Emerald Packaging Case Study

Tell me about Emerald Packaging

Emerald Packaging is a flexible packaging manufacturer focused predominantly on fresh cut produce, and other areas of the food industry, although fresh cut produce is the majority of our business. We are located in the San Francisco Bay area in Union City, CA, putting us in close proximity to our principle customer base in the Salinas Valley and Central Valley of California, otherwise known as ‘the bread basket of the world’. The close proximity to our customers and the ability to react to their needs is imperative to our growth and ability to support this customer base.

We are celebrating our 50th year in business. The company was founded by Jim Kelly Sr. and several partners, and then in the second generation of the Kelly family, the partners were bought out and the company is now owned and directly operated by three Kelly siblings… Kevin Kelly (CEO), Jim Kelly (Vice President - Sales) and Maura Kelly Koberlein (Vice President – Operations). The company has continued to reinvest in the business. We have a strong record of investing in our equipment, our people, and specifically over the last 10 years, investing very heavily in both equipment and human resources to continue to grow the business and continue to put out the highest quality products that are demanded in our market sectors. We do this with talented people that can resolve issues, come up with solutions, and provide new innovative products to the marketplace.

Tell me about your role at Emerald Packaging.

I came on board here 7 years ago as the Sales & Marketing Director. Since that time the company has grown about 40% in sales, added additional capacity, brought on new product lines including film laminations, different types of bags, projects we are working on now for track and trace, other new products that have come into the fold. I have responsibility for sales and marketing, which includes direct sales and well as independent reps serving predominantly the western United States. We also ship to national customers, as well as oversee our sales & distribution facility in Guanjuato, Mexico. It is a growing region in Mexico for fresh cut produce.

Tell me about Emerald Packaging’s customers and their needs and requirements

The customer base focuses predominantly on fresh cut produce, but it does cross over into various food categories such as bakery, confectionary, and frozen. Printed packaging has grown in importance within the marketplace, whereas years ago you may have seen things called “naked packs” where there was no packaging at all, or a standard one or two-color print UPC PLU (product look up). Those products have been replaced almost across-the-board by custom printed packaging, providing marketing outlets to packers and retailers. Being a printer of flexible packaging, we have really capitalized on that. And so what we do here is extrude polyethylene and take that polyethylene and print on it…up to 10 colors. We run (3) six-color presses, (2) 8-color presses and (1) 10-color press and then we take that film and turn it into a finished product. That finished product could be a roll form for form-fill-seal applications or it could be finished bags or finished pouches.

FINDING DOMINO

Tell me about the need to add the Domino Bitjet+ Ink Jet Printer to your operation.

We had a new project for unit-level traceability. It was brought to us by one of our customers, Growers Express (Green Giant) who wanted to more concisely target where their product was packaged, the day it was packaged, etc. This was primarily for food safety and traceability, but also for marketing reasons. The concept revolved around having a human readable and a QR code printed onto a package that was unique to each individual package. And then that unique code printed on the package would be boxed, with a label on the box saying in essence inside this box is numbers 1 through 3,000. It would go out to a field and then be scanned with a GEO tracker, the date and location code. Then there would be the history and the record of where something was packed, the field it was packed in, and so forth. The idea is that should there be any type of food borne illness, it could be tracked back to the specific field so that any tainted product could be isolated and removed from public consumption, rather than a complete recall which would affect perfectly good produce (just like we saw a few years ago with spinach that was recalled that ended up being perfectly fine). So by providing this information on the package, you could go back and target a specific field on a specific date of packing. And that’s just the food safety side. There is a whole other perspective on using these codes for marketing of the produce.

From the marketing perspective, the QR code provides a vehicle to help in building of brand loyalty and recognition, and cross-promoting other produce products. Any food borne illness would require the traceable features of the codes, providing a form of insurance, and the marketing aspects provide a form of revenue. So I think the marketing piece in terms of cross-promoting products and building brand recognition is really going to be critical, and the folks at Growers Express and the Green Giant label are going a great job with that.

So coming back to the challenge at hand…there was the desire on our end to be able to print directly onto the flexible package, in this case polyethylene, and to be able to do that in a manner where each

Why specifically did you choose the Domino Bitjet+ Ink Jet Printer?

