With developments in adhesives and technology, integrated cards and labels are old dogs that have learned new and profitable tricks.
Integrated cards and labels add extra value to traditional form and label products. With new advances in technology and adhesives, these products provide a less expensive solution to many of today's needs.
Judith Jacobs, marketing manager at Chicago Tag and Label, Libertyville, Ill., said that integrated cards and labels serve many applications in the insurance, membership, association, catalog and fulfillment markets. She noted that the company's form/label products are new to the market. "We have seen how integrated form/label combinations have been able to supplement the piggyback label product solutions," she said. "There is a wide variety of materials that can be used with these applications, including liners, and bond or tag stock face materials."
Jacobs also said that Chicago Tag and Label is committed to providing innovative adhesive products. "We do extensive testing on various adhesives and liners to ensure that our customers are getting what they need," she said. "These variables may include permanent, removable and patterned adhesives, in addition to standard- and custom-release liners."
According to Paul Edwards, president of FormStore, Fenton, Mo., while the integrated cards market maintains prevailing success, some integrated card products are defective. "Our market research and product testing showed that a significant number of integrated card products being sold contaminate printing equipment by leaving residue on the machines, or simply don't function well at high speeds," he said.
Edwards also noted that some end-users find it difficult to effectively use some of the current integrated card products. "In some cases, when end-users try to remove the integrated card from the sheet, the card is often destroyed. This has become a significant problem for card issuers," he explained.
To help eliminate possible manufacturing and end-user problems, Edwards explained that for the last two years, FormStore has worked on developing a premium integrated card product line. "Our new LaserMaster PerfCard and PeelCard products will not contaminate printers and are end-user-friendly," he said. "The cards feature sophisticated engineered perforations, patent-pending construction, premium paper and custom-formulated adhesives. They are designed to function on extremely fast, high-volume and high-color digital printing systems."
Manufacturers have pointed out that the integrated card and label market is evolving. Edwards said that the incorporation of radio frequency identification (RFID) technology into integrated products will soon become the industry standard. "Incorporating RFID technology into integrated cards as they are being produced is on the rise," he said. "FormStore will begin offering the technology in its LaserMaster integrated card products in 2005."
When it comes to products that yield the greatest sales, Jacobs said that gift cards and form/label products are Chicago Tag and Label's biggest sellers. "They are a nice fit whenever packing lists, bills of lading and shipping labels are needed," she said.
The Bottom Line
After the press has printed its last label and the sales force has exhausted all of its efforts, the question remains—how profitable is it to sell integrated cards and labels? Manufacturers agreed that it is a profitable and worthwhile venture. "Distributors can find profitable margins in this market segment if they pay keen attention to their customers' needs," noted Judy Miller, label products manager at Dayton, Ohio-based Printgraphics. "Selling customers a new product is not always the answer, but providing modern and more efficient solutions to what they are already doing is a sure way to generate new sales."
"Selling integrated cards could be very profitable for creative distributors," Edwards added. "In today's marketplace, as people move away from traditional forms, it's necessary for distributors to look to value-added products to gain margins."
Jacobs agreed, "This can be a very lucrative market, especially with the increasing number of traditional brick-and-mortar retail stores going into Internet sales."
Manufacturers were eager to offer distributors some tips for increasing sales and uncovering new markets. "Take a look at what your customers are doing and see how you can expand upon it," advised Miller. "If they are adding on or are opening new branch offices, this is a good indication that the business is expanding and may need other types of products."
Jacobs echoed Miller's sentiments. "It is important that distributors understand their customers' operations," she said. "Knowing the environment that the product will be stored in and the printer that will be used are important factors." She also said that distributors should look for areas where their customers' shipments have increased. "When this happens, distributors can show customers ways to save time and money, such as using an integrated label for the shipping box, rather than taping a perforated paper label to it."
As for uncovering new markets, Miller said that a little effort from distributors will go a long way. "Customers won't come to you—you have to go to them. Pay attention to the business community where you live and see when new businesses are opening up in your community," she advised. "Distributors should also be willing to look for new contracts outside of their immediate communities. They will be surprised to discover the number of business opportunities that are 20 or 30 miles outside of their immediate areas."
Looking Ahead
Edwards said that distributors who take the time to learn more about integrated card and label applications should continue to see substantial profits and increasing sales. "Distributors who research and understand their customers' integrated card and label applications will benefit from this growing market," he said. "Those who do not take the time to learn about product applications will have ongoing problems."
Miller said that the integrated card and label market will continue to see growth. "This market continues to be a high-growth area for us. We only expect it to expand in the future."
By Cynthia T. Graham
- Companies:
- FormStore
- Printgraphics
- Places:
- Libertyville, Ill.