Nov/ Dec 2021 AICC BoxScore: Building Better Boxes by AICC, The Independent Packaging Association

A PUBLICATION OF AICC, THE INDEPENDENT PACKAGING ASSOCIATION

November/December 2021 Volume 25, No. 6

BUILDING BUILDING BETTER BETTER BOXES BOXES

Effective collaboration with customers and your team is key to award-winning packaging

ALSO INSIDE Expect the Unexpected Special Section: AICC Annual Report Special Section: AICC Education Catalog

TABLE OF CONTENTS November/December 2021 • Volume 25, No.6

COLUMNS

CHAIRMAN’S MESSAGE

SCORING BOXES

LEGISLATIVE REPORT

MEMBERS MEETING

ASK RALPH

ASK TOM

SELLING TODAY

ANDRAGOGY

LEADERSHIP

MEMBER PROFILE

FEATURES

THE ASSOCIATE ADVANTAGE

STRENGTH IN NUMBERS

THE FINAL SCORE

36 BUILDING BETTER BOXES Effective collaboration with customers and your team is key to award-winning packaging

EXPECT THE UNEXPECTED As daunting as it has been, COVID-19 is only the latest reminder that manufacturers must be ready to pivot at all times

AICC 2021 ANNUAL REPORT Strong market, strong programming, high demand, glimpses of normal

SPECIAL SECTION: AICC EDUCATION CATALOG Take advantage of all the wonderful education provided by your Association—for free

DEPARTMENTS

WELCOME, NEW & RETURNING MEMBERS

AICC INNOVATION

FOUNDATION FOR PACKAGING EDUCATION

INTERNATIONAL CORRUGATED PACKAGING FOUNDATION

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.

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: Gene Marino, Akers Packaging Service Group, Chicago, Illinois First Vice Chairwoman: Jana Harris, Harris Packaging/ American Carton, Haltom City, Texas Vice Chairmen: Matt Davis, Packaging Express, Colorado Springs, Colorado Gary Brewer, Package Crafters, High Point, North Carolina Finn MacDonald, Independent II, Louisville, Kentucky Immediate Past Chairman: Jay Carman, StandFast Packaging Group, Carol Stream, Illinois Chairman, Past Chairmen’s Council: Joe Palmeri, Jamestown Container Cos., Macedonia, Ohio President: Michael D’Angelo, AICC Headquarters, Alexandria, Virginia Secretary/General Counsel: David Goch, Webster, Chamberlain & Bean, Washington, DC AICC Canada: Renee Annis DIRECTORS West: Jack Fiterman, Liberty Diversified Industries, Minneapolis, MN Southwest: Michael Drummond, Packrite, High Point, North Carolina Southeast: Ben DeSollar, Sumter Packaging Corp., Sumter, South Carolina Midwest: Casey Shaw, Batavia Container Inc., Batavia, Illinois Great Lakes: Josh Sobel, Jamestown Container, Macedonia, Ohio Northeast: Stuart Fenkel, McLean Packaging, Pennsauken, New Jersey AICC Canada: Terri-Lynn Levesque, Royal Containers Ltd., Brampton, Ontario, Canada AICC Mexico: Juan Javier Gonzalez, Cartró, S.A.P.I. de C.V. (CP), Tepotzotlán, Mexico

DIRECTORS AT LARGE Kevin Ausburn, SMC Packaging Group, Springfield, Missouri Eric Elgin, Oklahoma Interpack, Muscogee, Oklahoma Guy Ockerlund, OxBox, Addison, Illinois Mike Schaefer, Tavens Packaging & Display, Bedford Heights, Ohio

EDITORIAL/DESIGN SERVICES The YGS Group • www.theYGSgroup.com

EMERGING LEADER DELEGATES Cassie Malone, Corrugated Supplies Co. LLC, Chicago, Illinois Lauren Frisch, Wasatch Container, North Salt Lake, Utah John McQueary, CST Systems, Atlanta, Georgia

Copy Editor: Steve Kennedy

ASSOCIATE MEMBER DIRECTORS Chairman: Joseph Morelli, Huston Patterson Printers, Decatur, Illinois Vice Chairman: Greg Jones, SUN Automation Group, Glen Arm, Maryland Secretary: Tim Connell, A.G. Stacker Inc., Weyers Cave, Virginia Director: John Burgess, Pamarco, Roselle Park, New Jersey Immediate Past Chairman, Associate Members: Pat Szany, American Corrugated Machine Corp., Indian Trail, North Carolina ADVISORS TO THE CHAIRMAN Joseph M. Palmeri, Jamestown Container, Macedonia, Ohio Al Hoodwin, Michigan City Paper Box, Michigan City, Indiana Joseph Morelli, Huston Patterson Printers, Decatur, Illinois PUBLICATION STAFF Publisher: Michael D’Angelo, mdangelo@aiccbox.org Editor: Virginia Humphrey, vhumphrey@aiccbox.org

OVERSEAS DIRECTOR Kim Nelson, Royal Containers Ltd., Brampton, Ontario, Canada

Vice President: Serena L. Spiezio Content & Copy Director: Craig Lauer Managing Editor: Jessica Price Senior Managing Editor: Sam Hoffmeister Art Director: Alex Straughan Account Manager: Max Lalwani 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 Taryn Pyle 703-535-1391 • tpyle@aiccbox.org Patrick Moore 703-535-1394 • pmoore@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

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

Have a Strategic Framework

am excited to pen just my second article as your chairman of AICC. I am passionate about strategy, execution, and their vital importance in everyday operations of a business. My theme of “grip it and rip it” is meant to incorporate the concept of full strategic alignment simplified by that phrase: When everything is in place, you can swing for the fences. Everything, in this case, represents the six key components in a strategic framework derived from a system invented by Gino Wickman called EOS, or the entrepreneurial operating system. I have no vested interest in EOS and believe that any strategic business model will work just fine, but I am well versed in this particular model and can speak to it from practical experience. Wickman wrote a book called Traction and created a global enterprise of implementers who are trained in the practice with the goal of helping companies “get healthy.” Whether you subscribe to this EOS framework is frankly irrelevant. Wickman admittedly claims that his formula is a culmination of several experts in different specific areas that make up the components of strategy and execution; he simply created a model that incorporates a holistic approach, encompassing the six key components. I plan on spending the next year sharing some of my personal thoughts on the six key components that make up Wickman’s system, asking you to reflect on some thoughtprovoking questions in your own business, and sharing some lessons learned and some words of advice as we move forward in my journey as AICC chairman, so that we can grip it and rip it every time. (Disclaimer: My apologies to the nongolfers. Simply think about something you love, whether sport, art, music, or some other passion; visualize what greatness looks like, and you understand the grip it and rip it analogy.) Many entrepreneurs initially succeed because of their passion, energy, and charisma. They have a skill for painting a vision to customers, stakeholders, and employees that is clear, exciting, and dynamic. They have an aura about them that motivates others and a positivity that attracts those around them. As the business grows, so grow the complexities, challenges of all kinds, and of course, the workload of the leader. The leader becomes tied to the office, making decisions of all kinds, answering complex and at times repeatedly the same simple questions. They lose sight of their to-do lists because they are tackling 150 things at one time. The entrepreneur is working full time “in” the business instead of “on” the business. A strategic framework such as EOS works to establish a clear vision for the business. It then ensures that you have the right people on the bus, in the right seats. It creates an environment with established metrics to remove emotions from decision-making and to support good decisions with objective metrics. Once the team knows where they are going, who’s on the team, and how they are keeping score, they can focus on smoking out and solving the key issues in the business, creating repeatable, fool-proof processes to reduce the stress of growth and drive a meeting cadence and focused priority system to set and achieve the goals needed to successfully realize the vision. I will leave you with a few reflective questions to contemplate when you have some uninterrupted time to think about the business. For each statement below, rank your business on a scale of 1 to 5, where 1 is weak and 5 is strong. • We have a clear vision in writing that has been properly communicated and is shared by everyone. • All the people in our organization are the right people. • Our leadership team is open and honest and demonstrates a high level of trust. • All teams clearly identify, discuss, and solve key issues for Gene Marino the greater good and long term. Executive Vice President, Akers Packaging Service Group • Everyone in the organization has a number. Chairman, AICC

BOXSCORE www.aiccbox.org

Scoring Boxes

Consumption Does Not Equal Production BY DICK STORAT

BOXSCORE November/December 2021

Consumption vs. Production of Food Adjusted for Inflation, Index: 2017=100 120 110 100 90 80

Average Annual Growth Rates 2020/2010 2020/2019 %/Yr % Consumption 3.8% 4.6% Production 0.1% –6.4%

Consumption

Source: BEA

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Production

Consumption vs. Production of Nondurable Food Adjusted for Inflation, Index: 2017=100 120 110 100 90 80

Average Annual Growth Rates 2020/2010 2020/2019 %/Yr % Consumption 2.4% 3.1% Production –0.6% –4.3%

Source: BEA

Consumption

Production

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onsumer spending has been in the headlines of economic news since the COVID-19 pandemic caused widespread shutdown and social distancing in February 2020. Keeping consumer spending going while incomes were reduced has been the key strategy to help the economy get through the pandemic. Government stimulus measures, in the form of direct payments to consumers and expanded and extended unemployment benefits, were the major tools used to keep U.S. consumers spending while the pandemic threatened to stall economic growth. The top chart at right shows how consumption of all types of goods has grown since 2009. Inflationadjusted consumer spending has been converted to an index that was assigned a value of 100 in 2017. Production growth has also been indexed. Production of goods accounts for only about 30% of the nation’s output. The service sector makes up the rest. However, almost all boxes are consumed by producers of goods, and to some extent by wholesalers and increasingly by retailers. Online sale of goods is now the largest retail distribution channel for goods. As the top chart at right shows, goods consumption has grown steadily since 2009. On average over the past 10 years, consumption of goods grew at 3.8% per year. Last year’s data is particularly interesting. During the pandemic, consumer spending grew even faster than the 10-year average. It rose by 4.6% amid the worst months of the pandemic, evidence that the government stimulus was doing the job.

Scoring Boxes

Consumption vs. Production of Food Adjusted for Inflation, Index: 2017=100 120 110 100 90 80

Average Annual Growth Rates 2020/2010 2020/2019 %/Yr % Consumption 2.6% 7.6% Production 0.5% –2.6%

Source: BEA

Consumption

restrictions, foreign producers were still able to ship enough goods into the country to capture more than all that growth. The most corrugated-intensive manufacturing sector is food production. Purchases of food for consumption off-premises or grocery store sales amounted to slightly more than $1 trillion last year. The chart above shows the growth of these goods during the 10 years ending last year. Over that decade, on average, food consumption grew by 2.6% per year, after adjustment for inflation. That was advancing faster than the U.S. population, meaning that per capita spending has been rising steadily, showing a bias for more costly foods (e.g., prepared scalloped potatoes instead of the ingredients to make scalloped potatoes at home). Domestic production of food did increase over the past decade, albeit at a fractional 0.5% pace per year, not nearly fast enough to keep up with growing demand. And last year, purchases of food accelerated to 7.6%, reflecting the shutdown of eateries of all

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However, independent corrugated converters sell boxes to producers of goods and further forward in the supply chain, but not to consumers directly, with very minimal exceptions. The top chart on the previous page shows just how large the disconnect is between consumption growing at a 3.6% rate over time and production of these goods, which has averaged a scant 0.1% growth per year. And last year during the pandemic, despite consumption growing by an elevated 4.6%, domestic production sank by 4.3%. What that means is that imports supplied all the growth of goods consumption and more. Although some of the durable goods still being manufactured in the U.S. need corrugated packaging, few of those segments are in the fast-growing category. Less than 10% of U.S.-made corrugated goes to protect domestically manufactured durable goods. To sharpen the focus on where boxes are consumed, it helps to zero in on nondurable goods. They consume some 75% of all boxes, whether those boxes are shipped to manufacturers, wholesalers, or retailers. The bottom chart on the previous page compares the domestic consumption and production of these fast-moving goods. Consumption has grown at a relatively steady 2.4% per year over the past 10 years. Over that time period, however, domestic production of nondurable goods has eroded by an average of 0.6% per year. Even though government stimulus provided enough funds for consumers to increase their purchases of nondurable goods at a more rapid pace of 3.1%, none of the benefits of that growth went to domestic manufacturers or to those supplying them with boxes. Domestic production of nondurable goods declined by 4.6%, in part because the COVID-19 pandemic depressed domestic output. However, despite the pandemic’s

Production

types and substitution of eating at home during the pandemic’s worst months. Production of food, however, decreased by 2.6%, as imports again provided all the increased food products and more. It is important for independent corrugated converters to realize how significant a share of market is being supplied by imports. Even though U.S. producers of packageable goods exported $311 billion of goods during the first half of this year, an increase of 17% over last year’s first six months of exports, imports amounted to more than double that ($658 billion) and grew at a faster rate (20.5%), resulting in a deficit of $347 billion. In short, during the first half of this year, consumers purchased nearly $350 billion of products that were unlikely to be packaged in U.S.-made corrugateds. Dick Storat is president of Richard Storat & Associates. He can be reached at 847-867-1521 or storatre@aol.com.

