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Domestic tube suppliers labor under the increased pressure of international competitors while decorating innovation continues to enhance brand identity.
By Joanna Cosgrove, Contributing Editor
The average consumer loves products designed to make their lives easier, which is why tubes are such popular vehicles for everything from skin creams to toothpaste. That same consumer also has a "what have you done for me lately" attitude, which keeps cosmetic and personal care product manufacturers constantly in search of the next new product and packaging. But keeping costs down is an equally important goal, driving manufacturers to constantly search for packaging suppliers that can deliver the most for the least.
Offshore Competition Heats Up
Overseas packaging suppliers have been nipping at the heels of their North American counterparts for the better part of the last decade, but in the past few years the competitive pressure has been even more palpable. Domestic cosmetic, personal care and fragrance manufacturers are increasingly turning to offshore suppliers in China, Korea, India, Pakistan, Mexico and Costa Rica (to name a few) where labor costs are far lower that those in North America. Sourcing packaging components from these countries is cheaper and often faster than purchasing the same from domestic manufacturers in the U.S. and Europe. This scenario has caught many domestic tube suppliers in a competitive squeeze, as most are currently faced with either overhauling their core business strategies or aligning with overseas companies in order to maintain their market foothold.
Lengthy domestic tube lead times have been a perennial frustration for end-users. Industry executives said the logjam is due in part to large customers-especially dentifrice marketers such as P&G and Colgate-whose volume demands eat up large portions of line time, forcing other companies to source their tubes elsewhere. But those interviewed for this article said lead times are a secondary reason behind the overseas outsourcing. The primary problem is price.
"I think companies are looking overseas for better lead times and cheaper costs, but that is the business model of a capitalist society," observed Christopher White, managing director, The Filling Station, Walpole, MA. "The bottom line is, domestically, we need to manage lead times better and allow companies other then the big ones easier access to well produced tubes with state-of-the-art graphics.
"To set-up a line for production, the cost can exceed $10 million, so I can't imagine foreign companies sinking that much money in new lines when we won't do it domestically without large commitments from new companies," White noted.
Kelly Barry, president of Market Ability, a Freehold, NJ-based resource company that connects packaging customers with global choices of supply, acknowledged the potentially erosive effect of Asian competition, but contended the foreign tube markets are merely setting a standard that American suppliers ought to consider if they're serious about growing their respective tube businesses.
In particular, Barry, who has more than 20 years of experience in the U.S. collapsible tube industry, pointed out that the European penchant for innovation is a positive business driver. "European companies tend to be ahead of the curve regarding technical issues," he said. "Almost all tube making equipment is designed, developed and manufactured there, so tube producers in Europe have a stake in new developments. By listening to customers and partnering with equipment manufacturers, they often pioneer tube advances."
Asian suppliers have a different stake in the business. "Asian tube suppliers are excellent at reproducing the latest developments in tube specifications," Barry continued. "They are eager to be seen as global suppliers and work to accommodate customers' requirements."
Barry offered advice to domestic suppliers by tube type. In the aluminum tube segment there is stiff price pressure from imports from South America, Europe and Asia. For this category, Barry advised domestic suppliers to: control costs by cutting scrap and improving throughput; meet promised deliveries; provide top service to keep customers; run leaner; schedule better; and partner with offshore competitors.
For the domestic extruded plastic tube segment, which is most impacted by price pressures from Asia, Barry suggested domestic suppliers: endeavor to improve lead times; contain costs; and add capacity to service smaller customers along with the major ones.
Domestic laminate tube suppliers characteristically have more capacity than the customer base requires, so Barry surmised that a broader closure selection might attract a wider customer base.
Asia offers more than lower costs to tube customers, according to Barry. "In extruded plastic tubes, delivery times from Asia are often shorter than domestic lead times," Barry said. He added, "They are less focused on innovation and more focused on superior customer satisfaction."
Domestic suppliers are quick to remind their customers that cheaper doesn't always mean better. There can be legitimate issues with the quality of tubes produced overseas, as compared to those produced domestically. "We have had to send back two separate shipments from China for quality reasons. The resins used were recycled and not clean enough to be able to be sealed," recalled White. "This may not always be the case. However, I warn customers that a few pennies saved on the cost of tubes may cost them a lot of time/money over time."
Challenges for Tube Fillers Too
One of the biggest issues impacting tube fillers has been the transition from embossed lot and expiry information to the printing of this information directly on the tube. "Historically, this info has been embossed in the tube seal area. As it is embossed, it can be difficult to read," remarked Bernie Conlon, director of sales and marketing, IWKA Pack Systems Inc., Fairfield, NJ. "Many cosmetic manufacturers are discussing alternatives such as printing this data on the body of the tube with either a laser or an ink jet printer. This has an obvious effect on the artwork as an area needs to be prepared to receive the printed characters. A side effect of this is the fact that once you print something, you will need a vision system to verify that all the characters were printed and legible. This means that filling machines will need to be retrofitted with printers and cameras. This increases setup time as well as possibly cluttering up the machine."
Expanding diameters of cosmetic tubes (now at 60mm, up from 52mm) may also pose issues for current filling equipment, according to Conlon. "Current machines may not be able to handle this size without a retrofit," he said. "Newly developed machines will need to handle this larger size as a standard."
Equipped with an efficient utilization of servo technology, IWKA's compact new model TFS 80-1 tube filler flexibly accepts tubes up to 60mm in diameter and runs up to 100 tubes per minute with one filling nozzle, according to the company.
On the business side, tube fillers have witnessed ongoing business consolidations. "We have seen big guys get bigger and small guys close their doors," said The Filling Station's White. "Most new equipment is being sold to the end user of large quantities (P&G, Unilever, etc.)."
