4 (false) obstacles to digitization in the packaging industry
Realizing a custom packaging project can be a long and tedious experience for both the buyer and the supplier.
The market has evolved, and manufacturers now find themselves with many more quote requests than before: where they used to quote for 10,000 pieces, they now quote 10 times for 1,000 pieces.
In this context, estimators inevitably fall behind, and customers must wait an average of 48 hours before receiving the quote price. With each modification (and there are usually several), a new quote is drawn up, and the customer must wait again for 2, 3, or 4 days. It is not uncommon for several weeks to pass between the submission of the brief and the validation of a BAT, considering the quote delivery times, weekends, and other public holidays.
This is a delicate situation for both stakeholders:
- The manufacturer takes time to prepare several quotes for the customer, without any guarantee that they will end up working with them. It even happens that manufacturers find that more than 90% of their quotes do not convert into orders.
- The customer, on the other hand, is often in a hurry and does not understand the reason for these long delays.
To simplify this entire process, software solutions like HIPE now offer customers an online packaging configurator. This gives them the opportunity to create their own quote and get an instant price. With such a tool, the manufacturer fundamentally differentiates itself by offering significantly shorter lead times than average, while providing its customers with a remarkable buying experience.
Our industry is full of new technologies aimed at improving business performance. However, the packaging market is still very reluctant to embrace these developments.
But aren't most of the barriers to digital transformation more mental than factual?
Before answering it, it is important to define the term "digitalization" (= digital transformation), which is often misunderstood: digitalization is a process that aims to transform traditional processes, objects, tools or even professions through digital technologies in order to make them more efficient.
It is not just about implementing new technologies that latch onto current processes. It is above all about questioning one's dynamics in light of the possibilities offered by new technologies.
The fear of change
" Every innovation goes through three stages: first it is ridiculed, then violently opposed, and finally it is considered to have always been self-evident ," said Schopenhauer.
It's well known that anything new is met with rejection. As soon as new things disrupt our habits and take us out of our comfort zone, we struggle to accept them.
When desktop computers arrived in the 1970s, many employees were reluctant to replace their work tools with this new device, which they considered too complicated and impractical. 50 years later, it's clear that employees have come to terms with it, as it's now impossible to find offices without computers.
The problem, therefore, lies not with the tools themselves, but with our perception of them. One way of looking at things is to no longer see these new developments as a change, but more as an evolution. We need to accept the changes in the industry, move with the times and embrace the opportunities they bring.
Lack of time to rethink processes
Manufacturers have long days. Managing a factory (or factories) and its teams requires a lot of day-to-day work.
Implementing new software requires careful thought about the current state of processes. This is something we don't necessarily think about when we're "too busy working."
Like an athlete who takes the time to study and analyze his latest performances, a manufacturer should focus on his processes to realize the full development potential that can still be added.
There's no better time to do it, as the packaging industry is undergoing a profound transformation linked to changes in commerce.
Brands today have to adapt to competitive pressure, new market expectations and the proliferation of commercial events (Black Friday, French Days, private sales and sales, etc.). They are therefore looking to reduce the cycle of new projects by shortening the time between the design of the packaging and its arrival to the consumer.
The result is that manufacturers are producing more and more quotes for ever-smaller quantities.
These transformations require more efficient workflow tools to adapt optimally.
It is therefore important to set aside time to reflect on these processes. Is it possible to optimize them? How? With which tool(s)?
The sooner you do it, the sooner you will realize that you have the opportunity to save/earn a lot of money by perfecting them.
Prefer to invest in production innovation
It is important to have good, efficient and reliable machines. However, there is no point in investing in an ultra-fast machine if the rest of the process cannot keep up.
The majority of customers are not interested in new production methods. They simply want to feel valued and receive their products in accordance with their requirements: to be delivered on time, at the right price and with a good level of finish.
Therefore, customer relations should not be neglected under any circumstances. You should know that recruiting a customer costs three times as much as retaining them, and winning them back costs 12 times as much. More importantly, 75% of negative customer experiences are not related to the product.
Digitizing your processes helps you to strengthen your customer relationship: by better understanding the customer's needs, by delivering quotes more quickly, by having more structured follow-up; you provide a truly differentiating service to your customer. By centralizing and automating all processes, you avoid human errors that will make you look bad in front of your customers.
Employees opposed to new technologies
Many people have a biased view of new technologies. Many believe that robots will end up stealing their jobs, that new technologies are too complex, and are just a management fad. On the contrary, they allow them to focus on their core business.
Like a spell checker, new technologies simplify tasks, for example, by making it easier to correct and proofread texts. However, since this task requires critical and/or creative thinking, a competent person will always be needed to verify that the syntax is correct, that the text is comprehensible, and to correct it if necessary.
They reduce the burden of time-consuming and repetitive tasks, leaving teams more time to focus on important tasks: those that cannot be managed by the software because they require real business expertise.
In our industry, an estimator-manufacturer spends most of their days preparing quotes in a chain. A repetitive and intellectually unfulfilling task. They could let software like HIPE take over and concentrate on the most technical and innovative requests, in other words, the projects that truly create value.
How can we imagine that an estimator-manufacturer spends as much time on an order for 100,000 pieces for a key account as on a small, poorly defined and changing order for a customer who only places this single order per year?
You need to make your employees understand that new technologies are there to help them. Once in place, they will realize the time savings that these tools bring them on a daily basis, and they will be grateful.
Don't wait any longer
Today, the packaging industry is – to say the least – cautious about digital transformation. However, it is clear that its players will soon have to catch up. In just a few years, the printing industry has been completely remodeled through digitization, with the arrival of new players on the market completely "disrupting" a sector that printers thought was frozen in time. This paradigm shift will sooner or later arrive in the packaging industry.
There are already powerful players betting on its digitization, such as Heidelberg, which recently launched Zaikio, an App Store listing the best applications for printers and manufacturers worldwide.
The reality is that digital technology has increased the speed at which the business world operates. Stubbornly refusing to adopt new systems will put you behind your competitors.
No one is immune; just look again at the Print companies that thought they were safe, but were swallowed up by the arrival of Web-to-Print. So, be a pioneer, take this risk that isn't one, and get ahead of your competitors.
At Packitoo, we are passionate about the subject, and if you would like to continue the conversation and find out how HIPE could help you modernize your processes: