Printmann’s packaging agenda to focus on design to delivery - The Noel D'Cunha Sunday Column

Ramu Ramanathan (RR): We are going through very difficult times, and so, it is really laudable that you are creating a new factory in these times. What is the rationale?
Tejas Tanna (TT): Printmann as a company has always been on the growth path since its inception. We have always believed in continuous reinvestment into the business, and this has fuelled our growth and expansion.

RR: When did the work begin?
TT: Work on our new factory had begun much before the pandemic, and although the market did slow down during the lockdown phase, we were able to pull through without much disruption. And now that markets are opening up once again, it is safe to say we are back on track with our plans.

RR: Some facts about the new factory?
Ankit Tanna (AT): Well, it is the adjoining plot to our existing plant in Navi Mumbai. This new plant is 60, 000 sqft.

RR: And the old factory is 51,000 sqft?
AT: That’s right. So, the total area is 1,10,000 sqft in Navi Mumbai. Then there is the 30,000 sqft plant in Vasai.

RR: What are the types of equipment in the new plant?
AT: We have started with a KBA seven-colour brand new press. Two Bobst die-cutters, two folder-gluers with multiple glue guns. We are shifting some of the existing kit to the new plant.
Business: the shape of things

RR: Has the business environment improved, according to you? What are your customers saying to you?
AT: Markets are opening up once again, and our customers are bullish on demand picking and growing past pre-pandemic levels in the near future. Our business hasn’t seen too much of a slowdown over the past year and a half, but developments, which were put on the backburner, are now getting revived and reinitiated.

RR: Despite of the tough times, there have been a lot of new product launches (over 5,000 as per the Nielsen report) over the past 12 months. Isn't this unusual?
TT: Printmann has always paid heed to our customers’ requirements. Our product portfolio has grown and continues to grow based on our customer’s needs and have always supported new packaging development projects. To a point where we have a dedicated packaging development team that primarily focuses on supporting our customers' packaging development projects as well as our in-house R&D in packaging.

RR: Is this the reason for Printmann's strategy of four products from four businesses (cartons, labels, leaflets and foils)?
AT: We as a company have always looked to become a one-stop packaging house to help us better serve our clients, and that has led to us having our four business verticals and now the fifth one being a packaging development centre. We continue to live by this philosophy and will further expand our product verticals when the need arises.

Ankit Tanna

RR: What were the changes adopted by Printmann during the first and second wave?
TT: During the first wave, there was not much known about Covid, which brought some fear along with it. We first implemented additional health and safety protocols to give the staff a safe environment to work in. From transportation to daily screening at work, we did whatever was necessary to give our team the confidence to come to work.

Employees over 50 were reluctant to come into the factory due to health risks, and family pressure. This was when we realised that we needed to upskill the younger members of the team. They were given a free hand to get work done in their teams. So in a way we developed a team which confident to run the factory even if their senior members were not around. We plugged this gap due to the pandemic, and it was the perfect time for them to realise their potential and rise to the challenge.

AT: We are predominantly dependent on the pharma sector. So we kept adding new products that were required for the pharma segment. We were into cartons, leaflets, labels and foils. During the pandemic, we realised that if one segment goes down, all our products go down. Previously, our marketing was through word-of-mouth. For the first time, we have invested in marketing. We hired a marketing professional whose role was to tap businesses unrelated to the pharma sector.

RR: Delivery systems have become an indispensable part of our lives. What type of design collaborations do you have? Are there flexible and affordable design alternatives?
AT: Our evolving, dynamic market space is pushing secondary packaging beyond the plain corrugated box. As eCommerce and SKUs expand, and consumer demands drive change in the marketplace, the packaging is also expanding to accommodate these new channels.

RR: Like?
AT: We have worked with many brands in the personal care and QSR (quick service restaurants) sectors who have adopted the direct-to-consumer (DTC) model to move to a more customer-friendly, durable alternative. These alternatives can be more economical, but they always add value across the supply chain and brand perception.

Driving change with concept clarity

RR: In this day and age, what sort of yields should a packaging company target while creating an operating model?
AT: Over the past decade, the global packaging industry has enjoyed a steady growth driven by shifts in choice of substrates, expansion of new markets, and changing ownership dynamics. Growth will continue in the decade ahead, but heavier pressures and more disruptive changes are likely.

RR: In terms of a profitability tree, are the existing models sustainable?
AT: Five major trends will change the game in the packaging industry and raise the bar for performance in the next five to ten years – eCommerce, changing consumer preferences, FMCG and retail-margin compression, sustainability and digitalisation and internet of things (IoT) (Refer to box).

Tejas Tanna 

RR: Lots of work ...
AT: Yes. Much higher levels of innovation and agility will be required to deal with the pressure and potential disruptions emanating from these trends.

RR: These trends bring challenges too?
AT: All five trends are approaching at varying strengths and speeds, with a special role for digital trends. The biggest increase in pressure is expected from eCommerce, which will move from early adoption to early-majority diffusion. The second rush of new pressure will likely come from digitalisation. Initially, digital’s role will mainly be as a cost-efficiency booster via automation, and then, increasingly, as a source of customer-facing interactive tools, both to convey information and emotion and to collect data. The other three trends—changing consumer preferences, margin compression, and sustainability—are already having a moderate-to-strong impact, and they will increase in strength.

RR: With fluctuating paper prices and converters operating on wafer-thin margins, efficiency becomes paramount, and one wonders if an average Indian factory is aware of his operating costs?
AT: Monitoring of production costs has to be considered a standard business practice. One has to have checkpoints in place irrespective of the margins.

RR: I see.
AT: Point is, product pricing is a lot more elaborate and comprehensive than most manufacturers consider it to be. And this undoubtedly contributes to shrinking margins and eventually consolidation of the market.

RR: Do you capture your production costs? How?
AT: AAt Printmann, besides post-production analysis, we have SOPs in place that ensures production costs are factored in the right from the quotation stage. We have learnt the hard way, but now we know what a sustainable costing model should look like and where the gaps come up.

RR: ECommerce is one segment that has seen massive growth during the pandemic. Earlier it used to be the shelf visibility that was taken into consideration during a brand building and design process. Now, it’s – screen visibility. Printmann's take?
AT: ECommerce has impacted the way we buy and, more importantly, pack products. The eCommerce and DTC model has a lot more contact/handling points than the conventional retail model. Packaging durability has become more critical in comparison to packaging aesthetics. Screen visibility is now paramount as the buying decision happens much before the customer gets a chance to touch the product in their hands physically. While visibility is the key, it is still essential for companies to deliver quality packaging, as brand perception and recall will still bring customers back.

RR: Will the same old mantra work in terms of package prototypes? For example, many firms are trying to avoid tertiary packaging.
AT: The DTC model has made it possible to eliminate tertiary packaging in most cases. Like eCommerce distribution, DTC products are never intended to sit on a shelf. But unlike eCommerce, they also do not need to travel through the business-to-business distribution supply chain, meaning the bulk cases (tertiary packaging) are unnecessary.

RR: The key is secondary packaging ...
AT: The secondary packaging for DTC items completely changes the equation, necessitating a lightweight but durable secondary package that can efficiently protect the product while travelling directly to the consumer’s doorstep.

RR: Consumers are comfortable with this?
AT: Yes, since the way consumers buy products is evolving, the packaging needs will change and, to a great extent, be optimised to consume the least amount of packaging and reduce the carbon footprint of each product.

RR: Many companies and brands are switching to eco-friendly packaging. What kind of solutions does Printmann offer?
TT: Brands are constantly looking for solutions that are eco-friendly and sustainable. At Printmann, we offer a number of solutions that are paper-based and plastic-free.

RR: Any specific prototype?
TT: For the pharmaceutical segment, we have developed a child-resistant carton that is plastic-free. We have also developed cartons that are glue-less and have shifted to food-grade inks. This reduces the contaminants during the recycling stage, thus improving the yield.

RR: All the best for the latest expansion. You are obviously betting big on the Indian packaging consumption story.
AT: Yes. We hope to double our revenue in four years. For this, we hope to maximise automation in our factory. The aim is to have a strong mother plant in the Western region. This gives us the confidence to go multi-locational after two-three years.