July/ Aug AICC BoxScore: Midyear Converters Roundtable by AICC, The Independent Packaging Association

A PUBLICATION OF AICC, THE INDEPENDENT PACKAGING ASSOCIATION

July/August 2021 Volume 25, No. 4

MIDYEAR

CONVERTERS ROUNDTABLE Independent leaders discuss successes and challenges in business, workforce, supply, and transportation, all as light at the end of the pandemic tunnel emerges ALSO INSIDE One Team, One Mission Reach, Relate, Resonate at SuperCorrExpo® 2021 Member Profile: Package Crafters

TABLE OF CONTENTS July/August 2021 • Volume 25, No.4

COLUMNS

44 MIDYEAR CONVERTERS ROUNDTABLE Independent leaders discuss successes and challenges in business, workforce, supply, and transportation, all as light at the end of the pandemic tunnel emerges

58 62

ONE TEAM, ONE MISSION Reducing interdepartmental tensions and building a stronger business SPECIAL SECTION: REACH, RELATE, RESONATE Sponsors, floor plan, and exhibitors at SuperCorrExpo 2021

CHAIRMAN’S MESSAGE

SCORING BOXES

LEGISLATIVE REPORT

ASK RALPH

ASK TOM

SELLING TODAY

ANDRAGOGY

LEADERSHIP

DESIGN SPACE

THE ASSOCIATE ADVANTAGE

STRENGTH IN NUMBERS

THE FINAL SCORE

DEPARTMENTS

FEATURES

BoxScore is published bimonthly by AICC, The Independent Packaging Association, PO Box 25708, Alexandria, VA 22313, USA. Rates for reprints and permissions of articles printed are available upon request. The statements and opinions expressed herein are those of the individual authors and do not necessarily represent the views of AICC. The publisher reserves the right to accept or reject any editorial or advertising matter at its discretion. The publisher is not responsible for claims made by advertisers. POSTMASTER: Send change of address to BoxScore, AICC, PO Box 25708, Alexandria, VA 22313, USA. ©2021 AICC. All rights reserved.

WELCOME, NEW & RETURNING MEMBERS

MEMBERS MEETING

AICC INNOVATION

MEMBER PROFILE

FOUNDATION FOR PACKAGING EDUCATION

ICPF UPDATE

Visit www.aiccboxscore.org for Member News and even more great columns. Scan the QR code to check them out! BOXSCORE www.aiccbox.org

OFFICERS Chairman: Jay Carman, StandFast Packaging Group, Carol Stream, Illinois First Vice Chairman: Gene Marino, Akers Packaging Service Group, Chicago, Illinois Vice Chairmen: Jana Harris, Harris Packaging/American Carton, Haltom City, Texas Matt Davis, Packaging Express, Colorado Springs, Colorado Gary Brewer, Package Crafters, High Point, North Carolina Immediate Past Chairman: Joseph M. Palmeri, Jamestown Container Cos., Macedonia, Ohio Chairman, Past Chairmen’s Council: Al Hoodwin, Michigan City Paper Box, Michigan City, Indiana President: Michael D’Angelo, AICC Headquarters, Alexandria, Virginia Secretary/General Counsel: David P. Goch, Webster, Chamberlain & Bean, Washington, DC AICC Canada Director: Renee Annis DIRECTORS West: David DeLine, DeLine Box Co., Denver, Colorado Southwest: Eric Elgin, Oklahoma Interpack, Muscogee, Oklahoma Southeast: Ben DeSollar, Sumter Packaging Corp., Sumter, South Carolina Midwest: Casey Shaw, Batavia Container Inc., Batavia, Illinois Great Lakes: Mike Schaefer,Tavens Packaging & Display, Bedford Heights, Ohio Northeast: Stuart Fenkel, McLean Packaging, Pennsauken, NJ AICC Canada: Terri-Lynn Levesque, Royal Containers Ltd., Brampton, Ontario, Canada AICC México: Juan Javier Gonzalez, Cartró, S.A.P.I. de C.V. (CP), Tepotzotlán, Mexico OVERSEAS DIRECTOR Kim Nelson, Royal Containers Ltd., Brampton, Ontario, Canada

DIRECTORS AT LARGE Finn MacDonald, Independent II, Louisville, Kentucky Guy Ockerlund, OxBox, Addison, Illinois Kevin Ausburn, SMC Packaging Group, Springfield, Missouri EMERGING LEADER DELEGATES Daniel Brettschneider, Kolbus America Inc., Kennesaw, Georgia Cassi Malone, Corrugated Supplies Co. LLC, Chicago, Illinois Lauren Frisch, Wasatch Container, North Salt Lake, Utah ASSOCIATE MEMBER DIRECTORS Chairman: Pat Szany, American Corrugated Machine Corp., Indian Trail, North Carolina Vice Chairman: Joseph Morelli, Huston Patterson Printers, Decatur, Illinois Secretary: Greg Jones, Sun Automation, Glen Arm, Maryland Associate Board Director: Tim Connell, A.G. Stacker Inc., Weyers Cave, Virginia Immediate Past Chairman, Associate Members: David Burgess, JB Machinery, Weston, Connecticut ADVISORS TO THE CHAIRMAN Greg Tucker, Bay Cities, Pico Rivera, California Jerry Frisch, Wasatch Container, North Salt Lake, Utah Pat Szany, American Corrugated Machine Corp., Indian Trail, North Carolina PUBLICATION STAFF Publisher: Michael D’Angelo, mdangelo@aiccbox.org Editor: Virginia Humphrey, vhumphrey@aiccbox.org

SUBMIT EDITORIAL IDEAS, NEWS & LETTERS TO: BoxScore@theYGSgroup.com CONTRIBUTORS Maria Frustaci, Director of Administration and Director of Latin America Cindy Huber, Director of Conventions & Meetings Chelsea May, Education and Training Manager Laura Mihalick, Senior Meeting Manager Patrick Moore, Member Relations Coordinator Taryn Pyle, Director of Training, Education & Professional Development Alyce Ryan, Marketing Manager Steve Young, Ambassador-at-Large Richard M. Flaherty, President, ICPF ADVERTISING Information: Virginia Humphrey, vhumphrey@aiccbox.org Opportunities: Taryn Pyle 703-535-1391 • tpyle@aiccbox.org AICC PO Box 25708 Alexandria, VA 22313 Phone 703-836-2422 Toll-free 877-836-2422 Fax 703-836-2795 www.aiccbox.org

EDITORIAL/DESIGN SERVICES The YGS Group • www.theYGSgroup.com Vice President: Serena L. Spiezio Content & Copy Director: Craig Lauer Managing Editor: Jessica Price Senior Managing Editor: Sam Hoffmeister Copy Editor: Steve Kennedy Art Director: Alex Straughan Account Manager: Max Lalwani

ABOUT AICC PROVIDING BOXMAKERS WITH THE KNOWLEDGE NEEDED TO THRIVE IN THE PAPER-BASED PACKAGING INDUSTRY SINCE 1974 We are a growing membership association that serves independent corrugated, folding carton, and rigid box manufacturers and suppliers with education and information in print, in person, and online. AICC membership is for the full company and employees at all locations have access to member benefits. AICC offers free online education to all members to help the individual maximize their potential and the member company maximize its profit.

WHEN YOU INVEST AND ENGAGE, AICC DELIVERS SUCCESS.

Chairman’s Message

How Sweet It Is

e did it. AICC held our industry’s first large in-person event since the start of the COVID-19 pandemic. Boy, did it feel good to be with so many AICC friends. When I assumed the position of chairman in Toronto in the fall of 2019, I said that I wanted to focus on how independent companies can grow—either organically in increased sales and new product or material offerings, or through acquisition of other companies. Never did I anticipate the year that lay ahead, and that “growth” would be defined not by a carefully implemented strategy, but by a frenzy of marketplace demand that has strained our ability to keep up. Consider that between June and December 2020, box shipments as reported by Fibre Box Association increased a phenomenal 5.5%! Compare that with 2019, when shipments for the entire year were essentially flat, or 2018, when we squeezed out a mere 1.7% growth. We’ve grown in ways other than just sales and shipments, however. Consider that the pandemic has caused all of us to embrace new ways of doing things. In the plant and office, we’ve had to embrace technology such as plant automation and working from home for those who are able; in our business settings, we’ve had to rely on virtual meetings and discussions—certainly not ideal, but we’ve learned to work with them successfully. And our sales teams have had to learn new ways to serve customers without the benefit of face-to-face consultations. I am optimistic that because of what we’ve learned in the past year and how we’ve grown, our industry can return to a semblance of normal person-to-person interaction with our employees, customers, peers, and suppliers, in addition to the new things that we have learned out of necessity. In February, Board Converting News did a cover story on AICC’s plan to hold a spring meeting. In that article, I compared these days to the days immediately following 9/11, nearly 20 years ago. You’ll remember that back then, many people were fearful of flying. I was one of them. But I decided to attend AICC’s Annual Meeting in Vancouver, British Columbia, anyway. AICC did not cancel the meeting. Those who wanted to attend were thankful that we made that decision. There was an increased camaraderie among us, almost like that of kindred spirits who had all shared a difficult experience together. We appreciated each other’s presence, and we were glad to be together. I felt that same spirit in Amelia Island, Florida. AICC has played a vital role in the past year keeping us connected through Zoom events and other virtual programs with hundreds of participants. At the Spring Meeting, we connected in a new and unusual way, at least through the lens of the pandemic—in person! Once again, we learned from each other—and leaned on each other. It was wonderful. And it will be again when we all see each other at SuperCorrExpo in August.

Jay Carman President, StandFast Packaging Group Chairman, AICC

BOXSCORE www.aiccbox.org

Scoring Boxes

Consumer Spending in 2020 BY DICK STORAT

BOXSCORE July/August 2021

400

Inflation-Adjusted Consumer Spending

4.0% 3.0%

350

Index (2009 = 100)

2.0% 300

1.0% 0.0%

250

-1.0%

200

-2.0% 150 100

-3.0%

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 2019

Source: Bureau of Economic Analysis

160

2020

-4.0%

Percent Change Year-to-Date

Consumer Spending for Services

4.0% 2.0%

150

Index (2009 = 100)

ooking back on consumer spending patterns last year reveals unique and sometimes unexpected shifts in behavior as Americans responded to the pressures of the COVID-19 pandemic. Amid these consumer responses, corrugated box shipments grew by a surprisingly large 3.4%, their most rapid annual growth in more than a quarter century. Now that near-final economic data of last year’s consumer spending patterns is available, a look at how consumers reacted to the coronavirus offers some insight into why box shipments grew so rapidly last year. Overall inflation-adjusted consumer spending declined by 1.2% last year, as the top chart at right shows. After a strong start, spending dropped by record amounts in March and April during the severest economic lockdown in recent memory. By the end of the first half of 2020, outlays had dropped by 3.1%. Then, overall spending recovered slowly during the second half of the year. The most significant shift in consumer spending was toward spending on goods and the punishing decline of servicesector spending. Normally, consumers spend around 70 cents of every dollar on services, and only 30% of outlays go for goods. Last year spending on goods rose to 38% of total outlays, while spending on services dropped to 62% because of the disproportionately large impact on service-sector industries such as restaurants, entertainment, and travel. As the bottom chart at right shows, spending for services started out at a neartrend growth rate of 2%. There was some rebound from the disastrous decline in March and April, but not nearly enough to erase the contraction. From midyear on,

0.0%

140

-2.0% 130 -4.0% 120

-6.0%

110 100

-8.0%

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 2019

Source: Bureau of Economic Analysis

2020

-10.0%

Percent Change Year-to-Date

service-sector spending languished at a rate of nearly 8% below prior-year spending. As mobility restrictions diminish, the service sector will regain strength rapidly and return to become the main engine of economic growth during the second half of 2021.

Purchases of durable goods (those intended to last for more than three years) started last year at a 7% growth rate but saw the steepest decline during March and April. However, recovery didn’t take long, as much of fiscal stimulus benefits were spent on

Scoring Boxes

Real Consumer Spending for Durable Goods

260

10.0%

240

8.0%

Index (2009 = 100)

220

6.0%

200

4.0%

180 2.0%

160

0.0%

140

-2.0%

120 100

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 2019

Source: Bureau of Economic Analysis

2020

-4.0%

Percent Change Year-to-Date

these goods. Already in May they had recovered to more than prior-year levels, as the chart above details. This growth only accelerated during the remainder of last year, with full-year growth reaching 6.3%, in stark contrast to the 7.3% drop in service-sector sales. However, less than 10% of box shipments go to package these goods, reducing the overall benefit to boxmakers of last year’s ultrarapid growth. Domestic nondurable goods production consumes some three-quarters of

annual U.S. box production. Spending for these fast-moving goods started off the year at a typical pace, near 2%, as the chart below depicts. However, there was a strong purchasing surge in March as the economic lockdown took hold. Consumers hastily overstocked on basic food and household supplies in the face of an uncertain future. The result was a 5% monthly jump in March, from which domestic boxmakers benefited. However, the ensuing drop in April purchases was even larger. Starting in

Real Consumer Spending for Nondurable Goods

250

4.0%

240

3.5%

Index (2009 = 100)

230

3.0%

220 210

2.5%

200

2.0%

190

1.5%

180

1.0%

170

0.5%

160 150

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 2019

Source: Bureau of Economic Analysis

2020

Percent Change Year-to-Date

0.0%

May, growth resumed, and by June, spending for nondurable goods surpassed the prior-year sales. That trend continued for the remainder of the year, with annual growth of 2.6% recorded, providing a strong source of market strength for boxmakers. Another way of looking at consumer spending is by the type of store or distribution channel. The chart on the following page shows the changes in retail sales for last year broken down by type of business. Overall, retail sales grew by a fractional 0.4% last year. However, the sales changes by types of business were anything but fractional. At the head of the growth list was sales by nonstore retailers. Stay-at-home consumers sharply increased their online purchases as a way to deal with pandemic restrictions on mobility. When the smoke had cleared at the end of last year, that category of retail sales had grown by 21.3%, almost doubling the double-digit rate of growth that had already become the norm for online sales growth. Rapidly growing packaging of online sales was the primary propellent that boosted box shipments last year. As people spent more time at home, including the sharply rising number of employees working from home, spending at building supply stores rose by more than 13% to provide the tools and materials needed for growing home improvements and remodeling. Box demand benefited from growth in this sector, as well. Grocery stores also received a sales windfall as consumers changed how they got their nutrition—away from restaurants to cooking at home. At the other end of the spectrum, though, was the painful 19% decline of sales at restaurants, taverns, and other eateries. The shift from packaging restaurant supplies to more box-intensive grocery store goods provided another leg of support for last year’s strong box demand.

BOXSCORE www.aiccbox.org

Scoring Boxes

Furniture, electronics, appliance, and clothing stores were other large business sectors that saw substantial sales declines as a result of the pandemic. Overall, box shipments saw windfall growth from record-breaking online sales growth, as well as from the above-average growth at building supply and grocery stores, both of which sell products requiring above-average amounts of corrugated packaging per unit of sales. Dick Storat is president of Richard Storat & Associates. He can be reached at 610-282-6033 or storatre@aol.com.

2020 Retail Sales Change by Business Nonstore Retailers

21.3%

Building Materials

13.3%

Food & Beverage

11.1%

Sporting Goods

4.4%

General Merchandise

2.3%

Retail ex Auto & Gas

2.0%

Health & Personal Care

1.4%

Motor Vehicle & Parts

1.1%

Retail & Food Service

0.4%

-1.0%

Miscellaneous Stores Furniture

- 15.1%

Electronic & Appliances Food Services & Drinking Places Clothing Source: Census, RSA INC.

-5.9%

-19.3%

-26.0%

-35.0%

-25.0%

-15.0%

-5.0%

5.0%

15.0%

25.0%

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BOXSCORE July/August 2021

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Legislative Report

New Estate Tax Proposals Threaten Survival of Family Businesses BY ERIC ELGIN

n my last column, I wrote that AICC will be mobilizing our members and our industry allies to help preserve the business tax cuts enacted in 2017, which are now threatened with repeal by the Biden administration and the Democrats in Congress. “We’ll need everyone on the front lines,” I wrote. After reading the Small Business Council of America’s recent summary of the Biden administration’s new estate and gift tax proposals, titled “Allow Small Businesses to Thrive; Keep the Step-up in Basis and Current Estate Tax Exemptions,” my plea for mobilization has taken on greater urgency. For I believe the changes being proposed for estate tax laws truly threaten the long-term survival of family businesses in our country. Simply put, current estate tax law allows for a unified credit of $11.7 million per spouse—which will be halved on January 1, 2026, per a sunset provision of the Tax Cuts and Jobs Act of 2017— and a tax rate of 40%. Heirs may sell inherited assets without paying capital gains taxes—called “basis step-up”—or they can hold inherited assets without paying capital gains taxes until the assets are sold. Changes proposed by the Biden administration would reduce the unified credit to only $3.5 million per spouse and graduated tax rates beginning at 40%. Step-up provision is repealed, meaning heirs who receive inherited assets with the decedent’s basis must pay capital gains taxes on these inherited assets, whether they are sold or not. The exception to this is inherited family businesses that will continue to be run by the family.

BOXSCORE July/August 2021

To illustrate the potential effect, if the owner of a business valued at $12 million passes away, a total tax of $120,000 under current law could balloon to a possible $6 million. I’m not sure the heirs in this scenario and others would be able to pay the estate tax bill without selling the business outright to raise the cash. This would be a tragic outcome for our small business community, especially among our capital-intensive manufacturing base that AICC members represent. What can you do? Contact your representatives and senators today and tell them: 1. The proposed changes would negatively impact millions of America’s small businesses. 2. Many taxpayers not wealthy enough to owe estate taxes under current law will suddenly be subject to new death taxes.

3. The same assets shouldn’t be taxed twice—estate taxes and income taxes. 4. Taxes shouldn’t be triggered unless there is a sale so there are funds available to pay the taxes. Go to www.senate.gov/senators to find your state’s senators, and visit www.house.gov/ representatives to find your representatives. As I said, we need everyone on the front lines, and these battle lines are now clearly drawn. Eric Elgin is owner of Oklahoma Interpak and chairman of AICC’s Government Affairs subcommittee. He can be reached at 918-687-1681 or eric@okinterpak.com.