BOXSCORE www.aiccbox.org

Legislative Report

As Congress Dithers, Small Business Braces BY ERIC ELGIN

ark Twain is reported to have said, “No man’s life, liberty, or property are safe while the legislature is in session.” I believe this particular Congress is proving him right. As I’m writing this, the House and Senate are dithering on the “infrastructure” package and how to pay for it. Hence, when you read this column, whatever form the legislation takes will be long known and still, I imagine, little understood. One thing we can understand is that the House tax package, sponsored by Rep. Richard Neal (D-Massachusetts), would hit private companies twice as hard as public C corporations. This is not my opinion but rather the conclusion of the S-Corp Association and a new study from EY on the effects of the legislation. According to EY, the tax bill proposed in the House of Representatives “would impose marginal rates of 46.4% or more on private companies, while taxing public corporations as little as 26.5%. No business structure can survive such a competitive imbalance, so the net effect would be to encourage further economic consolidation away from Main Street and toward Wall Street.” In my view, EY’s conclusion is important because 77% of all private-sector jobs nationally are in privately held companies, many of them pass-through entities, while the remaining 23% are in public companies. The Neal bill, with its anticipated tax increases, threatens our viable small business job sources. Here are specific examples: • The bill authored by Congressman Neal would 1) increase the top rate on pass-through entities, 2) apply the 3.8% net investment income tax to all

BOXSCORE November/December 2021

their profits, and 3) impose a new 3% surtax on their income. EY says that adds up to 46.4%, or 17 percentage points more than they pay now. • For private C corporations, the corporate rate increases to 26.5%, while the top rate on capital gains and dividends increases to 31.8%. • The rate on public C corporations would rise to just 26.5%, and although the rate on capital gains and dividends increases, too, most public company shareholders don’t pay taxes or pay sharply reduced rates. The result is that the second layer of tax is deeply discounted if it’s paid at all. EY estimated the second layer for public companies was about 8 percentage points, so the combined rate for public C corporations is somewhere in the mid-30s, or about 12 percentage

points less that the private company rate. Of course, since our public policy debate is all about narratives these days, you won’t be surprised that this bill is being marketed as making the rich billionaires and multinational corporations “pay their fair share.” A tax rate of 46% for private companies and a rate of 26.5% for public companies is not fair share. So as Congress debates this tax bill, let those of us who own small businesses brace ourselves for the worst. Congressman Neal’s bill will hurt us and our employees. 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.

New Members

Welcome, AICC’s New Members! MILLER VALENTINE CONSTRUCTION LLC DENNIS J. WHITEHEAD Vice President, Business Development, Midwest 409 E. Monument Ave., Suite 200 Dayton, OH 45402 937-293-0900 www.mvg.com

RIGPARK JAY REDMOND Co-founder and CEO 8000 Avalon Blvd., Suite 100 and 200 Alpharetta, GA 30009 678-414-3178 www.rigpark.com

GLOBAL BOXMACHINE LLC JAMES A. SCHIFFMAN President 3180 MacArthur Blvd. Northbrook, IL 60062 847-949-5900 www.boxmachine.com

ADDUCO COMMUNICATIONS SIMONA GEORGESCU Founder/Owner 3693 E. Brittlewood Ave. Las Vegas, NV 89120 702-434-0341 www.adducomm.com

GREEN MARKETS RYAN FOX Corrugated Packaging Market Analyst P.O. Box 190 Sullivan, NH 03445 609-279-3849 www.green-markets.com/ box/home.html

BOXSCORE November/December 2021

GULF ATLANTIC PACKAGING CORP. BOBBY R. ATKINSON III Vice President of Sales 1100 Westlake Pkwy. SW, Suite 140 Atlanta, GA 30336 404-344-4444 www.gap-co.com

ADAPT-A-PACK INC. DEREK FAIRCHILD Vice President, Operations 678 Yellow Springs Fairfield Rd. Fairborn, OH 45324 937-845-0386 www.adaptapak.com

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Members Meeting

AICC México Members Meet in Monterrey

embers of AICC México met in Monterrey, Mexico, November 17–19, to celebrate the 20th anniversary of the founding of the AICC México Association. The group, numbering 135 members, suppliers, and guests, was welcomed by AICC México President Juan Javier Gonzalez, CEO of Cartró, and AICC President Michael D’Angelo. Gonzalez told members, “It is gratifying to see the support of so many AICC members at this meeting, given the challenges of the past year posed by the pandemic and the state of the economy.” He said that membership in AICC México had grown to 125 member companies and the interest in the activities of the Association, particularly the online training programs, was very high. D’Angelo, for his part, thanked the members for their support and encouraged them to participate in the services offered by the Association, especially the online training and learning resources. He reported that AICC had created the Foundation for Packaging Education, a charitable foundation specifically dedicated to supporting and sustaining the development of online education and training programs, including the translation of those resources into Spanish. He remarked briefly on the financial performance of AICC in

BOXSCORE November/December 2021

the past fiscal year, noting that the Association’s financial resources are very sound. He also commented on the AICC/TAPPI SuperCorrExpo, August 8–12 in Orlando, Florida, which saw attendance of nearly 3,000 people and 235 exhibiting suppliers. Speakers at the meeting included Patricia Inés Christensen of the Asociación Mexicana de Envase y Embalaje (AMEE), an expert in packaging, design, and brand identity, who spoke on creating value through packaging design. Juan Jacobo Mondragón, industrial engineer, discussed total quality systems design in corrugated packaging operations, while Hiram Cruz, also of AMEE, presented ways to optimize paperboard materials and reduce waste in the production process. On the topic of sales, Gerardo Rodriguez gave an energetic—at times, raucous—presentation, titled “Shut Up and Sell!” A well-known motivational speaker, Rodriquez told his audience that knowing how to sell is crucial for success in business-to-business industries such as corrugated and paperboard packaging, and that everyone has the ability—they just have to tap it. Also on the program were Marina Faleiros, the Latin American editor for RISI/Fastmarkets, who gave an overview of the containerboard and packaging

markets in North and South America, and keynote presenter Benjamin Aleman of Instituto Panamericano de Alta Dirección de Empresa (IPADE), who spoke about the main challenges and opportunities that arise in an uncertain economic environment. AICC México celebrated its 20th anniversary with a reception and dinner, where Marco Ferrara of Cartón Sultana was inducted into the AICC México Hall of Fame. On the event’s closing day, the group was hosted by Eduardo Posada, CEO of Grupo Gondi, at Papel y Empaques Gondi Monterrey, where members toured the recently constructed PM7, which can produce 400,000 tons of recycled containerboard annually. The completion of the mill in January 2021 raised Grupo Gondi’s total containerboard capacity to 1.1 million tons per year. Members were treated to a cocktail reception and tabletop trade fair, hosted by the sponsors of the AICC México meeting: Polycart; HP; Grupo Gondi; BCM Inks; EAM-Mosca; Kolbus; ICASA; PCM; Alliance Machine Systems; ARC; Fosber; Macarbox; ALHU International; Global Boxmachine; and Amtech. For more information about AICC México, contact Maria Frustaci at mfrustaci@aiccbox.org or Veronica Reyes at vreyes@aiccbox.mx.

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Ask Ralph

Score Cracking Revisited – Again BY RALPH YOUNG

here is much delight when one of us on staff is asked to share our knowledge or perspective on various issues at security analyst conferences, AICC national meetings or summits, Fastmarkets/RISI gatherings, or in this case, a fellow trade association: the International Association of Diecutting and Diemaking (IADD). In preparing for the conversation with IADD members, the following question came in to the Ask Ralph! blog just days before. We presented this timely case study to those in attendance at the IADD meeting: I have a customer that is having a white box randomly split (outside liner) in the vertical scores (corners of the box). Typically, the split in the outer liner tears/splits in the vertical score. We have examined the process from the corrugator and the die cutting operation. • Corrugator advises that they check moisture content in paper rolls but not the corrugated sheets. • We die cut and fold the sheets into a box (outside liner is white). • Anvil surfaces are routinely rotated and replaced. • In the winter months (Nov–Mar), we typically get the splits reported by the customer. • Die was built for a 42White board (42W-36medium-35inner). • Last run of 42W-40Med-31 processed well and did not split (March 2021).

Corrugators and converters often forget that containerboards have an elongation or stretch property of each of the components, which should be known. This is discussed in TAPPI Test Method T-494. MD/CD moisture

BOXSCORE November/December 2021

profiles with very little variation are critical in forming scores without cracks. It was suggested that the corrugated sheets from the corrugator be converted within four hours, while there may still be some additional moisture in the sheets. Since we provided feedback to this member, they bought a new die, and the issue has been resolved. The original die was 16 years old! The following AICC resources were also shared with the member: • Score Cracking: Causes, Characteristics, & Cures (available at bit.ly/3BNSE94). • Understanding the Key Characteristics of Linerboard and Medium and Their Impact on Combined Corrugated Board (available at bit.ly/3BSV46j). IADD shared that when die cutting a sheet where the medium has more basis weight and fluted strength than the inside liner, the single-face liner will crack. Another observation was that there is no significant loss of box strength when score crack is allowed to occur than from crushing the flutes around the score. The group also confirmed that different die specifications are needed for different combined board weights and ECT variations. Makes sense, right? There is one commercial testing lab that could actually quantify the strength loss from overcrushing the corner area and the score cracking corner. Contact me. Other dialogue, questions, and answers at the IADD forum included: • Global economic containerboard conditions. • Domestic containerboard conditions, economics, and capacities, and changing physical properties.

• Environmental, social, and governance. • The busiest person today? HR directors. • Which companies own the lion’s share of production of containerboards? • There are now 140-plus machines in North America, all with unique characteristics. • Imports from unconventional sources with different physical properties may impact scoring and die cutting. • All new production is 100% recovered fiber. • Different levels of sophistication exist in containerboard manufacturing. • Changes in fiber collection options— residential mixed waste and “cow manure.” • Basis weights keep dropping. • Newer corrugators are more sophisticated. • Issue with sheet feeders. • Follow the paper trail. • AICC resources—e-learning and white papers. • Extended producer responsibility is in the U.S. now, following Ontario. It was recently established in Maine in July and then in Oregon in August. Producers of corrugated are now responsible for its collection and reuse—or pay to play! Ralph Young is the principal of Alternative Paper Solutions and is AICC’s technical advisor. Contact Ralph directly about technical issues that impact our industry at askralph@aiccbox.org.

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Ask Tom

Data Management, Part 4 BY TOM WEBER

he following is my final recap of our four-part data management series, this one covering materials. The entire series was hosted by your AICC education team, which I moderated. I thought you might find this recap once again both relevant and compelling toward finding a better way in 2021 and beyond. I encourage you to obtain all four of the recorded versions. The recordings are available through your outstanding AICC education contacts, Chelsea May and Taryn Pyle. The goal of this fourth and final session was to identify uses of manufacturing data to precisely forecast, sense demand, and ultimately balance “inventories to demand” in near-real time. The following are the top five key webinar takeaways: 1. Demand Planning – How to drive this critical aspect. • Use your software to sense demand signals that indicate marketplace changes faster. • Translate demand signals, such as seasonality, costs, promotions, events, and merchandising, into a more effective market-driven response. • Take a visual approach to analyzing demand planning to unearth patterns and insights regarding sales, shipments, pricing, promotions, and operational performance. 2. Generate accurate forecasts at every level, down to specific product line SKUs. • Foster collaboration among sales, marketing, finance, and operations. • Utilize an interactive dashboard that can monitor, track, and report on forecasting performance.

BOXSCORE November/December 2021

• Use statistically driven consensus forecasting to ensure maximum accuracy. 3. Analyze huge quantities of data using algorithms to compare and adjust forecasting demands. • Get near real-time insight into supply-and-demand dynamics. • Calculate optimal inventory policies to ensure continual optimization. • Manage overall inventory costs while still driving product(s) where it is need most. 4. Use time-weighted forecasting to build models that reflect your business realities. • Use time series and machine data to build models that consider intermittent demand, new product needs, and expiring SKUs. • Utilize data inputs from both inside and outside the organization to round out accuracy. • Predictive modeling and what-if analysis can reveal how different variables may impact the supply chain material flow. 5. Use your data to create multichannel inventory optimization. • Generate unbiased consensus forecasts that work in conjunction with all data acquisition processes. • Avoid under- and overstocking at all costs to improve planning outcomes. • Lastly, collaborate and share customer and supply chain intelligence freely. Don’t expect your materials planner(s) to deliver top performance without the aid of advanced analytics. For instance, with artificial intelligence and analytics

AICC Technical Advisors Tom Weber and Ralph Young are hosting Material Testing and Why You Need It Now, April 20, 2022. This webinar will focus on why you need to know the characteristics or property values of the components you buy, and how they relate to other options in the industry. Learn more www.aiccbox.org/calendar. doing the heavy data lifting, a company might analyze 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. Also worth noting: The digital universe is doubling in size every two years. By the end of this year the data we create and copy annually will reach 44 trillion gigabytes, according to International Data Corp. This session four materials recap was intended to create the thought that perhaps there is a better, faster, and smarter way to do tomorrow, through the utilization of software data, what we have been wrestling with for quite some time. If I have somehow piqued your interest, please request the complete final session recording from your AICC education team or me. It might well trigger one novel useful thought for you and your team to utilize yet in 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

How to Choose and Get Buy-In for a CRM System BY TODD M. ZIELINSKI AND LISA BENSON

he Rolodex has long been relegated to the dusty corner of the supply closet with the rotary phone and paper calendar. However, maintaining customer information is no less crucial today than it was decades ago. It may be even more so. Today the repository for customer information often rests in a customer relationship management (CRM) system. If you are using spreadsheets to maintain customer information or using your CRM system like a Rolodex to store contact information, you are missing out on some of the most important benefits that can increase efficiency and productivity and prevent the loss of opportunities.

