires, from my point of view, an additional aspect, namely innovation. To anticipate customer’s needs or even create demand for future products secures long term business success. Innovation can be related to all kind of elements. Technology, distribution and communication channels, ordering processes, and logistics are just a few examples to be mentioned.
PW: One school of thought is, the key is to do more than just meet consumers’ immediate needs. What is your view?
RP: Manroland has focused for the past 150 years on technology and applications. Coating and double coating, perfecting, foiling, simultaneous plate changes, print length correction, colour measurements and controls are just a few examples of technological highlights, which are nowadays quite common in our industry. Digitalisation to facilitate real time data of production, interface with customer’s information systems to integrate sales and purchasing processes along with logistics and warehousing is the current innovation in our industry.
PW: 77% of Indian consumers are actively engaging with sustainability. These consumers will invest time and money in companies that try to do good. Three sustainable actions you have undertaken in the past year that you can share with us?
RP: No doubt that sustainability is and will remain a main factor to take care about in all industries. Our production facility in Germany is certified by the corresponding authorities as energy efficient company. We have been reducing our energy consumption for the last couple of years in all areas.
We are certified for ecological waste treatment. Next to the obvious fulfilment of legal regulations on this topic we work intensively on the avoidance of waste and recycling concepts for all the material in our production cycle. We develop our printing machines to be energy-efficient and offer customers technical solutions such as re-cooling. Our inline colour management systems are contributing significantly to shorter change-over times, but equally to reduce waste of paper and cardboard for our customers.
PW: Is there a Green Gap between what our industry talks about; and the rest of society? For example, the industry uses terms like “biodegradable” and “circular economy”.
RP: In fact our industry, as many others, is evolving with the essential need of thesocietytomake compatible economic growth with environmental sustainability. Technology drives both demands following customer’s expectation and legal regulations. In some countries the printing industry is not considered environmental friendly despite constant progress on controlled cultivation and recycling of natural substrates, avoidance of toxic substances, and reduced energy consumption.
PW: How can we bridge the knowledge gap?
RP: I personally believe that next to individual initiatives the printers’ associations could become a more active driver to reduce the gap of knowledge. We are now observing a clear trend of changing plastics by paper and cardboard. This trend is mainly driven by the consumers and supported by legislation. Another way to create awareness should be the inclusion of environmental factors in the standard processes of print. Next to the general accepted factors of print quality, the industry should establish corresponding factors of sustainability.
PW: Any lessons you can share from a customer that has been resilient or innovative (and flourished) during the past 18 months?
RP: Many of our customers have taken the difficult time of the pandemic to review their organisations and processes. Not necessarily to reduce their structures, of course many had to do so, but more with an optimistic view on the future. Some decided to insource process steps and others to outsource those processes not being core to its business. A common denominator is the awareness of performance. Increase in efficiency of production still has a huge potential in our industry.
PW: What is the analysis from your customers?
RP: According to our knowledge many customers are printing with an overall equipment effectiveness (OEE) below 50%. We have started with many of our customers to measure OEEs and support them to get better results. In some cases the solution to, for example bottlenecks in the print production, is not to buy an additional machine, but more to increase productivity with the already installed base.
PW: Your plans for 2022?
RP: Our immediate actions are focused to stabilise the supply chain. Next to that we will continue with our R&D to improve our products and launch some innovations. In the current pandemic environment we will continue to protect as good as we can our staff and business partners.
PW: One outrageous prediction for the year to come...
RP: It is not for to me to predict the future.