SAFETY PERCEPTION IMPACTS RISK TAKING THE ULTIMATE SALES APPROACH HOW TO BUILD THE MOST COST EFFECTIVE EDGE CRUSH COMBINED BOARDS PRESORTED STANDARD U.S. POSTAGE PAID PITTSBURGH, PA PERMIT NO. 35 A PUBLICATION OF THE ASSOCIATION OF INDEPENDENT CORRUGATED CONVERTERS OFFICERS Chairman: Kim Nelson, Royal Containers, Ltd. First Vice Chairman: Gene Marino, Innerpac, Inc. Vice Chairman: Dave Urquhart, New England Wooden Ware Vice Chairman: Andrew Pierson, Mid-Atlantic Packaging Vice Chairman: Chuck Fienning, Sumter Packaging Volume 14, No. 4 July / August 2010 The Association of Independent Corrugated Converters is an international trade association representing a majority of independent North America manufacturers of corrugated packaging products and the suppliers to the industry. AICC has 714 boxmaking members and 359 supplier members and offers both segments a full array of membership services, programs and benefits. Contents: 5 Chairman’s Message 9 Safety Perception Impacts Risk Taking Your Cost Manual–Using Setup Factors 13 Shaping When Allocating Selling Costs DIRECTORS-AT-LARGE Greg Tucker, Bay Cities Container Corp. Marty Englander, Englander Container & Display Warren Pearce, PearceWellwood Inc. John Bolender, Niagara Sheets Tony Schleich, American Packaging Corporation REGIONAL DIRECTORS Region 1:Tyler Howland, Sound Packaging Region 2: Joseph Beers, Crown Packaging, LTD. Region 3: Mark Mathes, Vanguard Packaging Region 4: Ryan Chappell, Louisiana Corrugated Region 5: Pat Haddon, Packaging Atlanta Region 6: Guy Ockerland, Ox Box Region 7: Brad Albright, Hendricks Box Region 8: Vacant Region 9: Mike Sutherland, Sutherland Packaging Region 10: Samuel Abbott, Abbott-Action Region 11/12: John Franciosa, Packaging Technologies, Inc. Region 14: Marco Ferrara, Cajas De Carton Sultana, S.A. DE C.V. Overseas: James Haglund, Central Container Corp. 15 You’ve Heard This One Before! PRESIDENT A. Steven Young, AICC Me By The Hand— The Audacity of 19 Take Authentic Customer Service IMMEDIATE PAST CHAIRMAN Jerry Frisch, Wasatch Container 23 AICC and BCN: Call for Entries in the 2010 Innovator of the Year 24 The Ultimate Sales Approach: A Revolutionary Technique to Get and Close More Sales How To Build the Most Cost Effective 25 Edge Crush Combined Boards 27 Can Technology Save Money? RFID versus DFID™ in the Corrugated Environment 31 Cost Vs. Price Regions Host Meetings, Golf Tourneys and 33 AICC ‘Boxmaking 101’ 37 International Corrugated Packaging Foundation 41 Members in the News . . . 43 New Members 45 THE FINAL SCORE PAST PRESIDENT COUNCIL Brad Morphy, Morphy Containers ASSOCIATE MEMBER DIRECTORS Chairman: Steve Warll, Dicar Vice Chairman: Lance Head, Hycorr Machinery Immediate Past Chairman: John Bird, JB Machinery EDITOR Taryn Pyle, [email protected] Director of Marketing and Communications DESIGN Cover by Nick Griffin, Griffin Communications, Inc. CONTRIBUTORS A. Steven Young, President [email protected] John Bacot, Vice President of Operations [email protected] Cindy Guarino, Director of Meetings [email protected] Maria Frustaci, Director of Latin America [email protected] Richard M. Flaherty, ICPF President [email protected] Laressa Gaitan, Manager, Member Services [email protected] SEND NEWS / LETTERS TO: AICC PO Box 25708 Alexandria, VA 22313 Phone (703) 836-2422 Toll-Free (877) 836-2422 Fax (703) 836-2795 [email protected] Website: http://www.aiccbox.org FOR ADVERTISING INFORMATION CONTACT: Howard Neft, InTheKnow, Inc. (847) 899-7104 BOXSCORE 3 4 BOXSCORE CHAIRMAN’S MESSAGE Audacity Moves Mountains Kim Nelson When I woke up on the morning of the leadership and will share with us the 10 day I was to travel to AICC Region 5’s most important things every executive meeting in Hilton Head, SC, I had no needs to know to: “Stand Up and Move idea what kind of day I was in for. At Up while your competition fails” and noon, I realized it was going to be a true how to “Turbo charge your business with test of my character. By 4pm, I had lost relentless focus on 12 key strategies” Not my passport, arranged for an emergency just your management team will benefit passport which required a lawyer, an from these sessions, so too will your sales accountant and two character witnesses, force. re-booked two cancelled flights, stood in a customs line for nearly two hours, experienced the worst customer service ever, and boarded and de-boarded a plane that never left the tarmac! I have talked a lot about Authenticity, but today it is about having the Audacity to see something through when the odds are stacked against you! This issue will focus on the roles of executive management. In addition to the articles written here, when you arrive about Authenticity, Lately our path seems to be paved with containerboard price increases! Not since 1974, have we experienced the tight supply numbers we are reading about but today it is about having the Audacity to see something today. Despite the market statistics, I am through when the hearing from members that business is odds are stacked improving. In my region the recovery is against you! slow but we are definitely headed in the right direction. From our management team at Royal Containers, we continue to focus on in Baltimore this fall, you will hear from Having a vision & celebrating it often two very prominent executives, each — one thing business owners have in who has experienced first hand; the common is their ability to “see” the end journey towards success is paved with results, but do all your employees see it? many obstacles. Having the Audacity They need clarity and articulation when to overcome the challenges is part it comes to vision; they need to know of the game. Scott McKain and Chet when and how they are contributing to it. Holmes both know a thing or two about “ I have talked a lot ” continued on page 7 BOXSCORE 5 CHAIRMAN’S MESSAGE: Audacity Moves Mountains continued from page 5 Don’t just delegate . . . Lead — become great leaders. “There are engagement, your customers will one of the greatest things about no titles in leadership” notice too. leadership is that anyone can Empower & Inspire — your em- Focus on Results — when more do it! You don’t need to be the ployees want to accept respon- time is spent discussing solutions, CEO of the company, challenge sibility and accountability for and less time on the “storytell- yourself to find who among your the desired results. Not only will ing” we avoid the potential for employees has the potential to you see an increase in employee T–BUCK, INC. Easi-Set Folder Arm Upgrade TM Easier to Use — Quicker to Set Up Stronger Design — Higher Quality Having problems with your flexo folder-gluer? Slow/difficult set-up? Scuffing? Rolling score issues? 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Have a learning attitude; an interesting fact is that only 10% of employees have a learning mind, they love to learn new ideas, read books, research, etc, while 90% see those things as a waste of time. I believe our future is dependent upon growing the leadership talent of our people – and that starts with individuals who love to learn. I recommend picking up the recent issue of MOTIVATED Magazine or the book “Lead without Titles” by Robin Sharma. Recommended by AICC member, David Diroll, Jamil Pkg: Zappo’s “Delivering Happiness by Tony Sheish. Regards, Kim Nelson GM Royal Containers Ltd. CEO Morphy Containers BOXSCORE 7 Beauty Starts with a KleenPlate . ™ Clean Plates… Clean Sheets… Kleen Printing. Continuous Hickey Removal System. Eliminates stoppages for Plate Washing. Reduces Hickeys by up to 95%. More Available Production Time for any Flexo Printing. BOXSCORE | Fax 203-544-0202 | 9 Sasqua Trail | Weston, CT 06883 USA | [email protected] 10203-544-0101 KleenPlate is patented. The word KleenPlate is a trademark of JB Machinery, Inc. Safety Perception Impacts Risk Taking By John Kiefner, CSP, ARM,Vice President, Risk Control Client Resource Services, Johnson, Kendall & Johnson Safety professionals address most hazards in a sequential order of thinking as follows: 1. Engineer Out The Hazard (get rid of hazard altogether) 2. Administrative Controls (minimize the hazard through improved job process) 3. Personal Protective Equipment (protect from the hazard) Safety guards, interlocks, and other safety devices are often used to engineer out the hazard so that there is no longer danger present. Almost all machinery in industry has some level of safety built into it through various safety devices. Variations of industry safety devices have also made their way into our home and are used on a daily basis. When do the safety devices that protect us become a hazard? Problems begin to surface when we rely on safety devices to protect. Have you heard the saying “People compensate for increases in perceived safety by taking more risk”? When we feel safe, we tend to take more risk. Picture yourself driving with and without a seatbelt. Without the seatbelt, most people feel vulnerable. However, most people do not have that same sense of vulnerability when driving 75mph with a seatbelt on. We have convinced ourselves that we are safe with the seatbelt, yet injuries from a 75mph accident could be significant. A furniture factory I once worked with used an edge-bander to cut the edges off tables. A large guard was on a timed delay that allowed the operator to open it 30 seconds after the machine was shut off, allowing saw blades to come to a complete stop. The operator would tug each day on the guard after the machine was shut off and wait until it opened. The operator did this for years without incident. One afternoon, maintenance was performed on the machine, affecting the delayed timer. The next day, the guard released at 25 seconds, rather than 30 seconds, and the operator instinctively reached into the machine. The blades had not yet come to rest and amputated a few of the employees’ fingers. Although the guard may have prevented many previous injuries, it contributed to the employee’s complacency and sense of perceived safety. Other examples of safety devices include: interlocked machine guarding, personal protective equipment (backbelts, fall protection harness, etc.), automatic shutoff of machinery (often triggered by temperature or time), audible and visual warning devices, smoke and heat detection, and much more. Please take a moment, with the help of your employees, to identify safety devices throughout your company. Explain the importance of these devices along with the consequences of by-passing safety devices. In closing, remind your employees that these devices are in place to help protect, but should not be relied upon. Safe decision-making prevents far more accidents than safety devices. “ . . . remind your employees that these devices are in place to help protect, but should not be relied upon. Safe decisionmaking prevents far more accidents than safety devices. ” Johnson, Kendall and Johnson, Inc. are new members of AICC. Mr. Kiefner can be reached at (215) 579-6455. BOXSCORE 9 Our faster take-offs will It can take 6 months to a year or more for most other corrugated machinery to get up to full speed. And that time can cost you plenty in lost productivity and missed orders. Mitsubishi corrugating machinery is built to start fast — in hours, not months. Plant records are frequently set during the first shift of operation after startup with Mitsubishi machinery. More importantly, Mitsubishi’s equipment remains at maximum production levels, while others go through multiple repair cycles. 