Does My Company Really Need a CRM System? This question comes up frequently. Many companies feel they have coped

BOXSCORE November/December 2021

fine without one, that they are timeconsuming to manage, or that user acceptance and use will be low. We respond, “Can you afford not to have one and remain competitive?” Increased efficiency, productivity, and revenue are achievable with a properly implemented and run CRM system. A CRM system provides a centralized location for the entire sales process, from prospecting through customer service. But it is so much more than that. It offers valuable pipeline visibility through dashboards and reporting, making it easier to quickly see how your pipeline progresses. It also provides accountability, which many sales processes lack. Other benefits include: • Improved contact management – Staff can upload customer or prospect

details to the database, prioritize activities, and get reminders of important calls and meetings. • Better customer experience – The system allows for easy tracking of longer sales cycles, so you can nurture a prospect throughout the sales cycle to increase the likelihood of a sale. • Easier organization and launch of marketing activities – Segment data for targeted email campaigns, targeting via buyer personas, geography, industry segment, and more. • Continuous data analysis – Make strategic data-based decisions and forecast sales volumes with realtime data. • Reduction in operational costs – Tasks that were once manual can be automated, decreasing routine operations and saving time.

Selling Today

• 24/7/365 availability – Transparency, accountability, automation, reporting, and data and contact management are available to users around the clock. If the system offers a mobile app, they are available anywhere you have Wi-Fi or cell reception. • Reduction in lost sales – By improving sales team efficiency and opportunity visibility, your team can reach out to aging opportunities before they are lost. A word of caution about trying to use your enterprise resource planning (ERP) system’s CRM component: These systems are designed to be ERP systems first, with CRM components being an afterthought. Because of this, capabilities are usually limited, which can result in a lack of use by the sales staff. Functionality of CRM Systems CRM systems’ functionality differs slightly based on the brand, but most allow uploads of data via spreadsheets. Some even allow upload from other CRM systems. Typical functionality includes the ability to monitor prospects, track activities, manage your sales pipeline, record communications, store account history, manage current customers, forecast sales, monitor the sales team’s progress, and create sales reports. To create an integrated system for your company, most CRM systems will communicate with other software programs (e.g., MAT software, invoicing, ERP systems), either directly or through a third-party connection. How to Choose a CRM System A CRM strategy should come before the technology purchase. CRM is about customer relationships. With this in mind, define your company goals, identify who your customers are and aren’t, and understand the buyer’s

journey and how you need to interact with them to get conversions. Another thing to consider when creating a CRM strategy is your company’s vision and mission and how you can align them with your CRM system. You may need to make process changes if you aren’t customer-focused, since you will want to integrate customer-focused business processes and key performance indicators into your strategy. Finally, evaluate how technology can support your CRM strategy. Research A CRM system that is right for your business may not be the same CRM system that a competitor uses. Start by doing research. Find out what is available and what actual users are saying. A software review website, such as G2.com, will provide ratings and reviews that offer pros and cons for each system. NARROW DOWN YOUR OPTIONS Determine what features are most important to you based on your CRM strategy and user needs. For example, do you require ease of use, email integration, other software integration, or a mobile app? It is a good idea to get management, your sales and customer service teams, and any other users involved in the process to find out what is important to them. Think about scalability, customization, and provided technical help and training. Ranking the required features in order of importance will ensure that you review only CRM systems with all the functionality requirements on your “must-have” list and most on your “nice-to-have” list. CHOOSE THE BEST OPTION Once you narrow down your options to five or fewer systems, have the companies give you their sales pitch. However, don’t get caught up in the marketing hype— stick to your prepared lists of needs. This

allows you to ask questions to ensure that the functionality will work as expected. Ask if a full demo or trial is available. Also, ask how many businesses similar to yours are using the system. It should start becoming clear which system is right for your business. Getting Staff Buy-In Many sales and marketing managers may be concerned about getting executive buy-in for implementing the CRM system. Buy-in should come before the purchase, with a member of the executive team involved to ensure that company goals and long-term vision are included in the decision-making process. To get the executive team on board, highlight the CRM system’s value in terms of how it will impact the bottom line—consider mitigation of lost sales, improved time and territory management, increased productivity, and smoother transitions from sales rep turnover. Once management is on board, it is easier to get staff buy-in. Start by highlighting features that will improve their productivity and performance and make their jobs easier. CRM systems with functional and easy-to-use mobile apps will be easier to “sell” to younger team members or those who travel frequently. Set up the CRM system so that it is easy to use, and provide continuous staff training. For staff members who are still reluctant, management may need to emphasize that use is mandatory. To ensure continued use, consider doing all pipeline management reviews with your sales staff in the CRM system. This will require staff to input data into the system regularly. If it’s not entered, reschedule the meeting for after it has been entered. Best Practices for Implementation The No. 1 thing to do before implementing the CRM system is to set it up completely before adding data. Don’t

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Selling Today

rush the process. Customization will be vital to getting the most out of the system. Each department has its own requirements and goals, but it is also essential to communicate a consistent brand and message across all customer touchpoints, whether through sales or customer service. Think about how each department will use it. For example, set up different pipelines and lists for each business segment. It is highly frustrating to create workarounds after the fact because it wasn’t set up to promote a smooth workflow. Be prepared for the setup process to be time-consuming, but it will be well worth it in the long run. Other tips for successful use: • Start by creating a strategy, and then look at the technology that will assist with executing your strategy.

• Set up the CRM so that it adheres to your sales process—rename steps specific to what your company calls them, so there is familiarity for your staff. • Scrub your data before uploading it into the system. Don’t gum up the system with garbage data. • Provide adequate user training before going live, as it is essential for use and data accuracy. • Appoint a CRM system administrator, even if it’s someone part time. This person becomes the central point of contact for the CRM system. • Encourage full use of all the features the solution provides to get the most bang for your buck. • As with all processes, continuous improvement makes it better, so understand that you may have to change your process at times.

Choosing a CRM system is a big decision that will require a lot of upfront work to make it successful. Leading with your CRM strategy, doing the upfront research, getting buy-in, and taking the time to execute it correctly will help to ensure success. Todd M. Zielinski is managing director and CEO at Athena SWC LLC. He can be reached at 716-250-5547 or tzielinski@athenaswc.com. Lisa Benson is senior marketing content consultant at Athena SWC LLC. She can be reached at lbenson@athenaswc.com.

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BOXSCORE November/December 2021

Andragogy

Does Education Count as a Gift? BY JULIE RICE SUGGS, PH.D., AND ALLI KEIGLEY

he holidays are upon us! Now, I’m sure you’ve all heard the hit song played ad nauseum during this magical, festive season, “Santa Claus Is Coming to Town.” Most of us could probably quote the entire song, but if you’re not quite at that level, you at least know the line, “He’s making a list; he’s checking it twice …” and you know how the rest goes. While we’re all old enough to not really worry about whether we’ve been nice enough to receive presents, the hustle and bustle of these giftgiving months can be overwhelming— special activities, events and traditions long held dear, making the lists, buying the gifts, decorating the house, baking cookies. The to-do list goes on and on. For me, the song is a reminder of the gift list I am supposed to be preparing for all the aunts, uncles, moms, dads, siblings, and other various and sundry humans who want to buy me a gift (the nerve!). My mind tries to remember: What was that thing I saw last month I desperately wanted to buy but couldn’t quite justify; Mom buying it for me doesn’t count—now, what was it? And come to think of it, do I really “need” some of the gifts that inevitably show up year after year: the new socks, cookbook, pajamas, gift cards, scented candles, or journal? Surely not, but sometimes the pressure to think of an idea for someone makes us write down things we don’t need just to get it over with. Man, remember the days when you had to restrain yourself from asking for too much? Things were so much easier when a pony, treehouse, my two front teeth,

BOXSCORE November/December 2021

and a Red Ryder BB gun were the order of the day. Here’s an idea: How about you pause on this year’s list (you already have everything you need, right?), let everyone know they can just give you cash, and then sign yourself up for something truly meaningful this holiday season—the gift of education. AICC and The Packaging School (TPS) can be your Santa Claus this year! The partnership between AICC and TPS 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. The gift that keeps on giving, right? Education is truly an evergreen gift— once given, expect great things in return from those who pursue it with passion and determination. Of course, continuing education has many tangible benefits, such as potential career opportunities and financial security. But the intangible benefits are significant as well—the sense of accomplishment and confidence that come from putting in the extra effort to grow your mind. I know some of you might be wondering where you would find the time to squeeze in a course or two, especially during this busy season. Well, we’ve got you covered there, too. For starters, we use a technique called microlearning. You may not be familiar with the term; it just means we take difficult topics, break them up,

and then arrange them into bite-sized lessons you can engage with on any device. We use infographics, quick readings, videos, animations, discussions, or interactive slides as vehicles to deliver information. This unique method empowers you to learn and complete courses on your schedule, at your own pace. We believe these short, focused sessions help avoid mental burnout and cater to adult learning styles. When you spend time in the pursuit of education, you invest in your most important commodity: your mind. Education and knowledge gain are vital for personal growth, and if you are not actively seeking these things in some form or another, you will suffer for it. Think of it as one of the necessities for life—air, food, water, exercise. Nourish your mind in the same way you nourish your body. So, this holiday season, while you are trying to figure out if you are on the naughty or nice list, take some time to give yourself the gift that keeps on giving: education. 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, who contributed to this article, is production coordinator at The Packaging School. She can be reached at alli@packagingschool.com.

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Leadership

Change Sickness BY SCOTT ELLIS, ED.D.

told him to watch the white line. I tried reasoning with him, but he was six years older and not required to listen. He was also a terrible host. He had invited me to spend the weekend and promptly came down with scarlet fever. He was supposed to be my cool older brother who had his own place and could drive and everything. Instead, I was stuck taking care of him in his tiny room while he spent all night talking in his sleep and taking regular breaks for projectile vomiting. He was hallucinating about riding in a car somewhere. He kept talking about the curves in the road, and then he would throw up again. I tried helping, but at about 3 a.m., I gave up and told him to watch the white line. He cursed me the next day because he watched that white line the rest of the night, but he stopped talking and throwing up. So, you’re welcome, bro. Motion sickness is caused by the inner ear’s reaction to unanticipated change in trajectory. Car sickness is ameliorated by two strategies. First, if you are driving, you choose the course and direction. Second, if you watch the white line, the inner ear can anticipate most changes. No surprises means no motion sickness. Think of stress as the motion sickness of the soul. Unanticipated changes result in stress. Anticipated changes that do not go completely as planned also cause stress. Here are two strategies that may ameliorate stress. First, when you are driving, you will not be stressed. However, there may be stress due to the pressure of taking on responsibility for controlling all variables. Second, watch the road ahead to anticipate and prepare. You did all that, and you are still stressed?

BOXSCORE November/December 2021

Stress is unavoidable, and some of the unease comes from our mistaken belief that stress is abnormal—that if we were doing it right, we would not experience the discomfort. Stress is an adverse reaction to change—to any change, not just to the negative ones. There is a checklist based on insurance norms that has been around for many years. The Holmes-Rahe stress test can be found many places online (see www.stress.org). Take it, and you will see that there are points gained for both positive and negative changes. You get almost as many points for getting married as you do for going to jail (insert your own punch line here). A higher number of points indicates a higher probability of illness or injury due to stress. Because we wrongly suppose that stress is the result of only the unwanted

outcomes, we are particularly vulnerable in victory. In truth, victory depletes us as much as loss, so we are often blindsided by a stress reaction. Our behavior demonstrates a paradigm that mental, emotional, or physical fatigue is a sign of weakness. In fact, fatigue is not a Red Bull deficiency. It is a body, mind, and soul reaction to the changes of a demanding life. Considering the pressures of the last 18 months, those in this industry have been stressed by the COVID-19 pandemic and perhaps even more by the welcome and unprecedented influx of business. To endure and achieve some type of healthy pace for the long term and to gain perspective, I suggest we predict, plan, prioritize, and partner. Predict. Watch the white line, and anticipate and adapt to changes.

Leadership

Anticipate what you can, and prepare for a reasonable set of positive and negative outcomes. Some people play worst-case scenario to deal with stress. They are not necessarily being pessimistic; they are just reasoning that if they know how they would handle catastrophe, they can improvise on anything less. Plan. Never stop taking time with your team to check current workloads and capacities as well as the individuals’ and team’s resilience. Busy times do not excuse us from this executive function. Do what needs to be done to keep the team healthy. Do not put off dealing with issues, conflicts, or nonconformances. Insist that people maintain a healthy pace, as there is no natural end in sight to this new level of busyness. Most are painfully aware of what happens when we neglect to do regular preventative maintenance on machines. The consequences for

humans are no less troublesome. Our bodies do not stockpile sleep or nutrition. These must be taken in a timely manner, or the self-righting system will result in an illness that requires us to take them in a more inconvenient means. However, with proactive rest, fitness, and nutrition, we can become more resilient to physical stress. Prioritize. Figure out where your efforts will be most effective. Delegate the things for which you lack the bandwidth or the expertise. Strategically ignore what you and your team cannot address by scheduling it forward. Partner. We can be accountable, actively engaging with our thinking partners. Few activities help me gain perspective more effectively than explaining the problem out loud to another person using a whiteboard. Asking someone to support or collaborate in this way will

help prevent the mental clutter that can result from solitary problem-solving. Of course, it is even better if that person can share responsibility. This will help avoid losing energy, joy, and perspective and is particularly important when things are going well. When these are habits, perspective and resilience will be the result. 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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Customer Service

Why Customers Buy From You, and Why They Don’t

ach company unquestionably has ideas and anecdotal evidence about their customers. But, what would you be able to do with fact-based evidence about why your customers buy from you? How would your company grow if you could get action items that could help you increase your share of wallet? AICC has partnered with OTB Solutions, and we negotiated an AICC rate for the voice of the customer research. The one-on-one research discussions help leaders in the industry answer the questions they need to design buyer-centric go-to-market plans.  Questions such as: • Why do customers buy from you? • Why don’t customers buy from you? • Are your customers aware of all your capabilities? • How do your buyers shop for solutions? • What buying criteria do your buyers use when making purchase decisions? • What is their decision-making and buying process today?

