Sustainable Transformation

New York converter Label World has transformed itself with a move into the prime label market and by adopting an ambitious environmental strategy. Danielle Jerschefske reports

Label World in Rochester, New York, has experienced a wave of change since president John McDermott took the lead of the formerly family-owned business. Primarily in the commodity label business in 2006, Label World now has a number of key prime label accounts and is eager to capture more.

The company has taken a strong environmental stance, finding a competitive advantage on many levels: waste reduction, increased profit, new business, and business leadership. 

Although pressure sensitive label manufacturing is the converter’s primary focus, it is capable of producing tags, inserts, plow fold and extended content labels to suit the needs of multiple markets. Label World uses a unique format letterpress for complex label constructions and also has  digital printing capability. The mix has served the business well. Only six years ago orders for clients in the H&B, wine and nutraceutical markets accounted for one percent of the business. Now it is 25 percent.

Before making its strategic move into prime labels, virtually the whole of Label World’s business had been basic paper labels. The converter catalyzed change around the Five Business Pillars (People, Planning, Process, Performance, Profit) and TLMI’s project L.I.F.E. environmental management system. John McDermott explains: ‘There was a total overhaul of the business. We established our strategic plan, set goals and made operational changes that would help us move from A to B.’

With the right systems now in place, a capital investment plan set, and sustainable values integrated into its business objectives, a modern Label World is well positioned for the future. 

Making Changes

Label World uses narrow web water-based Mark Andy and Aquaflex flexo presses to make both commodity food and industrial labels, and, increasingly, prime labels. But it was the investment in a used CID 12-color Ko-Pack letterpress from Singapore, capable of running UV, that helped the converter rapidly pick-up business in the complex prime label market. In addition, an all-new DuPont Cyrel CtP plate-making system, installed in 2008, gave the converter more control over its flexo process.

To improve quality, Label World started an ECR (error cause removal) program that highlights errors flagged in production. Each workday associates discuss the situation to find the best solution for preventing the error in the future. The ECR program has established new communication channels between the ‘front’ and ‘back’ lines. Key production numbers are regularly collected to calculate the cost of quality as a percentage of sales.

Label World’s sustainability policy – prominently displayed on the company’s website – states that it will strive to eliminate waste, to power its operations through renewable energy and to create products from sustainable natural resources. It vows to maintain a sustainability scorecard to identify wastes within the label production process, and to regularly evaluate, measure and set new goals for continual improvement.

Label World is a certified member of TLMI’s Project L.I.F.E. – Label Initiative For the Environment – scheme, which serves as a guideline for improving environmental performance in line with Lean manufacturing and six sigma principles. McDermott explains, ‘Having an environmental management system like L.I.F.E. has improved us as a company in several important ways.  First, it has allowed us to identify forms of waste that we never thought about before and that has helped us reduce cost. 

‘Secondly, we are now finding customers who want to partner with us on innovative environmental solutions that are good for their brand and their customers. This makes us more competitive and differentiates us in the marketplace in very positive ways. This has led to retention of major customers as well as acquisition of new ones.’

Label World is the 2011 winner of TLMI’s Environmental Award for Process Improvement. The company was selected for its leadership in making sustainability a core element of its business strategy. McDermott says, ‘we are seeing results in terms of more motivated associates and new customer opportunities for whom sustainability is a corporate commitment. L.I.F.E. has been a key driver in our transformation.’

Investments have been made to conserve energy and water usage within the plant. Lighting systems have been replaced with T5 bulbs, reducing lighting costs by half. An instant hot water heater has replaced a traditional heater using smaller bursts of energy on-demand. Since 2008 natural gas, water and electricity consumption have decreased by 40, 28 and nine percent respectively per 1000 sq. ft. of material converted. Label World offsets 100 percent of its electric and gas consumption with wind power renewable energy credits through the Renewable Choice Energy program, preventing 612 tons of CO2 emissions from being released into the atmosphere last year alone.

Solid Waste

Label World’s initiatives have enabled the business to divert all its label material waste and office waste from landfill since 2009. This waste is collected by Covanta in nearby Buffalo, New York, and used to generate energy though incineration with other domestic wastes. The heat from this process boils water and the energy is harvested and put into the grid. Label World diverted 250 tons of solid waste from going to landfill in 2011 because of this Energy from Waste (EfW) partnership.

The company has recently started pulling specific waste items out of the flow that goes to Covanta and is redirecting it to alternative recycling streams wherever possible. In the past few months this diversion has become about 10 percent of the total waste diverted.

Select customers have enlisted in a packaging reduction program with reusable plastic totes or bulk packaging on pallets. Reducing the packaging and increasing the amount of sellable material shipped can reduce the total carbon footprint of logistics operation.