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This is why we’re focused on helping you improve operations and reduce waste in your plant. With CTI’s best-of-breed Manufacturing Execution Solutions at work in your production process, you can significantly improve the performance of your existing plant floor equipment. Our Corrugator and Converting Management software integrates with all industry standard business systems and will help you extend the life and value of your current investments. Contact CTI today for more information. Phone: 1-858-578-3550 • Email: [email protected] • Web: www.corrtech.com Corrugator Trimming & Scheduling • Order Promising, Capacity Planning, & Finite Scheduling • Roll Stock Inventory Management • Supply Chain Execution • Shipment Planning • & More Shaping Your Cost Manual– Using Setup Factors When Allocating Selling Costs By Jan Rohde, President of Jan Rohde Consulting, Inc. This is the 1st of two articles which deals with the allocation of overhead costs and how different allocation methods can affect the way that you perceive your costs. Quite frequently, I am told by a box plant manager that the cost manual doesn’t “charge” enough for small quantities. Conversely, I am sometimes told that the cost system has too much cost on small quantities. You can alleviate either of these situations by including or excluding setup costs. Everyone agrees that machines have both setup times and run times. These, in turn, generate setup and run costs. But, there are many other expenses that may qualify as having setup components. A myriad of such costs are incorporated into a company’s selling costs (in some plants they are part of the company’s G&A costs). There are many different ways to allocate selling costs. I will use the following cost structure for my examples [see CHART A]. Let’s focus on the three elements of selling costs other than the Commissions. These fixed costs, design costs, and customer service costs total $785,000. In some cost manuals, these costs are allocated as a percentage of all material costs. To calculate the percentage, you would take 785,000 divided by $8,645,000 (board and other materials). Every $ of material would pick up 9.08% of selling costs. This would not have a significant CHART A Board 8,000,000 Other Materials 646,000 Direct Labor 500,000 Direct Overhead 350,000 Delivery 500,000 Total Direct 9,995,000 Fixed Mfg Overhead 2,275,000 Selling – Commissions 190,000 Selling – Fixed 500,000 Selling – Design 65,000 Selling – Customer Service G&A (Cost Center Specific) G&A Total Full Cost 220,000 225,000 1,265,000 14,735,000 impact on small quantities which have a small amount of material, but would add a lot of cost to more board-intensive items. Another popular way of allocating selling costs is to allocate them as a percentage of all direct costs. To calculate this percentage, you would divide the 785,000 by 9,995,000. Every $ of direct cost would pick up 7.85% of selling costs. The vast majority of these costs would be allocated against materials, some against delivery, and some against direct labor and overhead (which have a small setup component). This, too, would not charge a lot for small quantities, but adds more for larger quantities. “ The lack of inspection technology in corrugated is rare in a modern manufacturing process, particularly one done at high speeds containing hundreds of variables that produce defects. ” continued on page 14 BOXSCORE 13 Shaping Your Cost Manual–Using Setup Factors When Allocating Selling Costs continued from page 13 Suppose you find that your cost manual does not have enough costs on small quantities (you feel that you can charge the customer more), but inhibits your ability to look competitive on volume business. Consider allocating more costs as setup costs. In the following example, I have allocated some of the selling costs as follows [see CHART B]: MSF breaks. Also, fixed plant costs and G&A costs are excluded from this example. As you can see from this example, increasing the selling setup cost significantly increases the total cost per M, though it is not that much when you extend the cost. On the other hand, a lower cost per M is reflected on the higher quantity. CHART B Category Design Customer Service – order costs Customer Service – release costs Amount • For example A, enough volume to cover all of the materials used. • For example B, enough volume to cover all of your direct costs. 13.00 121,000 No. of Orders: 5,000 24.20 8,000 12.38 99,000 No. of Releases: Let’s look at the following example of an estimate [see CHART C]. I’ll emulate a plant with a corrugator so that board costs do not vary with It doesn’t matter what techniques you use to recover your selling costs AS LONG AS YOU SATISFY ALL OF THE ASSUMPTIONS THAT WENT INTO THE COST MANUAL. In this case, these assumptions include: Unit Cost 5,000 With this set of allocations, every order would get a $37.20 setup cost (to cover the design and customer service order costs). Every inventory release would get a $12.38 setup cost. But, just as importantly, $285,000 of the $785,000 in selling costs would be removed from the “blanket” allocation approach described earlier, leaving only $500,000 for such an allocation. BOXSCORE Qty 65,000 No. of Orders: The thought process behind the customer order charge is that every order has the same amount of processing and follow up time – whether it is an order for 100 pads or a truckload of RSCs. Design costs can be allocated many different ways, but one could argue that they are an extension of the order (and quoting) process. 14 Allocation The same technique can be used to generate setup costs for the plant (scheduling and purchasing personnel) and administrative costs. You can control the amount of costs that you want to classify as setup costs. If you don’t want to allocate as much of your costs to setup charges, you can make the design costs part of the earlier selling absorption. Conversely, if you want to allocate more costs to orders, you can include any or all of your design expenses, office expenses, stationery, postage, etc. • For example C, enough orders and enough volume to cover your direct costs. The 2nd article in this series will describe different ways to allocate administrative (G&A) costs. Jan Rohde is the President of Jan Rohde Consulting, Inc. and specializes in building cost estimating systems with accurate costs and a synergy with your pricing strategy. Any questions should be directed to [email protected] or phone (949) 521-2544. CHART C Setup $ Run $/M 5.00 800.00 Dir Labor & OH 35.00 40.00 Delivery 10.00 35.00 Total Direct Costs 50.00 875.00 Materials Qty 250 Qty 5000 Costs per M below Selling Ex: A 0.45 72.64 1149.44 957.73 Selling Ex: B 3.93 68.69 1159.41 954.48 Selling Ex: C 39.70 43.75 1277.55 936.69 You’ve Heard This One Before! By John Bacot, AICC Vice President of Operations “When the going gets tough, the tough get going.” There, I’ve said it. And yes, you’ve heard that one before. And you’ve even probably tried to do it once or twice. But what does it really mean? How do we really know when “the going” has gotten rough? What characterizes the change and even more to the point, how do we spot it before it happens? Are there “signs”? And then once we set about “getting tough,”what characterizes that? A few years ago, I experienced one of the those “life-events” we all go through, we all have happen to us, or are in some way are affected by. I didn’t know it was going to occur, but in looking back, there were plenty of “signs” something was going to happen. But never having anything like that happen to me before, the signs didn’t appear as signs. In fact they never even caught my attention, much less raised any heightened level of awareness as a result of them. It was what happened after the event that I like to look at as really the “event.”The initial, precipitating activities didn’t even have anything to do with what happened next. The “next” part was what was the most challenging to deal with. I had to figure out what to do, and then get it done. And there wasn’t a whole like of time for either part to take place. Both had to be sooner than now. So the going got tough, and I knew I had to get tough and get going as well. So I decided to invest some quality time to decide on a plan to handle this “new” normal. The first place I thought I should start, was to begin with the development of a “Goal,”a place, state of mind, or some reality, that had written characteristics. A GPS, so I would know where I had initially set off to go, and could realize while I was going there if I was either on track, off, track, or at least could know when I needed to change my track as the hands of time passed through my hour glass on my way through the process of being the “tough getting going.” I found the ability to characterize what I wanted the new normal to look like to be a bit daunting, frustrating, and delusional all at the same time. Was I simply dreaming that this new reality could come about, was I just fooling myself, or could “planning” and goal setting really effect a change in my life and outlook on it? I wasn’t very optimistic, but I thought I really had nothing to lose because I didn’t like where I was and if you’re going through Hell, the best thing, I’ve been told, is to keep on going. “ The key to this commitment, understanding, and even mantra is NOT the “taking” part; it’s the “willing” part. You truly have to be ready to, “willing to,”even excited to do, “whatever” it takes. ” In my research I found that goal setting, or rather goal accomplishments, is made up of a set items none of which can be continued on page 17 BOXSCORE 15 You’ve Heard This One Before! continued from page 15 eliminated, diminished, ignored, or the plan will never have any chance of coming to fruition. And the first item, which is sometimes the hardest one to grasp, internalize, and commit to is this: you must be willing to do whatever it takes to achieve your goal. action will pale in comparison to this first test. So, food for thought, if you find the going gets “tough,”it just might be due to the tasks and challenges you are not “willing” to do. After all, if you were willing to do them, how could the going get tougher? If the going gets tough, it’s those that are willing that get tough and the going will get easier. The key to this commitment, understanding, and even mantra is NOT the “taking” part; it’s the “willing” part. You truly have to be ready to, “willing to,”even excited to do, “whatever” it takes. If it takes moving to Iceland to achieve your goal for some reason, and any reason, whether you agree with it or not, you must be willing to do it. It’s the “willingness” part that is essential. Here’s the test everyone must take: think of your goal. Think of the one thing you would NOT do if you had to do it, that you might need to do to accomplish your goal. If you can think of just one thing you would not do, truly not do; something even as simple as sell your car and get a different one, then whoosh, there goes your goal. You can almost hear it vanish. And what’s really interesting about this one thing, is that if there really is one thing you wouldn’t do, it most likely will show up in your list of items to do very quickly, and whoosh there goes your goal. The other elements of goal setting: the objective (which is how to measure when and to what extent you’ve achieved your goal), the methodology (which is the plan through which you are going to accomplish your goal), and your BOXSCORE 17 Take Me By The Hand— The Audacity of Authentic Customer Service By Taryn Pyle Many months ago I had an issue with one of our vendors. A service was delayed and valuable membership information was held up by the post office through no fault of the printer. In my eyes, as a long time customer, it was time for the Printer to step up to the plate and offer as much hand holding and support as possible. I was outraged. I was not calm and I wanted the professional printer I do business with to get some answers for me. I trusted them and over the years I had become “invested” as the Customer. During this crisis, I expected them to rally to my aid, to do all within their power to get this mailing delivered to my customer. I expected them to be a partner in solving the problem. I was so frustrated that I am not quite sure what would have made it better. But I do know what made it worse. I was not getting any movement from the