• Are your customers satisfied? • What customers are preparing to defect and leave you? • Will your customers refer you to others? AICC Member Investment Top 30–50 customers by revenue interviews: $5,850 100 customers: $6,990 200 customers: $10,500 Given all the market changes and disruption we have seen over the last 18 months, we hope this service will help give AICC leaders the data to make strategic decisions to continue to profitably grow and improve customer experience.

Teams that participate in this research will receive a one-hour data debrief with OTB Solutions CEO Mark Roberts, with recommendations based on actionable insights discovered and the research data file by the customer by question for business development in the future. See sample data and actionable insights at www.aiccbox.org/voc.

SIGN UP FOR VOICE OF CUSTOMER SERVICE WITH MARK ROBERTS Contact Mark Allen Roberts, CEO, OTB Solutions (mention AICC) 330-413-8552 | markrobertsnosmoke@gmail.com | www.nosmokeandmirrors.com

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AICC Innovation

Leadership

Understanding the Past While Preparing for the Future BY BEN BAKER

“Study the past if you would define the future.”

our past, present, and future are intertwined. Your past is there to learn from, your present defines who you are today, and your future is a possibility of who you may become. The only sure thing is your past. It is what it is, and there is nothing you can do to change it. But you can learn so much from it if you allow yourself. Too many people say, “It doesn’t matter; it’s in the past.” The problem with that is that though the event may be over and done, what happened affects you either consciously or subconsciously today and becomes part of the decision-making process of what can be. We need to learn from our past. Our job is to deconstruct what has happened, garner the lessons learned, evaluate how this has changed us, and use this new set of knowledge to plan for our tomorrow. Without learning from the past, we are hindering ourselves. We will maintain the same assumptions, the same skill sets, the same biases, and the same blind spots, meaning that we are not setting ourselves up for success. If we do not learn from our past, all we can do is provide ourselves with the opportunity to repeat it. So why are so many people unwilling to learn from past mistakes? Are we

BOXSCORE November/December 2021

—Confucius afraid to admit that we are not perfect or all-knowing? Are we afraid that we are less than perfect by admitting that there are lessons to be learned? Are we afraid that people will not trust us if they see that we have had faults and missteps in our past? Most people nod their heads yes to this, and this is a problem. None of us is perfect. None of us is all-knowing. And most people realize that people make mistakes and judge you not by the mistakes you make, but by what you learn from them and how you recover. So what are you doing today to guide your future self? Are you willing to go back to see what lessons you missed learning along the way and rectify the situation? Are you ready to look at your present self and understand how you got to be who you are today? Are you willing to ask yourself if you have the knowledge and tools needed to become a more incredible version of yourself tomorrow? Are you ready to admit that there is more to know than you know and surround yourself with experts in certain areas in which you are deficient? Those who succeed in life do so because they continually evaluate what went well, what did not, and how it could have been

done better. Successes and challenges should be celebrated equally because both provide insights that allow us to create a better future. We need to understand where we are to know where we want to go and how to get there. Every decision that you make today is influenced by previous choices and creates your future success. In conclusion, we must realize that we cannot be afraid of the future or constrained by our past. Our future is never certain but becomes more apparent the more we understand who we are, what we believe in, why, and the experiences that have allowed us to gain those insights. Ben Baker is 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). Ben also hosts the iHeartRadio and Spotify syndicated YourLIVINGBrand.live show, with more than 265 episodes.

Member Profile

SMC Packaging Group: ‘Open. Transparent. Honest. Successful’ BY STEVE YOUNG

COMPANY: SMC Packaging Group ESTABLISHED: 1972 JOINED AICC: 1975 Photos courtesy of Southern Missouri Container.

PHONE: 800-999-7666 WEBSITE: www.smcpackaging.com LOCATIONS: Springfield, Missouri; Kansas City, Missouri; Conway, Arkansas; Tulsa, Oklahoma The SMC team, from left: Matthew Massey, operations manager; Matt Wallace, planning manager; Randy Bachus, executive vice president; Bryan Vote, national accounts manager; and Kevin Ausburn, chairman and CEO. (Not pictured: Mark MacNay, senior vice president and general manager; Rich Bachus, president and chief operating officer; and Matt Ausburn, chief financial officer.)

n 1972, two entrepreneurs from Hoerner Boxes’ Springfield, Missouri, corrugator plant founded Southern Missouri Containers (SMC). Ross Ausburn and Charles “Chuck” Bachus both started in the industry at Hoerner’s plant in Sand Springs, Oklahoma, and later moved to its Springfield location. As the story goes, Bachus, then sales manager, went into Ausburn’s office to give him the news that he wanted to branch out on his own, at which time Ausburn, the general manager, presented him with a copy of his own business plan to do the same thing. As Kevin Ausburn, Ross’s son and now chairman and CEO

BOXSCORE November/December 2021

of the company, tells it, “They really hadn’t talked to each other about starting a business prior to that time, but that started a conversation that, ‘we need to do this together.’ That was the birthing, or genesis, of Southern Missouri Containers on February 1, 1972.” Today, SMC Packaging Group, created to tie all the individual companies under one name for branding purposes, is a $155 million company with nine production and warehouse locations across Missouri, Arkansas, and Oklahoma, producing 1.4 billion square feet of board annually. Its 550 employees work in its four principal

OWNERS: Kevin Ausburn

divisions: Southern Missouri Containers’ main facilities in Springfield; Wonder State Box in Conway, Arkansas.; Arrowhead Containers in Kansas City, Missouri; and Sooner Packaging in Tulsa, Oklahoma. At its Springfield operations, SMC occupies four buildings with 669,000 square feet under roof. The company houses its 98" Fosber corrugator in 135,000 square feet on North Belcrest Avenue, plus another 16,000-square-foot warehouse, also on North Belcrest. On Division Street, a finished-goods warehouse contains 103,000 square feet, and its new, expanded location on East Progress

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Place contains 415,000 square feet. The long-term view, says Ausburn, is to consolidate all its Springfield operations into the East Progress Place location. In Kansas City, Arrowhead Containers, a sheet plant, operates in 85,000 square feet, with another 70,000 in an off-site warehouse. Wonder State Box, also a sheet plant, occupies 130,000 square feet in Conway and 45,000 square feet in Harrison, Arkansas, while Sooner Packaging in Tulsa, a warehouse distribution site, is in 50,000. According to Ausburn, the four locations enable SMC’s geographic reach, which covers Missouri, eastern Kansas, Oklahoma, northern Louisiana, and western Mississippi. The company’s market area, he says, is made up principally of small to medium-sized manufacturers, with some nuances in each location. “Here in Springfield we’re dominated by small to mid-sized manufacturers, distributors, and a fair number of locally owned businesses,” he says. “We do have a number of Fortune 500-type companies in the area, but that’s not really the market we go after.” Ausburn said Kansas City is a “larger company” market, and SMC’s sheet plant there—Arrowhead Containers—leans toward a higher graphic mix and, oddly, larger order quantities than the company’s other plants. In Conway, SMC’s Wonder State Box division serves an entirely different mix, says Ausburn. “Conway’s mix is probably more light industrial, agricultural, and forest products-based,” he says. “It’s a good market.” Operating Philosophy: ‘Open and Transparent’ SMC’s operating philosophy will be familiar to all independents in the box business. “It’s very customer-focused,” Ausburn says. Reflecting on the company’s early years, Ausburn says, “We started the company with a few key accounts, as I’m sure all independents

THE ENDURING LEGACY OF HOERNER BOXES In 1920s Keokuk, Iowa, a young man by the name of Corydon Rich, who owned the Purity Oats Co., saw an opportunity to package his company’s oats in corrugated fiber shipping boxes rather than wooden crates. So Rich backed a young entrepreneur by the name of James “Jack” Hoerner in the creation of the Iowa Fibre Box Co. Hoerner quickly brought in his younger brother, Richard “Dick” Hoerner, to join the company, and the two formed Hoerner Boxes. The long legacy of Hoerner Boxes can be seen today in AICC member companies such as SMC Packaging Group, Sumter Packaging, Packaging Express, Golden Bear Packaging (now Kaweah Container), and many other independents in our industry. They all share a common bond of founders and owners whose early training was the “Hoerner Way.” In the case of Southern Missouri Container (SMC), its founders, Ross Ausburn and Charles “Chuck” Bachus, began working together at the Hoerner plant in Sand Springs, Oklahoma. Later, and independently, they ended up working together again in the company’s sheet plant—which they subsequently built into a corrugator plant—in Springfield, Missouri, and it was during their tenure there that they formed a partnership in their new venture, SMC. Chuck Fienning, former president and owner of Sumter Packaging in Sumter, South Carolina, and a past chairman of AICC, reflects on the Hoerner Boxes influence in his career. His mother was a Hoerner—a sister of Jack and Dick— so he had close family ties to the business. “Hoerner’s legacy spawned a host of AICC member companies,” he says. “My uncles were courageous entrepreneurs who know how to recruit, train, motivate, and retain good people.”

Fienning’s father, Ed, worked for Hoerner from 1938 until 1958, when he ventured out on his own to start Kankakee Container in Kankakee, Illinois, and then, in 1980, founded Sumter Packaging. Fienning credits Hoerner’s innovative and forwardthinking operating philosophy for its success. “Uncle Dick initiated the industry’s first profit-sharing plan that set up company-managed accounts for associates from the executive ranks to the hourly people on the shop floor,” he explains. “Hoerner’s sales compensation was based on the gross profit on the sale, not on the gross sales dollars. It encouraged profitable sales at all levels of the company, including national accounts.” Jim Davis, former vice president of sales for DeLine Box Co. in Denver and founder of Packaging Express in Colorado Springs, says, “The Hoerner history is truly a legacy for many a box plant.” Davis, also a past chairman of AICC, recalls his acquaintance with the founders of SMC Packaging Group: “I was fortunate enough to know Ross Ausburn and Chuck Bachus, and you can see why they were successful: great people persons, very hospitable, and genuine!” The 1950s and ’60s in our industry’s history saw the beginnings of consolidation and acquisitions of independents by larger firms. In 1966, Hoerner Boxes merged with Waldorf Paper Products Co. of St. Paul, Minnesota, to form Hoerner-Waldorf Corp., and in 1977, Hoerner-Waldorf was acquired by Champion International. Champion was later acquired by Stone Container Corp. Subsequent mergers and acquisitions resulted in the company we know today as WestRock.

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Member Profile

Kevin Ausburn, chairman and CEO, in SMC Packaging Group’s new expansion on Progress Place, Springfield, Missouri.

do,arnd it was, ‘Take care of them at all costs, and it will work out in the long run.’ “We have always been focused on being open and transparent with our employees, to be honest, open with the customer— tell them what you can do, and do it, and don’t tell them something you can’t do,” he adds. “I think that’s served us well over the years.” Over in Kansas City, Vern Bennett, general manager of SMC’s Arrowhead Containers division, agrees, saying, “Our philosophy is more about service and quality. How can we make life easier for our customer?” That same service and relationship ethos is also apparent at Wonder State Box in Conway. “Our customers have been very loyal, based on relationships and on a handshake,” Ausburn says. “We still operate that way. Just sit down, work out the particulars, shake hands, and let’s do business. It’s a very good customer base.” Equipped to Serve Like many independents, SMC’s namesake, Southern Missouri Containers, began operation in 1972 with an assorted mix of used equipment typical for a startup sheet plant. “We had a slitter, a taper, and a Koppers two-color

BOXSCORE November/December 2021

rotary die cutter. That was a big investment for us,” Ausburn recalls. The Koppers die cutter lived a long life at SMC, Ausburn says, serving in Springfield and, later, Kansas City, until it was replaced and sold earlier this year. “It was nearly 50 years old, but that’s how we did it back in the early days: buying used equipment and trying to get as much as you can out of it—squeeze as much production as you can out of it and keep it operational.” Ausburn credits their crack maintenance team for the equipment’s longevity, saying, “We had some on-the-job maintenance people who could fix anything from a tractor to a rotary die cutter to the HVAC system. We were fortunate to have people who were very economical; they wouldn’t spend a lot of money to keep us operational.” SMC maintains this approach, as its Wonder State division still employs a similar-vintage Koppers flexo folder gluer. As SMC grew, driven by a talented team of sales professionals, customer needs demanded newer, faster, and better equipment. “Our sales group could sell anything—we’ve always been more sales- than production-oriented— but over time we realized that you can only serve your customers with used

equipment for so long, and eventually, you have to invest in new to assure quality for the customers and improved safety for our employees. We had to make that jump.” SMC’s North Belcrest location houses its 98" Fosber corrugator producing B, C, E, and BC/EB doublewall board. Among the printing, die cutting and finishing equipment also in Springfield are: a Latitude Mini 27" x 71" three-color flexo folder gluer; a BW Papersystems 50" x 113" two-color flexo folder gluer; Hycorr 66" x 115" two-color rotary die cutter; Hycorr 66" x 135" four-color rotary die cutter; BW Papersystems 16000 G-Grafix six-color rotary die cutter with four outside and two inside color capability, and a BW Papersystems 16000 G-Grafix 66" x 125" three-color flexo folder gluer with two outside and one inside color. The printing presses are also equipped with JB Machinery dryers. Rounding out the mix are a Latitude Jumbo 89" x 189" two-color rotary die cutter, an Automatan large-format labeler, an IMG Maxcut autoplaten die cutter, and two specialty folder-gluers: a J&L Mark 5 190" and a Bobst Expertfold 300. The investment philosophy apparent in Springfield’s equipment arsenal is duplicated in Kansas City and Conway, with slight variations in each. In Kansas City, the equipment mix is tilted toward its higher graphics market, with a BW Papersystems 16000 G-Grafix two-color rotary die cutter, a BW Papersystems 38" x 96" two-color flexo folder gluer with diecut section, and a BW Papersystems 66" x 115" four-color rotary die cutter with JB Machinery dryers. Complementing these are an Automatan 4260 labeler, a one-cut auto flatbed die cutter and a Bobst Expertfold 300 specialty folder gluer. SMC’s sheet plant in Conway is similarly equipped to serve its market’s unique customer base, with a Hycorr

