Good times ahead for packaging machinery

As more and more companies report increased earnings along with disappointing sales, this says to me that good times are ahead for packaging machinery companies and others who facilitate automation. Why? Because the only way to increase earnings on weak sales is through gains in productivity. These hard times are providing proof positive that there is another wave of productivity gains that can be achieved even by those who were already well along the path to automation.

Not only are those early adopters noticing this, but a new class of customer has become aware of the need and potential to automate. Small, privately owned companies who have eschewed automation up until now have taken notice of the potential productivity gains. They've seen that automation has moved beyond art to science. And these same companies are tired of the challenge of finding dedicated and appropriately skilled labor, even in these times of high unemployment. They see their future in automated processes and machinery. They are going to be the ones who drive the market over the next five years.

This will be a different sort of customer. These companies don't have engineering departments who have developed control architectures. They don't have maintenance departments with the power to demand that machines come in outfitted with their preferred components. In these companies, the buying decisions will be made by the owner, not some deeply-buried project management organization. The decision making will be based upon relationships, trust, technical capability and price.

This will open up new opportunities for machine builders who have developed superior-performing machines enabled by the low cost application of the best available technology. (If you recall, I advised builders to use this down time in business to reevaluate their offerings.) Second and third tier automation platform suppliers will gain in popularity, as owners look for best of breed solutions rather than for conformance to some engineering standard. Packaging machinery specifications from these new customers will be more like those for machines in the printing and converting industries where controls architectures and platform suppliers aren't a key issue.

Standards like PackML may also get a boost, not because owners specify PackML as ISA Technical Report TR88 part 5, but because they insist on common sense ideas like a simplified and common user interface across multiple machines. For that, PackML is the only game in town. Forget about it as an engineering standard, think about it as process simplification for operators.

Many packaging machinery manufactures have done relatively well in this recession. If I am right, those who have kept up with their technology will do really well as the economy improves. Do you think I am right? I'd love if you would share your opinion with our readers.

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Comments Unhappily, the thrust of this piece is tenable.This writer has no problem with position requirements being bumped up, but that an employer wold not hire an individual who lacks specific training, yet, clearly, exhibits the potential to learn on the job is difficult to not consider as more than disappointing. Posted by: Michael Sanna on August 2, 2010 Good article. We have a new machine that represents a radically new way to put tape on a box. The point is that we are getting a lot of attention because people want to automate whenever they can and our machine is the first step up from hand taping. Posted by: Tom Malec on August 2, 2010 Keith, not a comment on the current article, but just to point you to an interesting article about the German approach to employee training that I found on the Packaging World web site. Imagine the improvements we could have if American companies adopted these ideas. I know this is the kind of thing you like to look at and write about. The article is entitled "Contract packager works with machine supplier to meet customer demands" and was posted on June 17 at this URL: http://www.packworld.com/webonly-29894 Regards, M. Babb Posted by: Michael Babb on August 30, 2010 Post a comment (If you haven't left a comment here before, you may need to be approved by the site owner before your comment will appear. Until then, it won't appear on the entry. Thanks for waiting.) Name: Email Address: URL: Remember personal info? Comments: (you may use HTML tags for style) Type the word 'packaging' (required):