Printer. No action. No answers. So, I asked for the Printer to reprint the full piece at their expense and pay to have it mailed. I asked this after a stream of emails had gone back and forth where the Printer (in my mind the expert) could not assuage my concern. It wasn’t until I asked for a credit by way of a reprint, that management got involved because that involved an expense to their company. I was now hearing from the President of the Company. It was then that a polite stream of politically correct emails began regarding their rights and obligations as a printer. They only saw how it would affect their bottom line. If they had taken the time to assess the situation, and do something as simple as picking up the phone and talking to me, I think it would have been okay. But, they dismissed me. Overall, where the Printer fell short was in how they responded to my problem. The account rep did his best, the customer service team tried but they really did not have the resources nor the power to get answers. They simply did not have any processes in place for a problem they had never dealt with before. It seems they forgot who the customer was and they lost sight of meeting my needs. “ How an owner handles a crisis situation gives me a clear indication of what I can expect from the company. ” Looking back, I realize that my request may have been over the top, and certainly continued on page 21 BOXSCORE 19 20 BOXSCORE Take Me By The Hand—The Audacity of Authentic Customer Service continued from page 19 not one that a successful company would have agreed to make. After all, it was the post office that had made the mistake and could not find the piece. I just wanted them to hold my hand. expect from the company. It was clear that this was not a company I wanted to do business with. I was however not surprised to see them beating down my door to make the sale. The Vice President did his best to try and rectify the situation. I continued to use them for printing But the damage had already been on a month to month basis getting done. quotes from different printers and making sure they were competitive. Printers are like Corrugated Box However, I no longer was “invested” Plants handling multiple jobs and in the company. I was no longer a working with numerous customers loyal customer. as well as vendors which can affect the service they provide. How does Last week, the Account your box plant measure up when Representative left that Printer. I dealt a difficult situation, perhaps received two phone calls from the even a panicked customer? Printer that week, and then on my first day back from vacation the Here are some things I learned Vice President of Sales came to our about Customer Service & office without an appointment to Leadership: see about maintaining our printing 1) A customer never forgets. business. It seems printers are The Printer didn’t know it, having a tough time finding new but they were on borrowed business. time. I would take my business I said no. You see, I had no desire elsewhere when the timing was to do business with a company that right. could not pick up the phone and 2) The boss who has strong talk to a customer when a crisis leadership abilities can is taking place. How an owner play an integral part handles a crisis situation gives me in the outcome of a a clear indication of what I can situation. It doesn’t hurt to get the Boss involved. It shows that the company is invested in its people and its customers. 3) Never be afraid to pick up the phone and just listen. Many times, you can’t solve the problem, but you can show that you care. 4) Sometimes a simple gesture can go a long way in maintaining customer satisfaction. Would it have been too costly to waive a fee on my next printing job, or give a 10% discount? 4 5) Have a process in place for crisis management. Come up with a plan for how a customer crisis gets handled to ensure that the issue gets resolved satisfactorily. 6) Never assume you have to give the customer everything they are asking for in order to keep their business. Usually, when they start making demands it’s because they have lost trust in you. You can gain it back. 7) The customer isn’t always right, but you don’t have to be either. Think about that. It’s when we think we have to be right, that we begin creating our “Case,”our ARGUMENT. Yet, if we just listen, review the facts, hear what they have to say, we may find a way together to create a solution that works for us all. Lesson I learned: If it feels like a crisis to the customer, then at that moment, it’s a crisis. Do what you can to share in their misery and be a partner that works at coming up with reasonable solutions. If you have to, just hold their hand, and tell them you understand. BOXSCORE 21 The Association of Independent Corrugated Converters (AICC) and Board Converting News (BCN) Announce Call for Entries in the 2010 Innovator of the Year “Non-Machinery” Competition The Association of Independent Corrugated Converters (AICC) and Board Converting News (BCN) are proud to announce the Call for Entries in the 2010 Innovator of the Year – Non-Machinery Competition. The Innovator of the Year Competition will be held in conjunction with the AICC 2010 Annual Meeting, October 6-8, 2010 at the Hilton Baltimore in Baltimore, MD. overall, serve as a solution to a specific production or management problem. Since its inception in 1988, the competition has evolved to include AICC’s Boxmaker members as well as Associate members in Machinery, NonMachinery and Information Technology & Training categories. Competition entry brochure, entry form and criteria is available on AICC’s website at www.aiccbox.org/innovator For questions or additional information please contact Cindy Guarino at 877-836-2422 or [email protected]. This year’s competition seeks innovations from AICC associate (supplier) member that want to showcase innovations they have developed since October 2006. These innovations include, but are not limited to computer systems, software, consulting, linerboards and new substrates, quality and management controls, administrative support, financial services and more. In other words, innovations that add value to the board, or the plant’s operations, without coming into direct contact with the board during production. Cosponsored by AICC and Board Converting News, the annual Innovator of the Year Competition provides an outlet for AICC members to showcase innovations they’ve developed to increase plant productivity, improve plant efficiency, and BOXSCORE 23 Chet Holmes will present a 3 hour in-depth session on “How to grow a company from zero to $100 million and beyond” on Friday, October 8 at the AICC 2010 Annual Meeting. This is a MUST attend session for sales managers and employees! For more information visit www.aiccbox.org/meeting 24 BOXSCORE THERE’S ALWAYS MORE IN BaltiMORE MORE TO LEARN MORE TO SEE This fall we focus on ways to create distinction, stand out and move your company ahead of the competition. On Thursday, October 7, business leader and best selling business author Scott McKain (Collapse of Distinction, What Customers Really Want) will conduct a three-hour workshop session and provide a roadmap for driving your business to a higher level. Mr. McKain will present innovative theories, the conceptual framework and the tools necessary to deliver, “Stand Out & Move Up” ahead of the competition. The AICC/TAPPI 2010 Corrugated Week table top supplier trade fair will feature over 100 exhibits highlighting supplier innovations for the corrugated industry. Production managers, boxplant owners, engineers, technical service personnel, and production personnel will all benefit from networking, training and information opportunities on Wednesday & Thursday, October 6 & 7. Friday, October 8, the general session features an in-depth three hour session by Chet Holmes, acclaimed corporate trainer, business growth expert and best-selling author. (The Ultimate Sales Machine). His presentation will focus on “How to Grow your Company from 0-$100 Million and Beyond” A BaltiMORE bonus, Chet Holmes will offer a complimentary pre-meeting teleconference on August 4 at 3:00 pm (EST) on the Four Fastest Ways to Double Your Sales. More details at www.aiccbox.org. A valuable “can’t miss” opportunity for all SALES professionals. AICC will offer a new course – Lean Plant Assessment in conjunction with the meeting. The Lean Plant Assessment course will give an overview of 11 categories of Lean production of goods and services. Participants will learn to rate any plant and use the results to target increased speed and accuracy. Mark/Trece Inc. and MarquipWardUnited both located in the Baltimore region invite AICC meeting attendees to tour their facilities on Wednesday, October 6. MORE TO DO AICC will host an evening reception at the renowned Oriole Park at Camden Yards on Thursday, October 7. The outdoor reception will be held in the “bullpen” overlooking the unique pitching warm-up area. Attendees can take guided tours of the field and dugout, test their baseball skills in the “Fastest Pitch” and “Home Run Derby” games, or pose for a picture with the “The Bird”. BaltiMORE... Accessible, Affordable Location & “Charming” Destination Baltimore has been nicknamed “Charm City” for its many attractions and friendly residents. One of America’s oldest cities, Baltimore is known for its rich ethnic and maritime heritage, sense of history and fine food. From the beautiful waterfront that showcases the fabulous downtown attractions, to world-class museums and historic sites, to the delightful neighborhoods and authentic Chesapeake Bay cuisine, Baltimore has something for everyone. The City’s shining crown jewel, the Inner Harbor is lined with attractions, restaurants and is right in the heart of downtown. 2O1O Annual Meeting Authenticity Through Leadership, Stand Out, Grow, Spice Up Your Sales! OCTOBER 6 –8, 2O1O Spouses and Guests are encouraged to attend this meeting, as Baltimore is a city full of history, culture and charm, and alive with adventures and excitement around every corner. Baltimore is America’s first major seaport located on the Chesapeake Bay and is famous for Fort McHenry, the “Star Spangled Banner,” the Maryland Blue Crab and many “firsts” in industry. Easy to get around, you’re just two feet from everything! Inner Harbor visitors can explore world-famous attractions such as Harborplace and The Gallery and enjoy shopping, dining or strolling along the waterfront promenade, the National Aquarium, Maryland Science Center, Mount Vernon Cultural District, the maritime history of Fell’s Point and so much more! Accommodations The AICC host hotel is the newly opened Hilton Baltimore, located in the exciting Inner Harbor downtown district. It is within walking distance to over 13O attractions from education and history to entertainment and fine dining. AICC has secured the following discounted rates at the Hilton Baltimore for all AICC meeting attendees: $219.OO single/double room (rates are exclusive of taxes currently 15.5% per night.) Call 1-888-243-9694 (reference AICC) for hotel reservations. Please make your reservations before the group cut-off date of Monday, September 13, 2O1O. Hotel reservations can be made online directly into the group block at www.aiccbox.org/meeting. Meeting Registration Options & Fees For full meeting information and registration options, as well as online registration, visit: www.aiccbox.org/meeting. 