Increasing Label Costs Driving You Crazy?

Increasing Label Costs Driving You Crazy? Tips on how to stay sane.

By John Burke – VP, Winco Identification

Considering the high cost of gas and groceries, it should come as no surprise that so too is the label industry facing unprecedented high costs and raw material price increases.  Why the increases?

These increases are largely the result of commodity pricing associated with oil and pulp.  In particular, oil (currently selling at over $110 per barrel) is required for energy to operate and heat label manufacturing operations, to transport products; and like pulp, oil is even a key ingredient in many label materials.

The outlook seems to indicate no relief in sight in the short term.  In fact, some label industry experts speculate additional price increases by the end of the year.  So faced with high prices and projected future increases, how can you minimize the impact on your labeling budget?

First, consider the actual requirements of the label and re-evaluate your current solution.  Sometimes labels are over-designed (or over-sold) using label materials or adhesives that far exceed the requirements of the application.  Are alternative label materials available that fit the real needs of the application at a lower cost?  Why pay more for a label that doesn’t result in any real additional value?  Many label constructions are available with various substrate, adhesive and liner combinations. A little homework might uncover cost-saving opportunities.  

Second, manufacturing economies of scale in label production can be significant.  I realize the days of wide reaching “blanket orders” and “make and hold orders” have been replaced with just in time deliveries – especially in fiercely competitive or in fast paced and difficult-to-forecast environments.  However, the simple fact is that generally higher production quantities yield lower unit costs. Even in short run environments, eliminating redundant set-ups really save money by maximizing efficiency and driving costs down.  If possible, use a “stock” product that is made is larger runs.  Or consult with your label supplier to find opportunities to combine your label orders with other jobs your supplier produces in larger quantities.

Lastly, why use costly pre-printed labels if you can use blank labels and your thermal transfer printer to create the labels.  Even though the printer will create only a single color, many applications are perfectly suited for black images.  Labels used to identify assets, inventory, and even product or warranty information, are commonly produced with black images against a contrasting white or silver background. Even if multiple colors are required, consider eliminating at least one pre-printed color from the label.  Reducing the number of colors not only lowers the overall cost of the label, but could also minimize the risk of obsolescence due to design changes and will promote a more efficient on-demand printing process.

For more information or additional ideas about creative labeling solutions, contact me at john@labelingnews.com, or call me at 1-800-325-5260.