Volume, logistics and cost are usually the main barriers to a successful ‘reverse logistics’ system to recover manufactured materials. Label World acted as a beta site for DuPont’s plate material recovery program, a ‘take back’ program for DuPont customers to return all of their plate and packaging materials at no cost. To participate in DuPont’s program converters must separate the PET cover sheets from the plate materials, sorted by unprocessed and processed, with some configuration guidelines. In order for the system to work Gaylords must be a minimum of 800 lbs.

Liner recovery

Label World actively promotes the benefits of unbleached kraft liner because it can be easily recycled in current corrugated recovery streams. Green Bay Packaging supplies pressure sensitive label stock with unbleached kraft liner and 30 percent PCW facestock. The converter is moving to make this construction of white semi-gloss material its house stock.

Already, in collaboration with key customers, Label World has helped divert over two billion square inches of liner material from going to landfill. Increased volumes in kraft liner labels sold will improve the potential to increase recycling rates wherever Label World customers are located.

Per billion square inches, kraft liner reduces wastewater output by half, uses 30-40 percent less energy and releases as much as 20 percent less Greenhouse Gases (GHGs) into the atmosphere. Says McDermott, ‘So far we are getting very positive feedback from our customers, with occasional testing for specific applications. Once the conversion to kraft housestock is effective we will have to figure out ways to encourage and measure customer recycling of the liner.’

Label World also talks to its clients about the new innovation from Mitsubishi Polyester Films that allows PET release liner to be recovered from brand owner application streams, sorted and reprocessed into new liner. Reprocess, as it’s called, holds the same performance characteristics and price point as 100 percent virgin material.

The converter also offers a special label stock for the wine market featuring environmental benefits. The white textured facestock is 100 percent PCW with PET liner to close the loop. This material has been engineered to print, emboss and foil stamp beautifully while maintaining its strength and brightness even when wet.

Digital Brand Case Study

Label World helped its client, The Vitamin Shoppe, gain control of its brand, using digital print technology to enhance the shelf appeal of the product lines, streamline the ordering process and manage inventory more efficiently. The brand required regular orders of labels in a multitude of sizes with as many as 1000 SKUs. Due to the accuracy required on nutraceutical labels, the brand’s hands were tied when a change had to be made at the last minute and it didn’t have much flexibility when it came to re-designs and run lengths.

The converter worked closely with the brand to simplify its ordering process, which is now completely digitized. Brand procurement places orders remotely, signing-off on all artwork through the use of EskoArtwork’s Automation 10 software working in the background of Tailored Solutions Label Traxx ERP software. There are no checks or proofs required. The customer owns the quality.

All of the labels are printed digitally on an HP Indigo 4050 or 6000 dependent on run length and are stored and shipped as needed. McDermott says, ‘It has worked to put the ownership into the customer’s hands.’Label World has a finishing line to convert digitally printed labels off-line. Its AB Graphic Digicon II has a rotary die station and two flatbed embossing and foiling stations.

The converter helps control the traceability of the labels by linking customers to its e-commerce system where supply chain data is readily accessible.

Moving forward, McDermott says, ‘We’ll continue to find more business in multi-ply and premium label categories.’ About 30 percent of current work is digital, so the converter sees lots of opportunity there as well. And sustainability will continue to drive profitable operational changes and create a unique brand for Label World among its customers and the wider industry.

Converters: Sustainability Brands

Q: What’s the most difficult part of educating your clients on sustainability? How do they respond to L.I.F.E. and your internal changes to reduce the company’s impact on the environment? 

A: For most of our customers, sustainability is not a high priority yet.  They need us to provide a good quality product on time at a competitive price. Yet we are finding that if they can get all that AND a positive sustainability story on top of that, they want to hear more and find out how they can use that to improve their brand. This is a slow, patient process. 

Individual discussions are very helpful here. In other cases, some customers have already made a significant commitment and are willing to pay a premium for a unique sustainable solution because it is important to their brand. This is not very often, but it is happening and we are looking for those types of customers. 

Q: What about suppliers supporting sustainable innovation?

A: There will be no significant industry improvement without the commitment and effort of our suppliers. The key will be finding ways to encourage collaboration between brand owners who need the changes and can commit specific volumes with converters and suppliers who can develop innovative, affordable solutions. We have had wonderful support from several of our suppliers working in partnership with us and our customers. 

Q: Have you ever had a customer select sustainability over price? 

A: Yes. As an example, this past year we had a customer launching a new product whose branding was totally linked to sustainability. They paid a significant premium for a particular material that had unique environmental claims.

This article was published in L&L issue 1, 2012