2O1O Association of Independent Corrugated Converters Post Office Box 25708 • Alexandria, VA 22313, USA • Toll-Free: 877- 836 -2422 Fax: 703 -836-2795 • Email: [email protected] • http://www.aiccbox.org Annual Meeting TAPPI 2O1O Corrugated Packaging Division Conference The AICC 2O1O Annual Meeting is being co-located with the TAPPI 2O1O Corrugated Packaging Division Conference. The TAPPI conference will be held Tuesday, October 5 and Wednesday, October 6 at the Hyatt Regency Hotel in Baltimore. The conference sessions will focus on the industry hot-buttons of sustainability, renewability, color consistency, quality and safety. Corrugated Week 2O1O is revealing a new face on the What’s New Technology Showcase session this year. The session will be called “Innovations.” All AICC meeting attendees can register to attend the TAPPI conference through the AICC registration site at discounted rates. For more information on the TAPPI 2O1O Corrugated Packaging Division Conference visit: www.corrugatedweek.org. Co-located with the TAPPI 2O1O Corrugated Packaging Division Conference and held in conjunction with AICC/TAPPI Corrugated Week 2O1O THERE’S MORE IN BaltiMORE Hilton Baltimore • Baltimore, Maryland Meeting Speakers Schedule of Events Scott McKain Business Leader & Best Selling Author Creating Distinction for Your Company: Stand Out & Move Up! Mr. McKain’s presentation “Creating Distinction for Your Company: Stand Out and Move Up!” will provide a roadmap to take your business to a higher level. Some of the topics he will address include: • How can customers tell the difference between you and your competition? (If “price” is the only answer, you may be in trouble!). • What are you doing to ensure loyalty from your clients and employees? • Innovative theories, conceptual framework and the tools to deliver, “Stand Out & Move Up” ahead of the competition. BaltiMORE Bonuses! Attendees will recieve a complimentary download of Scott McKain’s latest book, “Collapse of Distinction”. Chet Holmes offers a complimentary pre-meeting teleconference August 4 at 3:00 pm (EST) on the Four Fastest Ways to Double Your Sales. To register visit www.aiccbox.org. McKAIN He is co-founder of the Value Added Institute, a “think tank” exploring the role of customer experiences in creating enhanced client loyalty and revenue for visionary organizations. Scott is the author of three #1 business bestsellers, including his latest: “Collapse of Distinction; Stand Out & Move Up While Your Competition Fails” — as well as “ALL Business is Show Business” and “What Customers REALLY Want.” Chet Holmes Acclaimed Corporate Trainer, Strategic Mastermind and Business Growth Expert AICC Corrugated Industry Fly-In* 7:30 am – 5:30 pm Wednesday, October 6 AICC Plant Tours (departures from Hilton Lobby) 8:30 am – 12:30 pm Mark/Trece, Inc. or MarquipWardUnited AICC Board of Directors Luncheon Meeting 12:45 pm - 3:15 pm AICC/TAPPI Corrugated Week Table Top Supplier Trade Fair 1:00 pm – 5:00 pm AICC Associate Member Meeting 5:30 pm – 6:00 pm AICC New Member & First Timer Orientation & Reception 6:00 pm – 6:30 pm HOLMES How to Grow Your Company from 0-$100 Million in Sales and Beyond Chet Holmes is an acclaimed corporate trainer, business growth expert and best selling author. His most recent book, The Ultimate Sales Machine — a New York Times extended list bestseller, helps managers turbo charge their business by relentlessly focusing on twelve key strategies. As Chet says, “Becoming a master is not about doing four thousand different things; it’s about doing twelve things, four thousand times each.” Chet is also the author of the “Business Growth Masters Series” with Jay Abraham. Industry Week named him “one of the top change experts in the country.” Success magazine said, “Chet Holmes breaks sales records wherever he goes.” He has also been written about in The Wall Street Journal, The New York Times, San Francisco Chronicle, and more than fifty other publications. Eye Opener Sessions Tuesday, October 5 AICC Opening Night Reception & Awards Dinner AICC/Paperboard Packaging Hall of Fame Award and AICC Richard Troll Scholarship Foundation Presentation 6:30 pm – 9:30 pm EVENT KEY: AICC events in blue Joint AICC/TAPPI Events in Green Additional Events Friday, October 8 AICC Optional Spouse & Guest Event AICC Continental Breakfast 7:00 am – 9:00 am AICC Continental Breakfast 7:00 am – 9:00 am Taste of Little Italy: Pasta Making, Lunch, Wine & Dessert Tasting Tour AICC Eye Opener Session I How Health Care Reform will Affect You and Your Business 7:00 am – 8:15 am AICC Lean Plant Assessment Training* 8:00 am – 12:00 pm Thursday, October 7 AICC Eye Opener Session II “FIRST” 4.0 - Paving the Way for Flexographic Excellence 7:00 am – 8:15 am AICC Lean Plant Assessment Training* 8:30 am – 12:30 pm AICC General Session I 8:30 am – 12:30 pm AICC General Session II 8:00 am – 12:00 pm AICC/BCN 2010 Innovator of the Year Winners Announced Keynote Presentation: Chet Holmes, “How to Grow Your Company from 0-100 Million in Sales and Beyond” 8:55 am – 11:55 am Hilton Baltimore: AICC 11th Annual Student Design Competition Winners Presentation AICC/BCN 2010 Innovator of the Year Video Preview & Vote Keynote Presentation: Scott McKain, “Creating Distinction for Your Company: Stand Out and Move Ahead!” 9:35 am – 12:25 pm AICC/TAPPI Corrugated Week Table Top Supplier Trade Fair 1:00 pm – 5:00 pm AICC Optional Off-Site Afternoon Event AICC Host Hotel and location of 2O1O AICC/TAPPI Corrugated Week Table Top Supplier Trade Fair (All AICC events take place at the Hilton Baltimore unless otherwise noted.) Hyatt Regency: TAPPI Host Hotel (All TAPPI events take place at the Hyatt Regency unless otherwise noted.) *Separate registration required Schedule of events is preliminary; Events, times and locations are subject to change. (departures from Hilton Lobby) Taste of Little Italy: Pasta Making & Lunch, Wine & Dessert Tasting Tour 11:30 am – 3:30 pm AICC Off-Site Evening Reception: Oriole Park at Camden Yards (located across the street from the Hilton) Thursday, October 7 • 7:OO am – 8:15 am How Health Care Reform Will Affect You and Your Business: A look at how the new health care legislation will affect small companies Gene Marks, columnist, author, and business owner Business owners have many questions about how health care reform will affect their business financially. The session will address significant issues that owners need to consider when projecting health care expenditures and offer recommendations for the future. A must attend for all owners, CFOs, COOs and HR professionals. ABOUT THE SPEAKER Gene Marks, writes monthly online management and technology columns for both Forbes and Business Week as well as a bi-weekly column that appears nationally in American City Business Journals. He is a regular guest on numerous radio and TV talk shows including the FOX Business Channel, MSNBC. Marks’ newest book, In God We Trust, Everyone Else Pays Cash – Simple Lessons From Smart Business Owners was released in the Spring of 2010. “FIRST”4.0 – Paving the Way for Flexographic Excellence FIRST 4.0 (Flexographic Image Reproduction Specifications & Tolerances) is a set of specifications that facilitate producing a predictable, consistent result every time. FIRST seeks to understand customers’ graphic requirements and translate those aesthetic requirements into specifications for each phase of the flexographic workflow. It creates a common set of guidelines, tutorials and data to be used as communication and production tools. For over a decade flexographers have used FIRST to produce consistent repeatable products. This presentation provides an overview of FIRST and a look at how workflow communication can enhance overall product quality. A must attend for production professionals. 6:00 pm – 7:30 pm Prime Time Networking Opportunities AICC Opening Night Reception & Awards Dinner Wednesday, October 6 • 6:3O pm – 9:3O pm – Hilton Baltimore The AICC 2010 Annual Meeting will officially kick-off with an opening night reception and awards dinner at the Hilton Baltimore. Join other attendees to witness the induction of another outstanding individual into the AICC & Paperboard Packaging – Hall of Fame and the AICC J. Richard Troll Scholarship Foundation. EVENING SCHEDULE OF EVENTS: Cocktail Reception: 6:3O pm – 7:3O pm Buffet Dinner: 7:3O pm – 8:3O pm Award Presentations: 8:3O pm – 9:3O pm AICC Thursday Evening Reception: Oriole Park at Camden Yards (located across the street from Hilton Baltimore) Thursday, October 7 • 6:OO pm – 7:3O pm AICC will host an evening reception at the renowned Oriole Park at Camden Yards, the beautiful baseball-only facility in downtown. The outdoor reception will be held in the “bullpen” overlooking Camden Yards’ unique pitching warm-up area. Guided tours of the field and dugout will offer a real ballpark experience. Attendees can test their baseball skills in the “Fastest Pitch” and “Home Run Derby” games, or pose for pictures with the “The Bird”, the infamous Orioles baseball team mascot. Baseball season might be over, but the game day spirit will be felt throughout the night at this home run event for all. Thursday, October 7 • 11:3O am – 3:3O pm The day will begin with a short guided driving tour of the beautiful and historic neighborhoods of Baltimore including Federal Hill, Mt. Vernon, Fells Point and finally, Little Italy. The Italian inspired afternoon will begin at Germano’s Trattoria, a favorite destination for those searching for an “authentic Italian” touch, with a pasta-making demonstration which offers historical and cultural insight to the area as well as an opportunity to get ‘hands-on’ with the pasta process. You will enjoy a fine Italian lunch which you helped to create. Then off to La Scala, another Little Italy favorite for a sampling of Italian dessert favorites and dessert wines. AICC & TAPPI 2O1O Corrugated Week: Table Top Trade Fair TRADE SHOW HOURS AND LOCATION: Hilton Baltimore Wednesday, October 6 • 1:OO pm – 5:OO pm Thursday, October 7 • 1:OO pm – 5:OO pm The AICC & TAPPI 2010 Corrugated Week table top trade fair will feature over 100 exhibitors highlighting their innovations for the corrugated industry. Production managers, boxplant owners, engineers, technical service and production professionals will all find something of benefit from the networking, training and information gathering opportunities. Likewise, exhibitors will experience unsurpassed access to key decision-makers from integrated and independent corrugated converters. For more information visit www.corrugatedweek.org. AICC Corrugated Industry – Capitol Hill Fly-In Tuesday, October 5 7:3O am – 5:3O pm SHOW YOUR SUPPORT FOR THE INDUSTRY BY TAKING A UNITED MESSAGE TO CAPITOL HILL: ONE INDUSTRY, WITH ONE VOICE, FOR ONE CAUSE. Plan to participate in the AICC 2010 Corrugated Industry Fly-In to show your support for legislation that benefits the domestic manufacturing base and improves the competitive climate in North America. With the upcoming election in November, this is an excellent opportunity to voice your views and express our pro-industry and pro-manufacturing message. You can “add on” the Corrugated Industry Fly-In to your AICC Annual Meeting registration. Once registered, additional information will be provided on the events and scheduling appointments with representatives. The Lean Plant Assessment course will give an overview of 11 categories of Lean production of goods and services. Participants will learn to rate any plant (their own or a supplier’s) and to use the results to target increased speed and accuracy of information and material flow. Use limited resources for maximum impact using the Lean Plant Assessment results as a guide. Presented by: Scott Ellis and Scott Heilmann of P2. A multi-disciplined improvement team with expertise in engineering, business management, and organizational psychology, P2 ’s approach is to address the policies, procedures and personalities that support the organization. AICC Lean Plant Assessment Training Course Thursday, October 7 • 8:3O am – 12:3O pm Hilton Baltimore Friday, October 8 • 8:OO am – 12:OO pm Atlas Container (transportation provided from Hilton Baltimore) Two of AICC’s local associate members, Mark/Trece Inc. and MarquipWardUnited will open their facilities to meeting attendees on Wednesday, October 6 from 8:30 am – 12:30 pm. Tours take place simultaneously. Attendees may only participate in one tour. AICC will provide round-trip transportation. AICC Plant Tours Mark/Trece Inc., an