The demand for unique labels is leading the way to higher profits
By Carol A. Katarsky
Presentation is important, especially in business. Custom labels can enhance the image of items on which they are placed. The value of adding an attractive, eye-catching custom label--or one designed to meet a specific set of requirements--can't be underestimated.
Custom labels are the largest product line at Woodinville, Wash.-based Labels West, mostly sold for retail packaging, according to John Shanley, president.
He noted that as the quality of four-color flexo has improved, it has become easier to increase the attractiveness of previously humble labels.
Bill Bohning, president of North Mankato, Minn.-based Label Works, concurred that the increas-ed quality of flexography has helped fuel the explosive growth of label sales.
"Custom labels are a tremendous opportunity right now, and are showing even better potential for the future," observed Bohning. "Flexo has improved to the point that we can produce offset-quality and still provide a lower price." He added that flexo is often a much faster process as well.
"The market is fantastic," agreed Tom Ainsworth, marketing director for Continental Datalabel, Elgin, Ill. "Distributors are looking to add value because selling stock labels usually means lower margins. Custom labels should be every salesperson's dream."
On average, Ainsworth said distributors can expect profits in the area of 40 percent to 50 percent. "Of course, that depends on the size of the order, and what the order actually consists of. Some labels are used in very tough conditions. If a label needs to adhere to a $1 million turbine engine, it has to perform, and the cost is going to be negligible in comparison to the cost of the item it goes on," he noted.
"People always try to add something, whether its foil stamping, embossing, four-color process or variable numbering, to make the product look better," observed Shanley. "It may cost a dime [more per label] to add foil stamping, but the customer may be willing to spend 30 cents more on the item. Studies have shown that a product with a higher quality package is perceived as being of better quality."