BeautyBank Tubes Reflect Possibilities
Demand for cosmetic and personal care tubes is high and much of the innovation revolves around graphics. In terms of decorative embellishments, just about anything goes, as long it helps catch the eye, commented Chris Barry, communications manager, The Tube Council, Naperville, IL.
Last October, NY-based BeautyBank, the newest division of the Estée Lauder Companies, launched three new cosmetic and skin care brands available exclusively at Kohl's Department Stores: American Beauty, Flirt! and Good Skin. Alcan Packaging Beauty (Cebal), Norwalk, CT, supplied most of the tubes for all three lines, according to Kris Christensen, director of marketing for the tube manufacturer.
He noted that the Good Skin line featured several oval shaped tubes with screw-on caps, offset printing and gloss coating, in 50ml and 200ml, while the American Beauty line includes a Silverline laminate tube with offset printing and flip top cap. This line also used various plastic tubes with pastel pearl finishes, decorated with silk-screen and hot stamp, and Cebalcaps with shrink band.
"This was a major undertaking as the timeline was very tight and there were numerous SKU's (about 30 different items)," said Christensen. "These launches included plastic tubes, laminate tubes and oval tubes with varying degrees of decoration, some of which included silk-screen and hot stamp."
In the past year, Alcan introduced two oriented flip top cap styles called Regal and Meridian, as well as a flip top cap for its 40mm oval tube. Another area of interest for Alcan has been personal care laminate tubes. "We have developed an embossed laminate tube that gives a tactile effect on the laminate surface," said Christensen. "Our customers can design the pattern of their choice to give their tube a unique identity."
Tubes with Tools Add Convenience/Difference
Tube Tools, the latest Handsfree Tube endeavor from Tectube (formerly Norden Andbro Inc.), Pitman, NJ, emphasizes functionality with implements such as sponges, pumice stones and massage heads that are sonically welded to the sealed end of a blended high and low density PE tube, according to Deb Spaeth, the company's sales manager.
Avon is currently using a 35mm oval Handsfree Tube outfitted with a sponge applicator for its Skin So Soft (SSS) brand Hair Removal Gel. "This makes for a no-mess application of product," said Spaeth. "The sponge itself is closed-cell, preventing the product from being absorbed into the sponge."
The biggest selling feature of the tube is its hands-free application benefit, according to Zena Sekavec, Avon's color package engineer. "A common complaint with depilatories is that they are messy," Sekavec said. "The sponge application allows for an easy, fast and effective application. A cloth is used in the removal process and therefore (for the most part) the depilatory does not come in contact with one's hands."
Avon liked the package's visual point of difference, Sekavec noted, and also that the design intrinsically increases the likelihood that the product won't unintentionally be transferred to a sensitive area such as the eyes.
Compatibility-possible discoloration or deterioration-between the sponge and formula was an initial concern, according to Sekavec. "We changed the color of the sponge so the discoloration from the depilatory would not be obvious," she said. "We did transit and consumer testing to be sure that the sponge would not dislodge or irritate."
Skin Care, New Sizes Boost Tube Use
The success of sophisticated skin care products has been fueling demand for both laminate and aluminum tubes for the last year, according to John K. Iorii, general sales manager, Montebello Packaging, US/Mexico Operations, Arlington, TX. "It appears that the anti-aging skin care market has been experiencing significant growth globally and utilizing tubes because of their consumer acceptance, demand and dispensability," he said. "More importantly, laminate and/or aluminum tubes have the necessary barrier properties for hard to hold, oxygen sensitive or fragrance sensitive products, which most of these cosmetic and personal care products require. In addition, cosmetic and personal care companies with a wide range of skin care products, formerly packaged in jars and/or bottles, have added tubes to their product line due to the convenience and consumer demand for tubes, further expanding their cosmetic/personal care franchise."
Montebello supplied the tube for Noxzema Soothe and Smooth Bikini Analgesic, which was chosen Pharmaceutical Tube of the Year in the recent Tube Council competition.
Tubed Products LLC, Easthampton, MA, has fielded increased demands for new tube shapes, more upscale decoration and decorating options, superior quality and more diverse substrate color matching, reported James Farley, vice president of sales and marketing for the company. "All of this appears to reflect the industry's prevailing trend towards plastic squeeze tubes that are truly innovative and more upscale," he said.
Farley added that heightened demand for new tube packaging has resulted in a need for additional production capacity, prompting Tubed Products to make investments in state-of-the-art labeling, hot-stamping, silk-screening and offset printing upgrades and equipment to continue to stay out in front of customers demands. The company designed the Family of Tubes project to provide its customers with an example of how a coordinated series of tubes can be combined to create a special seasonal gift package or to market several related products from the same manufacturer.
Beauty industry customers are calling for higher end effects, different closures and sidewalls, said Jennifer Hackett, marketing manager, Amcor Plastube North America, Granby, Quebec, Canada. "We are also seeing a recent trend towards metal-look tubes like our Polyfoil sidewalls," she said. "Decoration (for the Polyfoil) is simple because the punch is in the sidewall and closures."
Amcor's Polyfoil tubes are currently used by John Freida, Gap and Conair. The company recently helped Tony&Guy USA (TIGI) launch Cocky, a hair thickening paste, in a Polyfoil sidewall tube outfitted with a custom head and closure. Hackett said the Polyfoil silver sidewall provides a "better shell appearance and look," while the inverted, graduated closure (TIGI's own creation), was designed not only to look unusual, but also to help the tube stand on end.
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