Member Profile

66" x 115" two-color RDC, an Apstar 66" x 126" two-color rotary die cutter, the Koppers 66" x 110" two-color flexo folder gluer, and a J&L specialty gluer, among other machines. Beyond the physical equipment in each location, SMC links all its locations with its internal information system, and all corrugator and converting order entry systems are linked via Kiwiplan scheduling and real-time order tracking for on-time customer delivery. A Cohesive Culture, a Team Spirit When asked about the people of SMC Packaging Group, Ausburn simply says, “We don’t have a lot of people that think of coming to work as a job. We’re not punching the clock at 8 so we can get home at 5. People come in and

they do what they need to do to get the job done.” Ausburn credits this attitude with the culture their management team has created over the years. “We’re not really good strategists,” he admits, “but we’re big on culture. We’re big on making sure that our employees have the tools to do their jobs, and to do their jobs successfully. They’re excited about coming in to work.” The management team assembled at SMC’s Springfield headquarters is generational. Ausburn, a second-generation owner, is joined by President and Chief Operating Officer Rich Bachus and Executive Vice President Randy Bachus, both sons of founder Chuck Bachus. Kevin Ausburn and Rich Bachus both joined the company in 1982, and Randy joined in 1987. Preceding them all in his

tenure with SMC is Mark McNay, who joined the company in 1978, right out of college. In Ausburn’s words, McNay is “a very, very valuable member of our team—a planner extraordinaire.” In Kansas City, Bennett is a 26-year veteran, and in Conway, General Manager Jimmy Toal joined in 2017, coming with 30 years of corrugated experience. And at the Sooner Packaging distribution center in Tulsa, General Manager Gary Robinson is celebrating 20 years with the company. There’s also a third generation of family involved in SMC: Kevin’s son Matt Ausburn has been with SMC over 10 years and is chief financial officer and a member of the board of directors. Melissa Ausburn, Kevin’s daughter, has been with the company for over three years in its graphics

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Member Profile

seek the commensurate space in which to accommodate it, and that, says Ausburn, is not always a straight-line path. “We started at that building over on Belcrest, added on to it a couple of times; we buy a facility next door, then we lease some space, lease some more space, buy a building, and before you know it, we’re sitting here with five or six facilities, trying to run a business.” Ausburn says the process drove them to seek a consolidation of the properties into a larger, more efficient layout, and that led them in early 2020 to their newest location on East Progress Place in the Springfield Partnership Industrial Vern Bennett, vice president and general manager of SMC Packaging Center. “It was a three- to four-year Group’s Arrowhead Carton division in Kansas City, and the plant’s BW PaperSystems G-Grafix 16000 two-color flexo folder gluer with process, but next thing you know, we die-cut section. find this space here, and it was a pretty big leap for us at the time on a cost department, coordinating branding and we have.” Ausburn explains that the standpoint, an acreage standpoint, social media efforts. ESOP owns 25% of SMC Packaging and construction schedule,” he recalls, The long-tenured firepower enjoyed by Group, and all employees, once they’ve adding that past decisions required the SMC attests to the leadership’s commitsatisfied the minimum age and service same “leap of faith.” ment to openness and transparency with requirements, are automatically enrolled. “It was like our decision to upgrade the team. Aiding this cultural advantage “They start getting a growing ownership our corrugator years ago, to go from are targeted financial incentives as stake in the company,” he says, explainour old Langston fingered machine to well: an employee stock ownership plan ing that although the company has our high-speed Fosber,” he adds. “We (ESOP) as well as incentive plans still traditional retirement plans such as a just had to make that leap of faith and resembling those employed by Hoerner 401k, the ESOP is the one whose value push beyond the concerns, realizing Boxes, the training ground for the each employee can directly influence. “I that we had a good team backing us up company’s founders (see sidebar, “The tell our employees, ‘The ESOP is the and some opportunities we had to take Enduring Legacy of Hoerner Boxes”). one retirement vehicle that you can advantage of. So we charged ahead with Referring to the company’s early days, control how that investment performs this building.” Ausburn credits the timeless effectiveness every day when you come to work. With The transition hasn’t been without a of the Hoerner Boxes incentive system the ESOP, every day you’re working and few sleepless nights, Ausburn says. “We with driving the company’s profitabileverything you’re doing on your job had this construction going on, adding ity. “We’ve been bottom line-oriented, has an impact on how the company is 250,000 square feet to the building; we incentive-oriented, going back to the old performing, how profitable we are, how had three pieces of equipment coming in, Hoerner system,” he says. “That commiswe’re growing, and how we’re valued at and then COVID hit. We said, ‘Oh my sion and incentive system that drove the the end of the day.’ ” gosh, what have we done?’ ” Hoerner organization drives us today.” The fears were short-lived, Ausburn Discussing the ESOP, Ausburn calls Growth and Future says, because shortly after a “wobbly” it “a big underlying theme that ties us SMC’s trajectory of growth through its first quarter of their fiscal year, business all together.” We’re very big on being nearly 50-year history reflects that of “took off like a rocket.” Ausburn says transparent to people—how we’re many companies in the industry. “We’re had they not pushed ahead with the doing, what we’re doing, what we see like a lot of independents,” says Ausburn. move and expansion, SMC would not coming down the road, the investments “We’re all opportunists.” Seeking opporhave been able to take advantage of the we’re making, and the challenges that tunity has driven the company to also surge in demand. “We wouldn’t have

BOXSCORE November/December 2021

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Member Profile

been able to handle the growth we experienced in 2020 if we hadn’t done the expansion. It set us up, timingwise, just perfectly.” The growth in box demand aside, the pandemic affected SMC in adverse ways as well. One of Ausburn’s major frustrations was the curtailment of the company’s regular quarterly meetings with all employees. “We’ve been doing that for 25 years,” he says. “COVID hit, and that’s turned us upside down. It’s been awkward here the past year and a half.” Randy Bachus echoes Ausburn’s concerns from a sales standpoint, saying, “The major challenge this past 18 months has been shifting the sales process from in-person, face-to-face business transactions to video meetings, phone discussions, and email. We sell solutions, and when you are unable to physically see the customer’s challenges, we have had to learn to adapt.” Yet, he also lauds the sales team’s ability to transition as well as the loyalty of their customers during the pandemic: “Our major accomplishment has been that we must have adapted, as we have had continued growth in spite of these challenges. We have been fortunate to build a network of customers providing referrals, and I believe this has been a part of the 50 years of success we have enjoyed.” Community and Industry SMC is an active participant in the communities it serves. Ausburn and his team are firm believers that the “network of referrals” alluded to by Randy Bachus earlier is a direct result of visibility in and service to their local cities, towns, and counties. “A large reason for our success is the community we operate in,” Ausburn says. “You don’t operate in a vacuum; we feel like it’s important to give back to our community not only financially but with our time.” Ausburn lists Chambers of Commerce, charitable

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organizations, and local foundations to which he and SMC employees have contributed. “You’re not doing your full role if you’re not helping your community to grow and prosper.” As with the company’s involvement in the community, the Ausburn and Bachus families have also been actively engaged with AICC and other industry organizations. Ausburn’s father, Ross, was active on the AICC board of directors in the 1980s, and Kevin Ausburn has followed suit, serving in the past as an AICC regional director and currently as a director at large. “Ross [Ausburn] and Chuck [Bachus] were very supportive of AICC,” he recalls. “They joined a couple years into the Association’s founding, and one of the big benefits they believed in was being connected to other people that are doing the same thing we are, fighting the same battles, and learning from them.” Pointing to specific examples, Ausburn says, “Anytime I’ve been in another member’s facility or talk to other AICC members, it may not be a major thing, but I’m always picking up something to bring back and say, ‘You know, we can do that,’ or it turns on a light bulb that says there’s a way we can deal with a particular type of issue.” Future View As SMC Packaging Group looks forward to its 50th anniversary next year, Ausburn remains bullish about the state of the corrugated industry. “I’m probably as excited about the box business today as I have ever been since I started in it in 1982,” he says. “In fact, I’m pretty optimistic about manufacturing in general.” Noting the pandemic-induced backlogs in the supply chain, he predicts more manufacturing will return to North America, a development he sees as good for the corrugated industry. “We went through that cycle where everybody was going to Mexico to manufacture or

Southeast Asia or China, but now we realize that those long supply chains and all the events that can happen around the world—whether economic events or health events like the pandemic—can really impact on your ability to take care of your customer. We need to get manufacturing resources back closer to the customer, and that’s going to benefit the box business.” His optimism notwithstanding, Ausburn remains methodical and measured about SMC’s growth. “We don’t just go out on a lark and buy a six-color machine just because it’s the latest, greatest and the hot toy that everybody needs,” he says. And noting that this go-slow approach has afforded them the luxury to evaluate various investment options, he says, “Whether it’s high-speed flexo folder gluers that have all these capabilities, ‘Is this really a need we have? Maybe, maybe not.’ But at least we can think about it and reasonably consider it, whereas years ago, it would have been outside the realm of possibility.” SMC Packaging Group’s successful growth has been built on a solid foundation of honoring its heritage, building a culture of transparency and honesty with its employees and customers, continued investment in equipment, technology and resources for growth, and dedication to its communities. Yet, as much these SMC core ideals have played a key role in the company’s growth and success, Ausburn is careful to maintain his basic entrepreneurial instincts: “We’re not a bleeding-edge company,” he says. “We’ll let someone else do the bleeding, and then we’ll try to figure out what we can do to make money with it.” Steve Young is AICC’s ambassador-at-large. He can be reached at 202-297-0583 or syoung@aiccbox.org.

Machinery and Handling for the Corrugated Board Industry

BUILDING BETTER BOXES Effective collaboration with customers and your team is key to award-winning packaging By Robert Bittner

BOXSCORE November/December 2021

“F

or me, the critical aspect of getting a package right is understanding that it’s a collaborative effort between the box plant and the customer,” says Jay McMillan,

account representative with Utah Paperbox. “Award-winning boxes are the result of the seamless collaboration between art, function, and production techniques.”

It’s a collaboration often involving multiple departments, proven processes, keen innovation, and an overarching commitment to customer service. And it all begins with a conversation.

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Bleed Area Turn In

Design Area - lid face

Image courtesy of Michigan City Paper Box.

Clarifying the Vision Whether in person, via email, or virtually over a computer screen, the initial meeting between boxmaker and customer establishes the framework for everything that follows. “Every box and every customer’s goals are different,” McMillan says. “Our goals when we first discuss a new package are to understand the customer’s marketing and branding plan, how they want that box to be received, and whether they’re going to distribute the box directly to a consumer or if it’s going to be retail display. All of those ideas are discussed at length, setting the expectation of what that box needs to be and how it needs to function to achieve the overall goals.” “We’re trying to understand the sizing of the package, the artwork, the type of materials we’ll need, and the substrate thickness we’ll need based on the weight of the product,” explains Keith Thomas, director of strategic initiatives and business development for Michigan City Paper Box, which focuses exclusively on rigid boxes. “Customers don’t typically come in requesting a specific weight of chipboard; that’s determined by the needs of their product, budget, and so on. So we need to help guide them to the best solution from a structural standpoint.” Once a boxmaker understands the dimensions, the weight, and what the customer wants to achieve from a branding perspective, the concept moves to the in-house designers, who will typically produce a computer-based model and physical samples for the customer’s review

Michigan City Paper Box’s structural design templates are key to creating perfect rigid boxes on every project.

and approval. “Sometimes you get it right the first time,” McMillan says, “but most of the time there’s a back-and-forth conversation until we get to a structure that works for our manufacturing and works for the customer’s overall branding and concept.” It Takes a Team Multiple departments get involved to make sure each new design functions effectively and meets or exceeds the customer’s needs. At Utah Paperbox, representatives from sales, customer service, design, and

“We believe there’s a better way for every solution. … It’s not just design for design’s sake: It carries over into improved sales and customer service.” —Brian Romankow, design and innovation manager, DS Smith North America

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prepress are typically involved, along with the in-house team responsible for fabricating the cutting dies and tooling. “Each of these people checks over the designs and artwork to make sure they can be produced, cut, creased, and glued properly,” McMillan explains. “Five people, minimum, to get the box from start to production-ready. However, it’s likely even more than that, because we have meetings where the heads of each department come together and review all new jobs.” The department-head review is an integral part of the development process. Because of the group’s collected years of experience with the company, McMillan says, “they can look at a project and say, ‘Yeah, that’s a great concept in the design, but maybe it would function better if we changed this one key feature.’ Or, ‘Maybe it would go through our glue line a little quicker if we can change this.’ So, realistically, 10 to 12 people are

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Inspired to Innovate It may seem that the combination of budget and production limitations, along with an established approach to new-product development, might lead to cookie-cutter results. Yet the boxmakers gaining recognition are finding there is still room for innovative, out-of-the-box design solutions. “We are constantly innovating to find new ways to meet customer requests,” Thomas says. “For example, the chipboard substrate we use in rigid boxes is becoming more difficult to acquire. So we’ve begun working with microflute corrugated providers to manufacture our boxes from an F-flute material.” In addition to addressing the material shortages, Thomas notes, “the material we’re using has greater strength than the equivalent thickness of chipboard material, plus it’s lighter in weight.” Not surprisingly, it is an innovation that has proven particularly attractive for e-commerce. Brian Romankow, design and innovation manager with DS Smith North America, adds, “We believe there’s a better way for every solution. By empowering our designers to always challenge the status quo and design for performance and sustainability, our portfolio of award-winning designs is growing. It’s not just design for design’s sake: It carries over into improved sales and customer service.” A commitment to innovating in sustainability has led DS Smith to

BOXSCORE November/December 2021

Image courtesy of DS Smith.

involved in getting a design from concept to production-ready.” To ensure that all of those contributors are staying on track, the company has developed a list of safety checkpoints requiring customer signoffs throughout the process. Says McMillan, “Those checkpoints ensure that, No. 1, we are producing what we say we’re going to produce; and, No. 2, that the customer is going to get what they are expecting, so there are no surprises at the end.”