We chose the Domino Bitjet+ for several reasons, but you could pinpoint it specifically to its size, speed, and ease of use.

Size. The Bitjet+ has a small footprint so it gave us the flexibility to mount it onto a bag converting machine…in this case a Wicketer, and allowed us to do this in a pretty tight space.

SpeedOne of the main requirements was that the printer would need to operate fast enough so that it would allow us to run production without giving up any line speed, and that was important to help keep costs down.

Ease of Use. TThe Domino Bitjet+ was easy for our operators to work with and it was important to us to run 24 hours a day, 7 days a week virtually every day of the year, without needing significant technical support. We liked that our operators could be trained quickly in how the Bitjet+ worked, and be able to operate it 24/7, self-sufficiently

What was the timeline on this project?

The original idea came from the President of Growers Express a few years ago. He was really ahead of the times and very innovative, but the technology simply did not exist with what he wanted to do. And so we kept working on it and working on it. Our initial solution was printing and applying a label onto every single bag with a unique QR code and human readable number, but it was not cost effective. It was effective from a practical standpoint, but not from a financial standpoint. Pre-printing onto a label and then auto-applying that label onto a bag added to the process in terms of steps, in terms of cost…it was not efficient. The technology was not accepted by the customer base…it was too costly, it wasn’t sexy enough, and it wasn’t what was envisioned. And that’s when we took the avenue of seeking out an ink jet printer that would allow us to print, without giving up speed, directly onto a polyethylene material with the ink adhering at a rate necessary to be able to move the numbering system and the QR code fast enough to be able keep up with the speed of the bag line. And we ultimately came up with the Domino solution which was exactly what was envisioned several years ago.

Describe the partnership with Domino.

One of the things that I really like about Domino is that in the initial conversation it was not just about them telling us that their equipment could do what we needed, but rather they said that they would bring in the piece of equipment, put it on our floor and prove it. We ran a trial, and that was very important to us, because we had so many companies saying that they could provide a solution, only to find out that it was more complicated than they thought. So it was really important for us to take a piece of technology that we believed in on paper, and see it action and run it through its paces.

How long has the Domino Bitjet+ been installed at Emerald Packaging?

We have had it probably for about a year

The codes and information being printed onto the bags are ultimately for your customer Growers Express. What benefits have been recognized?

It is probably still a little early to express all of the benefits, but one of the main benefits we are seeing is code legibility. And that has been very important. We are going out to a customer base that, like most customer bases, is pretty unforgiving. If there were any technical issues or issues in terms of scanning or being able to read those codes, it would get back to Growers Express, then to us, then to Domino, and it simply hasn’t been happening. So it has been very positive.

What about the technology and using the Domino Bitjet+? Has that been positive?

The Bitjet+ equipment itself has been positive. In the marketplace, the product has been well received, however in terms of rolling this out to multiple labels and multiple product lines, it is still in its infancy. I envision it continuing to grow and cross over into other produce-related items. And it will happen in part due to necessity, but more specifically because people are seeing the success with what we are currently doing. The Domino Bitjet+ is allowing us to take on projects that otherwise might have been thought of as unachievable.

Do you have other customers like Growers Express who are interested in doing this same type of printing onto their packaging?

Yes, we do have other customers who are looking at the technology and talking to us about bringing it on board into their operation, and I am convinced that it will happen. It’s going to take some time though because what we are doing here is not a closed loop. The packers themselves, especially those in field packing, have a lot of work to do on their end as well in terms of infrastructure in order to be able to handle it. They have to be able to have multiple scanners, and scan codes in the field, and train people. For example, they may be packing in 13 to 18 different fields, on any given day, going through well over a million units in a day. And so many of them, while realizing the benefits of the technology, see the shortcomings of their own infrastructure, in terms of being able to handle it, and have to make decisions on if they want to implement it, how to implement it, and across what SKUs they want to do that. And so it is a little bit more complex than just going to a customer saying we are able to provide you this product with a unique code on every bag, labeled appropriately and so on. There still is a level of discipline and education within the packers that requires them to think through how they want to do something like this

One way to look at it is that the codes themselves on every single bag are unique…the QR and the human readable codes. However that has no information behind it from the time it leaves Emerald Packaging. It simply is a number with a bunch of blank fields behind it. And it is not until the time that the product is packed in the field that the data is then populated to show what the item is, where it was packed, who the specific packers were, so on and so forth.