industry leader since 1962, has partnered with numerous suppliers to further the advancement of the flexographic and point of purchase display industry. The latest in prepress, digital plates for award winning displays, laser burned and water jet manufacturing for steel rule dies and digital printing for sales, marketing and short run orders will be displayed all under one roof, in the true spirit of education. MarquipWardUnited, a Barry-Wehmiller company is an international market leader in high-speed corrugating, finishing and sheeting machinery for the corrugated box and paper converting industries. They manufacture rotary die cutters, flexo folder-gluers; rebuild pre-owned equipment and aftermarket upgrades to existing equipment. Approximately 330 team members at the Hunt Valley facility provide complete engineering, manufacturing and technical support services for MarquipWardUnited finishing products. How To Build the Most Cost Effective Edge Crush Combined Boards By Ralph Young, AICC Technical Director Just last month an AICC member contacted ASK Ralph! regarding a box failure at a new customer. The converter had secured the account with both an understanding and promise that a new corrugated board combination utilizing a high strength 47# linerboard could replace the 52# linerboard in the original construction. simple principal that basis weights by themselves are very poor predicators of ECT, BCT and performance of the package through the distribution system. this design principal just the fibre cost savings alone over conventional models can be substantial. Knowing the minimum ring crush levels in the containerboards we Any medium must proceed through need to achieve a minimum ECT, one can begin to source the right the corrugating labyrinth and containerboards as raw materials there are more than 15-20 physifor the corrugated box. Along with cal properties to describe its ability the raw materials we need to know to be fluted successfully. The most While this is a possibility it is not important criteria have been caliper, the efficiency levels of the corrugaby any means certain without a tor to combine these elements and MD tensile, MD stretch, and coefcomplete knowledge of the competi- ficient of friction. If you are buying also the degradation factors of each tor’s box, the user’s real needs and piece of converting equipment that the medium, caliper is usually the testing of the new and old corruwe use to process the sheets. only one of these four properties gated design. Let’s take a look at the you will receive. Both historical data and recent studelements in this case. While the unique attributes of semi- ies by the AICC have demonstrated Our needs as an industry to reduce that corrugators can vary by almost chemical or recycled or one ply, or waste, fibre, labor, energy, environ40% in their ability to maximize two ply mediums are not discussed mental dangers, costs, work place here, there are differences. Combin- ECT from the containerboards. And risks, and equipment inefficiencies ing and converting efficiencies vary we have also seen that converting has never been heavier upon our plants can destroy up to 35% of the and therefore there are differences shoulders. Therefore, having a more in the ECT outputs. One needs ECT strength in the corrugated comprehensive knowledge of the structure because of process variato weigh carefully the real cost of user’s supply chain, our converting tions. the achieved ECT in light of the efficiencies, the combined board containerboard costs, corrugator strength at the end of the corrugator efficiencies and converting degrada- Predicting ECT targets or values from the strength of the compoand the characteristics of the contion factors. nents by using CD ring crush or tainerboard being converted have STFI can be determined with long With the research that was done never been more critical. though Owens Illinois in the 70’s we standing and proven formulas. In this case, I have never experi(Contact me outside of this article learned that under the best condienced a 47# linerboard that has for more details.) These formulas tions the vertical compressive load the same ring crush strength as a should be used to provide your own sharing in the corrugated structure 52-56# linerboard. And both the set of Expected Values when you should be 50% supported by the US mill offerings of 26# mediums mediums and 50% supported by the know the corrugator efficiency and and 23# mediums vary by 67% in liners. This is not the way we gener- the degradation factors in your own their Cross Direction Ring Crush ally combine or design our sheets strengths. It all comes back to the continued on page 26 of boxes today. When engineered to BOXSCORE 25 How To Build The Most Cost Effective Edge Crush Combined Boards continued from page 25 operations. This should be part of any quality, sustainability, or lean manufacturing program. To achieve any given minimum ECT value we need to select the linerboard and mediums that will deliver the needed outcome in the most cost effective manner. To design to a minimum 32 ECT requires 150# of total ring crush from the two liners and the fluted medium. From a theoretical point of view this could lead us in the direction of selecting liners with a minimum of 38# of CD ring crush each and a medium with 53# of CD ring crush. This is not the way we build this very common Your package has only three to six seconds to grab the consumer’s attention... CRI inks speed up the process. Now you can achieve vibrant, true-to-life colors for corrugated and folding cartons and printed store displays. CRI can custom formulate flexographic inks and coatings with brilliant high-gloss colors and a durable scratch and rub-resistant finish. Combined with CRI’s unique TrueColorBalance™ color management system for superior process control, your attention grabbing package will keep your customers coming back for more. Best of all, CRI water-based inks are among the most earth-friendly, with extremely low VOC’s and minimal environment impact. Contact a CRI specialist for fast response to your ink and color application questions. 800.346.8570 www.colorresolutions.com 26 BOXSCORE structure today in the US. But you might find this type of combination in Europe. We will share more on this subject with the next issue. You are always welcome to contact me at anytime to discuss any technical concerns at ASKRalph@ aiccbox.org or thru my consulting company, Alternative Paper solutions, at youngralph1@ bellsouth.net. SAVE THE DATE! AICC 2010 Annual Meeting October 6-8, 2010 The Hilton Baltimore Baltimore, MD The AICC 2010 Annual Meeting is being held in conjunction with AICC/ TAPPI Corrugated Week October 4-8 Co-located with the TAPPI 2010 Corrugated Packaging Division Conference at the Hyatt Regency Baltimore. www.corrugatedweek.org Can Technology Save Money? RFID versus DFID™ in the Corrugated Environment By Kenneth Schoening Corrugated manufacturers have long desired a more cost effective way to monitor the paper/containerboard supply chain throughout the manufacturing process. In recent years, there have been several attempts to use RFID technology to achieve this, but no one has succeeded for 2 reasons: Roll Storage Roll details are displayed on the Clamp Truck terminal when the driver scans the barcode. This information is then associated with the DFID™ tag for the life of the roll. When the roll is transferred to the 1. The inability of RFID technology to transmit signals through the paper roll and, Corrugator Roll Verification & Traceability When a roll is scanned onto a Rollstand, the paper details are displayed on a touch screen located warehouse the system suggest a location and the driver would accept as shown. or reject that location, or in manual A quote from one company execucontinued on page 30 tive says it all: “The cost of the RFID systems, the driver enters the roll location manually via the touch system and tags were absolutely screen terminal. insignificant compared to the savings we were able to achieve. The Roll Locating problem was we couldn’t get continuous reads from the tags and the Hardware kept breaking down…so we scraped the program.” 2. For the Hardware to withstand the rigors of the corrugated environment. DFID™, a technology used for over 4 years in Europe, uses a Dual Frequency Identification (DFID) System that sends high powered/ low frequency Dual Signals on Dual Channels through Dual Antennas. The carrier signal then wakes up the chip in the DFID tag and it responds at a very high speed for instantaneous reads. By providing greater signal penetration through roll goods and providing readability at greater distances, DFID™ can easily read rolls with 126” diameter (or 3.2 Meters). Screen showing roll location detail prompt on Clamp Truck terminal. The layout of the Warehouse will be displayed on the system. Selecting a specific area will then result in the system zooming into that area to show the details of the rolls. Hence very quick locating of rolls will be enabled. Rollstand operator touch screen. Operator screen shows running & ready rolls with the respective details. The touch screen can also be used to manually enter roll details if required. BOXSCORE 27 Can Technology Save Money? RFID versus DFID™ in the Corrugated Environment continued from page 27 • Track usage/consumption • Verify Yield versus what was delivered • Monitor upgrades “Real-Time” • Better able to accurately understand what is left on “butt” rolls. This allows operations to better manage “Butt” rolls to operational requirements and eliminate waste. The system checks to ensure the correct roll is loaded for the production schedule and prompts the operator to enter the reason code if an error is detected. Reporting & Traceability Reporting provides traceability of roll usage and details all upgrades with the reason codes displayed. Analysis of the actual paper consumed compared to what is planned is now possible giving the potential to minimise un-necessary upgrades and mistakes with the loading of incorrect grades. Standard reports include: • Upgrade report with cost of upgrades • Stock levels by paper type, supplier, width, remaining length • Individual roll history from delivery to full consumption • Quarantine history • Aging reports • Delivery times • Clamp truck utilization • Paper yield (Consumed compared to delivered) With the ability to now read accurately & consistently through large paper rolls, in “Real-Time,”the DFID™ Paper control system has shown to reduce costs over 2% (based on the cost of paper) by utilizing the “Real-Time” information to: • 30 Automatically track inventory BOXSCORE • Reduce labor looking for inventory • Reduce forklifts • Monitors Quarantined material • Reduce downtime and overtime caused by searching for paper or shortages. • Provides “guaranteed traceability” for Customers Requiring Environmental/FSC/SFI Commitment from Suppliers A “White Paper” has shown significant savings using DFID™. A video of the DFID™ process being used “Live” in a corrugated facility can be viewed when you visit http://web29.streamhoster.com/ ms1video/a1%20packaging%20 revised%20approved.wmv. For more information, or a copy of a DFID™ White Paper, please contact: Ken Schoening A-1 Packaging Solutions, Inc. (630) 587-0660 Cost vs. Price By Steve Warll, Chairman of AICC’s Association Members and Vice President of International Sales for Dicar Not long ago I had a few things to do that required a hammer and a pair of pliers. It was late at night, and the local hardware store was closed, so I went to a 99 cent store nearby. This is a store where everything costs a dollar, or 99 cents to be exact. As luck had it, they had a hammer and the pliers. What a deal! I was happy, at the low price, because my projects were simple. After all I was not a carpenter. The price was good, but was it actually a good value? I soon arrived home to put my new tools to use. The first project was to hang four picture frames on the