DS Smith’s proprietary “circular design principles” ensure a design process that maximizes efficiency and sustainability.

develop its proprietary “circular design principles,” an integral and critical part of its overall design process. “Our circular design principles ensure that we’re optimizing sustainable metrics such as reuse capability, carbon-emission savings, fiber savings, supply-cycle optimizations, or pallet optimizations, to name a few,” says Romankow. The first principle is to ensure that the box or pack being made is both

fully functional and optimized for sustainability. The second is to optimize the materials, having the right paper combination, supply chain information, and performance requirements. “We have access to state-of-the-art design tools to help us determine the right materials and the right balance of materials,” Romankow explains. “Third,” he says, “we look at maintaining and recovering materials, a key step

“Determining the structure of a new rigid box is pretty straightforward. But it’s conveying the branding message— through art, print, papers, and graphic treatments—that requires the most iterations to get just right.” —Keith Thomas, director of strategic initiatives and business development, Michigan City Paper Box

in designing for a circular economy. We ask, ‘How can I repurpose this packaging?’ and ‘How can I reuse this package?’ Before we even think about recycling, we’re thinking about all of the other ways to get more use out of the box. Can the box be sent back and used over again? Will it be easier to recover or recycle materials if we replace plastics or other materials with something else? “The fourth principle is to maximize supply-cycle efficiencies. Supply-cycle information is critical to what we do because we need to understand what happens to the box when it leaves our manufacturing sites. If we don’t understand that, we can’t help to optimize the new solution. “Finally,” Romankow says, “we continue to explore efficiency gains in the manufacturing process through fiber reduction or palletization strategies.” Although such a comprehensive approach may not be feasible for every boxmaker, everyone can take a close look at their own design-development process and seek ways to move beyond the traditional or the familiar. “It’s easy to get caught up in the cycle of producing similar designs,” notes Stevan Matic, sales manager with Great Little Box Co./Ideon Packaging. “So when an opportunity for structural/print innovation presents itself, take a step back. Start with a clear mind, a fresh perspective, and invite multiple ideas from your team. That’s what allows for innovation.” Watching the Clock There is no set schedule when it comes to building a better box. Matic notes that his team works to turn around corrugated and folding-carton designs within 24 to 48 hours. “More intricate designs,” he says, “mostly displays and protective packing, can range from two to five days.” He believes this kind of responsiveness is critical in today’s marketplace. “Speed to market has never been more important,” he says.

At the same time, some steps in the designing. Otherwise, you have designers process may be out of the boxmaker’s who create things in Illustrator and control. “I’ll have a customer email me Photoshop that look great on a computer six months after we created a design screen, share them with a client, and raise and tell me they’re finally ready to pull the client’s expectations—only to find out the trigger and get it going,” McMillan that, from an implementation or cost perreports. “Others are trying to rush spective, they’re just not feasible designs. through all of the work within a week It’s easy to mislead a client into thinking because they need the box a month from that something is manufacturable when, today. So it’s part of our customer service in fact, it’s not. Or the economics are and sales teams’ responsibility to manage such that it’s not. Understanding machine that expectation with the customer capability is crucial to package design.” upfront, to make sure everyone underRomankow suggests that companies stands and agrees to the timeline.” continue striving to go above and For Thomas, the step that requires the beyond—even after the box has left the most time involves meeting the customplant. The final element in DS Smith’s er’s expectations regarding the branding detailed development process is somemessage. “Determining the structure thing the company calls “deployment.” of a new rigid box is pretty straightfor“We follow the package throughout its ward. But it’s conveying the branding life cycle,” Romankow says, “continuing message—through art, print, papers, and to work with the customer to make graphic treatments—that requires the improvements and refinements.” most iterations to get just right. People In other words, a DS Smith box is never come to us and say, ‘I have this product, truly finished. Even after a box enters the and I want to make a package for it,’ in supply chain, the company continues to which case you are starting at ground zero. explore ways to make a great box better. Other times, people have a design agency that has already constructed renderings No One Formula and outlined the branding message. In “I can’t say for sure what makes an those cases, you’re able to go right into ‘award-winning’ package,” says McMillan. the quoting phase.” If you’re starting However, companies that excel likely from zero, however, “the process can take share several similarities to what he has a couple of weeks to go through several experienced at Utah Paperbox. iterations of samples.” “We keep our employees for a long period of time, so we know the industry Award-Winning Insights very well. We can see a concept that a When asked what insights these customer is going for and come up with award-winning boxmakers wanted to an innovative solution. We have excellent, share with their fellow AICC members, creative designers. And I think we just thoughts turned to the importance like to push ourselves. We like to create of broad education and exceptional unique concepts that did not exist before customer service. and push the envelope of innovation.” Thomas says, “When it comes to effective and innovative package Robert Bittner is a design—particularly with domestic Michigan-based freelance manufacturing—I think it’s important journalist and a frequent that designers be given the opportunity to BoxScore contributor. visit factories and understand the equipment that’s making the packages they are

BOXSCORE www.aiccbox.org

BOXSCORE November/December 2021

EXPECT THE UNEXPECTED As daunting as it has been, COVID-19 is only the latest reminder that manufacturers must be ready to pivot at all times By Lin Grensing-Pophal

hile it’s fair to say that no organization was prepared to respond to the emergency of COVID-19 in early 2020, some organizations moved more quickly than others to address, and adapt to, the massive impacts the virus created—from the need to send employees home to work remotely, to fluctuations in demand for products (both up and down), to concerns over personal health and safety amid the uncertainly. Acme Corrugated Box, though, acted quickly to communicate with

clients and supply partners. In a March 13, 2020, message they said: “We assure you that we are fully operational and are taking the proper precautions in order to maintain safe operations to support your supply chain efforts.” That initial message was followed up by additional messages on March 18 and March 20—and the announcement of a “Thank You Rally” for the company’s production crew, held with appropriate safety precautions and social distancing on April 17, 2020.

BOXSCORE www.aiccbox.org

Concerns over supply chain disruption were among the first to emerge during the pandemic, as companies and organizations of all sizes—as well as individuals—worried about whether they would continue to have access to the supplies and resources they needed to operate, and survive. “You can’t plan for something like this—you really have to roll with the punches,” says Bob Cohen, president of Acme Corrugated Box. “I think we reacted as best we could from the beginning to protect our employees and to keep running continuously.” Acme was, of course, considered to be crucial to the supply chain. And while Cohen says business dropped off in the beginning of the pandemic, it took off considerably in June. But, Cohen says, while businesses can’t plan for specific impacts such as a worldwide health crisis, what they can do is “always be prepared for the unknown.” Because whether it’s a pandemic, an economic downturn, a gas shortage, a hurricane, or any other of a vast number of natural and manmade disasters that businesses are always subject to, there are certain key considerations that need to always be top of mind: • Employees. How will the situation impact where and how they work, and their personal safety? • Customers. How will the situation impact their ability to get the products and services they need, and their personal safety? • The company. How can the organization remain operational and viable? • The community. How will the situation and the company’s ability to respond quickly and appropriately impact the local community and economy? John Kochie is general manager at Acme Corrugated Box. Acme, like some

BOXSCORE November/December 2021

“The unfortunate reality is that it’s not a matter of if a company or brand will face a crisis, but rather when their brand will face an issue.” —Jo Trizila, founder and CEO, TrizCom Public Relations and Pitch PR other companies, had contingency plans in place for more than three years prior to the pandemic, generally addressing the steps and actions it would take in the event of a disaster, says Kochie. But, says Cohen, “I don’t think you can anticipate every bad thing that can come down the pike. I think you just have to have your company be strong enough to survive a blow of any type.” Taking Steps to Be Prepared “When our phone rings, one of the first questions we ask is, ‘Do you have a crisis plan?’ ” says Jo Trizila, founder and CEO of TrizCom Public Relations and Pitch PR. “Nine times out of 10, the answer is no.” Every business must have a crisis management plan in place, she says. “The

unfortunate reality is that it’s not a matter of if a company or brand will face a crisis, but rather when their brand will face an issue.” Especially in an environment in which news travels faster than ever before, companies need to act fast. “The media— especially social media—waits for no one,” Trizila says. It’s fair to say that every company around the world discovered the wisdom of having a plan in place in March 2020. At a minimum, says Trizila, companies should consider the following questions to help them determine how prepared they are. If you answer, “I’m not sure” or “no” to any one—or more—of these questions, it’s a good indication that you need a plan: • Have you identified your organization’s potential risk areas?

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• Do you know who would be on your crisis team? • Have you ever sat down and thought about crisis worst-case scenarios? • Does your company have a prepared crisis communications plan? • Have you identified your internal and external stakeholder groups (such as investors, employees, vendors, customers, government regulatory agencies, suppliers, volunteers, board of directors, suppliers, service providers, local government, media)? • Have you performed effective crisis management simulation exercises? • Have you identified potential spokespeople in the event of a crisis? • Do you know who to call when a crisis occurs? Identifying any gaps can help you prepare for the worst. As you prepare, keep each of your key stakeholder group’s needs in mind.

WHAT YOU NEED TO BE PREPARED FOR TrizCom PR has handled a wide range of issues, says Trizila, who offers a list of the types of crises companies might be impacted by: • • • • • • • • • • • • • • • • • • • • • • • • • •

Pandemics Arrests Car accidents Corruption Deception Drug/alcohol issues Environmental hazards/damage Workplace violence Fraud Infringements Leadership issues Litigation Product tampering Security gaps Supply chain disruptions Terminations On and off-the-clock Rumors Injuries and fatalities Skewed management values Software failures Spokesperson misconduct Bank regulatory shutdowns Slips and falls Contagious diseases Food poisoning

Addressing Employee Need Acme paid premium pay for two months to help keep employees on the job. “We didn’t know what to expect,” says Cohen. “We didn’t know if people were going to get sick or how people were going to react.” But, he says, “Everybody kept working Trust is key, Kochie says. Employees because they saw a lot of their neighneed to trust that the organization has bors and friends laid off and going on their best interests in mind. Kochie feels unemployment.” At Acme, he adds, “the Acme did a good job here and notes that, pandemic kept people in place.” even during the height of the pandemic, But there has been employee instability, “there were never more than 19% of staff Cohen says, in response both to govcalling in to take time off.” ernment subsidies and the need of some Establishing a trusting and transparemployees to adjust to caring for others— ent culture requires personal support like school-aged children—during the and setting a personal example. Kochie’s pandemic as schools shut down. own personal actions had an impact, Kochie points to a family-focused culture he says—he showed up on the plant as key to helping companies remain profloor every day, something that both ductive and stable during a crisis. That has impressed and meant a lot to the certainly been a factor for Acme during the employees still working in the physical pandemic. A focus on culture, transparency, work environment. But, he stresses, the and trust are foundational to ensuring entire leadership group pulled together continuity during any type of crisis. to manage operations together in

BOXSCORE November/December 2021

• • • • • • • • • • • • • • • • • • • • • • • • •

Accusations Bankruptcy Accidents Data breaches Cybercrimes Murder Patent/trademark issues Employee misconduct Labor disputes Aviation accidents Social media incidents Weather-related events Regulatory issues Health and welfare Criminal activities Sexual abuse allegations Race relations/discrimination Accounting errors Terrorist attacks System failures Misrepresentation Illegal activities Faulty products Industrial accidents Executive/management misconduct

extremely uncertain times, and they couldn’t have done it without “our dedicated and outstanding workforce.” Addressing Customer Needs Communicating quickly and continuously with customers is a best practice for companies of all kinds—this certainly bore out during the pandemic. Customers want to know: • If your business is accessible and how—in person, via phone, email, text, etc.—to place orders and get answers to questions. • What safety precautions you’re taking relative to the crisis situation. • What, if any, changes in operations are or will be taking place.