How about the software piece of the track and trace solution?

We started working with TrueTrac, who was acquired by FoodLink. They provide the software portion of the solution, the issuing of the specific numbers, the sequencing of those numbers, managing of the data behind those numbers, and so on. They provide a critical piece of the solution.

How many bags are being printed with the Domino Bitjet+?

In a calendar year, we will print 12 to 15 million units with the Bitjet, and that’s just on the limited SKUs that we are rolling out right now for Growers Express. Overall, here at Emerald Packaging, we are putting out upwards of 2 billion units/year. That is either plastic bags or impressions for form-fill-seal applications in total for all customers

What do you forsee moving forward in terms of Emerald Packaging, your customers, and this type of package printing with QR codes?

I envision the marketing groups within our customer base, the fresh cut produce and the food industry, playing a much larger role, coming in tune with today’s world of social media and social media marketing. I envision our customers (the food packers) wanting to draw their customers (the consumers) into the fold onto a more regular basis and so one way to do that would be marketing and gaming and bringing people into giveaways and coupons and discounts that would draw consumers of product to scan the QR code with their smartphone, and go to a website on a regular basis so they could be more intimately knowledgeable about the products themselves and the products being offered. In turn, the companies packing those products can start to cross-promote their other products and build brand and consumer loyalty. And then go back to retailers who would be doing the same thing, to grow their business at that end.

I think there is a good fit in that Domino offers high quality, high efficiency, unique task printing equipment and to be able to play a key role in that arena is important, especially as packers and retailers start to look towards that type of marketing and branding opportunity.

What about for other sectors?

I think it’s getting the codes that are being printed by food, beverage and consumer good manufacturers off of the back, bottom corner of the package and onto the face of the product. If you can do that, it puts Domino into a completely different world. You are no longer the afterthought of manufacturing for track and trace only, you are now the forethought from marketing departments who are then dictating to everyone else how things get done and what needs to happen.

If you look at the Green Giant application, we are printing a simple white block right on the face of the bag, then printing this unique numbering and unique coding so that it is very prominently seen by consumers. At the end of the day, it’s quite similar to what gets printed on the bottom of a beverage can. Yet in the former example, the people driving it are not the production side of it, it’s marketing departments driving it. If Domino can find ways to promote that, you will not only move the codes to more prominent spots on the package, but you’ll increase your ink coverage area, which at the end of the day, gives you an increase in consumable sales. If your consumables increased 10X, that would be a great increase. Plus, to the brand owner, what previously was seen just as a cost is now seen as a revenue source and that is a world of difference when you trying to sell something. Instead of thinking outside of the box, it is thinking outside of the bottom of the box.

Aside from the QR and human readable codes, what about the flexo printed areas of the bags? Do you foresee an evolution to digital package printing?

Certainly if you look down the road, digital printing could certainly be the future of it. Right now we are running exclusively flexographic printing, but digital printing absolutely could be the future. There are some challenges to it, but on the short runs and quick turns, the high impact target marketing campaigns…it is definitely on our radar screen as far as what digital printing can do. It may not fit well within the large volume static print-type world, but you never know what will happen as cost structures can alter over time. It is hard to envision at the moment being able to run digitally 6, 8, 10, 12-million impressions at a time of static print. The value may not be there, but you can certainly see the value in doing it for a target market campaign or for a new product launch where a variety of different options may be looked at where you are running 50,000 or 100,000 impressions of something or splitting into multiple or different prints…or marketing on a regional basis. There are food items that have regional success that may require a different marketing perspective or different languages to be used on a package to promote it. You can easily envision products being promoted in English and Spanish for states close to the US-Mexican border, and at the same time promoted in English and French as you go north near Quebec and other parts of Canada. So whereas now those would require multiple sets of printing plates or multiple runs, digitally you could conceivably do that more efficiently.