wall. The first strike of a nail resulted in the head of the hammer falling off the handle where it was welded to the handle. I eventually got the pictures hung on the wall by using the heel of a shoe. After all, it wasn’t a demanding project; however, I did take a divot out of my shoe heel. Days later, I had a similar experience with the pliers. When I applied a little pressure the rivet popped out leaving me with two useless pieces. Strangely, I left the broken hammer and pliers in my tool box for sometime, probably because they had a perceived value, because they resembled real tools. As with most of the economy today, price is a big issue in the corrugated packaging industry. It’s driven by consumers and comes down stream to all of us. We all face the pressures of offering low competitive prices. It is important to be competitive and find a good value. The problem is when price becomes the focus over true cost or value. Often a low price will result in a higher cost. My example of the 99 cent hammer could be an example of this. I pretty much got no value from the hammer, and you could argue that the chunk taken out of my shoe heel was an added cost. A die maker from Europe recently explained this to me. His market had a demand for cutting dies for short run work. The customer frequently changed the box design, so longevity of the die was not important. He could use inexpensive die components that performed well for a short period of time, but would not last a long time. This was an example of a good value. The problem was that many customers saw the good performance of the inexpensive dies and started to use them across the board. For more demanding orders, the dies had high costs of repairs and failure. Rubber would stop stripping, leaving scrap and causing jam ups in the stacker. As a result, anvil covers would be replaced more frequently to compensate for the poor stripping. Box quality decreased, and the machine ran at slower speeds. This is an example of poor value, where saving a few dollars leads to higher operating costs. The die maker who explained this to me put direct numbers to the example, where he demonstrated how the cheaper die resulted in the machine running at 500 sheets less per hour. It was eye opening when dollars were put to these 500 sheets. These numbers did not reflect all the hidden costs, but they clearly showed that the value was not there. The added operating costs clearly outweighed the savings on buying a cheaper cutting die. “ We all face the pressures of offering low competitive prices. It is important to be competitive and find a good value. ” I finally took the useless hammer and pliers out of my tool box, and bought some moderately priced tools. It’s important for consumers to look at true value of products or cost vs. price. For box makers this means looking at the hidden results of cheap products and weighing if they actually meet the demand. BOXSCORE 31 BOXSCORE AICC Regions Host Meetings, Golf Tourneys and ‘Boxmaking 101’ Back to back Regional Meetings were the highlight of AICC member activities earlier this summer. AICC Region Five — covering the Southeastern States from the Carolinas to Florida and west to Mississippi, hosted a meeting June 10-11 at the Westin Hotel in Hilton Head, South Carolina. More than 65 members and guests attended the two day event, which began with an opening reception on the evening of Thursday, June 10. On Friday, June 11, Pat Haddon, President of Packaging Atlanta, Canton, Ga., and Regional Director for AICC Region Five, welcomed the members to the four-hour business meeting which featured on a broad based look at the current state of the containerboard and corrugated industry and in-depth examinations of plant operating efficiency and costing systems. Special guest at the meeting was Kim Nelson, CEO of Royal Containers Ltd., Brampton, Ontario, and current Chairman of AICC, who presented her vision of “authentic customer service” based on open communication and employee involvement. She demonstrated Royal Containers’ customer order web portal which allows customers to receive instant pricing based on specifications which they provide. Nelson said “being easy to do business with” is a core value for Royal Containers, and it encourages customer loyalty. Mike Harwood, Deputy CEO of Pratt Industries USA, spoke on the current state of the containerboard and corrugated market in North Ryan Chappell, President of Louisiana Corrugated Products and Regional Director for AICC Region Four, makes a point from an owner’s perspective as part of the Boxmaking 101 seminar. America and globally. His hour-long keynote presentation outlined the facts of the containerboard market, including capacity, inventories and current supply situation. He also discussed trends in basis-weight use in North American corrugated market, saying that converters may be missing opportunities to help their customers reduce the weight of their packaging while preserving performance. He cited trends showing North American basis weights trending upward after declines in the early 2000s. and ink, and he suggested that a single person be in charge of staging orders for each machine. Jan Rohde, president of Jan Rohde Consulting, finished the morning’s program with an analysis of plant costing systems. Rohde, who spent his early corrugated industry years in box plants and later as an associate at Harry Rohde Management Systems, presented an intricate analysis of how costs should be allocated between plant operations, office support and sales, general and administrative. He advocated that After the macro look at the industry, costing systems should have a built the program shifted to plant effiin profit percentage based for each ciencies, with Scott Heilmann of P2. machine center so that members Heilmann’s presentation showed ex- do not “give away gains” made by amples of lean plant operations and efficiency improvements. challenged members to take a fresh AICC President Steve Young also look at their processes for running spoke, giving an update on new and orders at various machine centers. upcoming programs, including the He said machine operators should be running machines, not chasing continued on page 34 after cutting dies, printing plates BOXSCORE 33 AICC Regions Host Meetings, Golf Tourneys and ‘Boxmaking 101’ continued from page 33 Again, he advised members to build in profit to their estimating system just as they would their direct and indirect operating expenses. Ralph Young leads a discussion on containerboard manufacturing at the Boxmaking 101 seminar held Tuesday, June 15, in Mesquite, Texas, during the AICC Region Four meeting. AICC Annual Meeting, October 6-8, in Baltimore, Maryland. TexCoat, the CSI’s coating facility located adjacent to the mill. Chris Blockhaus, GM of TexCoat, led the tours at TexCoat. Following the tours, the group met at the Hamtpon Inn in Mesquite for a cocktail reception. Paul Teten, Director of Fixed Income Portfolio Management for Capital One, gave an overview of current economic conditions. He said that he expects the economy to be on a modest growth mode for the next few years, but said that he has concern about the level of government debt beginning in 2015. He said we are in a “square root shaped” recovery – sharp decline, followed by rebound in building depleted inventories, followed by sluggish growth. Jim Smith, principal of The Mesa Group, a Dallas-based business and Members enjoyed a golf tournainformation technology consultment at the Port Royal Golf Course. ing firm, who discussed “Business The meeting was sponsored by: Continuity Planning: a cost effective Pratt Industries; Stafford Cutting approach.” He told AICC members Dies; CEL Chemical and Supplies; that they must consider what would Mitsubishi Heavy Industries (MHI); The business meeting, held Tuesday, happen to their business in the Sun Automation; Color ResoluJune 15, featured presentations on event of a major disruption or ditions; People’s Capital and Leascosting systems, business continusaster. He cited Hurricaines Katrina ing Corp.; A.G. Machine Inc/A.G. ation, insurance needs for indepen- and Rita and the current oil spill Stacker; Fosber America; Royal dent manufacturers and an ecoin the Gulf as examples. Following Containers Ltd.; MarquipWardUnit- nomic forecast. Members also heard Smith, Stan Rorison of Eustis Insured; Bobst Group; Poteet Printing about new programs from AICC as ance Inc., presented an overview of Systems; Southeastern Packaging well as an overview of the recently various kinds of business insurance Co.; and American Corrugated completed corrugated industry Lify options outside of normal property Machine Corp. Cycle Assessment. In addition, the casualty and workers compensation. program featured a separate educa- He discussed the need for crime AICC’s Region Four – the states tional seminar, “Boxmaking 101,” insurance, to protect against interof Arkansas, Louisiana, Mississippi, designed specifically for new-hires nal crimes such as employee theft; New Mexico, Oklahoma and Texas and other employees in the industry employment practices liability, – held its annual regional meeting wanting to know more about the for coverage against employment June 14-15 in Mesquite, Texas, with corrugated industry. claims; and directors and officers 60 members in attendance. The coverage. All these forms of insurmeeting began on Monday, June 14, Ryan Chappell, President of Louiance are becoming more important with a tour of Corrugated Services siana Corrugated Products, Monto small businesses, he said. Inc., a 100% recycled linerboard and roe, La., and Regional Director for medium mill in Forney, Texas. Bill Region Four, welcomed members AICC President Steve Young was Baker, VP of CSI, welcomed more and introduced Jan Rohde, who also on the program, giving an than 30 members for the afternoon gave a reprise of the presentation he continued on page 35 tours, which also included a visit to presented in Hilton Head last week. 34 BOXSCORE AICC Regions Host Meetings, Golf Tourneys and ‘Boxmaking 101’ continued from page 34 overview of AICC services such as on-site training programs. He also discussed the recently completed corrugated industry life cycle assessment (LCA) and AICC’s pilot program to establish an independent containerboard price index. Following the morning program, AICC presented an educational seminar titled “Boxmaking 101.” The four-hour course, attended by 21 corrugated industry employees, took a close look at all the aspects of corrugated converting, from paper making and costing systems, to sustainability. The “faculty” for the program consisted of AICC Technical Advisor Ralph Young, Jan Rohde of Jan Rohde Consulting, Roger Poteet of Poteet Printing Systems, and Ryan Chappell of Louisiana Corrugated. Sponsors for the Region Four meeting included: Brian Thomas Display and Packaging; Simpson Tacoma Kraft; Innerpac; Corrugated Roll Corporation; Interstate Resources; Poteet Printing; Louisiana Corrugated; Bobst Group North America; PRI Technologies; Poteet Printing Systems; Georgia-Pacific Corporation; A.G Machine; Supply One; MarquipWardUnited; Leaman Container (Also printed the signs); and Sonoco Products Company. This combo rocks. Now a complete short-run production solution from one company—Gerber Innovations. Made in America, it’s the ultimate corrugated print-to-cut solution for under $200k. Solara ionTM Wide Format Printer M Series Digital Cutting System This is the ideal—and affordable—corrugated printer. It features low temperature UV-curing so boards won’t curl and vibrant GerberCatTM ink which is highly flexible and won’t crack on scores. The industry’s newest and most versatile cutting system features M-vision for automatic registration of printed sheets, T3 tool head with a complete range of tools, heavy duty construction and complete substrate compatibility. 260 J Fordham Road Wilmington, MA 01887 800-331-5797 www.gerberinnovations.com BOXSCORE MADE IN A M ERI CA 27 34 BOXSCORE International Corrugated Packaging Foundation Lewis-Clark State to Launch Corrugated Curriculum to Serve Operations In Northwest Richard M. Flaherty International Corrugated Packaging Foundation President “ Co-Chairs George and Michelle Sickinger invite ICPF Partners and other ICPF supporters and their spouses to gather for ICPF’s Holiday Weekend in New York on Friday and Saturday, December 10 & 11, 2010. ” Working with ICPF, the Division of Graphic Design/Print Technology at LewisClark State College (LCSC) in Lewiston, Idaho, announced plans this summer to incorporate corrugated packaging classes into its curriculum beginning in the fall semester of 2010. Associate Professor Diane Driskill and Assistant Professor Brian Kolstad started looking into the possibility of offering LCSC students experience in corrugated packaging two years ago (in 2007). “We want to create the preeminent graphic design and print technology program in the Northwest,” Kolstad says. LCSC recently designed and installed a twentystation Mac lab integrated with an Apple X-Serve server. After reviewing ICPF’s online corrugated curricula and participating in the Careers in Corrugated Teleconference this past February, LCSC took ICPF up on a standing offer to help seek a discount on design software and a CAD table, which would enable LCSC to make the purchase with funds from a one time grant from the State of Idaho. At the request of ICPF, both EskoArtwork and Gerber Innovations provided heavily discounted proposals. Both companies have partnered with ICPF in the past to place CAD tables and software for college corrugated curriculum programs around the country. LCSC selected the EskoArtwork proposal that offered a new table at a 66% discount and a donation of Artios software. world production experience in corrugated packaging and display. Nobody else in the region will be able to offer as much. The closest place is probably San Jose State, 900 miles south of here.” With a campus location literally on the Washington State border, the new LCSC program will generate graduates who should become a special source of recruitment for the concentration of industry operations in the Pacific Northwest. If you are interested in providing speakers, mentors or faculty advisors for the new corrugated program at Lewis Clark State College, please contact ICPF at (703) 549-8580. Co-Chairs Announced for Third Annual Holiday Weekend in New York December 10 & 11, 2010 ICPF Vice Chairman George and Michelle Sickinger (Color Resolutions International) have been announced as this year’s Co-Chairs of ICPF’s 2010 Holiday Weekend in New York fundraiser. In its third year, the New York event was designed as an annual fundraiser where executives and their spouses can support the International Corrugated Packaging Foundation educational mission while socializing, networking, and enjoying the best of New York City during the holiday season! Co-Chairs George and Michelle invite ICPF Partners and other ICPF supporters and their spouses to gather for ICPF’s Holiday Weekend in New York on Friday and Saturday, December 10 & 11, 2010. This Next fall the twenty work stations will year’s participants will begin with a Friday each have a copy of EskoArwork’s software evening reception hosted by Anthony package (ArtiosCAD) for use with the CAD Pratt and Mike Harwood in Mr. Pratt’s table. “It’s a complete package,” Kolstad penthouse home at the Sherry-Netherland says, “one that will provide our students continued on page 39 in graphic and structural design with real BOXSCORE 37 ICPF Update continued from page 37 overlooking Central Park. A sold out matinee performance of the Tony Award winning, “Best New Musical of the Year,”Memphis, and a reception and dinner at a renowned New York restaurant, Sardi’s, are scheduled for Saturday. Free time on Friday, Saturday morning and Sunday will allow for a Friday dinner with spouses and clients, leisurely brunches, holiday shopping, site seeing and museums. and a registration form, contact ICPF at 703.549.8580, rflaherty@ icpfbox.org, or visit www. careersincorrugated.org American Packaging Corporation Provides Testimony on ICPF Referrals Tony Schleich, COO of American Packaging Corporation, is an executive of one of the many firms that benefited this past In addition to participating in year from ICPF’s placement of the event, George and Michelle recent packaging and graphic are asking industry executives to communication graduates. While invite clients, suppliers, potential his story is not unique, his ICPF Partners, and to also consider enthusiasm in telling it during the rewarding additional key employees ICPF presentation at the AICC/ from their companies with this FBA 2010 spring meetings in San special weekend holiday function. Diego has led to dozens of firms asking for the opportunity to meet Advanced registration is required with students and recent grads this and early registration encouraged. spring and summer. I would like to ICPF already has received over 60 share his comments with you here verbal or other firm commitments as well. from executives and their spouses. Registration is $2,800 (spouse “When American Packaging is free) with a large portion of committed to a long-term the registration supporting ICPF contribution to the ICPF, we did so operations and tax deductible. primarily to assist the Foundation’s Additional expenses may be mission to generate a stream of deductible as business expense, increasingly qualified students check with your company’s tax to enter the corrugated industry, advisor. Group rates for rooms now and into the future. In all for participants are available at honesty, given our location in the ICPF’s host hotel, the W New middle of Kansas, we did not focus York at Times Square until the necessarily on directly benefiting block is sold. Hotel rooms are from the qualified students that the in demand during this special ICPF supports. time of the season, so executives In August of 2009, I took a call are encouraged to make their from ICPF, as many of you have, reservation through ICPF as soon about a recent Michigan State as possible. School of Packaging graduate Pratt Industries, Inc., Color who actually lived in Kansas. I Resolutions and Sumter am not certain about all of you, Packaging are the initial sponsors but in 2009, I was not exactly in of this year’s event. Additional the “hiring mood.” However, I sponsorship opportunities reluctantly said “yes” to meeting with her when Richard indicated currently are available, including the hosting of Saturday’s reception that there was no obligation to hire, but meeting with her would help in in the name of the sponsoring promoting a corrugated packaging company. For more information career and help the student with networking in her job search. I was extremely pleased when I met with Apoorva Rastogi and found that she had graduated with an extensive knowledge not only in corrugated packaging but in many other materials as well. With her impressive outlook on our industry coupled with her straight-forwardness with how she could positively impact our company, I knew that I needed to hire her. I was unable to bring Apoorva along with me, .but I would like to play a short video that she put together for us that will provide some perspective from Apoorva. (Video can be viewed at https://msupackaging.site-ym. com/?page=PlacementSuccess) One quick success story that I would like to share with you is one of the first sales calls that Apoorva went on with one of my salespeople. After the initial meeting with the prospect, she determined that there was an opportunity not only to redesign their current packaging, but she designed new graphics for them based on her observations within the customer’s facility. Ultimately, she branded the company to the point where the new logo is now present on all of their printed materials. This is truly something we’ve never had before! In closing, I would strongly encourage those that are not a contributing partner to contact and consider becoming an ICPF partner in order to support the mission of recruiting the next generation of managers and leaders in our industry. If you are an ICPF partner, I would implore you to utilize the ICPF resources and let them know that continued on page 40 BOXSCORE 39 ICPF Update continued from page 39 you have job openings for interns or new graduates. Perhaps you would even consider mentoring one of the new graduates. As in my case, you may not be thinking of hiring anyone, but I would strongly encourage you to visit with the very bright talent coming from a number of fine packaging schools. The support of ICPF and outreach by individual firms will not only contribute to the future of the industry, it can certainly have a positive affect on your bottom line. We ask you to let ICPF know if you are interested in hiring a recent grad or offering an internship this year.” Jack Cooper Inducted Into the ICPF’s Circle of Distinguished Leaders During a ceremony at the past 2010 spring meetings of AICC, FBA and the International Corrugated Packaging Foundation (ICPF), Jack C. Cooper was inducted into the International Corrugated Packaging Foundation’s prestigious Circle of Distinguished Leaders. The special designation as a member of ICPF’s Circle of Distinguished Leaders recognizes and honors those exceptional few whose vision, energy, and creative and technical talents have combined to move the corrugated industry forward into a new dimension of accomplishment. Jack served as General Counsel to the Fibre Box Association for 35 years, the Corrugated Packaging Alliance and its predecessor organization for 16 years, the International Corrugated Case Association for 12 years and as co-counsel for the International Corrugated Packaging Foundation for 19 years. His nomination was through nomination contributions to ICPF made in late 2009 and 40 BOXSCORE early 2010 by a large group within the industry that includes: Firms: AICC FBA American Packaging Bates Container Brian Thomas Display Central Container Corrugated Packaging Alliance Great Lakes Packaging Green Bay (George Kress Foundation) ICCA Kelly Box & Packaging Landaal Packaging Liberty Diversified Packaging Express Packaging Services of MD Rengo Richard Storat & Associates Smurfit/Kappa Smurfit Stone York Container Individuals: Dwight Schmidt Mike and Renie Harwood Tom & Lynn Herlihy Jim Keller David Simon All the FBA Staff In submitting his name for nomination consideration, FBA President and ICPF Director Dwight Schmidt said that “over the years Jack participated in literally every meeting (easily well over a thousand) of FBA, ICCA and CPA. When he rarely couldn’t be there in person, he would participate via conference call, even if it was in the middle of the night where he was traveling.” During the April 15th ceremony in Coronado, CA, Jack was recognized by ICPF Chairman, Jim Akers (Akers Packaging Service Group), for his “dedication to the advancement of the corrugated industry both domestically and internationally through his work with the CPA, FBA, ICCA and ICPF”. This twelfth inductee joined a small, exclusive list of leaders who have been inducted after being nominated by firms and individuals from the industry. Those previously honored include Mr. H. G.. Craddock - Founder of Triad Packaging Inc. of Conover, North Carolina; Mr. Ben Fiterman - former CEO and Chairman of Liberty Diversified Industries; Mr. Thomas C. Landaal - former President of Landaal Packaging Systems; Mr. Laurence C. Schiffenhaus - former Co-Chairman of Schiffenhaus Industries, Inc.; Jack D. Grollman - former President and owner of Triangle Container Corp.; Bruce Benson -former President of FBA and ICCA: James McKinney - former Vice President and General Manager, Lewisburg Container: William J. Sweeney - former Senior Executive of Packaging Corporation of America; William I. Flinn - former CEO of Scope Packaging; J. Richard Troll - Founder and former President of ICPF and AICC; and Ronald Warll - Founder and CEO of Dicar, Inc. ICPF invites family, friends and business colleagues to honor and nominate an additional outstanding individual for induction into ICPF’s Circle of Distinguished Leaders during the next AICC spring meeting in Ft. Lauderdale in 2011. Visit www.careersincorrugated. org or contact rflaherty@icpfbox. org to learn how you can make a nomination. Members in the News . . . Gerber Innovations Announces Sun Automation Group Move to Tolland, Connecticut Celebrates 25th Anniversary Gerber Innovations announced today that it is relocating its Wilmington, Massachusetts operations to Tolland, Connecticut this summer. The transition is expected to be completed by September 30, 2010. Stafford Cutting Dies, Inc. recently installed another combo laser manufactured by Gerber Innovations of Wilmington MA. President Clint Medlock stated “The addition of this equipment will bring Gerber Innovations is North a total of three rotary lasers and America’s only full-line manufacturer two flat lasers under one roof. The of automated cutting hardware for Gerber RQL system (rotary quick the design, die making and shortlock) mounting system will definitely run production segments of the streamline our rotary manufacturing packaging industry. Gerber Scientific, process and adding the Fast Track Inc., Gerber Innovations’ parent flat laser system will more than company, has a 230,000 square foot double our capacity in platen design and manufacturing facility diemaking. located in Tolland where it produces Due to the demand of TopMatrix and a wide variety of Gerber products such as cutting systems, plotters and TrimSaver, we needed the additional printers. Gerber Innovations will manufacturing capacity. We are well positioned to take advantage of the be joining them at this location; 24 demand for these products in our Industrial Park Road West, Tolland, Connecticut 06084 USA. newly expanded market area.” Gerber Innovations service functions will be integrated into the global Gerber Service organization as part of this relocation process. This will increase the scale and range of services available to Gerber Innovations customers on a worldwide basis. Gerber Innovations President Steven Gore notes; “This move will allow Gerber Innovations to take full advantage of the significant resources available as a Gerber Scientific business. These advantages will include greater engineering and manufacturing capabilities, enabling us to get the latest technology to our customers more efficiently.” Gerber Innovations customers can expect their high level of service to continue uninterrupted, and may continue to use the same contact number at 1-800-400-3458. They can also reach Gerber Innovations by calling 1-800-331-5797 or visiting their website at www.gerberinnovations.com. years in various box plant production management positions. Ernie is active in both TAPPI and AICC and is former Chicago TAPPI Chairman. “We are pleased to have a veteran of Ernie’s caliper on our team. With his box plant operations, and printing experience, he further strengthens our overall knowledge of the industry we serve, ’’ states Ron Rauschart, Dicar’s V.P. Marketing & Sales. Ernie can be reached by email to [email protected] and by phone at (708) 738-2933. Total Impact! 2010 Announced The First Ever North American User Meeting for Impact CAD Software October 24 - 27, 2010 Nestled in the mountains of Park City, Utah, just 30 minutes from Salt Lake City airport, the first user group Stafford Cutting Dies, Inc. is a meeting for Arden’s Impact CAD supplier of rotary, flat and auto platen and WEBcnx software will be held steel rule dies for the corrugated this fall. Scheduled at The Newpark container industry. Resort for October 24–27, 2010, the meeting will cover all aspects of the Additional information about Stafford software in addition to providing Cutting Dies can be obtained by a look into the future of CAD for calling (704) 821-6330 or visiting continued on page 43 their web site at www.gostafford.com. Ernie Moon Ernie Moon Joins Dicar Industry veteran Ernie Moon has joined The Dicar Group’s growing sales team. Ernie has over 43 years of experience in the corrugated container industry. He spent 31 years in the printing ink industry and 12 BOXSCORE 41 44 BOXSCORE Please join AICC in welcoming its new members Jeffrey Moness Canadian Paper Connection Inc. 1600 Steeles Avenue West, Suite 322 Concord, ON L4K 4M2, CANADA [email protected] (905) 669-2222 Israel I. Garcia Microcart S A De CV Av. Universidad No. 1001, Piso 15 Col. Bosque Del Prado Norte 20127 AGUASCALIENTES AGS, MEXICO [email protected] +52 (449) 914-1435 Prakticaja, S.A. De C.V. Jose Del Bosque Olvera Av. Americas No. 702 Col. Americas 67130 GUADALUPE NLE, MEXICO [email protected] +52 (81) 8334-7905 Javier Melano M. Agroindustrias Avicolas SA De CV Km. 28.4 Carr. Tototlan 47600 TEPATITLAN JAL, MEXICO [email protected] +52 (378) 7010 103 Eduardo Arroyo M. ASC Packaging Sde RL Carlos Rousseau 300 66634 APODACA NLE, MEXICO eduardo.arroyo@ascdemexico. com +52 (81) 8321-0838 Ana Paulina Xacur Empaques Nova, S.A. De C.V. Km. 8 Carretera Merida-Uman S/N Ciudad Industrial 97288 MERIDA YUC, MEXICO [email protected] +52 (999) 919-0305 Jorge E. Diaz Todipak, S.A. De C.V. Av. Castillo De Chapultepec N0. 23 Col. Revolucion 62390 CUERNAVACA MOR, MEXICO [email protected] +52 (777) 320-4866 Ruperto Fernandez Linares Linfer Impresores, S.A. F. Castillo Puerto No. 1003 76120 QUERETATO QRO, MEXICO [email protected] +52 (442) 217-0783 Douglas J. Friel, Vice President Johnson Kendall and Johnson, Inc. 109 Pheasant Run Newtown, PA 18940 www.jkj.com (215) 579-6439 Email: [email protected] Members in the News continued from page 41 the packaging and manufacturing industries. The three day training and forward-looking event plus welcome reception and special event/ dinner will guide attendees through the depth of features and provide hands-on, in depth instruction as well as offering numerous “tips, tricks and shortcuts” for maximizing productivity. “Having just recently passed the 1,200 users mark here in North America, we believe this fall will be the ideal time for an intensive, advanced user group session for our Impact CAD and WEBcnx software,” stated Jim Silianoff, President of Arden North America. This first User Group conference for Impact will coincide with the release of Impact 2010. This will allow existing users to get up to speed with the new software and give all users the ability to focus on specific aspects of the software. All key personnel from Arden’s global offices will attend and the user will have the opportunity to determine the future course of Impact. According to Silianoff, “there’s nothing quite like the depth provided by a user group setting to sharpen skills and open eyes to new techniques.” Topics covered during Total Impact! 2010 will include: • Advanced 3D Design and Animation classes • Workflow and Database Management • Machine settings and optimization. • Manufacturing Classes covering every aspect of die making • Tips, Tricks & Shortcuts • All aspect of the structural design process. For more information and to register today, visit the Upcoming Events section at www.ardensoftware.com, e-mail [email protected] or call 435-709-3100. Additional information about the hotel can be found at www.newparkrsort.com. BOXSCORE 43 46 BOXSCORE THE FINAL SCORE 3rd C’board Increase Puts the Integrity of Our Industry on the Line Steve Young, AICC President AICC released the following editorial during the week of July 12, 2010, commenting on the August 1 containerboard price increases. Weeks of Wall Street’s tightmarket cheerleading have moved nearly all the major suppliers to announce a third increase this year in the price of containerboard. While the Association of Independent Corrugated Converters (AICC) acknowledges the current market conditions, we also believe that a third increase in a six-month span is an unnecessary burden both on independent purchasers of containerboard and sheets and the customer base we serve. This action calls into question the integrity of our industry. Recognizing that capacity cuts of more than 3.0 million tons since 2008 have removed imbalances in the containerboard supply system, we also note that our member companies are not reporting the situation to be unmanageable. In a poll of more than 100 AICC members in the last week in June and first week of July, a majority of those surveyed reported “no trouble” in getting linerboard, medium or sheets. Among corrugator plant owners, 61% said they are having “no trouble” getting linerboard.1 Those who do report anomalies say that longer lead times are the only issue. Among sheet plants, 92% say they are having no trouble getting sheets. The small percentage who are reporting “trouble” say suppliers are stretching out delivery time from overnight to 1-2 days.2 What’s more a June 18 report in Pulp and Paper Week seems to contradict the predictions of continued tight market conditions saying, “U.S. containerboard supply is expected to gradually improve moving into the summer period,” citing sunnier weather in the South that has allowed more harvesting of wood chips. Downward movement of containerboard inputs is also in our view discrediting the need for this third increase. Cost drivers such as OCC, wood chips and pulp have or are declining from their late winter peaks. According to recent trade industry reports, June spot-market pulp prices dropped $35/ton. What’s more, the June Institute of Supply Management Index (formerly PMI) indicates that the manufacturing economy is slowing, from 59.7 in May to 56.2 in June, a drop of 3.5 percentage points (www.ism.ws). Even leading stock analysts, who have been predicting a relatively easy implementation, say “hike #3 may be tougher-thanexpected.”3 We also challenge assertions in industry reports suggesting that this increase is justified continued on page 46 BOXSCORE 45 The Final Score continued from page 45 because previous price increases occurring in January and April have been passed through to the box market “with relative ease.” According to the June Forest Products Monthly published by Equity Research Associates, linerboard prices have increased at a far greater rate than national average box prices, suggesting that this is not a case of the end-use market being easily able to absorb these increases.4 This third increase is rightfully calling into question the pricing activities of the major companies. During the years 1994-1995, six price increases in the span of 18 months pushed containerboard to a then-unheard-of peak of $525-535/ton. These actions rightfully caused corrugated users to seek alternative packaging and reduce their corrugated purchases – witness the growth of returnable plastic container use in the mid-1990s. A far more serious result was an inventory collusion allegation and subsequent class action lawsuit brought by the corrugated industry’s customer base that cost containerboard makers over $210 million in settlements. 5 46 BOXSCORE The corrugated and containerboard industries have recently invested heavily in the successful telling of the sustainable corrugated box, documenting its life cycle and proving again that it is an environmentally sustainable packaging choice – something we have all known and are proud to tell. It is therefore unfortunate that the integrated producers, with their capacity control and pricing actions, are negating this good message and once again putting the integrity of our corrugated packaging business on the line. Steve Young President AICC AICC Market Conditions Survey, June 2010 1 2 Ibid. Mark Wilde, Deutsche Bank, Dr. Paper’s Pulse on Paper, Tuesday, July 6, 2010 3 4 Equity Research Associates, Gibsons, BC, Canada, Forest Products Monthly, June 2010 5 United States District Court for the Eastern District of Pennsylvania, as reported in Official Board Markets, September 14, 2002. 717-898-2549,
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