Over the past few years, in the never-ending battle for shelf space and consumer recognition, small to mid sized businesses often convinced themselves to spend a great deal more on product labeling than called for in their original plans. Sometimes, this was due simply to underestimating the costs of their requirements. Frequently, however, it was their perceived need to stand out from the crowd that catapulted them towards pursuing more elaborate-and more expensive-labels.
The emergence of private label manufacturing as the premier avenue for revenue and market share of most nutraceuticals companies further resulted in an increase in overall label costs. This was predictable because, by its very definition, private label means the label customization for each customer, regardless of quantity ordered. Since one of the leading cost variables of label manufacturing is production run lengths, smaller quantities inevitably lead to higher pricing.
In addition, technological advances brought many design options within reach of most label buyers-but within reach did not necessarily mean within budget. Label converters and printers offered a great many options to label designers, and the temptation of producing electrifying labels for their products sometimes led nutraceuticals business managers-especially those in small businesses-to exceed their desired spending levels.
The marketplace rarely tolerates inefficient decision making, and in many cases, unwise selections of decorative options and the accompanying overspending contributed to difficulties on the bottom line. As a result, nutraceuticals marketers began demanding a wider variety of labeling options from label vendors, while simultaneously insisting on reducing their labeling costs.
In response, innovative label companies efforted to merge state-of-the-art technology with customer oriented management processes and services. Today, sophisticated label vendors catering to the nutraceuticals industry have succeeded in opening up a world of production options and service features to the nutraceuticals product label buyer at responsibly affordable pricing.
Examining Label Options
Hot foil stamping is a great example of a popular but expensive design alternative. Historically, foil stamping had been reserved for cosmetic, wine, gourmet foods or other premium priced product labels and packaging. In recent years, as battles for consumer interest and approval intensified, more companies in a wider variety of industries began incorporating the elegance of gold or silver foil into their labels in an effort to upgrade their image. To marketers of products in competitive, low-margin industries, however, adding this glimmering accoutrement to a label has always been difficult to manage within the realities of their cost structure due to the high up front costs of the customized tooling, which hot foil stamping requires.
Today, two credible alternatives to the hot stamping process have emerged, which can produce labels that are remarkably similar in appearance to hot foil stamped labels but at dramatically lower prices.
First, there is cold foil stamping, which mimics the hot stamping process but utilizes standard printing plates and tooling instead of the specialized tooling previously required. When it first hit the scene, cold stamping was unable to duplicate the fine detail, which was the hallmark of hot stamping. Recent innovations and the development of new foils, inks and adhesives have brought the process almost all the way, according to most experts-and all the way, according to the most enthusiastic boosters of cold stamping.
A second, even lower cost alternative to hot foil stamping has been developed by combining the recent improvements in high definition flexography with the emergence of higher quality ultraviolet (UV) inks and printing processes. Using top quality standard printing plates produced by expert prepress technicians, flexographers are capable of successfully overprinting an entire label on pressure sensitive foil, carefully reversing out the areas previously designed for hot stamping. The only increase in price for this process over a standard pressure sensitive label is the minor cost differential between paper and foil. For smaller quantities, this is by far the least expensive of all foil options and the resulting label bears an extremely close resemblance to the finished product of the other options.
Two other decorative label enhancements, which have traditionally been too expensive for lower margin industries, are rotary screen printing and embossing. Rotary screen printing is an inline printing method primarily used to lay down opaque white on clear labels when ordinary water-based inks would just not be quite sufficient-even with multiple "bumps." Due to the relatively high up-front cost of the custom screens, many label purchasers have been forced to settle for a less-than-perfect opacity, which certainly has detracted from the overall appearance of the label. Today, with the emergence of improved UV inks and UV-Flexo printing capabilities, many companies have achieved their desired opacity on clear film labels with only minimal cost increases over water-based inks.
Like foil stamped labels, embossed labels have typically been employed to connote a premier status to a product. And like both foil stamping and screen printing, embossing's high up-front tooling expenses all too frequently rendered this option too costly for short and even mid-sized production runs. Quite recently, however, certain label converters have been successful in developing the skills and processes to emboss labels utilizing specialty polymer plates and low cost tooling. While the resulting "soft" emboss does not fully achieve a completely identical depth or fine detail of traditional embossing, for many applications the unique look and feel of the "soft" emboss is more than sufficient.
Expanding Label 'Real Estate'
Another area that has recently garnered a great deal of attention in the nutraceuticals arena is the emergence of multifold booklet-style labels as a solution to the need for added "real estate" to be able to include the increasing amounts of information dictated by the federal government's disclosure requirements. For some companies, multiple panel labels are a wonderful solution and succeed in providing the desired benefits. For a great many others, however, these types of labels, which typically require multiple printing, converting and finishing processes, are just too expensive to merit consideration.