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“Everybody kept working because they saw a lot of their neighbors and friends laid off and going on unemployment. [At Acme], the pandemic kept people in place.” —Bob Cohen, president, Acme Corrugated Box

• How you’re taking care of your employees—customers care bout that! • That you’re there to meet their needs and that their concerns are important to you. At Acme, “we knew we had to keep producing so we could keep providing boxes to the food service industry,” Kochie says. Acme communicated quickly and often to keep customers informed and up to date on what was happening with the company.

BOXSCORE November/December 2021

Addressing Company Needs Addressing company needs relates to issues such as how you will communicate with employees, customers, and others, how you will ensure that data and other employer resources are kept safe, how you will ensure continuous business operations, and, closely related, how you will project your bottom line. Addressing Community Needs Different types of organizations impact the community in different ways. Health

care organizations, for example, have an obvious impact on the community and those in it. Manufacturing companies also have community impacts, though. This might include such things as potential environmental impacts related to a disaster and how they are being addressed, economic impact if the company has to reduce staff or operations, or philanthropic contributions and participation in community-related corporate social responsibility initiatives. In each of the above areas—employees, customers, company, and community —manufacturing organizations should consider: • Areas where they face risk. What types of impacts could threaten the viability of your company? • Critical business functions that need to be able to operate no matter what. • Identify areas where you can proactively purchase and put in

place safety- and communication-related technology, and other resources based on your identified risks, to support a quick and flexible response to disaster. There are certain things every company can do now to prepare for future impacts. For instance, making sure that all data is backed up remotely. Ensuring that your business insurance policies provide the broad protections that you may need. Plan into your budget emergency funds that would be required to keep your company going for some specified period of time. In addition, identifying the go-to people and their related responsibilities for responding during a crisis, and the communication methods that would be used if current methods fail, can help you be in a better position to respond to all of your key stakeholders. Learning From Each Event An important best practice for companies dealing with crisis situations is not to move beyond the crisis without making an effort to learn from the experience. Kochie notes, “The pandemic definitely yielded some new insights about how to prepare for the worst.” One of those insights was that, yes, employees could work from home if need be. When the pandemic hit, he says, more than 90% of Acme’s office staff were suddenly working from home—“something that, before the pandemic, many would have likely said was impossible.” Reaching out to others—both during and after a crisis situation—can also be very instructive and very helpful, Kochie says. He found regularly scheduled calls with colleagues to be invaluable. No, you will not be able to proactively identify every specific crisis or calamity that might impact you, but what you can do is be prepared generally to hit the ground running when the worst happens. Kochie says, “We never could have predicted or prepared for the pandemic. Yet, by and large, we have survived it.” He credits the entire leadership team and outstanding workforce for their ability to weather this storm and to prepare for whatever may lie ahead. Lin Grensing-Pophal is a Wisconsin-based freelance writer and a frequent BoxScore contributor.

BOXSCORE www.aiccbox.org

2021

ANNUAL REPORT Strong market, strong programming, high demand, glimpses of normal

BOXSCORE November/December 2021

ICC completed its 2021 fiscal year on June 30. It was certainly an unusual year, one that began in the full grip of the coronavirus pandemic and ended with some hope in vaccines but concern with a rising Delta variant. AICC members adjusted to the new realities of COVID-19 and worked mightily to keep their employees safe, boxes in production, and machines and systems in operation. AICC programs that began with the lockdowns in spring 2020 continued, such as the weekly COVID Zoom conference and the Daily COVID Update webpage. As the year wore on, the topics and frequency of AICC’s member support efforts adjusted to the changing environment and to meet members’ needs.

National Meetings and Special Events As in the previous fiscal year, the pandemic scuttled an AICC national meeting, one scheduled for fall 2020—more than just an AICC meeting. September 2020 should have seen AICC and TAPPI jointly host SuperCorrExpo in Orlando, Florida. The event was postponed to August 2021. Despite the cancellation of AICC’s spring 2020 meeting in La Costa, California, and the postponement of SuperCorrExpo, AICC did conceive a way to keep a popular member deliverable. Tours of nearby box plants and supplier operations are hallmarks of most AICC in-person meetings. To keep that particular form of entertainment and education, AICC instituted a series of virtual plant tours. Members had the great pleasure to “visit” Dusobox, The Boxmaker, Utah Paperbox, Wasatch Container, and Packrite thus far in 2021. AICC appreciates these members for “opening” their

doors and expects to conduct more virtual tours through the balance of this year into 2022. During this time, AICC’s Emerging Leaders (EL) developed a “regional ambassador” program to create and highlight EL events across the country and to support AICC’s regional directors. They also began a monthly EL newsletter and conducted a free quarterly leadership webinar with various speakers. When SuperCorrExpo was postponed, we were all wondering: When will AICC members meet in person again? By the fall and winter, we had all become pros at Zoom conferences and communicating virtually. Doing so was reassuring, to be sure, but just not the same as being together. News of COVID-19 vaccines began to create hope that we could travel and book meetings once again. By the beginning of 2021, vaccines were being administered. AICC’s board of directors made the decision to proceed with the Southeast Summit at the Grandover in Greensboro, North Carolina, March 30–31. Southeast Regional Director Ben DeSollar was instrumental in making that happen. It was great to see 70 members and friends reunite. There was a tremendous spirit at the event, one that the shared tribulations of operating during a pandemic can bring. In typical AICC format, there were education and networking components to the summit. Unfortunately, the planned golf outing was done in by foul weather. Holding the Southeast Summit convinced the AICC board of directors of two things: that a meeting could be safely staged, and that AICC members were ready to travel and get together. As the vaccine program across the country

picked up speed, so, too, did the certainty that AICC would hold its national Spring Meeting in Amelia Island, Florida. On Tuesday, April 27, an emotional Mike D’Angelo opened the general session of the Spring Meeting, welcoming 350 attendees on site and another 150 attending virtually. AICC Chairman Jay Carman remarked that the meeting had a spirit akin to that experienced by members when AICC held its 2001 fall meeting in the aftermath of 9/11. Gratitude and the sense that, out of something tragic, we once again emerged stronger. It truly felt like a rebirth of the industry as members from across the United States came to Amelia Island. Due to travel restrictions, our Canadian and Mexican colleagues unfortunately were missing. AICC takes this opportunity to express gratitude to its members to the north and the south for their participation and contribution from afar toward what AICC accomplished for membership during this year. Throughout the early months of 2021, the rescheduled SuperCorrExpo was looming on the horizon. Postponed from September 2020 to August 2021, AICC’s board of directors and TAPPI’s Corrugated Packaging Council, along with the staff of both organizations, continually took the pulse of the respective memberships, communicated, coordinated, and ultimately decided to proceed with the event. As AICC’s fiscal year ended, plans were well underway for SuperCorrExpo. The event was held successfully and was conducted safely. Thanks to all who attended, and a special thank-you to AICC and TAPPI staff for staging the exhibition under the challenging conditions at the time. Coverage of SuperCorrExpo can be

found in the September/October issue of BoxScore. Or you can await the FY 2022 summary article, which will mention the SuperCorrExpo highlights and results one year hence. Education and Training AICC’s partnership with The Packaging School (TPS) to host AICC’s education programming online has now been a four-year success. With the advent of the pandemic, member use of AICC’s online education exploded. As members settled into a new normal, the number taking AICC’s courses online naturally subsided, but it remained well above pre-pandemic levels. AICC currently offers 113 courses through TPS, with more than 20 available in Spanish. AICC is adding a minimum of 10 new courses each fiscal year. For those who may not be aware, every employee of every AICC member company is able to access these courses at no cost, a member benefit included with the company’s annual dues. The strength of AICC’s online education was confirmed through the interest that other associations expressed in gaining access to some of the programming. The Latin American Asociación de Corrugadores del Caribe, Centro y Sur América (ACCCSA), and AICC entered into an agreement that granted ACCCSA members access to 20 Spanish-language AICC courses through TPS. AICC also entered into an agreement with the National Wooden Pallet and Container Association (NWPCA), jointly offering a program through TPS that combines the NWPCA Pallet Design System training with AICC’s Corrugated Basics courses for the benefit of members of both associations.

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The creation of these programs is consistent with the AICC board of directors’ call for AICC to seek out and maintain mutually beneficial relationships with other associations in the packaging space. AICC has also established a prospect site, which provides four TPS courses, so that nonmembers can easily access and sample one of the value propositions available with an AICC membership. AICC members averaged 696 logins per month during the fiscal year. Through June 30, members have completed 7,438 courses since the AICC/TPS partnership was introduced in spring 2017. Foundation for Packaging Education In spring 2020, AICC’s board of directors approved the creation of a second 501(c)3 education foundation as a complement to the International Corrugated Packaging Foundation (ICPF). The newly created Foundation for Packaging Education (www.packaginged.org) was launched in November 2020 with the mission to ensure that there will always be a source of funds to sustain AICC and other entities’ education programming for the benefit of those who are already employed in the paper-based packaging

industry. In contrast, ICPF’s support has been oriented toward two- and four-year education institutions that offer packaging-related curricula. As of the close of the fiscal year, the Foundation for Packaging Education had $1,139,008 in cash on hand and pledges totaling $1,415,700. This is due to the support and foresight of the foundation’s inaugural donors as of June 30: Michigan City Paper Box, Bay Cities, Jamestown Container, Oklahoma Interpak, SUN Automation Group, StandFast Packaging Group, DeLine Box, Harris Packaging, Package Crafters, Packaging Express, Wasatch Container, Central Package & Display, BCM Inks, Buckeye Boxes, L.D. Davis, Welch Packaging Group, Adducco Communications, McLean Packaging, Ox Box, JB Machinery, Kolbus, Haire Machinery, Arvco Container, Equipment Finance Corp., Southern Missouri Container, Akers Packaging Service, Tavens Container, Pamarco/Absolute, Royal Containers, Athena SWC, and A.G. Stacker. The AICC board of directors also approved a “million-dollar match” to be transferred to the foundation when pledges reached $1 million. The funds

were transferred to the foundation in June (more on this later in the financial portion of this report summary). Among the 113 courses now available at AICC’s Packaging School, included are courses created by AICC’s Education Investor partners: Fosber America, BCM Inks, SUN Automation Group, JB Machinery, Pamarco, Absolute Engineering, Printron, EFI, Krueger, Bobst North America, HP, and Stafford Corrugated Products. These partners contribute financial resources, technical materials, subject-matter expertise, and the necessary time and oversight to ensure technically viable, educationally appropriate programming. AICC appreciates the partnership of these member companies. Due to the pandemic, AICC’s education Xperience event was not held during the fiscal year. The two previous iterations, Digital Printing and E-Commerce, had proven to be very popular. As such, AICC is looking forward to renewing the Xperience in the new year. Publications and Advertising Revenue totaled $290,056, down from FY 2020. The components of the total

BOXSCORE www.aiccbox.org

were made up of $275,246 in website and print (BoxScore) advertising and $14,910 in publication sales. This represents a reduction in BoxScore advertising and about the same revenue for website advertising compared to the previous year. The reduction in BoxScore advertising is explained by several companies reducing the annual number of inserts compared to previous years, clearly a result of the uncertainty that so many members had when planning their budgets for 2021. There were solid sales across the range of AICC publications, but AICC’s Salary, Benefits & Hourly Wage survey was by far the most popular publication. Last year, AICC transitioned to all downloadable publications. There is no longer hard copy of any AICC publication available for sale. AICC Canada AICC Canada comprises Ontario, Québec, and the Maritime provinces. It is run by an independent board of directors, led by Don Duplantis of Royal Containers in Brampton, Ontario, who serves as AICC Canada president. The lockdowns in Canada lasted longer than in many places in the U.S., and AICC Canada programming was limited as a result. AICC Canada did refresh and launch its website. AICC Canada publishes its own regional membership directory and biennial salary survey. Terri-Lynn Levesque of Royal Containers serves as the Canada director on the AICC U.S. board of directors. For more information on the activities of AICC Canada, contact Renee Annis, administrative director, at 674-264-8674 or rannis@aiccbox.ca, or visit www.aiccbox.ca. AICC México AICC México is celebrating its 20th anniversary in 2021. Despite the pandemic, it has been a very active emerald anniversary year. Reaching

BOXSCORE November/December 2021

the membership virtually, AICC México staged 13 webinars, six seminars, and three forums, which drew nearly 1,600 participants. The membership continues to grow, with the total number of member companies approaching 50. AICC México also has a very robust and active EL program. AICC México is represented on AICC’s board of directors by Juan-Javier Gonzalez of Cartró SAPI de CV in Tepotzatlán, Mexico. For more information on the activities of AICC México, contact AICC México Director Maria Frustaci at 703-535-1382 or mfrustaci@aiccbox.org, or visit www.aiccmx.com. Executive, Governance, Cooperation, and Advocacy AICC continued its traditional collaboration with related industry trade associations, including the Technical Association of the Pulp and Paper Industry (TAPPI), the Fibre Box Association (FBA), Flexographic Technical Association (FTA), the American Forest and Paper Association (AF&PA), and others. Internationally, AICC maintains membership in the International Corrugated Case Association (ICCA), where it is ably represented on its board of directors by AICC Overseas Director Kim Nelson of

Royal Containers. AICC is a participant at many of these organizations’ meetings each year. Unfortunately, several were cancelled due to the pandemic, including FBA and ICCA. AICC also maintains a close relationship with the U.K. Sheet Plant Association (SPA), the European Federation of Corrugated Board Manufacturers (FEFCO), and the aforementioned ACCCSA. In terms of advocacy, AICC has partnership on Capitol Hill through its affiliation with the Council of Manufacturing Associations (CMA) which is an arm of the National Association of Manufacturers (NAM). Through the CMA, the interests of AICC’s manufacturing members are voiced. AICC is also a member of the Small Business Legislation Council (SBLC). D’Angelo became a member of the SBLC board of directors in 2021. As its name implies, the SBLC advocates on behalf of small businesses. The AF&PA advocates on paper and forestry related issues. These partnerships have come in handy during the pandemic, as AICC has been able to receive information from these organizations regarding worker safety, vaccinations, etc. And with the change in the U.S. Congress and the presidency in January, AICC receives information regarding all the new legislative initiatives and executive orders. Directly in our