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New Members

Welcome, New Members! PHOENIX-VETERANS PRINT BOB PAWLICKI Vice President of Sales 10430 Argonne Woods Dr. Woodridge, IL 60517 630-410-0260 www.phoenix-veteransprint.com

MILLER WELDMASTER PACKAGING KATIE SPUHLER Marketing Manager 4220 Alabama Ave. Navarre, OH 44646 330-833-6739 www.weldmasterpackaging.com

TCY MACHINERY MFG. CO., LTD. KEN HSIAO General Manager No. 42 Santeh St. Ru-Chu District, Taoyuan, Taiwan 33842 +886-3-3544888 www.tcy.com

ADAMS CONTAINER CORPORATION MASON ADAMS President & CEO P.O. Box 1270 Toccoa, GA 30577 706-886-2239 www.adamscontainer.com

TRESU NICK GEROVAC Head of Sales – Ancillary Americas 635 Westport Pkwy, Suite 300 Grapevine, TX 76051 214-774-1600 www.tresu.com

Call (513) 948-9000 Visit www.kaocollins.com

BOXSCORE July/August 2021

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Members Meeting

AICC ELs Treated to Invaluable Insights From Seasoned Professional

Photo courtesy of AICC.

hat advice would you have wanted when you were starting out? The AICC Emerging Leaders (ELs) aren’t waiting for hindsight; they are finding answers now. Their inability to come together in person this past year caused them to create the Quarterly C-Suite Webinar Series. They invite leaders from inside and outside of the AICC Emerging Leaders sat down virtually with Robert Ruijssenaars, vice president of marketing at E. & J. Gallo industry each quarter to Winery, to learn valuable lessons about career growth. offer advice and suggestions to give AICC ELs new perspectives and participants submitted before and during Ruijssenaars gave concrete examples ideas. Each quarter, a new department is the event. Ruijssenaars, who has spent of effectively communicating as a chosen as the focus. Q2 brought Robert his entire professional career at Gallo, leader and shared some lessons learned Ruijssenaars, vice president of marketing encouraged the leaders to be willing to with the ELs. The hour-and-a-halfat E. & J. Gallo Winery, to the forefront look at their career ladders holistically long conversation also ventured into to share his history, tips to moving up in and understand that a lateral move, like marketing questions and strategy, with a family company, and vast experience to the one he made from sales to marketing, Ruijssenaars giving candid feedback nearly 30 ELs. might help them get to where they want to attendees. The event was brought together by the to be, focus on their soft skills, and as a In closing, Malone said, “The goal AICC EL delegates, Cassi Malone young professional, ask questions for the of these is to do exactly what we just of Corrugated Supplies Co., Lauren first 90 days, rather than share opinions did—have an intimate conversation with Frisch of Wasatch Container, and Daniel when they are in a new role. an executive in specific areas of expertise, Brettschneider or Kolbus America, with “The differentiator in my opinion for so we can listen to them and hear what it the support of Scott Ellis, Ed.D., of middle and upper management is not takes to get to that level.” Working Well, who is also an AICC the hard skills. It’s the soft skills,” said The Q3 Emerging Leader C-Suite consultant. The webinar began with a Ruijssenaars. “Most people around you Webinar, Wednesday, September 15, will short history of Gallo Winery, which is will have pretty good hard business skills, focus on chief operating officers. the largest family-owned winery in the just like you have good hard business world. With more than 7,000 employees skills. The differentiator ends up being worldwide, Gallo Winery has more than the soft skills, the ability to think on The AICC Emerging Leaders program 120 different brands and is available in your feet—make your point, use clear is an exclusive series of training, more than 100 countries. Gallo Winery language, and don’t get fancy. Make networking, and leadership has been selected as one of the top 50 best convincing points.” opportunities for ambitious young companies to work for by Glassdoor from He also suggested public-speaking professionals in the paper and packaging industry. Learn more at 2017 through 2020. training, to help them become more www.aiccbox.org/leader. Then, Malone moderated the convercomfortable and confident when sation and introduced questions that speaking with others.

BOXSCORE July/August 2021

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Ask Ralph

ESG Programs at the Fore BY RALPH YOUNG

e have come a long way since the early days of Walmart sustainability more than 10 years ago. Now environmental, social, and governance (ESG) is the new hot topic, mainly in Europe and Japan, and making its way into the United States. There has been an array of changes in this area since the beginning of this year. The AICC senior staff is often invited to seminars and other events with banks and financial institutions, which solicit our perspectives and keep us informed of changing conditions. The information here is from a two-day virtual conference with Deutsche Bank.

BOXSCORE July/August 2021

Here, we will look at and explain the difference in the priorities in the 17 elements on both sides of the big pond. You may need to look to suppliers such as International Paper, DS Smith (Mondi), LEIPA, SCA, Metsä, and Saica to help develop your responses to other suppliers, communities, employees, financial institutions, and politicians. “Green infrastructure” will continue to be an ever-evolving subject. Corporate discussions around climate change and the reports from corporations will relate to the following subjects. This discussion will also extend to investments in green buildings and homes. • Renewable energy • Emissions and supply chains

• Investors’ perceptions of climate change • Reduced energy • Scope 3 or greenhouse gases through the entire supply chain—upstream and downstream • Sustainable suppliers • Reduced waste • Measurement of emissions • Environmental awareness The banking and investment communities are actively engaged in the performance of publicly traded companies that are responding to these initiatives. Although this may not directly impact you today, there is usually a trickle-down effect. Our responsibility is to make you aware of these changes and point you in

Ask Ralph

the direction of more information. This movement was introduced by several authors in several articles in the March/ April 2021 issue of BoxScore. Robert Bittner, in “New Administration, New Possibilities,” speaks on the merging of environmental responsibility and social justice: the issue of low-income areas that are at high risk from environmental pollutants. In ranking most important to least important, here are 17 areas that public companies, financial institutions, governments, and large box buyers consider significant in this politically charged culture. These are United Nations Sustainable Development Goals, and companies report on these in their ilings, press releases, event transcripts, company presentations, and ESG reports. These are for the U.S. and not Europe, where, for example, education is the most important subject.

1. Justice system 2. Poverty 3. Education 4. Sustainable partnerships 5. Hunger 6. Affordable clean energy 7. Health 8. Climate change 9. Inequality 10. Sustainable cities 11. Responsible production 12. Gender equality 13. Infrastructure 14. Biodiversity 15. Clean water 16. Decent work 17. Marine life So given these criteria, how are you preparing yourself to respond? I remember the days when the Food Initiative, HazMat, ISO, forestry

certification programs, heavy metals, water and energy usage, recycled content, emissions, dust collection, plant safety, mineral oil migration, and REACH—to list a few—were key issues of the day. Now layered on top of those are these new programs to keep us up at night. The growth in the discussion of these new issues is just beginning, including green infrastructure not listed above. Big companies that are under the microscope are becoming more concerned about the financial implications and reputation around biodiversity and destruction of natural ecosystems. Ralph Young is the principal of Alternative Paper Solutions and is AICC’s technical advisor. Contact Ralph directly

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BOXSCORE www.aiccbox.org

Ask Tom

Data Management, Part 2

he following is a recap of the second session in a four-part series surrounding data management, this time covering machinery, that was hosted by your AICC education team and moderated by me. The two remaining sessions, regarding methods and materials, respectively, will be recapped in my next two BoxScore articles. I encourage you to read ahead by obtaining all four of the recorded versions, available through your outstanding AICC education contacts, Chelsea May and Taryn Pyle. The machinery session aimed to answer the following question: How do we enable a “connected factory” to be available 24/7 for operational teams? The top three explorations we utilized were: • Taking a holistic view of operations. • Exploring barriers created within operating systems in order to gain full visibility into what’s happening on the shop floor and out in the field. • Uncovering meaningful ways to integrate structured and unstructured data from all shop floor sources. The major machinery opportunities for improvement that were identified during the session (and that follow here) were explored by our AICC Associate member panelists from Amtech, Advantzware, EFI, Kiwiplan, and OMP. Maximize Your High-Capital Machinery Assets Keep high-capital machinery assets running at maximum efficiency to meet production goals and boost profitability, without increasing costs or risking failure. Predict problems in advance with machine sensor data that feeds into analytical models. When there is an issue, diagnose it with root-cause analysis tools so you can efficiently correct it.

BOXSCORE July/August 2021

Don’t expect your machines to deliver top performance without the aid of advanced analytics. For instance, with artificial intelligence and analytics doing the heavy data lifting, a company might analyze profit per hour, factoring in as many as 1,000 variables and 10,000 constraints to help manufacturers figure out what to buy, what to make, and how they should make it to yield the most profit in each period. Enable Full Machine Sensor Visibility on the Shop Floor When a manufacturing firm adds more machine sensor technology, it can reliably find patterns hidden in the data that may indicate an impending failure or performance degradation. By showing employees how to test and measure data and helping them to understand its importance, you help get them invested in the data-driven culture. A self-service culture of data visualization along with key performance indicator (KPI) dashboards will present the information necessary to manage the entire process. Asset Replacement and Decision Support Support your repair or replacement strategy with a machine-generated, data-driven trade-off analysis. Downtimes, production losses, future probability of occurrences, etc. are all considered and can be optimized to determine the most profitable course of action for management to take. Maximize Output Data analysis should be directed at problem-solving, process improvement, and profit generation. You may get a fresh perspective on a variety of machine processes or business challenges. Status dashboards and automatic alerts can notify operations staff of impending failures, so you have time to correct issues in advance.

Establishing a data-driven culture as a priority can improve buy-in to the initiative while leading to improved production rates, lower costs, reduced downtime, and greater employee satisfaction. Optimize Maintenance Cycles The use of KPIs and dashboards can move a company toward using predictive and preventative maintenance strategies to address known sources of failure without driving up costs. Avoid costly just-in-case PM strategies by using leading indicators that tell the entire story. Improve Root-Cause Analysis Using Machine Data Generation Quickly and accurately identify root causes using your machine-generated data to mine, drill down, and ultimately detect hidden patterns to facilitate swifter and more data-focused, permanent corrective actions. Reduce Downtime Avoid major defects and prevent extended downtimes. Address potential performance issues before they escalate, using your newly added automated data monitoring and predictive alerts. This machinery session recap was intended to create the thought that perhaps there is a better, faster, and smarter way to do tomorrow. If I have piqued your interest, please request the session recording from your AICC education team or me. It may well trigger one novel useful thought for you and your team in the second half of 2021! Tom Weber is president of WeberSource LLC and is AICC’s folding carton and rigid box technical advisor. Contact Tom directly at asktom@aiccbox.org.

Selling Today

Strategic Sales: How Saying No Can Grow Your Business BY TODD M. ZIELINSKI AND LISA BENSON

hen the COVID-19 pandemic hit, most corrugated, folding carton, and retail display manufacturers found that they fell into one of two categories: those fortunate enough to be providing packaging for essential businesses and those that weren’t. Suddenly many manufacturers saw a shift, and they were either overwhelmed with business or saw it drop off. We have heard in the marketplace that companies that weren’t servicing essential businesses have taken a hit ranging from 20% to 32% top line year over year. Now, as companies are working to build momentum again, many are quoting anything that comes their way to fill excess capacity, whether or not it is a good fit. Going after the wrong type of prospects isn’t uncommon. In fact, according to a survey by Sales Insight Lab, 71.4% of salespeople report that only half or fewer of their prospects turn out to be a good fit. If you are wasting efforts with a poor-fit prospect, you are losing valuable time and resources. The sooner you realize they are not a fit and walk away, the more time you save. As busy as your salespeople are, wouldn’t it be great to give them back that time to focus on ideal opportunities?

Strategic Sales Growth Is the Answer When we talk about “strategic sales growth,” we are talking about growing your business by defining your prospect using a tactical approach so that you weed out those that are wasting your time. When you think of growth, you may be thinking you want to grow X% year over year, by a specific dollar amount, or by expanding geographically or into a new industry. This is a good start.

BOXSCORE July/August 2021

However, there is an additional question to ask: What does strategic growth look like—i.e., how do you define your ideal customer in terms of opportunity to facilitate growth? Your Ideal Customer So, maybe you’ll break out SIC codes, look at the company size and the industries they are in. This is a good first step, but this isn’t enough to weed out the prospects who aren’t a fit. You can have two companies of similar size in the same industry with entirely different packaging needs. One may need a lot of support with structural and graphic design, and the other may use more plastic packaging and prefer off-the-shelf corrugated for the little they do need. This is why it is imperative that you go deeper and really focus on what your ideal customer looks like. Look at some of your best customers—those who create headaches are not the ones you want to emulate. Some things to consider include: • What type of program is in your sweet spot? • How many SKUs are ideal? • What materials, product size, shape, weight, etc. are preferred? • How much consultation and support do they need? • What is a realistic lifetime or program opportunity value? • What should the average order value be? • What is the purchase frequency that fits with your operations? • What margins do you need?

You can probably come up with an even longer list of pertinent questions specific to your business. Your ideal customer is likely complex. The key is to focus on the right type of profitable work, move away from quoting, and focus on one order. When you focus this way, you can intentionally go to market, proactively targeting the right type of accounts that will produce the specific opportunities you want. Equally important to identifying your strategic sales profile is defining what you do not want in an account. Be specific about what you are willing to walk away from and why. Don’t be afraid to say no to any opportunity that doesn’t fit, but be sure to communicate what is an ideal fit, and ask if those opportunities exist within that prospect’s organization. This also gives you an opportunity to look at existing customers. As you start gaining customers that fit your exact profile, start weeding out those customers that aren’t a great fit or take up too much time for little return. It

Selling Today

is OK to break up with your current customers. It allows them to find a partner that is a better fit for them. This tactic is beneficial for those manufacturers that have been overwhelmed with business in the past year. Replace those challenging customers with ones that fit your wheelhouse. Benefits of Strategic Growth Planning Manufacturers interested in strategic growth view the process from a long-term perspective. You are not going to have overnight success. It takes time to build a pipeline in this way as well as shift or change your sales and marketing teams’ behaviors to focus this way. When your sales team is hyperfocused on the right type of opportunities and more strategic about turning down prospects that don’t fit, you have a greater probability of winning opportunities. On one hand, it is basic math; when you remove those that don’t fit, your win percentage will be higher. But on the other hand, because you have more time to spend with those opportunities discussing how your value proposition benefits them, you will be able to engage them in deeper conversations to learn about the issues that are causing them grief. This type of focus also provides a greater probability of closing higher-margin sales and increasing customer retention. Todd M. Zielinski is managing director and CEO at Athena SWC LLC. He can be reached at 716-250-5547 or tzielinski@athenaswc.com.

The Perfect Combo

Get Peak Performance From Your Equipment with Matched Component Sets

Nothing’s more rewarding than a couple made for each other. That’s why the engineers at ARC International have focused their skills and talents on crafting perfect matches between the components that must work in tandem on your flexo folder gluers and die-cutters: • Anilox Rollers and Ink Chambers • Anilox and Wiper Rollers • Feed and Pull Rollers • Glue and Meter Rollers You can achieve the press speeds and print quality you need to fill your most demanding orders by pairing your team with The ARChitects of Flexo. Contact ARC today to learn how these engineered matches of flexo folder gluer and diecutter components (new or reconditioned) can help you achieve a more perfect union of production and profits.

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Andragogy

Summertime – Time for an Education Vacation BY JULIE RICE-SUGGS, PH.D., AND ALLI KEIGLEY

ummer 2021 is upon us. And while summer means different things to different people, we wonder what it means for you this year. Chances are, your mind conjures up images of happy places associated with relaxation, fun, and sun (or shade), but that may not be your reality this go-around. Certainly, for working professionals, the days of a three-month-long vacation are long gone. And the concerns over travel during the pandemic we’re still facing should be taken seriously. But that does not mean you cannot make time to try something new or get a fresh perspective on things—after all, isn’t that why we usually travel somewhere on a vacation? So, for those of us who can’t leave our 9-to-5 to head to the nearest beach, we have a different journey in mind—an educational journey. Online education is a way to explore something we’ve not previously had the time to delve into, and to gain valuable knowledge from our efforts. We’ve made it incredibly easy for you to do just that. AICC’s partnership with The Packaging School allows for member companies and all respective employees to receive the value-add of training programs for free. And with more than 80 online courses in both English and Spanish, all related to the packaging industry and the manufacturing environment, you’re sure to find something that suits your current needs. Let’s take a closer look at how these courses offer the chance for a packaging journey you won’t soon forget. The Corrugator, a course made in collaboration with Fosber, takes you through the key systems of—you guessed it—the corrugator, including the wet-end,

BOXSCORE July/August 2021

dry-end, and corrugator control system. With up-to-date industry information, interactive diagrams, and exciting video clips, you’ll gain a strong understanding of corrugator zones and the key sections within. Our Rotary Die Cutting Operations course was made in collaboration with SUN Automation and covers the fundamentals of rotary die cutting, beginning with an overview of the system capabilities and associated equipment. Here, you’ll dive into the major sections of this system: the feed section, print section, and die cut section. Another course in which you can explore a place you may not be familiar with is our Machinery course. This journey takes you on a tour of the plant floor, where you’ll get a thorough look at the machinery used to produce high volumes of quality packages, such as line loading and unloading, container cleaning, liquid and solid product filling, form-fill sealing, capping and closing, labeling, etc. In all of the courses we’ve discussed here, you’re able to see the various plant floor machinery from the comfort of your own home. Our online courses use a technique called microlearning, in which difficult topics are broken down and arranged into bite-sized lessons you can engage with on any device. Lessons take the form of infographics, quick readings, videos, animations, discussions, and interactive slides. This unique delivery method empowers you to complete courses on your schedule, at your own pace. At this point, you may be thinking there’s no way a virtual “trip” to a corrugated plant can replace a trip to,

say, Belize. In some respects, it can’t, but it can offer a respite from the dayto-day grind of a normal workweek. Take your computer outside if the weather allows—breathe in the fresh air—and broaden your knowledge of a subject that you’re interested in. Not only will your body be replenished from being outside—we know the numerous health benefits of enjoying the natural world—but your mind and intellect will also be sharpened. And continuing education throughout your career gives you an enhanced understanding of the world, opens doors to new opportunities, and improves quality of life. Even though online training may not be as glamorous as a five-day vacation at an exotic resort, it does have the potential to change your life for the better—to open your eyes and give you a renewed sense of purpose or direction. So no matter what the summer holds for you, we challenge you to take some time for an educational journey—along with that trip to Belize, if you can swing it. You won’t regret it. Julie Rice Suggs, Ph.D., is academic director at The Packaging School. She can be reached at 330-774-8542 or julie@packagingschool.com.

Alli Keigley, is production coordinator at The Packaging School. She can be reached at alli@packagingschool.com.

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Leadership

Grow Your Own, Dammit! BY SCOTT ELLIS, ED.D.

n the economic climate of 2021, it is very difficult to attract, engage, and retain people who are willing to work and capable of exercising good judgment. Blame a past or present administration, or the pandemic, or “kids these days” all you like. But please, stop complaining that you “can’t find good people” if your primary source of candidates is still the temp agency. Modern workforce development requires that your company invest in education and skills training locally so that the workers of the future will be prepared to thrive in your employ. It also requires that we invest in current team members to develop their critical-thinking skills. They can be engaged by involvement in problem-solving, planning, and implementation of ongoing improvement, growing their skills in judgment with each experience. Lessons in judgment came hard and early for me. My grandfather was a cop, a farmer, and a teacher of life lessons. My lessons were as constant as required by my creative disobedience and general immaturity. When I was a boy of 8 summers, my chores included the feeding and medication of a bull calf. All summer, I would rise before sunrise to rope the calf for medication and bottle feeding. It was complicated by the fact that 8-week-old calves outweigh 8-year-old boys. He did not enjoy being roped before breakfast, particularly when the meal included a hot-dog-sized pill to treat scours (that’s bovine for diarrhea). One morning I was having a particularly rough time. The Guernsey bull calf had been roped easily enough but had no interest in being tied to the center post. He had dragged me through the slime and knocked me into the fence. I snagged the rope, planted my feet, and thought

BOXSCORE July/August 2021

of the most potent swear word I knew. Throwing my weight toward the center pole, I commanded, “Come here, dammit.” I looped and tied the rope neatly to the pole and stood back to survey my solitary victory. “Is that the calf’s name?” asked a deep voice behind me. How did he do that? He was always just there. “No sir,” I replied in a hushed tone. “It is now,” he said, and he went about his work. I didn’t hear another word about it until the family had finished Sunday dinner. Then it happened; he removed his toothpick, leaned back in his chair and donned a puzzled look. “Now Scotsman, what was that calf’s name again?” I glanced at my grandmother and my mother and said, “Uhhh, Dammit, sir.” We repeated this ritual every Sunday until that wretched animal took his rightful place in the meat locker. My grandfather consistently used logical consequences to guide me toward maturity. He also allowed natural consequences to teach me, but those lessons quickly grew more severe. He took me along so that I could observe, and he allowed me to ask questions so I could understand the choices he made. When we worked together, he would ask me, “What comes next?” in order to engage my head and my hands. By thinking out loud through planning and problem-solving on the ranch, he taught me skills that transferred to every aspect of life. His example has been my model for helping employees learn problem-solving skills for today while developing critical thinking for tomorrow. Test me in this. Use the time that is already set aside for crew meetings to engage them in a discussion. Say there was a quality snafu last week that made it to your customer. It would be easy, even natural, to vent frustration toward the

crew—to sit them down and tell them the cause of the problem, the solution, the standard of performance, and the consequences of failure to meet that standard. But this will not change future outcomes or their ability to improve them. Assigning blame sucks all the energy out of improvement. What if, instead, the meeting began with everyone getting on one side of the problem? “Folks, we let our customer down last week, and we need to work together to fix our process. The way we are doing things today allowed this production loss to hurt our customer. I need your help in closing the gaps in our process so this cannot happen again.” With the focus shifted to what happened, rather than who did it, you can attack the problem together. Although it is likely that you knew the root cause when you entered the room, there is value in examining the noncompliant product and discussing all the possible causes, perhaps using a fishbone diagram. The team develops a better understanding of the causes and then focuses on prevention. Keep asking the question of your team, “How can we make it difficult to do this wrong?” By this method you may grow your own willing and capable employees. Scott Ellis, Ed.D., delivers training, coaching, and resources that develop the ability to eliminate obstacles and sustain more effective and profitable results. He recently published Dammit, Learning Judgment Through Experience. His books and process improvement resources are available at workingwell.bz. AICC members enjoy a 20% discount code: AICC21.

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Design Space

Design Adapts and Grows BY BRIAN VITAGLIANO

s anyone who has ever worked in a design department can attest, design changes are commonplace. The design sector of the corrugated conversion industry is no different. These days, the design environment itself appears to be going through a major revision of its own, with changes hitting all aspects of this sector of the industry. Though my perspective on this will be influenced greatly by my personal experiences over my first decade in this industry, there are many trends that will be recognizable to anyone in the corrugated industry who is working either in or closely with design. From what is being

designed to how those designs are being created and communicated, we have seen rapid developments across the design space. But with a new crop of informed designers coming into the fray, the sector is well positioned to facilitate this quickly evolving landscape. “Nobody intends to get into this industry; you are either born into it or you accidentally fall into it and never leave.” I’ve heard sayings to that effect many times since I myself fell into the corrugated industry. Back in 2011–2012, I had recently graduated from college with a degree in architecture, with no strong desire to be an architect—not unrelated

to the fact that job openings in architecture were a rarity following the bursting of the housing bubble. I answered a job posting that I believed at the time to be a graphic design position, only to show up to the interview and find that the job I had actually applied for was that of a structural designer in a corrugated sheet plant. I knew nothing of the corrugated industry; I definitely didn’t know the first thing about corrugated structural design. But thankfully, their desire to pay as little as possible aligned perfectly with my lack of experience—as well as piquing my curiosity based on what I learned in that interview.

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Design Space

Over the next few years, I learned a lot. It was a trial by fire, and the teaching I received came from either someone who was born into the industry or who unintentionally stumbled into the thick of it, just as I had. But that is changing rapidly. I have a structural designer in my department who had every intention of pursuing a career in corrugated structural design, learning software and basic concepts back in college. Similarly, when my department’s graphic designer showed up for her first day all brighteyed and bushy-tailed, she already had a personal copy of the Fibre Box Handbook. More and more I am hearing about new programs in colleges that directly relate to this industry, and I am meeting more and more young people who are not only aware of the industry but are seeking to start careers here. For someone like me—who lucked out by

stumbling blindly into the corrugated world that I now call home—this is an exciting change to see! Trigger warning: Although I would have loved to avoid any discussion around COVID-19, the realities of this

current pandemic environment have accelerated many of the other changes we are currently seeing in the design sector. From the types of projects that are requested to the way those projects are communicated and, ultimately,

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Design Space

to how the design of those projects is approached, this social distancing climate has led to changes in each step of the design process. Case in point: Online shopping was already growing at a rapid pace, but social distancing and temporary store closures led to an explosive boom in e-commerce and direct-ship product deliveries. Although retail packaging and displays are still encountered, shipping boxes and direct mail pieces have grown greatly in importance. Similarly, where most meetings used to happen face to face, it is much more common to work based on information obtained solely through email or phone calls. In some ways, this has upped the amount of direct communication from the customer to the designer, as digital communication can be both initiated and relayed quickly and accurately.

BOXSCORE July/August 2021

As far as the actual act of designing is concerned, digital technology solutions have grown greatly in importance. Though 3D CAD solutions were not uncommon pre-pandemic, the need to design within a digital 3D environment expands greatly when access to a cutting table—or material for that cutting table— is limited. Similarly, when working within a digital 3D environment, a digital show-and-tell creates rapid communication of those ideas with a customer before a physical sample needs to be cut and delivered. Though change is common in any design environment, the rapid change currently being experienced in the corrugated industry is notable. Hastened by the current social distancing environment, most every aspect of design has seen rapid advancement in the past year. The value of digital mediums of communication

and design has not only increased but also found ways to better work in conjunction with the basic building blocks of designing in this industry. Samples still need to be cut, and faceto-face meetings still need to happen. But the efficiency surrounding these actions has increased greatly. With an incoming design workforce that is not only more acquainted with current technologies but more familiar with the industry at large, the design sector will continue to grow and adapt quickly alongside a workforce that is able to move in lockstep with this rapidly changing design environment. Brian Vitagliano is design manager at Tavens Packaging & Display Solutions. He can be reached at bvitagliano@ tavens.com.

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INNOVATION Certifications

Which Food-Safety Certification Is Right for You? BY BASKAR KOTTE

he demand for new packaging materials and technologies from food manufacturing companies has been unprecedented in the 21st century. This has presented manufacturers of packaging and packaging materials with the burden of not only ensuring the safety of their materials but also demonstrating consistency in the quality of their products. It has also resulted in several standards and certification requirements appearing for most industries—none more so than food packaging. The Role of GFSI Certification The Global Food Safety Initiative (GFSI) is an initiative to ensure the safe processing of food for consumers through the establishment of food-safety management systems. A GFSI certification provides evidence that a plant has a structured, effective, and comprehensive food-safety program in place. Certification is becoming ever more important as companies look to mitigate

the risk of food-safety problems and reduce recalls. On average, food recalls continue to cost companies $10 million per incident. Which Food-Safety Schemes Fall Under GFSI? The GFSI recognizes certain food-safety schemes when they meet specific requirements outlined in the GFSI Guidance Documents. This means that the GFSI

certification is not for a single GFSI audit; however, it can be applied to several different schemes, the most applicable ones being: • BRCGS Global Standard • FSSC 22000 • Safe Quality Food (SQF) • IFS International Featured Standards Picking the standard that is right for your company depends on your products, region, and existing quality systems.

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AICC Innovation

A Breakdown of the Different Standards for GFSI Certification BRC Global Standard for Packaging and Packaging Materials: This standard provides a framework to assist packaging manufacturers in the production of safe packaging materials and to manage product quality to meet customers’ requirements. Certification against the standard is recognized by many brand owners, retailers, food-service companies, and manufacturers around the world when assessing the capabilities of their suppliers. The standard has been developed to specify the product safety, quality, and operational criteria that must be in place within a packaging manufacturing organization to fulfill its obligations about legal compliance and protection of the consumer. The standard is popular in Europe and is required for exports to Europe. It must be renewed annually. Food-Safety System Certification 22000 (FSSC 22000) Standard, Ver. 5.1: The FSSC 22000 Certification Ver. 5.1 is based on the universally accepted ISO 9001 framework and, therefore, much easier to implement and integrate with other ISO standards. The FSSC 22000 standard consists of three important standards, namely, ISO 22000:2018, ISO 22002-4 (prerequisite program specific to the packaging manufacturing industry), and FSSC 22000-specific requirements. Certification must be renewed every three years. Safe Quality Food (SQF) Code for Packaging, Ed. 9: The SQF Code is a site-specific process and product certification standard with an emphasis on the systematic application of principles and guidelines for control of food-safety and food-quality hazards. The SQF Code for Packaging outlines a separate set of requirements to achieve safety of a variety of packaging materials. It is a more stringent standard with respect to buildings, surroundings, and storage. It requires a trained SQF practitioner in addition to a

BOXSCORE July/August 2021

food-safety team. Code certification must be renewed annually. International Featured Standard (IFS) PAC Secure Standard Ver. 7: The PAC secure standard was created to provide packaging manufacturers and converters the ability to certify primary and secondary packaging materials for the food industry. However, the IFS PAC secure standard is applicable to all kinds of packaging materials. In addition to stringent conditions, it requires attention to anti-microbial resistance. This certification is mandatory for exports to Europe and other nations, and it must be renewed annually. How Do I Get Certified? Once you have identified the GFSI scheme that best fits your company, your next step would be to contact a GFSIrecognized certification body associated with your scheme. After connecting with a certification body, the next step is to conduct training on the requirements for your company to understand the system that needs to be developed.

Following training, your company would implement a food-safety management system and document your processes in preparation for an audit. Once ready, you will be audited by a certification body and receive your certification if you pass. If you are unsure about which program is best for you or need help navigating the process, enlisting the help of a GFSI consultant can simplify the process and increase the likelihood of your achieving certification on your first attempt. Baskar Kotte is a consultant who has performed more than 100 audits toward GFSIapproved food-safety management system schemes in connection with the Food Safety Modernization Act. To learn more about Baskar and his company, Quality Systems Enhancement, visit www.enhancequality.com.

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AICC Innovation

Management

Breaking Down Silos BY BEN BAKER “Silos will continue to be inevitable as long as the rewards for collaboration are outweighed by the rewards for competition.” —Pearl Zhu

ompanies large and small need to realize that one of the biggest impediments to their eventual success is silos within their organization. Many people’s desire to focus on internal stature and hierarchy within companies leads to decisions that benefit the few, frustrate the many, and alienate clientele. So, if this is the case, why do silos exist? Why are structures put in place, formally or informally, that pit one department against the other, creating frustration and mistrust? Why do we allow and enable internal competition and fiefdom building to occur when we know that it is terrible for morale and hurts our customers? For manufacturers, this siloing can lead to a series of inefficiencies: • Operations not communicating effectively with sales can lead to sales making promises to clients that the operations cannot fulfill and vice versa. • Accounting not telling the sales department that they have put a customer on credit hold can create unnecessary frustration and lost clients instead of effectively managed and resolved situations. • Sales not communicating needs with marketing can lead marketing to spend time and effort developing campaigns that are tone-deaf to clients’ needs.

BOXSCORE July/August 2021

• Shipping not letting sales know that a truck broke down and a critical shipment to a client will be late does not allow sales to work with the client and fix it. Companies and staffs need to be aware of the danger of ineffective communication. Being hyperfocused on your department’s tasks, and not on how your actions affect others and the organization,

positions you as a commodity supplier— easily replaced and forgotten. The reasons for all of this are both simple and complex. The simple reason is that human nature and corporate structures exist to encourage competition and zero-sum-game mentalities. The argument can go something like this: “If my piece of the budget is bigger, naturally yours must be smaller, and that makes what I do far more

AICC Innovation

important than what you do.” The more complex answer has to do with the fact that organizations desire to maximize efficiencies through labor distribution. Still, those efficiencies are squandered when departmental infighting leads to situations in which the need to be right trumps interdepartmental cooperation to the end client’s detriment. No client cares about internal politics, power structures, status, or budgets. What they care about is having their problem solved, and silos within organizations impede this. They force the customer to navigate internal structures and politics that they do

not understand in order to have their issues solved. You can only imagine how frustrating that must be until you have been on the receiving end of this in another organization. Claims of internal bureaucracy, “not my department,” and the like only make those who pay the bills (the customer) start looking for another more straightforward solution for them to navigate. Now, before you start thinking that silos are the curse of only large organizations, think again. An organization can be two people and siloed. It has very little to do with head count and everything to do with internal structures, culture, and communication.

So what do we do to solve this problem? The first thing to do is to look and see what is causing the silos to form in the first place. How are people compensated? Are specific departments treated differently from others? How companies allocate bonuses, perks, access to education, seminars, or conferences creates mistrust, ill feelings, and even outright resentment. Are all departments represented equally in the boardroom? Do specific departments like HR and marketing fall under the chief financial officer’s auspices, and are their budgets delivered to them without their ability to advocate for what they genuinely need? While others have an equal and fair seat at the table when it comes to developing budget priorities? Is there effective communication throughout the organization? Does each department understand what other departments do within the organization, their priorities, and what frustrates them because of the unintended actions thrust upon them by other departments? Organizations need to understand that frustration, mistrust, and ill will can cost them thousands, if not millions, due to inefficiencies. They also need to realize how their siloed mentality affects their customers and creates opportunities for them to look for solutions partners elsewhere. Ben Baker is the president and CEO of Your Brand Marketing, an employee engagement consultancy designed to help you communicate your brand’s value effectively inside your organization. He is the author of two books: Powerful Personal Brands: A Hands-On Guide to Understanding Yours (2018) and Leading Beyond a Crisis: A Conversation About What’s Next (2020). He also hosts the iHeartRadio- and Spotify-syndicated YourLIVINGBrand.live Show, with more than 265 episodes.

BOXSCORE July/August 2021

Thank You, Education Investors These companies are making a significant contribution to the online education available to all AICC members.

For more information, contact Mike D’Angelo, President, 703.535.1386 or mdangelo@aiccbox.org.

AICC Innovation

Tax and Accounting

Supply Chain Disruptions and the Employee Retention Credit BY MICHAEL GALDIERI

he world of packaging has come out of the COVID-19 pandemic strong and is helping America get back on its feet. In an effort to accelerate businesses out of recovery mode and back into growth mode, Congress made legislative changes to significantly cut taxes for businesses who kept employees throughout the pandemic through federal incentives. The Employee Retention Credit (ERC) is particularly applicable to the packaging industry, as it can completely eliminate a business’s payroll tax and generate a cash refund, if the company had business disruptions, including supply chain issues. These disruptions oftentimes stem from government orders that have either forced packaging companies to halt operations or had an effect on suppliers and their ability to fulfill necessary orders.

Employee Retention Credit Background The ERC, which was put in place as a part of the Coronavirus Aid, Relief, Economic Security (CARES) Act, offers U.S. businesses a refundable credit that they can claim on qualified wages, which include health insurance costs paid to employees. Packaging businesses can claim the credit for all of 2020 even if the business claimed PPP. The American Rescue Plan took the credit a step further, allowing taxpayers to claim the incentive for all of 2021 as well. In order to qualify for the credit, businesses must be able to establish that they were either fully or partially suspended

BOXSCORE July/August 2021

due to orders from an appropriate government authority in any calendar quarter or that they experienced a significant decline in gross receipts. It’s important to note that businesses that were not suspended can still qualify if their suppliers and vendors were fully or partially suspended and if that is having a material effect. How AICC Members Qualify While most businesses across the country were closed in 2020 and thus can qualify for that year, boxmakers have continued to face supply chain issues, and those disruptions could qualify AICC members for significant tax savings in 2021. We are seeing businesses regularly claim six to seven figures in cash and credits for the first quarter alone. As an example, if a boxmaker’s paper supplier is able to supply only 80% of what is ordered due to governmental orders, reducing the output of the company, that would be deemed a qualifying disruption. Even if the company itself is deemed essential, is profitable, and is operating at full capacity, it may still be considered a partial suspension due to supplier issues. Ideally, the IRS would want to have seen that the taxpayer company made a reasonable attempt to find an alternative option when their primary supplier was unable to fulfill their orders. Even further, the impact from suppliers being unavailable—or any other work disruptions—needs to have more than a nominal effect on the company’s business operations.

While the IRS has attempted to put forward guidance clarifying the incentive, there is still a significant amount of ambiguity surrounding the ERC. Many businesses are trying to claim the credit themselves or by using a financial advisor who is simply asking them to earmark which employees they want to claim the credit on. That may be ill-advised as proper documentation, and substantiation of disruptions, supply chain issues, government orders—at an employee-by-employee level—would be prudent. Michael Galdieri is associate director at alliantgroup’s New York office. He has more than 15 years of experience working with startups to Fortune 500s. He has also partnered closely with CPA firms to uncover significant tax savings for their clients. He can be reached at 844-898-3280 or michael.galdieri@alliantgroup.com.

Member Profile

Package Crafters: ‘It’s All About the Hustle!’ BY STEVE YOUNG

COMPANY: Package Crafters ESTABLISHED: 2002

Photo courtesy of Package Crafters.

JOINED AICC: 2008

Team Package Crafters, from left: Michael Spohn, chief financial officer; Gary Brewer, founder and CEO; Shawn Bragan, plant manager; Kimberly Potter, customer service manager; Mike Roach, designer/estimator; Hugo Hernandez, production supervisor; and Alan Deal, director of sales and marketing.

ary Brewer, CEO of Package Crafters in High Point, North Carolina, remembers his initial reaction once he looked out into the 70,000-square-foot building he had purchased for the sheet plant he founded in 2002: “There were only six of us when we started. You could see all the walls in the building. I was, like, ‘What have I gotten myself into?’” Now, 18 years later, Package Crafters and its sister company, Creative Packaging in Savannah, Georgia, employ 39 people in 129,000 feet of manufacturing space and produce 160 million square feet per year. Of the company’s fast success, Brewer says simply, “It’s all about the hustle. My machinery looks like everyone else’s machinery. And now, when we’re all buying from the same

BOXSCORE July/August 2021

suppliers, the materials are pretty much the same. I say in theory, my box is no better than my competitor’s. It comes down to the hustle: Do I give you what you want when you want it? That’s really what’s put us on the map.” Rich Market, Golden Opportunity The point on that map occupied by Package Crafter’s main plant is the Piedmont Triad region of north central North Carolina. Anchored by the cities of High Point, Winston-Salem, and Greensboro, the region’s economy has historically been tied to textiles, furniture, and tobacco. But according to the Piedmont Triad Regional Council, new growth industries are emerging rapidly, including distribution, consumer products, biotech, and aerospace. The city of

PHONE: 336-431-9700 WEBSITE: www.packagecrafters.com LOCATIONS: High Point, North Carolina CEO: Gary Brewer

High Point itself, so named because it was the highest point on the North Carolina Railroad, has long been known as the “Furniture Capital of North America,” and the corrugated box market in the area has historically reflected that. After getting his degree in chemical engineering and pulp and paper science at North Carolina State University in 1992, Brewer went to work at St. Joe Paper Co. in Port St. Joe, Florida. After five years, he left St. Joe and joined Carolina Container, where his father, Wayne, was chief financial officer. As Brewer explains it, Carolina Container’s owner, Paul Ingle, wanted someone with mill experience to take over the company’s containerboard purchasing. Brewer recalled that Ingle’s direction was simple: “’I want you to be a paper salesman’s worst nightmare.’”

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During his five-year stint at Carolina Container, Brewer completed an MBA at Wake Forest University in Winston-Salem. His last class was “Entrepreneurship,” and his last assignment in that class was writing a business plan—in his case it was for the sheet plant that he would eventually start with his father, Wayne. “When we decided to start our own company, what I saw at the time was lead times, on average, were a week, a week, a week,” he explains. “And I went to market with third business day after receipt of order, and that caught a lot of people’s attention.” Fulfilling that third-day promise meant equipping the plant properly, and Brewer credits Ben Liskey at The Haire Group for doing the heavy lifting. “I dealt with Ben at Carolina Container; he’s the guy who helped me get started,” said Brewer. “I started with a 35" flexo folder gluer, a 66" rotary die cutter, and a 74" rotary slotter, because I was at Carolina Container, and they had a lot of Ward (Machinery Co., now BW PaperSystems), and that’s what I knew.” And the market responded. The box market in the Piedmont Triad is a typical industrial mix and mostly brown box, says Brewer. “I try not to fool anybody about us being a graphics house; the brown box market is where I cut my teeth at Carolina Container. It was industrial packaging, and that’s how we’ve grown.” Brewer outlines the principal industries served by Package Crafters in North Carolina, those where his faster lead-time advantage has paid off: consumer goods, automotive, plastics, food and beverage, specialty chemicals, and firearms. He says the biggest growth within this industrial packaging segment has been in the large-box, or jumbo, format. “When you look at my equipment out there, you see some really big stuff,” Brewer says. He explains that for his business model, large-format packaging fits a

distinct niche, and one whose margins are, as it were, audible. “The industry is moving to all these high-speed flexos running 350 boxes a minute. and it’s going ‘10 cents, 10 cents, 10 cents, 10 cents.’ I’m out here, and I hear ‘12 dollars … 14 dollars.’ Everybody likes to hear that machine going tick, tick, tick, tick, tick, but how much revenue is being produced?” Equipped for Success Brewer has an instinct for opportunity in his market and a knack for equipping his plant to respond to it. Understanding the needs of his large-format box customers, he has, over the years, added a 66" x 125" Ward two-color flexo folder gluer with die-cut and a 75" x 185" Ward two-color flexo folder gluer. Rounding out the mix are a 115" Post specialty folder gluer and two Pioneer flatbed die cutters, a 110" and an 80", respectively. He says he “scours” the used-equipment market to find deals and, in these two instances, credits industry consolidation for providing him exactly what he needed. The 66" x 125" came from a plant closure; the 75" x 185" from the closure of a WestRock plant in Texas. Looking further around his market, he saw that no one else offered stitched boxes, so he added a stitcher to his mix as well. Now, when companies he calls on report glue-joint failures—for whatever reason—they become fertile ground for planting new business. The only piece of new equipment purchased recently was a die cutter stacker from AG Stacker in Weyers Cave, Virginia. “My die cutter was just slammed, to the point that I thought I was going to have to add a second shift,” Brewer says. “What I came to realize is, the stacker is the tail that wags the dog. When I put the AG Stacker in, it sucked everything up—more production but no overtime, no second shift.”

Growth, Acquisition Being an owner, Brewer is a member of an AICC-sponsored CEO Advisory Group. He joined the group in 2013, and at its first meeting in Southern California in the spring of 2014, he met John MacIntosh, president and owner of Creative Packaging in Savannah. MacIntosh founded Creative in 1997, a year after his stint as the executive director of the 1996 Summer Olympics sailing venue had ended. “At the meeting, John made a comment that made my ears perk up about being interested in selling,” Brewer says. He explains that Creative’s calling card was its high service levels and being the only independent in a market dominated by integrated companies. “If I thought I was high-service, he was even higher-service. I saw a diamond in the rough and a great opportunity for the market.” Creative Packaging’s Savannah market calls for more graphic work, due to the mix of customers in southeast Georgia— firearms, outdoor power equipment, and consumer products firms. “Compared to me, they did a lot more color work,” Brewer says. “They have a consumer products multicultural hair care company, so a lot of countertop display for bottled product. That was all the graphic side of it—the label part of it—and maybe a four-color direct print.” Creative’s equipment inventory serves this customer base well. The company has a 37" x 96" McKinley two-color flexo folder gluer, a 50" x 110" S&S two-color flexo folder gluer with a die-cut section, a 66" x 80" Langston Titan two-color rotary die cutter, a 74" x 184" S&S onecolor rotary printer slotter, and a 49" x 65" Stock laminator. Brewer and MacIntosh penned the deal in 2015. For Brewer and Package Crafters, the acquisition has meant an extended geographic reach, to be sure, but also what Brewer calls the “soft benefit of recognition in the marketplace.”

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“People will say, ‘Oh, you have two locations. Oh, you have redundancy. Oh, you have additional capabilities.’” Operationally, the two locations function as one and are now linked via the Harry Rhodes ERP system. And in this past year, during the middle of the COVID-19 pandemic, Brewer relocated Creative Packaging into a larger brand-new 40,000-square-foot building. Key People Brewer has assembled a talented and motivated crew behind him. His longest-serving colleague on the management team is Alan Deal, sales manager. Deal was part of the original group of six managers, along with Gary Brewer, Wayne Brewer, Steven Vaughn, Billy McCall, and Tom Slate, who formed the nucleus of the company in 2002. “Alan was one of my original employees,” says Brewer. “He looked at me and said, ‘Let me get this straight: You want to start a sheet plant with no customers against some of the biggest competitors around?’ And I was, like, ‘Yeah.’ And it attracted him.” Kimberly Potter is customer service manager, and when she joined the Package Crafters team four years ago, she brought her experience in running a printing plate and cutting die shop with her father. “I used to buy print plates from her,” says Brewer. “She and her father had a print plate shop, Target Graphics.” Potter’s familiarity with tooling and its specifications are invaluable in ensuring the accuracy of customers’ orders and delivery schedules. Potter says that the most rewarding part of her job is interaction with customers. “Most rewarding is definitely being able to work one on one with the customers to meet and exceed their expectations,” she says. “It’s always nice to have that interaction and that relationship that you have over time.” Shawn Bragan, plant manager, came to Package Crafters three years ago from a Packaging Corp. of America (PCA)

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plant in the Atlanta suburb of East Point. Before working at PCA, he worked at another independent, Container Service in Ringgold, Georgia. Bragan says he appreciates the opportunities afforded in an independently owned box plant. “Working for Gary has been one of the

best jobs I’ve ever had,” he says. “He gives me the freedom to do what I want to do.” Bragan works hard to ensure that workers under his charge are motivated to do their best. “Keep the morale up,” he says. “Pat them on the back, tell them they’re doing a good job. They get a good

A ‘FRACTIONAL’ CFO? MIKE SPOHN AT PACKAGE CRAFTERS EXPLAINS Controller, accountant, finance director—these titles, found among those companies responding to AICC’s 2020 Salary, Hourly Wage & Benefit Survey, bespeak the responsibility for the financial health of a company, and often more.

distribution, financial services, and retail firms. His service to Gary Brewer, CEO of Package Crafters, has included advice on real estate transactions, banking negotiations, and due diligence in the acquisition of other companies.

But what is a “fractional” chief financial officer (CFO)? Michael Spohn, CFO at Package Crafters, explains that a fractional CFO is one whose time is split among several client companies. The concept, he says, is gaining traction in the United States and elsewhere as firms seek CFO-level expertise but do not wish to have that person in their full-time employ. Spohn, having finance and accounting degrees from University of North Carolina Greensboro and High Point University, respectively, is a principal at NextGen CFO in High Point. Founded in 2010, NextGen CFO has grown to be the largest provider of fractional CFO services in the Piedmont Triad region of North Carolina.

In the real estate case, it was a nearby 60,000-square-foot building, a third of which Package Crafters uses for warehousing. “Gary was looking for some additional space and was considering leasing 20,000 feet of it,” Spohn explains. “I said, ‘Gary, you might as well buy the whole thing.’” Brewer did; he’s now receiving lease income from the building.

According to Spohn, the principal advantage of fractional CFOs is to leverage CFO-level expertise to enhance the value of the business for owners and shareholders. “The business owner usually wants a full-time person in that role because it’s a safety net,” he says. “A fractional CFO is the same concept. I’m only putting in a couple days a week, but you’re getting CFO-level expertise.” Spohn currently serves seven other client companies in addition to Package Crafters. Thus, he brings with him an outside perspective from diverse manufacturing,

In another instance, in his first year at Package Crafters, Spohn noticed unusually high cash balances, and he urged Brewer to use this cushion to begin taking discounts on his principal expenditures for sheets and other raw materials. Says Spohn, “In the first year, we saved $140,000, which is three times what he pays me.” Spohn brought no expertise in the corrugated industry with him to Package Crafters when he began five years ago. In fact, he admits he first looked at the industry with a jaundiced eye. “My first impression was there is no way that a company selling corrugated boxes could make money,” he recalls. “It’s pennies, and if you’re multiplying pennies you usually don’t get to large numbers. I was proven wrong quickly.” For more information about the fractional CFO concept, visit www.nextgencfo.com.

FOCUS ON QUALITY

Kolbus Hycorr understands that quality is a reflection of the great care that takes place throughout the entire manufacturing process. From the time we pour the first casting until the equipment is prepared for shipment, our manufacturing team owns every step to maintain strict quality control. Our customers can rest easy knowing that their equipment has been built with great attention to detail.

KOLBUS America Inc. 216-931-5100 sales@kolbus.com

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setup, I tell them, ‘Great! Get the next one, too!’” Hugo Hernandez, a 16-year employee, is plant supervisor. “I’m personally proud of him,” says Brewer. “He came here as a temp making $6.75 an hour; he knew nothing about the box business.” Hernandez adds, “I started on the hot melt machine. I know how to run every machine now.” Hernandez is an evangelist, of sorts, for the corrugated industry, encouraging new hires in the dynamics of the box business. “I tell everybody out there we have a job for a long time. Not just one week, one month, a year. If you run a machine, you’re going to have a job for a long time.” It was 13 years ago when Mike Roach, designer, came on board at Package Crafters. “He used to work with me at Carolina Container,” Brewer explains. “He ran a Langston Saturn III flexo folder gluer and holds several production records on it.” Roach, being modest, acknowledges only two he can remember: 32 setups in one eight-hour shift and 1.4 million square feet. Why did Roach join Brewer at Package Crafters? “Gary needed a designer, and I needed to keep a job,” he says. When asked about his role in the “hustle” philosophy engrained in the company, Roach says, “I don’t like making a customer wait. I’m just like everybody else here: Try to get [the customer] the best answer as quickly as possible.” Challenges and Future Path Talking to Brewer and his team, one senses a commonly held understanding, not only of the challenges facing the industry but of the vision for the company going forward. “Most obvious is the labor challenge,” says Brewer. “Look, we’re a ‘get-er-done’ kind of company, right? The customer’s due date is what drives our ship. And it works backward from there. If someone doesn’t want to come to work, if someone walks off the job, whatever it might be, everybody else has to fill the void.”

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Adds Bragan, “The industry’s booming right now. Everyone’s busy, and no one can get any workers.” Extended lead times on materials are also dogging the corrugated industry, and this affects any company’s ability to deliver on time. Deal says, “I think the challenge for us from the sales team point of view will be managing the customer’s expectations for delivery. That’s a fancy way of saying we have extended lead times due to materials and the amount of work we have to get through the plant. Everybody’s banged right now.” Potter agrees, offering the example of triple wall and other packaging materials purchased from outside vendors. “The customer was accustomed to placing the order and receiving product in two weeks. That two-week period turned into, like, 26 weeks!” Deal says another challenge for the corrugated industry is the need for increasing technical knowledge on the part of its sales professionals. He believes Package Crafters and Creative Packaging are a step ahead of the crowd on this point. “We built our sales team on technically based people: former customer service from other companies or former designers. I have two salespeople who came out of the tooling side of the business, and our main designer here, Mike Roach, was an award-winning flexo operator in his former position.” Brewer sees the future of Package Crafters and Creative Packaging growing first, internally by dint of their service and capabilities, and second, geographically. “I would like in my career to make one more acquisition,” he says. “Somewhere in the Southeast. It would help me to increase my footprint—make a service triangle.” Talking about the kind of company he may have in his sights, Brewer says, “Somebody size-wise that is roughly my size; I’m not looking to swallow someone bigger than me. It has to be something manageable, somebody that does what I

do because that’s what I know. I think I have enough bandwidth left.” A successful AICC member, Brewer serves on the Association’s board of directors and last year was tapped for its executive committee. In 2025, he’ll assume the chairmanship of the board of directors. Looking back on his decision to join, he says, “Chuck Fienning [former CEO of Sumter Packaging in Sumter, South Carolina] talked me into it. I always knew about AICC, but I felt like I was too small to join. And I look back on that and realize it was a total mistake.” He cites the AICCsponsored CEO Advisory Groups as “the best single thing I’ve done in AICC.” “There are issues you have or want to address, and you can’t have that conversation inside the four walls of this building, nor would I want to,” Brewer says. In a CEO Advisory Group, he adds, “you can put it in front of your peers and get tons of advice.” Our discussion with Brewer brought out many memories for him, memories likely shared by many AICC-member owners and operators. “I literally sold everything. My wife, Ginny, was the only income. You talk about some sleepless nights. I look back on it and say, ‘If it were easy to be an entrepreneur, everybody would do it.’” Yet he also credits his original team, giving them their due as well. “I was smart enough to know that I didn’t have every card in the deck. Without my father, it wouldn’t have gotten started, and without that original team of six people, it wouldn’t have gotten started.” What started at Package Crafters in 2002—a third-day delivery promise— continues to serve the company and its customers well. “It’s all about the hustle,” says Brewer. “It’s all about the hustle.” Steve Young is AICC’s ambassador-at-large. He can be reached at 202-297-0583 or syoung@aiccbox.org.

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MIDYEAR

CONVERTERS ROUNDTABLE Independent leaders discuss successes and challenges in business, workforce, supply, and transportation, all as light at the end of the pandemic tunnel emerges

BOXSCORE July/August 2021

Jack Fiterman

Al Hoodwin

Ian Bernstein

Vice President, Business Development LIBERTY DIVERSIFIED INTERNATIONAL

CEO MICHIGAN CITY PAPER BOX CO.

President TRENTON CORRUGATED PRODUCTS

HARRIS PACKAGING CORP./AMERICAN CARTON CO.

Jana Harris

Jenise Cox

Matt Bivens

President

Chief Financial Officer

Sales Manager

he past year-plus has tested the boxmaking world, only to prove that this essential industry can break through any challenges it’s faced with—and see lasting success. In this first-ever BoxScore roundtable discussion, several independent leaders talk about the state of business over that time and how, today, they’re aiming to overcome new challenges and setting up their companies to sustain momentum. Moderated by AICC President Michael D’Angelo, this conversation was recorded live on May 19 and transcribed exclusively for BoxScore readers.

Michael Drummond President PACKRITE

BOXSCORE www.aiccbox.org

Managing Pandemic Restrictions Michael D’Angelo: We know that the pandemic has affected all of our operations for the past year, and all of you have had to make changes by the nature of your business, the nature of your customers’ business, and the nature of all of the constraints that came from being in a society that’s in a pandemic. We’ ll start with you, Al, if you don’t mind. Given the latest CDC guidance concerning the fully vaccinated and masks, is Michigan City Paper Box requiring your vaccinated manufacturing employees to continue to wear masks? Al Hoodwin: That’s a very interesting question, Mike, and it was interesting to see the guidance provided by [the Fibre Box Association]. For the immediate future, we’re going to continue to require masks in our production and office environments. We’re looking forward to some healthy discussions with AICC. I’m hoping that you’re working on a webinar real quick for us to discuss with each other and share ideas, how we’re going to implement this in our workplace. And I know by working together with fellow members, we’ll come up with a good policy. But for now, masks stay on. D’Angelo: We’ ll work on a webinar. We’re waiting for the OSHA update that apparently has been sitting on someone’s desk across the river from AICC in Washington, D.C., but we want to basically keep our powder dry until we at least have some idea what OSHA’s doing. And that’s one of the reasons why we’re asking the question, because a lot of members without the OSHA guides are pretty much wanting to know what everybody else is doing. So, Ian, how about up your way? What are you requiring your folks to do? Ian Bernstein: We don’t have much option. The great state of New Jersey continues to require masks and is not giving us any date at which they won’t require masks. As far as our plant, we started early—my wife has been busy making

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[vaccination] appointments for anybody that would take one. So, I think we’re about somewhere between 85% and 90% vaccinated in the plant. So, you know, we’re feeling pretty good. People would love to be able to take their masks off, but the state still requires us to wear them. D’Angelo: So, if we move over to the great state of Texas and Jenise and Jana, what’s the story down there? Jenise Cox: Well, Gov. [Greg] Abbott lifted the statewide mask mandates and opened up all businesses to 100% capacity, effective March 10. We announced June 1 as the date to lift our mask requirements shortly after the governor’s March announcement. We chose to wait a couple of months to ensure that the changes at the state level did not result in another spike. Since the COVID-19 statistics have trended downward in our area since March 10, we are sticking with our decision to end Harris Packaging and American Carton mask requirements on June 1. D’Angelo: So your folks will be able to wear them if they choose to or not wear them if they choose to—is that what that means? Cox: Right. D’Angelo: How about up in Minnesota, Jack? Jack Fiterman: What we decided to do and what we’ve done all along on this, Mike, is we followed CDC guidelines by state. So, all the states that have removed the mask mandates, like in Minnesota, we’ve done that as well in our plants. I think it’s been very well received. For the plants that do have unions, we have to work with the unions to talk to them about that before we do that. But for the most part, the states that allow us to make it optional, like those of you that are talking about it, we’re doing the same thing. But I’ll tell you, the state of California, I think it’s going to be a while

before they remove the mask mandate there. So, that’s going to be a big deal. D’Angelo: How many states does LDI have facilities in? Fiterman: I think we’re in 11 or 12. D’Angelo: So, you’ve got kind of a “soup to nuts” arrangement, I guess. Fiterman: Yes. All we’re doing is following CDC guidelines, but if the state is still mandating it, then we’re complying with it. D’Angelo: Michael, when we had our Southeast summit down in North Carolina, we had to wear masks in accordance with state policy. I don’t know if there’s been any updates or movement since then. But what are you going to do down at Packrite? Michael Drummond: Well, the state took off the mandate as of last Friday. So, as of last Friday, it was done. State took it off, we took it off. We’re following the guidelines the governor’s setting for us, which is a CDC guideline. So, some people are still wearing them— they feel comfortable doing that, and, you know, God bless them, that’s their choice. But as far as requiring anything, we are not. D’Angelo: The interesting thing will be whether the OSHA commentary about masks will in any way, shape, or form mirror the CDC guidelines or chart their own course. Any comments relative to that from anyone? Hoodwin: I guess, Mike, I’m just a little concerned just because right now, the OSHA guidelines I think clearly state you’re supposed to treat vaccinated and unvaccinated workers the same, yet I’m hearing during this call, many people are removing the mask mandate. So, in a sense, you’re in conflict with OSHA regulations that regulate your work floor. So, that’s what I find troublesome on my part, but it seems others on this call aren’t as concerned as I am with the conflict.

“As manufacturers, I think all of us are in a war to try to find people; we have to meet people to some extent where they’re at.” —Jack Fiterman, vice president, business development, Liberty Diversified International Fiterman: I’ve never been asked to show my vax card. Everyone talks that game, but in order for that to actually happen, you’re going to have to have companies start asking people to show their vax card. And I haven’t seen that once, whether it’s a restaurant, whether it’s a grocery store, whether it’s a company, a customer—I’ve never seen that once. They ask, “Have you been vaccinated?” Drummond: That would violate—we can’t ask health questions. Whatever that

mandate is, if you do that, you violated their rights. D’Angelo: It’s actually a step further on that because my understanding is, because the vaccinations are approved under an emergency order, neither the United States government nor an individual employer can actually require someone to get a vaccine. I would think it follows along the lines of what Jack’s saying, that if you’re not required to get a vaccine, you’re

probably not required to state whether you’ve gotten one, or you have to produce your vaccination card or anything else. It kind of all follows under that emergency order. Although I don’t know the specifics of the order. Drummond: Well, you know, like I said, the problem is, you’ve got HIPAA, and to ask somebody about their vaccine violates the HIPAA laws. So, what’s worse? Hoodwin: It’s interesting, Michael, if you get ahold of the FBA update sent out [May 18], that was one of the questions asked specifically, and I guess the law firm that FBA was working with to put together these guidelines gave a lot of reasons why they say it isn’t a HIPAA violation. So, again, it’s a lot of differences of opinion on it. Working Remotely and the Search for Labor D’Angelo: How about on the office side? Obviously, your manufacturing workers can’t work remotely during the pandemic, because you can’t produce boxes out of your home, but I know many boxmakers have had some of their office staff either working entirely remotely or coming in the office on, let’s call it “shifted” days, where like teams are coming in with like functions or things like that. Is there a future for remote work in your business, Jack? Fiterman: I’m not sure we’re going to have a choice. As manufacturers, I think all of us are in a war to try to find people; we have to meet people to some extent where they’re at. We have to figure out how we can do some of these things and make it flexible for them. So, whether or not we want to do this, I really think that that is going to be one of the ways to be an employer of choice, to figure out how we put the technology in and the systems in to allow people to cycle in and out and not have to be physically at the office. And I think, also, how do you monitor that? How do you put metrics in? How do you evaluate employees? Just a lot of

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things that go into that. I know there’s definitely going to be businesses that are just going to be set up for that. They’re going to be talking about, “How do you run that way?” I mean, let’s face it. At some point, I think all of us had a little of that going on during COVID, and I think the people I talked to, businesses, ran pretty well. We still invoiced, we still shipped boxes, and we still took calls. So, it’s just going to be a different world coming out of this. If you’re a law firm or you’re an accounting firm, nobody’s moving back to the big cities right now—I’ll tell you that much. Everybody’s staying home, and they’re reevaluating, “Do I really need to go spend $30,000 a month on a big office tower in one of the big cities that we’re in?” So, I think a lot of this stuff is going to change for sure. It already has. D’Angelo: Jana, Jenise, Matt, any concerns if you’ve got remote workers going into the future and maintaining culture? Culture’s such an important criterion in an independent business and in a family business. What are the challenges that will come with remote work and maintaining culture from your point of view? Jana Harris: We spent a lot of money on redoing offices, so they’d better come back. (Laughter) D’Angelo: So, you’re modifying your offices for the returning workforce to feel it’s a safer environment, where there’s a little bit more separation and other safety protocols taken into consideration? Harris: No, we just needed to do it. With COVID, we’re moving our corporate office to our other location, our warehouse. And we kind of learned during COVID that we could actually do that and not all be in the same building together. So, that was an eye-opener for us, but pretty much all of our people are back. We’ve got a couple that work from home maybe a day or two, but

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“We’ve definitely seen some people in interviews who are looking for remote work and don’t want to be in the office. We’ve been discussing [remote work] more from that perspective going forward.” —Ian Bernstein, president, Trenton Corrugated Products

pretty much everyone’s back. And I do prefer it that way. I mean, we do have quite a family culture, and it’s different when you’re just doing it from home, you know? So, I think it’s better for us to have everybody together. D’Angelo: But you’ ll also have some flexibility for the workforce, kind of along the lines of what Jack’s saying. Harris: I think so. I think, you know, if there’s a need for a body that knows what they’re doing and they want to stay at home, we can consider that now, whereas we wouldn’t have before COVID. D’Angelo: How about you, Michael? Your offices, the building’s fairly new, the office is really modern. I’ve been there a couple of times; it’s a nice layout. What are your thoughts? Drummond: When this thing first kicked off, the first thing I did was ban my salespeople from coming back into the office. They essentially got stuck at home. Nobody’d see them, and I wouldn’t let them come into work. So, the salespeople, they were off-site for at least six months. The second thing I did is rotated the office staff, split it into three groups, so I didn’t have exposure. So, they were working a minimum of two days a week off-site and probably could have taken most of the staff, had we gotten some of the systems we’re working on right now up and running. We’re working on upgrading our EFI to go paperless.

And if we’d had that paperless, I think everybody could have worked remotely with customer service and accounting. But with manufacturing itself, obviously, we would need people. We did a lot of things on our plant level to make sure people were comfortable. One of the things I got out of the AICC Spring Meeting was putting Saran Wrap over all the controls, and when you got through with it, you took your Saran Wrap with you. We implemented that and ran with that for almost nine months. And then we had a cleaning schedule, and we had people constantly cleaning the office. We can somewhat on the office side work remotely, but not completely. D’Angelo: Ian, how about you and your operation? Bernstein: We’re just a small sheet plant, with not that many people in the office. They’re pretty spread out. So, we set up the ability to be remote, but we never actually went remote and never had anybody working remotely. The only thing I could add really is, we’ve definitely seen some people in interviews who are looking for remote work and don’t want to be in the office. We’ve been discussing it more from that perspective going forward. D’Angelo: So, are you going to find a way to accommodate them? Bernstein: We may have to, but we’re still discussing. We’d rather not—we

Machinery and Handling for the Corrugated Board Industry

think from a cultural perspective, it’s important to be in the office and be together because, again, there aren’t that many of us, but we may be forced to by the market. D’Angelo: Al, from my knowledge of everybody on the call, I’ d say you’re the technological guru. So, the use of remote systems and whatnot—where do you see it? Hoodwin: You know, we’re a small plant, too, and I think culturally, like Ian and Jana said, we feel it’s important for everyone to be together. But of course, we’re accommodating mostly office workers with any sort of school or child care situations. That has been most of the time where people have had to do remote work. I think, like Jack, if we were looking for a particular individual and they desired remote work, we would kind of see, are the skills they would bring to the table worth enough for them not to actually be at the table? But I’d say right now, we would be encouraging people to be in the office. D’Angelo: Jack used a very telltale phrase in his commentary there. When he talked about being “the employer of choice,” it kind of indicates who’s got the power right now in terms of getting a position, in terms of how difficult it is in the labor markets for manufacturers these days. Jana, Jenise, Matt, what are the challenges that you’ve got down there in terms of filling open positions, be it in the office or on the plant floor?

Matt Bivens: I think they’re some of the same challenges everybody else is experiencing. There’s a labor shortage with the extra unemployment benefit that’s going on in the country right now. It isn’t helping. We’ve significantly raised hourly wages over the last nine months to incentivize people to come to work. We’ve given them hazard pay for the last year, basically, to incentivize them to come to work. We relaxed some of our less critical policies that we’ve had in place for years. As far as absenteeism, tardiness, we’ve paid employees to stay home when they weren’t feeling well, even before the government stimulus program came out. So, we are being more flexible than we’ve ever been with our employees in an attempt to try to keep the ones we have and lure new talent in the building. D’Angelo: I know 21 states are going to, I think as early as June 1—maybe it’s even earlier, some of them—are going to turn down the enhanced federal benefit for unemployment. Bivens: Texas is turning it down June 26. D’Angelo: Hopefully, that’ ll at least bring people back into the labor market that might not otherwise be there, because then they’re just getting the state benefits. Ian, New Jersey is not a state that’s on that list right now as far as I know, although it changes seemingly daily. Are you finding a challenge in terms of competing with enhanced government benefits?

“I think that this year is going to continue to follow up strong. When I started this year, I didn’t think it was going to do that. … I’m seeing a strong demand through the end of the year.” —Michael Drummond, president, Packrite

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Bernstein: Yep. It’s almost virtually impossible to find people. And you spend a lot of time being ghosted, with people setting up interviews and not showing up, or you set up an interview for two days later, and they take another job before they even come in for the interview. We’ve been trying to work closely with our community college locally, because they’re getting government grants, and trying to see if we could do some workstudy things. And we’ve also gone heavy on two temp agencies we work with. We’re probably running more temporary hours in the plant right now than we are permanent employee hours. So, that’s how we’ve made up the difference. But that’s probably the biggest challenge that we have at this point. D’Angelo: The temporary workers that you’re getting, are they showing any desire to be permanent workers? Do they like the work and therefore want to stay, or is it the temporary lifestyle was working for them maybe even before the pandemic? Bernstein: They’ve gotta get somewhere between 800 and 1,000 hours, so we definitely have a few that have expressed interest, but it is fairly transient. So, we put an operator together with two temps, and they make their way through the day. We’ll probably have a better sense of that maybe in the fall. We’re hoping that some of them will stay, some of the better ones. D’Angelo: Michael, how are you seeing things in North Carolina? Drummond: What labor? [Laughter.] The temp agencies are out of temporary employees. We call them and they say, “We don’t have anybody that is even applying” to send to you. So, I think it’s going to shut down a bunch of temporary agencies. They’re just not going to have them. We’ve been lucky. We’ve been able to hold on to most of our people, but I’ve got a strong need for machine operators. I mean, I think everybody’s in the same

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boat. I’m automating even more of my lines—in-line stretch wrappers, in-line banders—as much as I can put in-line, I’m putting in-line so that I don’t need as many people. I’m automating as fast and as hard as I can. D’Angelo: Thank you. Al? Hoodwin: We’re in a small town, 35,000 people, and we’ve found it extremely difficult to compete with the federal program. I’m happy that our governor is going to stop providing the federal assistance June 19. As of June 1, he signed an executive order that in order to get unemployment in Indiana, you’re going to at least have to show you’re looking for a job, which, you know, you would think that would be how it would always work, but, surprisingly, no. In the meantime, what we’re trying to do is make sure our employees understand what they’re really making, because our business has a lot of benefits in terms of holidays, health insurance. So, we’re spending a lot of time detailing the value of those benefits so they don’t think, “I’m only making X an hour”; they realize that their health insurance alone adds $2.71 an hour to really what they’re making, in order to keep the core set of employees in the plant, which we’ve been able to do. But otherwise, we’ve been about 15 people short since August of 2020, when things started to pick up, and we, just through churn, have never been able to permanently fill those 15 positions. Drummond: I’m 20 down. D’Angelo: You said something interesting in terms of having to be looking for work in order to be eligible to collect. My understanding, too, is if you’re offered a job and it’s within a reasonable pay scale, not something that’s far below a livable wage, that you also are somewhat obligated to take that job in order to continue to collect. You can’t keep turning down jobs and collecting unemployment. Jack, what are you seeing,

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especially with the fact that your footprint covers a lot of states, some that are probably not participating in the enhanced federal benefits going forward and some that will continue to do so? That presents a bit of a challenge for you from a central point of view, doesn’t it? Fiterman: Yes. I agree with what everyone’s saying. It is virtually impossible to find people. I found this statistic interesting: From 1948 until 2021, the average unemployment rate in this country, for the last 75 years, has been 5.77%, OK? In April 2020, when COVID first hit, we hit 14.8% unemployment in this country. Today, I think we’re sitting around, in April, we’re sitting around 6.1%. I haven’t seen the May numbers yet. So, if you have 6.1% unemployment, and then what everyone’s been talking about on the federal program, everybody that wants to work is working. It’s going to be very, very hard to find employees. And the only other thing I’ll say about this is when my parents were my age or younger, it was prestigious to be a press operator. Now, the generation that’s coming up today, it’s totally changed. I don’t think they want to work in the manufacturing environment that we’re all in. Not to stereotype certain sectors of our employees or our population, but I do think, in general, that’s going to be a major issue going forward. And it’s not like we can just turn on a light and say, “Now, we have these pre-feeders or now we have these machines that are going to run a lot faster.” The machinery people, even if you do it, are out 18 months, many of them are out 18 months for new installations, so this is going to be a major issue, and I don’t think it’s going to get better anytime soon. D’Angelo: You’re correct—the date and the statistics tell a story. So, if the historical unemployment rate over that time span as you say is 5.7% and we’re hovering at near the historical level, and we’re incentivizing

people that may want to work to not work, it’s not necessarily a good combination. AICC sent out a mailing on May 19 to the key contact at every AICC member company with a letter template about the enhanced unemployment benefits. This is something the government affairs committee wanted us to do, so hopefully, AICC members will take up the challenge to get in touch with their local officials and opine about it. At least see if you can get a little bit more participation in terms of folks that are looking for jobs, because as we know, the box business has been quite busy since the pandemic bottomed things out in the spring of 2020. Busy Boxmakers Amid Tight Supply, Struggling Transport D’Angelo: Box shipments are up almost 4% in Q1. Things are busy. Jack, what do you attribute that to, and do you see it lasting? And if you see it lasting, how long do you see it lasting? Busy box plants. Fiterman: It was interesting; I had this conversation with a customer yesterday. They said, “Well, if it’s only up 4%, that doesn’t sound like it’s that much.” But if you take 4% and look at the global paper supply, that’s like 1.3 million tons, OK? And if that continues, even if that could just stay, we’re not bringing out anywhere close to that in North America. That is between labor shortages, between business being good, between e-commerce continuing to grow. It’s really been a perfect storm. Even with the new capacity coming on, I don’t see that changing too much unless all the big integrateds stop exporting paper, which could happen. I don’t know if we’re going to talk about this later, but I think freight is going to be a continued problem. Rail is just not dependable, and so people are trying to truck more, and there’s a shortage of trucks, and now with oil. There’s a lot to be excited about, but it doesn’t come without its challenges right now, for sure.

D’Angelo: Prior to the COVID, the 10-year average growth for the corrugated industry was 1.3% annually, so you’re seeing four times that. If RISI’s numbers for the second-quarter speculation are right at 7%, it’s going to be roughly seven times that. You’re right; it creates the perfect storm for labor, and it creates the perfect storm for paper, transportation services, and the like. Ian, what can you do to weather the storm when nobody knows how long that storm’s going to last? You got any thoughts? Bernstein: I think just going back to what you were just talking about, I look at e-commerce, and you’ve had a step change, obviously. But if you look at the percentage of retail sales that are online and getting delivered in a package in the United States and compare it to where they are in China, we’re still at a fraction, like, maybe a third, of the percentage of sales that get done online relative to the overall sales that get done online in China. So, at least from where I sit, between e-commerce and sustainability, which are both just huge right now, maybe it’ll flatten out a little bit, but I don’t see us going back from a demand standpoint. I don’t see us sliding back

all that much. What do we do about it? I think automation is probably the key. Continuing to try to move the plant forward from an automation standpoint and becoming more customer-friendly on the e-commerce side and figuring out how to interact with those customers and that marketplace, which is a bit different. We’ve added on fulfillment and some other things to try some storage and warehousing to try to go after that marketplace. D’Angelo: Al, the rigid box industry’s a little bit different than corrugated. Do you see things any differently? Hoodwin: A rigid box tends not to be vital to a lot of our customers’ operations. It tends to be more of an add-on product. We are essential to some companies, so we’re riding the wave with the corrugated folks in terms of being busy, and I would expect that we will be busy through the end of the year and making as much as we can, based on the limited number of employees we have and based on the materials we can get our hands on. I don’t see that changing before the end of the year.

D’Angelo: At Harris Packaging and American Carton, you’ve got corrugated at Harris Packaging and folding carton at American Carton. You’re seeing things from two sides of the coin down there. But how does it look going forward? Bivens: From a corrugated perspective, it looks strong. Business the last nine or 10 months has been really, really good. We’ve outpaced the industry significantly. We had made investments prior to the pandemic in the plant that really paid dividends over the last year. We were well positioned to grow. We think that strong conditions in corrugated will last at Harris through at least the end of the year, and then in 2022, they may taper off just a little bit and be at a “new normal” of accelerated growth, but not quite as robust as we were in 2021. Harris: Same thing at the folding carton plant. We’ve had an outstanding year, lots of growth within our existing customers, and also some new customers as well. It’s been a challenge, the very quick amount of high growth, and not having everything staffed and the same issues of trying to get people. We’ve gone from a two-week lead time for our customers to a five- to

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six-week because we just can’t keep up with the demand. So, it’s been crazy. I expect it to continue that way for a while. We are trying to staff up as best as we can to get that down maybe to a three- or four-week lead time. But I see it being steady as it is right now probably through the end of this year and maybe into next year as well. D’Angelo: Michael, due to the unique nature of your business, we could say you kind of wear a folding carton hat and a corrugated hat as well. Do you get to see a couple of different futures, or do you see things saying strong on both sides? Drummond: Well, I think that this year is going to continue to follow up strong. When I started this year, I didn’t think it was going to do that. I saw a lull about two weeks ago, and then it just vanished and went that much stronger. So, I’m seeing a strong demand through the end of the year. I just don’t know where it’s going to go. People say, “Will you run stuff for me?” and I’m like, “Great. Here’s your price.” They say, “Well, it’s gone up a

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lot,” and I say, “So has paper. If you want it, great. If you don’t, that’s fine.” Pricing had stopped being an issue, because paper increases have gone crazy. D’Angelo: Jack, on your side? Fiterman: I agree, again, with what everyone’s saying. I think business is going to remain strong. I think there’s been pockets of softness in the last two weeks from who I talk to. But I think, for the most part, it’s going to be very busy, and it’s going to be a busy fall again. For the integrated suppliers, the protein business is going to continue to grow every year—pork, chicken, turkey. Let’s face it; that’s a lot of what they run. That’s going to continue to grow. I agree with what Jana was saying. I think business is going to be strong for sure for the next 12 to 18 months. D’Angelo: The interesting thing for me about the e-commerce statistics is that of the top 10 fastest-growing e-commerce shippers, if you will, or participants in the last year, Amazon’s not in the top 10, because they

were already so huge to start with. So many people kind of caught up to them and found a lot of spots and spaces in the market. Going to the comment I think it was Ian made, about comparing e-commerce sales in China compared to here, where it’s just kind of scratching the surface, paying attention to what Amazon does, the growth—and the others will all take a completely different philosophy from Amazon—that’s still got to be something that’s encouraging for the box business. Don’t you think, Jack? Fiterman: Yes, I think it’s very encouraging, because as independents, we’re not supplying the Amazons. We’re supplying our customers’ e-comm sites. So, we want our customers to grow. If their business was 90% shelf-ready and 10% e-comm, and now it’s going to 70/30 or 60/40, that’s what independents should be looking at: How do we do that with our customers? What equipment do we need? How do we help our customers be more profitable with less damage? I’ve seen more inside print in the last month—it’s unbelievable the amount of inside print work I’ve seen.

And I’m sure, Mike, you can talk to it more than I can because you run for the trade, but it’s amazing, the trend of inside print. Drummond: That’s the big one for me right now: inside and double print. We run a ton of double-sided prints, registered inside prints. I mean, I just took a PO today for close to 2 million boxes of double-sided, soft touch, every embellishment for a rollover lock that’s going in the mail. I’m like, “Holy mackerel.” I’ve just never seen the amount of double-sided print that I’m running today. We do a lot of that, and we’re really good at it, so I’m finding a lot of corrugating companies coming to us, saying, “Hey, this is beyond us. We want to take care of other stuff,” just passing off the double-sided print. And especially the level that they want that inside print. We’ve coined a term, it’s an “inside-outside box,” and we’re seeing a ton. D’Angelo: Anybody else want to add something to that discussion? To summarize, everybody on this roundtable is bullish about the prospects of busy box plants remaining so for the foreseeable future, which obviously takes us to the challenges of the substrate, which was touched on a little bit earlier in the call. Jana, Jenise, Matt, any difficulties getting any grades of paper these days, be it on the folding carton side or the corrugated side? Bivens: On the corrugated side, we still have some challenges. The situation has improved, but we can’t get anything we want anytime we want it, like we have for the last 40 years. It’s gotten a lot better over the last 30 days. We’ve had some increased commitments from our suppliers to us that we have long-standing relationships with. So, we feel like on the whole, it’s better than it was and we’re well positioned for the summer. But we are a little bit nervous about what the fall holds, when business spikes back up as people go into the holiday season and the e-commerce kicks back up. Will there still

be enough left for us to hit our increased order amount that we’re at right now? I’ll let Jenise speak on the ACC side of things. Cox: So far, we’re OK with our supply. Our main supplier has committed to us not to put us on allocations. However, one of the other suppliers in the industry, we’ve heard from some of our friends that buy from them, they are starting to do allocations. So, kind of what we started experiencing last fall, September-ish, in the corrugated world, we’re starting to see a little bit in folding, but thankfully, we’re OK as of right now. D’Angelo: Ian, what do you see? Bernstein: We’ve been OK. We’re a member of one of the cooperative corrugators, so we’ve been pretty lucky in being able to access most grades. The biggest challenge we have right now has been on triple-wall—seems to be still taking six weeks, eight weeks, to get triple-wall in. And then we’ve also had some challenges. Our glue suppliers cut us back on some of the glue that we use, and we’ve seen some other things away from board that have been challenging. D’Angelo: We’re going to come back to other supply in a minute. Michael, how about you on the paper side? Drummond: It’s definitely tighter than I’ve ever experienced in my life. We’re in a pretty strong position. We have been fortunate, but we’ve got four or five suppliers, and because we’ve got a multitude of suppliers, we’re able to get a little here and a little there and make it work. The interesting thing for me is the amount of mills cranking up in my general vicinity. It’s going to be great for us. Cascade’s putting in a mill in Virginia that’ll be up and running first of next year. Sports Group or New Indy put one in Catawba, South Carolina. There’s another one in Tennessee, and then there’s another one slated for Danville, Virginia. So, I see for me, personally, I’m going to be in great

shape, but between now and then, it’s going to be very interesting. D’Angelo: So, independents continue to have to be resourceful. Jack, I’m sure you’re a resourceful guy; how’s the paper looking for you? Fiterman: Very tight. And I think that the medium remains very, very tight, undersupplied. And I would say that I think white, bottle white, is very, very tight. And also, I would say any of the heavy grades, like 69-pound and higher, are also very, very tight right now. Drummond: They’re more than tight. Fiterman: I would say I agree with what people are saying, that paper supply is a tad better than it was a month ago. My concern is with all the mill downtime that’s coming up this summer, and the busyness that typically hits us, you know, starting in June, July, are we going to go backward again? I don’t know if it was Jana or who from Harris said this, but to Jana’s point, the sheet feeders want to help the independents. It’s not that they don’t want to help. Some of it’s capacity; they only can get so much out, and they’re working every Saturday, working every Sunday. But some of it is, they just don’t have the paper. They just do not have the paper, and that’s a concern. That’s a concern for the independent market for sure. D’Angelo: And in Al’s case, where you already have a limited number of suppliers and you don’t have any new suppliers buying space or coming in anytime soon, what’s that mean for you? Hoodwin: Thanks, Mike. For our industry and the grade of board we use, there’s only three producers left in the U.S. Due to allocation issues, two of those producers won’t even sell to us at this time. If they did sell to us, their lead time is 16 weeks right now. So the one producer we do have is running around six weeks, so that has limited us. However, let me say, the corrugated industry has come to my

BOXSCORE www.aiccbox.org

rescue, and it’s really microflutes that have been our savior. We can still get F-flute in probably two weeks or less. While there might be a price premium, a little less than 10% versus our normal-grade board, our customers are thrilled that they can still get their boxes on time because we have microflutes as an alternative. So, praise be that we have it. D’Angelo: We’ve got a little bit of time left. Are there any issues—because I think Jack touched on it earlier on—transportation-wise? Issues today versus issues in the future you’re concerned about? I mean, we know that there’s a truck driver shortage right now. I know a lot of independent plants have their own trucking fleets, but that doesn’t mean the drivers stick with them. How’s it looking from a transportation point [of view]? Have you been able to get the product that you produce to your customers? Fiterman: It’s been tricky. There’s been times where we’ve had some issues with it, for sure. And the price has gone way up. The price in many cases has doubled on freight, and that has been a major issue for us. Like many of you, we don’t track some of the metrics, like how many MSF are you getting in a truck? We do what it takes to take care of our customers, right? That’s the independent mindset. So, that typically hasn’t been a metric. But as freight continues to be an issue, we have to be smarter about how we load our trucks and get things out. But it’s going to be a big issue. I think oil is going to be an issue. I think housing starts would be up 10% to 20% right now if it wasn’t for a shortage of wood and steel and resin-based products. Nobody can get it. Absolutely nobody can get it. Then, interest rates are at an all-time low, so it really is setting up for a very interesting fall, I think. D’Angelo: Ian, do you see things similarly, from a transportation point of view? Bernstein: We have our own trucks, and we supplement with third-party, and

BOXSCORE July/August 2021

we’ve been reaching out and just trying to make more third-party relationships so that we have more places to go to try to get trucks. But we’ve had issues on a fairly regular basis where they’ll take the delivery, and then they just don’t show up. So, that’s been an ongoing challenge for us. D’Angelo: They accept the load, then just don’t show up for it? So, same thing as a guy coming in for a job interview and not showing up. Wow. Bernstein: Yes. They don’t show up, we call them up, and they say, “Oh. Yeah, you know, the guy got busy or couldn’t make it or whatever. We’ll pick it up tomorrow. We’ll pick it up in two days,” and you’ve got to go from there. Disappointing to customers. D’Angelo: How about down in Texas? Bivens: Our vendors are constantly talking to me about the challenges that Jack was referring to, getting paper from the mill to our vendor. They don’t trust the rails anymore, whether it’s BNSF or UP, they kind of just ship you the paper whenever they want to—doesn’t matter how bad you beg for it. So, they’re going more over the road, where it’s more expensive. It’s one of the justifications they have for raising prices. As far as delivering boxes, we haven’t had a whole lot of issues with getting boxes delivered. We are looking at better cube utilization on our deliveries. Again, to what Jack spoke to, we typically try to just take care of our customers, and if somebody wanted five pallets of boxes, we’d ship them five pallets. Now, we try to find something else to put on that truck to go with it, just because it is more expensive. So, that’s typically how it goes around here. Drummond: Well, I have chosen not to have a truck fleet, because we ship all over the country. I’m with everybody else. People will book it, and then it’s

time for them to be here, and they’ll say, “Oh, well, that driver got diverted; we’ll send you another one tomorrow.” So, it’s tough. Most of what we ship is full truck, so it’s easier to get that, but the prices have doubled, without a doubt. And I think it’s going to get nothing but worse. Used to be, I’d ship to other corrugated plants, and then they’d ship out to their customer. Now I’m shipping directly to their customer because they don’t want to waste the freight. D’Angelo: Al, you ship all over the country, too; you seeing it the same way? Hoodwin: Yes, exactly just what Michael said. If we’re shipping full truckloads, it’s much easier to get those shipments out. If it’s LTL, same thing as Ian. We’ll sometimes get four appointments in a row all canceled, and we can’t get LTL shipments out. Where I’m having even a bigger issue is we use a lot of cut-and-sew product from Asia in our packaging, and our containers have tripled, and we’ve gone from 28-day door-to-door service from Asia now to 60 to 90 days. It really is bad. We’ve heard a lot of talk about the issue at the ports, but now I’m seeing the issue at the endpoints. So, like in Chicago right now, the number of containers that are stacking up is crazy. The unions are not working to get those containers out, so now congestion is all the way here at the endpoint, not even at the port. D’Angelo: So, this is a factor that has to be dealt with, with no apparent solution. Not necessarily something that time is going to fix. If anything, in listening to some of you, time may aggravate this even further, as the case may be, and the independent will once again have to be resourceful in terms of coming up with the way to make it work. I want to thank everyone for your time. We could talk for hours, I think, about all of this. It’s so compelling. I really do appreciate it.

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TEAM, MISSION

BOXSCORE July/August 2021

Reducing interdepartmental tensions and building a stronger business By Robert Bittner

“

hen things change, or when people perceive inequalities or unfairness, there is going to be resentment,” says Acme Corrugated Box President Bob Cohen. COVID-19 brought unprecedented changes to the boxmaking world, as many companies shifted to home-based or off-site administrative, sales, and office staff—while plant employees were required to be on-site and safeguarded, as they were essential for keeping the machines running. It was a situation that could have brought out any lingering resentments between “office” and “plant.” For some converters, though, that was not the case. “I don’t believe there was any animosity or tension [between administrative and plant staff],” Cohen recalls. “Everyone understood that we were in a unique situation that required a unique response.” That understanding was aided by a long-established company culture that emphasizes teamwork over an atmosphere of “us and them.” “Everybody understood the mission,” Cohen adds. “2020 could have been a disaster, and it didn’t turn out that way.”

Flexible Management Cohen’s ultimate success doesn’t mean there weren’t challenges along the way. When the pandemic first hit, Acme employees experienced anxiety, uncertainty, and confusion as a result of the virus and subsequent changes in the workplace. “We had a 20%–25% absentee rate because people didn’t want to bring the virus home,” Cohen recalls. “So, as an incentive and to fulfill our client obligations, we decided to pay our hourly staff time-and-a-half for regular time. And then we paid double-time for what would normally have been time-and-a-half situations.” This approach, which Cohen likens to combat pay, continued through April and May 2020. At the same time, Acme equipped all of its salaried administrative staff to work from home. They did not receive the “combat pay” that plant workers did, as they were not assuming the same level of risk. Neither did on-site managers, although the company did reward them at the end of the year with a “pandemic pay” bonus. “Without them present during the entire period of 2020—and most of my middle managers came in every day—we wouldn’t have been able to function or operate,” Cohen says. “They were crucial to the business, so we made sure we took care of those people who were critical to the operation.” Cohen credits his company’s flexibility for making it possible to continue operating without massive layoffs. Terri-Lynn Levesque, vice president of administration for Royal Containers, believes the foundation for such flexibility is a strategic plan. “It’s very important to have a company strategic plan in times like this, so all staff know the role they play in the company’s overall success and how every decision they make directly impacts the customer experience.” Unified Messages Part of a strategic plan should be an approach to ongoing, companywide communication, which Levesque sees as the key for eliminating interdepartmental tensions, especially in times of change and challenge.

BOXSCORE www.aiccbox.org

“We’ve focused a lot of attention on company communication, to make sure everyone is hearing the same message and that everyone is staying as engaged as possible, no matter where they’re working,” Levesque says. “The worst thing you can do is have a situation where only office people know about something and the plant people are a week or two behind in getting that same information. That may then be accentuated by multiple plant shifts, which make it even harder to get everyone on the same page.” Levesque checks in regularly with her team, through videoconferencing as well as email, to ensure that everyone is on the same page, working from the same messages. On-site, monitor screens located throughout Royal’s Ontario locations deliver company news and information

“It’s very important to have a company strategic plan in times like this, so all staff know the role they play in the company’s overall success and how every decision they make directly impacts the customer experience.” —Terri-Lynn Levesque, vice president of administration, Royal Containers to keep all employees up to date. “To keep people connected with one another, we’ve launched something called ‘Meet the TEAM: People Behind the Box,’ a program that features profiles of a couple of employees every month in our social media and on the monitors.”

Royal also has launched its own informational and inspirational town hallstyle meetings, at which everyone in the company is invited to join a conference call on their cellphones. “We’ve held at least four or five of those over the last year,” Levesque says. “Our president gives a short

OFF-SITE ENGAGEMENT “There has always been separation between the production floor and the office, and that can often lead to people having an ‘us versus them’ mindset,” notes Ben Baker, founder of Your Brand Marketing and co-author of Leading Beyond a Crisis: A Conversation About What’s Next. “When you add the physical divide that comes with having some people working remotely, that can exacerbate the situation. I know many boxmakers pride themselves on their company culture, and that culture can change when suddenly you don’t have everyone together in one place all of the time.” Baker suggests several steps managers can take to ensure that remote workers remain engaged, productive, and positive contributors to the company culture: Know the needs. “The first thing leaders should do is ask, ‘What does everyone need to be able to be successful?’ What does employee engagement look like now? It’s a matter of looking at not what was

BOXSCORE July/August 2021

but what can be. Ask how we can be more effective, more productive, and best serve ourselves, our staff, and our clients now in this new environment.”

solution may be that some people work remotely only several days a week. And be prepared for the possibility that some people simply don’t work well on their own and will need to be in the building full time.

Adjust expectations. “Not every worker will have the same needs or respond to the same motivations,” Baker notes. What When possible, come together. If your worked while everyone was together in a company is particularly tight-knit, remote single building or office may not necessarworkers may feel especially disconnected ily work for a more remote team. “If you from their peers. Baker suggests it can had an expectation that your marketing help to bring everyone together at least department would produce X amount of one day a week, every week. These need content when they were in the office,” for not be in-person meetings, though; regular, example, “maybe that expectation needs companywide video meetings can help to be adjusted if they’re working remotely.” as well. (You may find that remote workers may be “Every company has its own key performore productive.) mance indicators, the things that are Constantly communicate. Ask remote going to make it successful,” Baker workers how they feel about working adds. “There is no standard thing that’s from home. “Find out the challenges going to work for every company. But they’re having with working remotely,” if you’ve got good employees—people Baker suggests. “Maybe they don’t have you trust who are good at what they the right tools. Maybe they get distracted do—you just need to work together because they don’t have an effective to make sure everybody’s productive space for working from home.” The moving forward.”

message on something of interest—maybe a company announcement, a COVID update, whatever. Everybody’s getting the same message at the same time.” Kevin Ausburn, chairman and CEO of Southern Missouri Containers Inc., shares that commitment to transparency. “We’ve been an employee stock ownership plan (ESOP) company for a long time, so our culture may be a little bit different from a lot of box plants’,” he says. “Our people are significant shareholders in our business. We hold quarterly meetings where we share everything from top line to bottom line and our financials, talking a lot about the income and expense items in between those two lines. Our employees like being included in those conversations and in the decision-making process. Consequently, whenever we’ve had difficult economic cycles, they were very understanding of why we had to do certain things, why certain decisions were made. They helped us get through those difficult periods, and as far as I’m aware, we’ve been able to do it without any animosity between departments or functions, like ‘office’ versus ‘production.’” COVID-19, however, put that to the test. “COVID has been particularly difficult for us, because we weren’t able to have big group meetings like we used to,” Ausburn says. “It’s been awkward trying to find new ways to communicate. We just

started holding quarterly meetings again, bonuses. These can go up and down over but we did so in an abbreviated fashion— the years, and that reinforces with our standing out in the open areas in the plant, employees that there are no guarantees; spaced out. We’re having more frequent we have to ‘earn our keep’ every day.” meetings with fewer people in them, The company’s quarterly performance trying to get back to what we’ve been bonuses are credited with helping to doing for years and years and years. We’ve reduce divisions between departments. had to rely on videos and Zoom calls and “All employees can have direct daily that kind of thing on multiple occasions. impact on five key metrics that drive “It’s unfortunate because, like everybody, our success and profitability,” Ausburn we have been trying to avoid each other explains. “Assuming we’re profitable for as much as possible,” he adds. “That’s the quarter, a predetermined percentage counter to everything we have been doing of the quarterly profits funds a tentative for the last 25 years in our organization. performance-bonus pool. How we score But I think we’re seeing the light at the on our chosen metrics determines how end of the tunnel.” much of that tentative bonus is paid out. “The element of this that pulls the team Responsibility and Reward together is that everyone is paid the same Ausburn is also a believer in the unifying dollar amount of the earned performance power of compensation. “Since we are an bonus, regardless of their position,” he ESOP company, we feel it’s imperative adds. “The unitizer operator is paid the that the results we achieve, the successes same amount as the CEO. This has resowe earn, are shared with our employees nated with our employees, and I believe it that made it happen,” he says. “We reinforces the fact that all employees are have multiple incentive-compensation important. We all have to do our jobs well programs that are geared to different if we’re going to be successful together.” areas of responsibility in the company. Everybody has an incentive element to Teamwork for Tomorrow their compensation. The big one is based Cohen’s advice for other converters upon profitability and how we perform on seeking to ease interdepartmental tension an annual basis. A significant percentage is simple: “Talk to people. Explain the of company profitability is allocated back situation, and make sure everyone feels to employees in the form of year-end valued for their contribution, even though how you do that may be different for different parts of the organization. I think people recognize they’re not just working for a paycheck and they’re not just working for today; they’re also working for tomorrow. Everyone, in every role, wants the company to succeed, because their personal success is tied directly to the business success for us all.”

“We hold quarterly meetings where we share everything from top line to bottom line and our financials, talking a lot about the income and expense items in between those two lines. Our employees like being included in those conversations and in the decisionmaking process.”

Robert Bittner is a Michigan-based freelance journalist and a frequent BoxScore contributor.

—Kevin Ausburn, chairman and CEO, Southern Missouri Containers Inc. BOXSCORE www.aiccbox.org

August 8–12, 2021 Orange County Convention Center North Complex Hall AB, Level 1 Orlando, Florida

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BOXSCORE July/August 2021

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BOXSCORE www.aiccbox.org

TAPPI/AICC SuperCorrExpo August 9-12, 2021 Orange County Convention Center North Complex Hall AB, Level 1 Orlando, FL USA

SuperCorrExpo Floor Plan SERVICE CENTER

Exhibit Hall Hours: Monday: August 9 - 12:00pmTuesday: August 10 - 12:00pm Wednesday: August 11 - 12:00pm Thursday: August 12 - 12:00pm

30' 72"/10

SALES OFFICE

138'-9" 72"/10

72"/10

50'

72"/10

20'

72"/10

20'

SGS 2581

Nextwire, LLC.

2680

72"/10

TAPPI Academy

WEIMA America, Inc.

20' Advanced Dynamics/ MoveRoll 20' 2575

20'

72"/10

20'

2483

Mid America Paper Recycling

2382

2021 BOX MANUFACTURING OLYMPICS

50'

2683

20'

Quest7 2181

2380 2281

72"/10

50'

72"/10

2780 2681

Henkel Corporation

20'

2769

2675

TKM, US

Hurst Boiler

2671

20'

Eaglewood Technologies

2768 2669

20'

Beta Industries

2475

2568 2469

Monroe Rubber & Höcker Plastic Polytechnik GmBH Inc./ Essential Products 25'

Signode Packaging Systems/Strapping

DuckerRingwood Automation 50'

20' COPAR Corporation 20' 2269

2369

2668 2569

Freeman Manufacturing & Supply Co.

2374 2275

20' JDengineers B.V. 20'

JJC KPI Services Incorporated LLC 15' 15'

Rochester Midland Corporation

2376 2277

TEUFELBERGER

1972

1874

Northland Chemical Inc.

1871

1970

CavCom 15'

Projects Designed and Built (PD&B)

Nye Lubricants Procemex

20'

Muhlen Sohn Inc

SRC Corp. 20'

20'

1774 1675

20'

30'

2963

20'

2975

20' 2663

30'

Graphic Solid Inks, Inc

ATS-Tanner Banding Systems AG/Felins USA/ Wexler Packaging Products

2973

FujiFilm North America 20'

30'

2969

30'

20'

HAECO

2947

2657

20' Air Systems Design, Inc. 20' 2561

20' 20' CST PICSystems Precision Inc. Industrial Contractors 20' 20' 2560 2361

20' Corrquest Automation, Inc. 20' 2555

20' Arden Software 20'

30'

WSA USA, LLC

20' Zund America, Inc 20' 2556 2355

2255

40'

Flora/Shenzhen Runtianzhi Digital Equipment

PRP 20'

3049 BCN/ Corrugated Today

30'

3045

2747

Heraeus Noblelight America LLC

2746 2647

1863

2547

20' Absolute/ Pamarco 20'

20' Automation & Control Inc. (ACI) 20' 2249

2349

Jonco Die Co Inc. 20'

MaxDura International Co., Ltd.

20'

40' 20'

20'

Corrugated Gear

20'

2148 2049

30'

Barberán S.A.

30'

2931

2731

ISRA VISION

30'

20'

Kiwiplan Inc.

20' HarperLove Adhesives 20'

20'

Para USA Corp.

20'

3023

Talleres Serra S.A. 30' 2921

3021

60'

20' Sharp/ Leipa/ Friese/ Cristini 30'

40'

50'

2915

70'

50'

SUN Automation 40' Group

1835

2509

3015

3009

ontact:

Core Stripper, Inc.

3007

30' 20' Engico SRL 20'

25'

Transpak Equipment Corp/ PAC Strapping Products Inc.

20'

2817

3005

Baler Service Co./ Paper and Dust Pros 20'

3001

2901

20' Kohler Coating 20' 2823

pi.org 5

30'

Policart SRL Anvil Covers

20'

2521

2723

TRUE NORTH GRAPHICS, Inc.

40'

Kongsberg Precision Cutting Systems

30'

2717

ENTRANCE

20'

2514 2415

40'

2701

3013

Stitching & Gluing Solutions

25'

2222

20'

ARC International 20'

Magnum Inks & Coatings

2318 2219

20'

90'

25' 20'

Peoples Capital & Leasing Corp.

2501

20' OM Partners 20' 2409

20' Premier Paper Converting Machinery Inc. 30' 2401

Kadant Apex Johnson International Inc. 20' 20'

20'

50'

40'

20'

2211

20' Samuel Packaging Systems Group 30' 2301

2119

20' 20' Corrugated Box Equipment LLC 2111

20'

Two10 Technologies

2309

758

Insun 20'

1255

George M. Martin Company

20' Container Graphics 20' 1249

1349

C.U.E. Inc. 1247

754 Xante Corporation

20'

50'

Lubcon Wisdom Turmo Adhesives Lubrication, Worldwide Inc.

20'

1640 1541

20'

1340 1241 15'

Mitsubishi Heavy Industries America

HansenRice, Inc.

20'

1370

Box & Carton Blue Book

770

BKG Corrugating Rolls

768

Polymag Tek, Inc.

Corrugated Albany Replacements International

1641

50'

50' 20'

20' ADI/PDM Trade Group 20' 1535 20' Baumer hhs 20'

15'

1336 1237

EAM-Mosca Corp

70'

15'

1334 1235

20'

744 RaeCorr Industries

20'

941 SynTech Ltd. 20'

1040 BOWOO CO

825

Tribco Inc.

1331

1531

20'

Doyle Systems, Inc./DuoTechnik GmbH

20'

OASIS Alignment Services, Inc.

2112 GeorgiaPacific Hummingbird

2116

Unico, LLC 20'

20'

Boiler & Steam Performance

20'

Baysek Machines Inc./Digital Print, Inc.

40'

2101

30'

823

1713

20' 1911

Solema USA

25'

Baldwin Technology Co. Inc.

2001

40'

20' Cuir Corrugated 20' 1515

1615

50'

25'

2106

20'

1521 20' LENZE Americas 20'

1917

2110 2011

50'

20' StraPack Inc.

1321

Tien Chin Yu Machinery Mfg. Co, Ltd

1609

1509

50'

30'

1701

1501

Pace Punches, Inc. 30'

920 CETCO

819 20' 25' EFI 1413

20' Mercury USA INC 20'

20'

BW Papersystems

1901

50'

TISCO/Thacker Industrial Service Co.

35'

A.G. Stacker, Inc.

70'

20'

50'

Automated Conveyor Systems, Inc. (ACS)

PolyChem Corp 1923

20'

Dieco/Graphics 2 Press

2316 2218 2217 2216 2117

20'

25'

1355

1449

1631

2123

Ely AICC, The Olympic Cambrica DataLase, Enterprises, Packaging Wire & Inc. Corp. Inc. School Equipment

2414 2315

20' Emmepi Group SRL/ Robopac Systems

MAIN AISLE

CORRUCLEANER/ JKSP Services

2321

Haire Group

20' Sauer System 25'

American ICASA Baler

Zefco Inc.

1931

2131

30'

40'

3011

50'

Alliance Machine Systems International, LLC

Sioux Rubber and Urethane 20'

1361

30'

1644 1545

30' 20' Colex Finishing/ Padrick & Vernon Equipment 40'

Flint Group 30'

1549

MAIN AISLE 20'

1382

Koenig & Bauer-Durst

25'

15'

Poteet Printing Systems

1749

40'

1941

20' Stafford Corrugated Products Inc./Rodicut Industry s.a.u 40'

2231

1555

50'

2141

2531

2631

20'

20' JB Machinery Inc. 20' 1455

20' Ingredion 20'

1655

1755

50'

2244 2143

SRPACK Machine Co. LTD 40'

FARO Bearings USA, Inc.

1560 1461

1561

20' DICAR Inc. 20'

INNOVEYANCE: C&M Conveyor & Ohio Blow Pipe

20'

20' Chicago Electric Company 20' 1949

Stafford Cutting Dies

20'

20' Bickers GmbH/ Lamina Systems 40'

20'

Domino

2543

Advanced Equipment Sales

40'

1463

20'

750

1955

Zenith Cutter

Valco Melton 30'

2640 2541

20'

MAIN AISLE

20'

Balemaster

1369

Fluke Printron Reliability

Advantzware

1661

50'

Fosber America/ Tiruna

2741

3035

20'

2740 2641

RapidBond

30'

Stickle Steam Specialties Co. Inc.

Global Boxmachine

Kolbus Hycorr

50'

2147

80'

3041 MSK Covertech, Inc.

Deublin

30'

1469

20'

1860 1761

1960 1861

2155

2447

20'

PowerHandling, Inc

1862 1763

Maren JML Balers & Services Shredders

International Baler Corp.

1845

20'

Erhardt & Leimer Inc. 30'

2748 2649 DuPont Image TRIOSIM Solutions CORPORATION USA, LLC

20' Blower Application Company (BloApCo) 30'

50'

Inspire Automation: Systec & Automatan

1768 1669

MAIN AISLE 20'

Arco J.M. Fry Murray Printing 2750 20'Inks

40'

1772 1673

Anilox Roll Corrugated Cleaning Chemicals Systems, 20' Inc. (ARCS) 20'

BCM Inks 20'

Mainline MoistTech Conveyor Corp. Systems Inc.

KERNIC OpSigal SYSTEMS INC.

20'

50'

30'

36"

Pace Borregaad Punches, USA Inc.

1868 1769

40'

American Corrugated Machine (ACM)/Engineered Recycling Systems

2261

36"

MAIN AISLE

20'

Bahmuller

20'

36"

SuperCorr Cafe

30'

36"

1872 1773

Re S.p.A. 20'

1968 1869

1969

MCTRON

1876 1777

20'

60'

2169

Tilia Labs

MAIN AISLE EDDA WRAPPING MACHINES

50'

36"

20'

Compass Taiwan Systems & Endurance Sales, LLC Co. Ltd.

20'

72"/10

20'

WPR Services

36"

60'

20'

Omya, HITEK Inc. Equipment Inc.

72"/10

FOOD COURT

31'

20' ZematTechnology Group 25' 1313

Allied Powers

918

20'

914 Belt Power

20' 20' 1407 20' Amtech Software/ Avista/ Qualitek 30' 1401

20' Wulftec International 25' 1307 20' Harmax RollCon 25'

828

20'

824 TRESU 20'

820 TAPPISAFE

1301

810

GENERAL SESSION & KEYNOTES

72"/10

ENTRANCE

3 AM

AS OF JUNE 18 64

BOXSCORE July/August 2021

Let us help you navigate the corrugated jungle

Visit our experts at stands 1549 and 1449 Join us, together with our fellow Flint Group divisions at SuperCorrExpo 2021, where we will share our innovative insight & sustainable view of corrugated printing.

www.flintgrp.com

info.packaginginks@flintgrp.com

SuperCorrExpo® 2021 Exhibitors Company Name

Booth #

1255

A.G. Stacker, Inc.

1713

Borregaad USA

1673

Emmepi Group SRL

Absolute/Pamarco

2349

BOWOO CO., LTD.

825

Engico SRL

2817

ADI/PDM Trade Group

1535

Box & Carton Blue Book

770

Engineered Recycling Systems

2155

Advanced Dynamics/MoveRoll

2575

BW Papersystems

1501

Equipment Finance Corporation

2155

Advanced Equipment Sales

2541

C&M Conveyor

1755

Erhardt & Leimer Inc.

2547

Advantzware

1561

C.U.E. Inc.

1247

FARO Bearings USA, Inc.

1461

AICC, The Packaging School

2117

Cambrica Corp.

2218

Felins USA

2947

Air Systems Design, Inc.

2561

CavCom

1968

Flint Group

1449

Albany International

1541

CETCO

819

Chicago Electric Company

1949

Flora/Shenzhen Runtianzhi Digital Equipment

2747

Alliance Machine Systems International, LLC

2321

Allied Powers LLC

918

Colex Finishing/ Patrick & Vernon

1835

American Baler

1644

Compass Systems & Sales, LLC

American Corrugated Machine (ACM)

2155

Container Graphics

Amtech Software/Avista/Qualitek

1401

Fluke Reliability

1463

Fosber America/Tiruna

2231

2376

Freeman Manufacturing & Supply Co.

2275

1249

Friese GmbH

2915

COPAR Corporation

2269

FujiFilm North America

2969

Core Stripper, Inc.

3007

George M. Martin Company

1349

Anilox Roll Cleaning Systems, Inc. (ARCS)

1768

Corrquest Automation, Inc.

2555

Georgia-Pacific Hummingbird

2110

Apex International

2315

Corrugated Box Equipment LLC

2111

Global Boxmachine, LLC

1369

ARC International

2123

Corrugated Chemicals

1669

GRAPHIC SOLID INKS, INC.

2963

Arco Murray

2750

Corrugated Gear

2049

HAECO

2657

Arden Software North America

2355

Corrugated Replacements

1640

Haire Group

2701

ATS-Tanner Banding Systems AG

2947

Cristini Corrrugated Belts

2915

Hansen-Rice, Inc.

758

Automated Conveyor Systems, Inc. (ACS)

1521

CST Systems Inc.

2361

Harmax RollCon

1301

Automation & Control Inc. (ACI)

2249

Cuir Corrugated

1515

HarperLove Adhesives

1749

Avista Solutions International, Inc.

1401

DataLase, Inc.

2217

Helios

1931

Bahmuller

2261

Deublin

2640

Henkel Corporation

2768

Baldwin Technology Co. Inc.

2001

DICAR Inc.

1655

Heraeus Noblelight America LLC

3041

Balemaster

2244

Dieco/Graphics 2 Press

2119

Highcon

2921

Baler Service Co.

3001

Digital Print, Inc.

2101

HITEK Equipment Inc.

2780

Barberán S.A.

2731

Domino

2931

2509

Baumer hhs

1531

Doyle Systems, Inc.

2116

Hurst Boiler

2668

Baysek Machines Inc.

2101

Ducker-Ringwood Automation

2169

ICASA

1545

BCM Inks

1769

Duo-Technik GmbH

BCN/Corrugated Today

3045

Belt Power LLC

2116

Ingredion

1555

828

DuPont Image Solutions USA, LLC

2746

INNOVEYANCE: C&M Conveyor & Ohio Blow Pipe

1755

Beta Industries

2374

Eaglewood Technologies

2669

Inspire Automation: Systec & Automatan

1469

Bickers GmbH

2631

EAM- Mosca Corp

1331

Insun

754

BKG Corrugating Rolls

768

EDDA WRAPPING MACHINES

2975

International Baler Corp.

1861

Blower Application Company (BloApCo)

2447

EFI

1413

ISRA VISION

2143

Boiler & Steam Performance

1917

Ely Enterprises, Inc.

2216

J.M. Fry Printing Inks

2649

BOXSCORE July/August 2021

HAVE YOU MARKED YOUR CALENDAR? Connect with experts in the global corrugated industry – all under one roof

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supercorrexpo.org/register August 8 – 12, 2021 Orange County Convention Center Orlando, Florida USA

SuperCorrExpo® 2021 Exhibitors (Continued) Company Name JB Machinery Inc.

1455

Pace Punches, Inc.

1772

Stitching & Gluing Solutions

2901

JDengineers B.V.

2369

Pace Punches, Inc.

920

StraPack Inc.

1609

JJC Services LLC

2568

Padrick & Vernon Equipment, LLC

1835

SUN Automation Group

1931

JML Services

1860

Paper and Dust Pros

3001

Syn-Tech Ltd.

1040

Jonco Die Co Inc.

2641

Para USA Corp.

1941

Taiwan Endurance Co. Ltd.

2277

Kadant Johnson Inc.

2414

Peoples Capital & Leasing Corp.

2318

Talleres Serra S.A.

2921

KERNIC SYSTEMS INC.

1960

PIC-Precision Industrial Contractors

2560

TAPPI Academy

2483

Kiwiplan Inc.

1845

Policart SRL Anvil Covers

2717

TAPPISAFE

810

Koenig & Bauer-Durst

1361

PolyChem Corp

1923

TEUFELBERGER

1874

Kohler Coating

2823

Polymag Tek, Inc.

744

Tien Chin Yu Machinery Mfg. Co, Ltd

1701

Kolbus Hycorr

1955

Poteet Printing Systems

1549

Tilia Labs

1876

Kongsberg Precision Cutting Systems

2501

PowerHandling, Inc

1661

Tiruna

2231

KPI Incorporated

2469

Lamina Systems

2631

Premier Paper Converting Machinery Inc.

2401

LENZE Americas

1615

Printron

1560

Torosian Tech Services, Inc

2155

Lubcon Turmo Lubrication, Inc.

1241

Procemex

1675

Transpak Equipment Corp

2723

Magnum Inks & Coatings

2219

Projects Designed and Built (PD&B)

1872

TRESU

820

Mainline Conveyor Systems Inc.

1763

PRP

3049

Tribco Inc.

823

Maren Balers & Shredders

1761

Qualitek Solutions, Inc.

1401

Triosim Corporation

2647

MaxDura International Co., Ltd.

2740

Quest7

2181

TRUE NORTH GRAPHICS, Inc.

3005

MCTRON

1777

RaeCorr Industries

941

Two10 Technologies

2211

Mercury USA INC

1509

RapidBond

2741

Unico, LLC

2011

Mid America Paper Recycling

2380

Re S.p.A.

1869

Valco Melton

2147

Mitsubishi Heavy Industries America

1631

Retroflex

2921

WEIMA America, Inc.

2382

MoistTech Corp.

1862

Robopac Systems

1255

Wexler Packaging Products

2947

Rochester Midland Corporation

2569

Wisdom Adhesives Worldwide

1340

Rodicut Industry s.a.u._

2131

WPR Services

2281

Monroe Rubber & Plastic Inc./Essential Products

Booth #

1972

TISCO/ Thacker Industrial Service Co.

1321

TKM, US

2671

MoveRoll

2575

Samuel Packaging Systems Group

2301

3035

WSA USA, LLC

2255

MSK Covertech, Inc.

Sauer System

1355

1307

Muhlen Sohn Inc

1773

Wulftec International

SGS

2514

2415

Xante Corporation

1370

Nextwire, LLC.

Sharp International Group/LEIPA

2915

1641

Northland Chemical Inc.

1970

Zefco Inc.

Signode Packaging Systems /Strapping

1969

1774

Zemat Technology Group

1313

Nye Lubricants

Sioux Rubber and Urethane

750

2148

OASIS Alignment Services, Inc.

2112

Zenith Cutter

Solema USA

1901

2316

Zund America, Inc.

2355

Olympic Wire & Equipment

SRC Corp.

1868

OM Partners

2409

SRPACK Machine Co. LTD

2531

Omya, Inc.

2683

Stafford Corrugated Products Inc.

2131

OpSigal

1863

Stafford Cutting Dies

2141

PAC Strapping Products Inc.

2723

Stickle Steam Specialties Co. Inc.