For these cost conscious label purchasers, the daunting challenge of fitting the added content onto the label without vastly increasing the price of the label can be attacked through a combination of technical and creative means. A quality converter experienced in reverse side printing can generally add 40-70% of label "real estate" by printing on the back side of the label, while creating a pattern adhesive which will enable a consumer to temporarily peel the label to access the backside information before resealing. But be careful as peel-and-reseal technology can be tricky. The correct inks, varnishes, laminates and adhesives must all be accurately matched to the container being labeled to ensure successful performance. In addition, care must be given to "locking in" the reverse-side printing to avoid having the inks sloppily transfer onto the container itself.
With this added space, a creative designer with a working knowledge of the federal requirements can effectively include all required information without diminishing from the graphics and impact of the product, brand and company identification elements of the label. Ultimately, this two-sided peel-and-reseal label should cost only slightly more than a similarly constructed single-sided label and will succeed in meeting both regulatory requirements and marketing objectives.
Consider Partnering
Service and logistics enhancements are being achieved within the nutraceuticals industry by the operational partnering of label converters and product marketers, graphic designers and label buyers.
The material cost variables in label production typically include substrate, ink, size, adhesive, number of colors, finishing requirements, and, of course, quantity. However, in many cases, the actual direct costs of the label are outweighed by the costs incurred as the result of operational decision making. These non-production cost factors are especially prevalent in the nutraceuticals industry due to the very nature of the industry itself.
In the nutraceuticals industry, which is so heavily dominated by private label programs, costs escalate when businesses reduce the actual production run sizes by requiring not only different labels for each SKU (of which they may have many), but customized labels for each customer of each SKU. In addition, "Just-In-Time" manufacturing, which efforts to cut costs and free up working capital by reducing or eliminating inventory, similarly shortens label production runs, which in turn increases the cost of labels (due to the reduced volume across which set up time and waste can be amortized). A relatively unique non-production factor in this industry, which contributes to higher costs, is the aversion to holding label inventory due to the fear of new government labeling requirements that could render all existing labels useless.
Cost conscious nutraceuticals companies would be well served to work with label vendors who demonstrate expertise not only in technical production skills but in their approach to the non-production cost factors. In this age of customization, a label converting partner experienced in crafting tailored programs that minimize these operational cost factors can be a major competitive asset. For stable businesses with a solid handle on their label requirements, forward-thinking label vendors may be able to develop a customized inventory program that will reduce label costs by offering annualized volume pricing, as well as contributing to Just-In-Time manufacturing by enabling same-day shipping. Establishing livable min-max inventories would limit the nutraceuticals company's exposure if the label at some point requires altering. In addition, many label vendors will invoice customers upon shipping, providing a cash flow benefit to the purchaser.
Cost-Efficient Design
Operational cost factors can similarly be combated at the design level. For flexographic printing, with a bit of foresight, solutions to potentially vexing and expensive situations are often simple. For example, when multiple versions of a single style label will be required, incorporate as many colors (including four or six color process) as desired into the base design, while ensuring that any potentially varying information (i.e. product name, ingredients, bar codes, legal disclosures, etc.) is restricted to a single spot color. This will enable the more efficient and less costly production of multiple copies at the minimal cost of a single plate and plate change per copy, rather than having to deal with multiple plate changes, which would, in effect, be the equivalent of starting from scratch for each additional copy.
Taking this concept one step further, many nutraceuticals companies utilize a carefully designed standard multicolor template printed on thermal transfer pressure-sensitive stock. Then, using their own inexpensive thermal printers (or in some cases, outsourcing the thermal printing to label vendors with thermal transfer printing bureaus), they can print the variable information in a predetermined pattern. Innovative thermal transfer materials, such as colored ribbons and imprintable laminations, as well as traditional processes such as pattern UV varnishing, provide these companies with the ability to customize labels in any quantity for any number of customers. In addition, these companies can lower their costs by purchasing the flexographically printed template labels as a single SKU in high quantities, without any concern for having to discard inventory due to changes in the label information.
Businesses requiring numerous short runs of different labels who cannot work within standardized label templates should consider the benefits of revolutionary digital printing. This state-of-the-art technology, such as Indigo's Omnius Webstream digital offset press, offers ultra-high quality color process labels produced via direct-to-press printing, eliminating the need for costly printing plates. In addition, digital printing offers unique capabilities, including low cost variable information printing, beyond the means of traditional printing processes.
There is certainly no arguing with the fact that increasing spending to design and produce elaborate labels can have a positive impact on the sales of the product. Indeed, a great many products can point to their eye-catching label as a primary contributor to their success. Standout features, such as embossing or foil stamping, can position a product to the customer in a manner far superior to any advertisement or promotional campaign. But prudent and cost conscious label designers and buyers should be aware that alternatives to most traditional expensive methods exist, alternatives which, in many cases, produce virtually identical results at significantly lower prices. NW
About the author:
Elisha Tropper is president of label converter Prestige Label Co., Brooklyn, NY. He can be reached at et@prestigelabel.com.