2543

BOXSCORE July/August 2021

AS OF JUNE 21

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The Associate Advantage

Post-COVID Reflection and Best Practices BY JOE MORELLI JOE MORELLI HUSTON PATTERSON PRINTERS VICE CHAIRMAN JMORELLI@HUSTONPATTERSON.COM

PAT SZANY AMERICAN CORRUGATED MACHINE CORP. CHAIRMAN PSZANY@ACM-CORP.COM

GREG JONES SUN AUTOMATION GROUP SECRETARY GREG.JONES@SUNAUTOMATION.COM

TIM CONNELL A.G. STACKER INC. DIRECTOR TCONNELL@AGSTACKER.COM

DAVE BURGESS JB MACHINERY IMMEDIATE PAST CHAIRMAN DBURGESS@JBMACHINERY.COM

BOXSCORE July/August 2021

n April, I had the honor of speaking at the AICC Spring Meeting in Amelia Island, Florida, as a panelist in a Member Town Hall on Top Industry Issues. Considering it was our first in-person event since the COVID-19 pandemic began, the first question brought to the table was particularly relevant for the nearly 200 people in attendance: What procedures were put in place during the pandemic that you believe will become a part of everyday life? As I begin to travel around the country again and talk to people about how their businesses are changing, three process changes stick out to me as ways we all can take problems from the pandemic and turn them into benefits for our businesses. The first is supply chain management. Many of us have had supply chain contingencies built into our daily processes for years. If one supplier goes down, we all have backup. What I have found particularly interesting during the pandemic is the attention to detail when discussing emergency supply chain protocols. Companies are diversifying their supplier base and going into great detail with their current suppliers to understand their protocols, whether there are disruptions in their supply chain, and what their reliance is on foreign products. It is something that will without a doubt become a part of their normal supply chain management, creating an all-encompassing protection plan for their businesses. Perhaps one of the more interesting byproducts of the pandemic was the improvement in efficiency. I’ve heard stories from industry friends, one person said

they reorganized a material staging area in their plant in order to reduce human touches on the material itself. The move reduced the number of touches from four people to one person before it went on the machine. Not only did the move end up being safer for the employees in terms of COVID exposure, but in the end, the company realized it was much more efficient. The third lasting aspect of pandemicaffected business is sales tactics. In a recent virtual think tank that I hosted, we interviewed sales expert Mark Allen Roberts, who presented several staggering statistics from McKinsey & Co. He reported that 70%–80% of B2B buyers prefer virtual sales, even when COVID restrictions are lifted. Also, 70% of B2B buyers feel comfortable purchasing up to $50,000 virtually, without ever meeting a sales rep, and nearly 30% of those same buyers feel comfortable spending up to $500,000 without in-person contact! These numbers are shocking and a clear indication that a permanent shift in sales tactics is on the horizon. Being back in person at an AICC event was incredible, and I don’t think there will ever be a time when we replace the in-person dynamic of business, particularly in sales. I believe the pandemic gave us an opportunity to innovate within our businesses and has created opportunities for growth that perhaps we didn’t even know existed. Joe Morelli is vice president of sales and marketing for Huston Patterson Printers and is vice chairman of AICC’s Associate board.

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Strength in Numbers

Managing Success BY MITCH KLINGHER

or me as a guy who interfaces with many converters on a regular basis and is privy to a lot of financial information, 2020 was probably the most profitable year for converters since I got involved with the industry almost 30 years ago. It certainly didn’t start out that way, and when COVID-19 hit the economy hard in early 2020, many of you experienced some rocky months. But just about everyone obtained PPP loans, which more than covered the down months and the trials and tribulations of running a fairly labor-intensive manufacturing operation during a pandemic. Even without the effect of the forgiven PPP loan on the income statement, many converters were showing profits in the rarified air of 15%-plus on the bottom line, many of you were in the 10% to 15% range, and almost everyone had a good year. With two price increases already implemented (and a third one looming), it seems that price increases are good for everyone’s bottom line, and my observation from watching the business closely for quite a long time is that converters pick up margin when the price of paper goes up. The economists point to a dramatic increase in nonstore retail sales during the second half of 2020 and cite the government stimulus programs for a big overall uptick in consumer spending. Panic buying during the early stages of the pandemic has also been cited as a factor in all of this, but the bottom line is that everyone is busy—so much so that paper supply has become tight, lead times for orders have lengthened dramatically, and everyone is working hard to take care of their good customers. The price for packaging has all of a sudden become less of an issue with the customers than

BOXSCORE July/August 2021

the availability. Integrated companies are sending more and more orders to independent companies, and large independent companies are sending more and more orders to smaller independent companies. The last half of 2020 and the first four months of 2021 have been a veritable panacea for both integrated and independent companies. So the question that needs to be asked is, “What should you be doing with this success?” In the last edition of BoxScore, I argued for using it to invest in your business to help ensure its long-term future. High-speed converting, with its increased output relative to plant employee head counts and more consistent and precise boxes

with better print and a lower average cost per unit, will certainly help you be more competitive. I still believe that this is the right course of action for most of you, but let’s look beyond this and talk about the market and other external forces that need to be considered to help you come up with a more comprehensive plan. • With the integrated-based companies so busy, they are exporting much less paper. • Pricing for paper in almost all of the export markets has improved dramatically, so many of these contracts that used to generate little or no profit are not nearly as bad now. • Because of this, it is unlikely that the prices that they are willing to pay for

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VIRTUAL PLANT TOURS Hundreds of AICC members have already gone on virtual plant tours of Dusobox, Wasatch Container, The BoxMaker, Utah PaperBox, and Packrite, with more on the way!

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Strength in Numbers

your business are going to be as high right now as they were for the past decade, when most of the integrated producers were trying to become more integrated. • If you embrace the concept of utilizing your current success to invest in the future, then it is likely that your balance sheet will reflect lower cash balances and higher debt balances. • Company valuations are most likely on the rise due to the increased profitability, but remember that valuations are reduced dollar for dollar for increased debt and reduced cash balances. • Also keep in mind that most valuations use an average of a couple of years in the calculations.

how this will play out and whether the changes will be made retroactive to the beginning of the year (yes, they can do this and have done it in the past). What he is proposing for successful business owners is absolutely frightening. The following are a few of the key provisions in his proposal: • Increase in capital gains tax for taxpayers with over $1 million in taxable income from 20% to ordinary income rates (which he proposes to make 39.6%). • Reduce the estate exemption amount to Obama-era levels of $3.5 million ($7 million for a husband and wife). • Eliminate the step-up in basis to fair market value for assets passing through an estate.

Let’s digress from these thoughts and spend a few minutes discussing the current political climate in Washington, D.C. President Joe Biden wants to institute a massive investment in infrastructure and pay for it with increased income and estate taxes. No one knows exactly

So, if you have a company (or own real property or any other investments) that is worth $20 million, instead of being able to pass it to your children tax-free with a full step-up in basis, you now will have an estate tax on $13 million and no step-up in basis. If you

BOXSCORE July/August 2021

sell the company (assuming you have little or no basis), you will incur $8 million in taxes instead of $4 million. If you wish to preserve some or all of the current roughly $23.5 million in estate exemption and the 20% tax rate on capital gains, you may need to move very quickly, because once the new laws are enacted, you will be stuck. While no one knows exactly how this political process will play out, it is a safe bet that tax rates are going up and favorable estate rules will be diminished. So here is what you need to consider in the very near future: • Consider obtaining current appraisals for all of your key assets. The valuation will probably be as low right now as it can be, assuming your business profits are accelerating and you are taking on new debt to pay for equipment and systems. • Meet with your tax and estate planning experts to develop a plan to transfer assets out of your estate in the very near future. A strategy encompassing some combination of gifts, outright sale, installment sale, sale to a defective trust, or transfer to a trust should be drawn up. • Trusts need time to be formed, recapitalizations involving nonvoting stock can take time to effectuate, and deeds on real property often cannot be changed overnight. • Valuation and estate-planning experts are going to be very busy in the near future, and you may not be able to get to them quickly. Significant change is on the way, and if you are going to manage your current success properly, you need to get ahead of all of this and start the process immediately. Mitch Klingher is a partner at Klingher Nadler LLP. He can be reached at 201-731-3025 or mitch@ klinghernadler.com.

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PackagingEd.org /Donate

Foundation for Packaging Education

Donate to Don Your Pin!

he Foundation for Packaging Education had a good AICC Spring Meeting, thanks to the focus of the board of directors and to the generosity of so many AICC member companies. The foundation held its very first board meeting on Monday, April 26. Chairman

BOXSCORE July/August 2021

Al Hoodwin opened the meeting, and in short order, the board approved the foundation’s first budget, for fiscal year 2022 (July 1, 2021–June 30, 2022). A committee will be formed to explore fundraising event possibilities going forward (see the Foundation for Packaging Education article, page 68, in the May/June 2021 issue of BoxScore). The Foundation for Packaging Education donor pin was the fashion accessory during the Spring Meeting in Amelia Island, Florida. At the start of the meeting on Monday, April 26, there were 19 donor members whose attendees could wear the coveted pin. These companies had pledged a combined $795,000. By the time the meeting ended on Wednesday, April 28, the foundation had 30 donor members, and many lapel pins were being worn! The pledge total stood at $1.345 million by the end of the Spring Meeting;

AICC’s million-dollar match challenge was met! AICC will undertake the transfer of $1 million from its investment accounts to the foundation’s. With a combined $2.345 million in pledges and donations, the goal is now to achieve $3 million by the end of SuperCorrExpo at the Orange County Convention Center in Orlando, Florida, which runs August 8–12. The mission of the Foundation for Packaging Education is to ensure a stable source of funding to sustain AICC and industry education programming for the thousands of individuals employed by AICC member companies in the corrugated, folding carton, rigid box, and related supply industries. Your pledge can make a difference in the training that your team members receive. And you get to make a fashion statement!

AD GEO Martin

Booth # 1349

International Corrugated Packaging Foundation I N T E R N AT I O N A L

PACKAGING

CORRUGATED

F O U N D AT I O N

Now Is the Time to Begin Posting 2022 Student Internships and Career Openings

or ICPF Corporate Partners, August is the best time to begin posting student internships and career openings for 2022 graduates with majors and minors in packaging engineering, industrial engineering, business, sales, structural and graphic design, paper science and chemical engineering, supply chain management, mechanical engineering, and related fields. Once your firm posts openings on ICPF’s Career Portal, it also has access to the portal’s Résumé Bank, which currently has hundreds of résumés of students and upcoming grads seeking opportunities in production, operations, sales, and packaging design. Each year, 120–150 students and new graduates secure openings in the corrugated packaging industry through ICPF’s Career Portal and its other resources. The following are a few of the hires made through ICPF this year. Michelle Clayton (University of Florida packaging science, May 2021, and international business (MIB), December 2021) was hired as a packaging solutions and sales intern at WestRock Corp. “I attended my first ICPF teleconference with a little knowledge I had from a few classes at school. Now, two years and several ICPF events later, I am interning at one of the world’s most prominent corrugated packaging companies. The conversations I had with industry leaders at the Student

BOXSCORE July/August 2021

Dialogue Dinner opened my eyes to all of the infinite possibilities in the corrugated industry. Each executive had so much wisdom to share and also invested in getting to know each student. The Career Portal created a perfect bridge for me to apply to internships. I’m so grateful to ICPF’s community and helpful resources!” Haley Melvin (Clemson University packaging science, 2020) was hired as a sales representative trainee at Hood Container Corp. “Shortly after ICPF reached out to me through its LinkedIn corrugated careers system, I was able to network with industry professionals and fellow students in ways that would not have been possible without ICPF. Through ICPF’s mentor program, I was able to gain more insight into the overall experience working within the industry, as well as enhanced confidence when interviewing for potential roles. I learned so much after attending the virtual Student Dialogue Dinner, which also introduced me to executives, including my current boss, and other recent graduates impacted by pandemic hiring freezes. ICPF’s Career Portal made it possible for me to apply to this career opportunity that I would not have known about otherwise. The fact that ICPF was able to make career searching practically effortless during the middle of a pandemic is beyond me!”

Sam Savery-Orton (Cal Poly industrial technology and packaging, 2021) was hired for a rotational GIFT opening at Packaging Corp. of America. “After being invited through ICPF’s career network to the ICPF’s virtual Student/Executive Dialogue Dinner last fall, I was able to make numerous new connections in the corrugated industry. The Career Portal also allowed me to post my résumé to receive the maximum attention from employers, and I am very thankful for this incredible resource. I was nervous to search for employment during an international pandemic, but the ICPF Career Portal made the process of finding a career in corrugated as simple and efficient as possible. Now having served as an ICPF student representative at my university, I can confidently say that my decision to get involved with this foundation directly led to this special career opportunity.” Abby Saul (North Carolina State University paper science and chemical engineering, 2023) was hired as a pulp operations intern at WestRock Corp. “ICPF was and is super helpful in terms of allowing me to network and find jobs within the industry. ICPF’s Career Portal, LinkedIn corrugated career network,

International Corrugated Packaging Foundation I N T E R N AT I O N A L

PACKAGING

CORRUGATED

F O U N D AT I O N

and various other resources assisted and were integral in allowing me to secure an internship for the summer. I am truly thankful to ICPF and Richard’s persistence in reaching out and ensuring that everything is well taken care of!” Emily Emahiser (Bowling Green State University visual communication technology, 2020) was hired as a packaging design engineer at Rex Carton Co. “I cannot say enough great things about ICPF. Throughout my time as a visual communication technology major at Bowling Green State University, we would take part in the annual ICPF teleconference. This teleconference is where my interest in the corrugated industry was really formed. It gave me the opportunity to learn about the industry from professionals, ask questions, and network. While the teleconference gave me tools and information, ICPF’s Career Portal is how I found my position at Rex Carton Co. The portal helped to streamline my process of making applications to reliable companies and positions aimed at what I wanted to do.” Wesley Smith (Clemson University graphic communications major and packaging science minor, 2020) was hired as a management trainee at WestRock Corp. “After being introduced to ICPF through its LinkedIn corrugated packaging career network and reading many great things about the foundation, I decided to put my résumé on the ICPF Career Portal. I

was later presented with the opportunity to appear in an ICPF trade press article. Within a couple of weeks, I had many companies reach out to me for internships and full-time job opportunities. Thanks to ICPF’s assistance, I reconnected with WestRock, where I had previous internships, and landed a full-time management trainee opportunity.” Makayla Sarkis (Virginia Tech paper systems and design, 2021) was hired as a junior structural designer at Bay Cities Container. “ICPF’s industry dinners and multiple teleconferences

really helped me to expand my knowledge about the industry, as well as learn about different career paths. The website’s Career Portal was exceptionally helpful to me in securing interviews and a full-time position at Bay Cities Container. The portal is easy to navigate and constantly being updated to help students find internships and full-time positions. I am very thankful for ICPF and Richard for helping me to acquire a career within the corrugated industry!” Richard Flaherty is president of the International Corrugated Packaging Foundation.

REGISTER FOR ICPF’S 2021 HOLIDAY WEEKEND IN NEW YORK, DECEMBER 10–12 Registration is now open for this year’s Holiday Weekend in New York, scheduled for Friday, December 10, through Sunday, December 12. Join us to celebrate ICPF’s return to New York and enjoy the best Manhattan has to offer during the holiday season. BW Papersystems, Fosber America, Greif, Kiwiplan, Pratt Industries, and WestRock are sponsors for the 2021 Holiday Weekend in New York, which supports ICPF’s educational programs and outreach to students. In announcing Pratt Industries’ sponsorship for 12 years in a row, Brian McPheely, CEO, stated, “As one of the original sponsors of ICPF’s New York event … again thankful and honored Pratt Industries can support this important industry cause in 2021.” “We look forward to the event being the biggest and best ever,” added Jeff Pallini, president of Fosber America.

Neal McConnellogue, president of BW Papersystems, said, “Having just recently made a long-term Corporate Partner pledge to support ICPF, BW Papersystems is pleased to also continue its ongoing sponsorship of ICPF’s New York event in 2021.” Kiwiplan President Rodney McGee said, “I hope you’re off to a good start this year! I don’t want to miss signing up for the ICPF weekend in New York.“ Jeff Chalovich, chief commercial officer and president of corrugated packaging at WestRock, summarized. “ICPF’s weekend in New York during the holidays is one of the most unique events and opportunities in the industry. This year’s weekend will sell out even earlier than in past years.” To download a program and registration form, visit www. careersincorrugated.org, or email registration@icpfbox.org for specifics.

BOXSCORE www.aiccbox.org

The Final Score

Amat Victoria Curam

y friend and predecessor, Steve Young, would occasionally lead this column with a Latin phrase. Latin gets attention, and using it can make one appear smarter than they may actually be. I figured I would uphold that tradition as I was thinking about a way to capture all that is going on in our business and your Association lately. It’s been a good run of late. A successful in-person and virtual AICC Spring Meeting in Amelia Island, Florida. A booming box business. There are active and looming challenges such as increasingly anti-business policies being proposed by the Biden administration. Extended Producer Responsibility (EPR) legislation pending in several states. Ongoing issues with the supply chain and with labor. Victory loves preparation. Your AICC staff and the convention content committee did a tremendous job of organizing and staging the Spring Meeting. There were multiple options for the attendees, in-person and virtual. Wonderful speakers were booked. The location was ideal. The team anticipated, had a plan, were patient, executed, and delivered. We are grateful to them and to all of you. The theme of the meeting was A Brave Independent World. The team and the attendees proved this to be true. Victoria! The box business is flourishing. Shipments in 2020 were up 3.4% and, in the first quarter of 2021, up 5.5%. The circumstances behind this happy situation were perhaps not anticipated, but the response of boxmakers and their suppliers was a matter of being prepared and being agile. Your response to the market’s push has nothing to do with luck. Your engagement with your customers and their confidence in you and your people are the result of careful planning, brand-building, and execution. Some execution has suffered under the strain on supply chains, but customer relationships built and nurtured over the years and your partnership with other AICC members have played key roles in maintaining satisfaction. Victoria! The challenges in the supply of paper and other raw materials and your ability to recruit and hire effective workers will remain for the foreseeable future. Adaptation is a form of preparation. In matters governmental, victoria is less clear. The government’s extension of unemployment benefits through September and other stimulus brought forth in the American Rescue Plan Act put a definite drag on the available labor pool. The pending PRO Act is another business-unfriendly legislative package, as are the tax implications of the bloated infrastructure proposals beginning to take shape in Washington. Several state legislatures have EPR ready to move. The sustainability track record of paper-based packaging should exempt it from EPR. EPR may make sense for other forms of packaging, especially plastics. AICC, with its partners on Capitol Hill and our own government affairs committee, will continue to be by your side. AICC, too, has prepared and proved itself to be a trusted partner to members and an ally in their victories. AICC will continue to tirelessly put in the work on behalf of membership. Et nos tecum sumus. We are with you!

Michael D’Angelo AICC President

BOXSCORE July/August 2021

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July/ Aug AICC BoxScore: Midyear Converters Roundtable

Articles inside

THE FINAL SCORE

DESIGN SPACE

ICPF UPDATE

FOUNDATION FOR PACKAGING EDUCATION

THE ASSOCIATE ADVANTAGE

MIDYEAR CONVERTERS ROUNDTABLE

STRENGTH IN NUMBERS

MEMBER PROFILE

ANDRAGOGY

SELLING TODAY

LEADERSHIP

SCORING BOXES

ASK RALPH

LEGISLATIVE REPORT

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WELCOME, NEW & RETURNING MEMBERS