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.

marketplace, many state governments have advanced legislation that makes extended producer responsibility (EPR) a reality. AICC shares all the information we receive with membership through the website and through the weekly newsletter, inBox. All the changes brought on by the new administration in Washington, D.C., have also revitalized the AICC Government Affairs Committee, ably led by Eric Elgin of Oklahoma Interpak. If you are interested in becoming involved in this committee, please contact D’Angelo at mdangelo@aiccbox.org. Membership Despite the uncertain market conditions and business environment, AICC welcomed 10 new general members and 12 new Associate members during the fiscal year. Dues totaled $1,573,001 in FY 2021, down marginally from $1,608,190 the prior year. The Association’s member retention rate was 94% against a target of 94%. The total number of AICC

member corporate entities, national and international, general, and Associate members, is 472. AICC general members are boxmaking members. AICC Associate members are suppliers of machinery, materials, ancillary equipment, and services to boxmakers. Financial Results Budgeting under the circumstances was difficult, as it likely was for all who read these words. The AICC had favorable results compared to budget on the administrative, membership (dues), and publication revenue lines and unfavorable results on the advertising, meetings, and education revenue lines (AICC did receive PPP funds). Due to the tremendous work of the AICC staff and the postponement of some events, AICC performed better than budget on all expense lines. In AICC’s financial statements, 2021 operating revenue was $160,065, which was favorable to budget by more than $150,000. Below the

Balance Sheet Year Ending June 30, 2021

FY 2021 (UNAUDITED)

FY 2020 (AUDITED)

3,988,224

4,974,384

Property & Equipment

446,469

462,581

Other Assets

202,057

157,337

4,636,750

5,567,302

1,143,154

1,724,572

Current Assets

TOTAL ASSETS Current Liabilities Long-Term Liabilities

200,077

158,273

TOTAL LIABILITIES

1,343,231

1,882,545

Unrestricted

3,568,291

3,682,491

Restricted Net Assets TOTAL LIABILITIES & NET ASSETS

1,966

4,636,750

5,567,302

Income Statement Year Ending June 30, 2021

FY 2021 (UNAUDITED)

FY 2020 (AUDITED)

TOTAL REVENUE

3,478,508

3,261,789

Operating Expenses—Program

2,457,037

3,078,685

Operating Expenses—Management

1,294,129 (includes $1M for foundation)

313,781

TOTAL EXPENSE

3,751,166

3,392,466

OPERATING INCOME

(172,658)

NONOPERATING INCOME TOTAL INCOME

BOXSCORE November/December 2021

(130,677) (687) gain/loss disposal only

(272,658)

(131,364)

operations line, net other income showed a loss of $423,723, which brought a net income loss of $272,658, compared to the budgeted amount of $37,805. An explanation of how AICC came to the total income loss is in order. Please recall that earlier in this article you read about AICC making a $1 million donation to the Foundation for Packaging Education for the board-approved million-dollar match for the first $1 million in pledges made. This donation was recognized in operating expenses, management, as a contribution. The Foundation for Packaging Education is a separate entity from AICC with its own EIN number. As such, this contribution flowed from one corporation, AICC, to another, the Foundation for Packaging Education. This contribution was not foreseen in AICC’s FY 2021 budget. Had AICC not made the million-dollar match, net income for the year would have been $727,342. The balance sheet also reflects this contribution when compared to FY 2020. AICC’s strong financial condition allowed the contribution to be made. AICC finances, long and short term, remain well funded and well managed by AICC’s Budget Committee. The FY 2021 figures shared come from AICC’s monthly financial statements, which are currently in the audit process. At the time of submission, AICC’s annual audit has not been completed. AICC’s audit numbers generally track the financial statements very closely. The audit will certainly be complete by the time you read these words. AICC’s auditor is Mullins PC of Bethesda, Maryland. AICC members who wish to receive a copy of AICC’s audited financial statements should send a request in writing to: Mike D’Angelo, President, AICC, P.O. Box 25708, Alexandria, VA 22313, or by email at mdangelo@aiccbox.org.

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SPECIAL SECTION

AICC EDUCATION CATALOG Take advantage of all the wonderful education provided by your Association—for free

AICC is the leading educator for independent corrugated, folding carton, and rigid box converters. The Association offers members virtual and live seminars, webinars, and in-depth conferences. Members also have access to nearly 100 free online courses, many of which are available in Spanish. When a company invests in professional development, it is an investment in the organization’s potential. Teams are equipped with shared knowledge that helps them perform at a high level, and the organization is positioned to attract and retain top talent—professionals who value continuous learning and career growth. See all the ways your team can grow.

WEBINARS AICC will offer more than 50 webinars over the coming months. Members can register for webinars individually, or the company can purchase the All Access Pass, which allows all of their employees to register for all webinars for only $1,695. Learn more about the All Access Pass at www.aiccbox.org/pass.

2021 December Maximize Your Professional Persona Using LinkedIn Wednesday, December 1, 2:00 ET Operations Leaders: Prioritize Your Team’s Time to Get More From Your Machines Thursday, December 2, 2:00 ET Critical Considerations Overlooked When Selecting New Converting Equipment Wednesday, December 8, 2:00 ET Empowering Others for Success Thursday, December 9, 2:00 ET

BOXSCORE November/December 2021

Leverage the Voice of Your Customers to Grow Revenue Wednesday, December 15, 2:00 ET

2022 January Do You Have the Right Sales Structure for the Future? Tuesday, January 11, 2:00 ET Folding Carton/Rigid Box/Microflute Webinar Series Wednesday, January 12, 19, 26, 2:00 ET Trouble Shooting 101: Requirements for Maintenance Professionals Thursday, January 20, 2:00 ET

Packaging Xperience

Packaging possibilities. A New Era. A New Xperience. March 1–4 | Kansas City, MO Xperience life from your customers’ perspective. For months, supply chain issues and labor shortages have impacted your ability to do your job and meet your customers’ needs. Their patience is wearing thin. This Xperience will show you how to maximize your machines and fine-tune your processes to put your company at the head of the pack. Registration opens this December.

Economic and Legislative Updates Impacting AICC Members Thursday, January 27, 2:00 ET

February How to Think Like an Owner: OTJ Judgment Training Wednesday, February 2, 2:00 ET Taking Control of the Corrugator Thursday, February 3, 2:00 ET Commercial Conversations That Lead to Revenue Tuesday, February 8, 2:00 ET

Professional Prospecting Tuesday, March 15, 2:00 ET

Maintenance Department 5S Thursday, April 21, 2:00 ET

Physical Attributes of Paperboard and Corrugated Wednesday, March 16, 2:00 ET

Troubleshooting Printing Problems Tuesday, April 26, 2:00 ET

How to Leverage Data to Drive Productivity and Improve Business Agility Wednesday, March 23, 2:00 ET Trouble Shooting Today: Collaborative Problem-Solving Thursday, March 24, 2:00 ET

Developing a High-Performance Team Thursday, April 28, 2:00 ET

May Accelerate Business Relationships Wednesday, May 4, 2:00 ET

How Do Leaders Become Coaches? Thursday, February 10, 2:00 ET

How Bundling and Unitizing Affect the Bottom Line Tuesday, March 29, 2:00 ET

What Testing and Requirements Are Best Suited in the Packaging Industry Wednesday, May 11, 2:00 ET

Maintenance Troubleshooter Core Knowledge Friday, February 11, 2:00 ET

Operations Leaders: Understand Your True Cost of Downtime and Take Action Thursday, March 31, 2:00 ET

Maximizing Productivity Through Effective Plant Scheduling Thursday, May 19, 2:00 ET

Don’t Play With My Pay: A Wage and Hour Update Wednesday, February 16, 2:00 ET

April

Managing Disability and Leave Issues Tuesday, May 24, 2:00 ET

March Learning to Set Print Impressions Thursday, March 10, 2:00 ET

Key Account Development Wednesday, April 13, 2:00 ET Material Testing and Why You Need It Now Wednesday, April 20, 2:00 ET

June Guaranteeing Board Strength Wednesday, June 8, 2:00 ET

2022 IN-PERSON SEMINARS The coming year will bring back in-person seminars that will allow your team members to have hands-on learning opportunities to maximize their productivity. Upcoming seminars include: » Flexo Fundamentals » School for Financial Managers

» Corrugator Training » Rotary Die Training

ONLINE COURSES Nearly 100 free online courses are available for all employees at AICC member companies. Log in and start learning at www.aiccbox.org/packagingschool.

New and Coming Soon » Accelerate Virtual Relationships for Increased Sales » Maximize Sales Results » Data Management » Top 5 Sales Skills

» How to Facilitate Margin Improvement » Corrugator Roll Alignment » Moving From Leadership to Management

» How to Engage, Retain, and Grow Employees » Maintenance: Facility Assessment » Maintenance: Strategies and Tactics

BOXSCORE www.aiccbox.org

Courses Certificate – Packaging Science

Industry

Corrugated Containers Fundamentals

Corrugated Basics 101: History and Industry Overview

Distribution Glass Packaging Introduction to Polymers Machinery Metal Packaging Package Printing Packaging Design Workflow Packaging Foundations Packaging Regulations Paperboard Cartons Sustainable Packaging

Customer Service How to Help an Upset Customer

Education Investors Benefits of ERP Software Solutions for the Packaging Industry Digital Transformation for Corrugated Printing Essential Principles of Water-Based Flexo Inks Optimizing the Flexographic Printing Process Rightweighting Rotary Die Cutting Operation The Corrugator

Finance Keeping Score: How to Read Financial Statements Understanding Accounts Receivable and Cash

Human Resources Corrective Counseling Designing Your Training Space Internal Staff Development Guide

BOXSCORE November/December 2021

Corrugated Basics 102: Corrugated Board and Its Uses Corrugated Basics 103: Manufacturing and Converting Corrugated Basics Bundle How to Audit a Corrugator Introduction to the Rigid Box Unit Load Design and Analysis Introduction to E-Commerce

Leadership Avoiding Antitrust Liability Communication for Coaches Delegation DIY From Management to Leadership Giving Motivational Feedback Go Team! How to Make Your Team More Productive How to Train Anyone to Do Anything Maximize Training ROI Mentoring Best Practices Navigating Time: Time Management for the Job Shop

Faster, Better, Smarter With Value Stream Maps Introduction to Lean Packaging Key Performance Indicators OEE for the Packaging Industry Project Planning: MAPP the Project for Success Proposals, Problems, and Projects With A3 Setup Reduction Standardized Work

Production Achieving Higher Levels of Productivity Fingerprinting the Flexographic Press Flexographic Print Fundamentals Flexographic Print Plates: Vol. 1 How to Spec a Corrugated Box Packaging Production Math Understanding Anilox Rolls Understanding Combined Board Combinations Warp, and How to Control It

Resources Packaging Math Test

Situational Leadership

Tracking Training Tool

Maintenance

Safety

Corrugated Roll Audit

Safety Basics

Implementing a Scheduled Routine Maintenance Process Maintenance Mapping Preventative Maintenance Optimization

Processes and Systems 18 Ways to Sell Value Build a Visual Workplace With 7S Convergent Selling Decision Trees: Knowledge Insurance

Spanish Cómo especificar una caja Cómo mejorar las ventas en esta nueva realidad Cómo optimizar la mpresión flexográfica Cómo realizar una auditoría a la corrugadora Comprensión de las combinaciones de cartón corrugado

Conceptos básicos de corrugado 101

Fundamentos de seguridad

Conceptos básicos de corrugado 102

Introducción al diseño de cargas unitarias de cajas a nivel de sistema

Conceptos básicos de corrugado 103 Creando un lugar de trabajo visual usando las 5s o las 7S Factores que afectan la resistencia a la estiba en los empaques de cartón corrugado Fundamentos de la impresión flexográfica

La eficiencia general del equipo (OEE) en la industria del empaque

Matemáticas para la producción de empaques Optimización del mantenimiento preventivo Pandeo y cómo controlarlo

La importancia de los empaques en el e-commerce, Modulo 1

Principios básicos de las tintas a base de agua para impresión flexográfica

La importancia de los empaques en el e-commerce, Modulo 2

Reducción de configuración Ventas exitosas en esta nueva era

ADVISORY GROUPS Advisory groups help your team members hone their skills. Peer learning is available for Emerging Leaders, production leaders, CEOs, and others at www.aiccbox.org/advisory.

SALES COHORTS COMING SOON Sales trainers Ed Wallace of AchieveNEXT Relational Capital and Mark Allen Roberts of OTB Sales Solutions are working with AICC to develop two confidential groups for sales professionals. One for managers and another for sales representatives. These groups, using data and relationship-building skills, will help managers hone their leadership skills, drive sales and profits through accountability, and develop stronger sales processes. Sales professionals will learn to maximize their prospects, strategic negotiation skills, and increase their share of wallet. Cohorts will meet virtually six times and once in person at an AICC national meeting. Cohorts will be limited to 20 people. To learn more or to join the waitlist for the groups, contact Taryn Pyle at 703-535-1386 or tpyle@aiccbox.org.

VOICE OF THE CUSTOMER

Given all the market changes and disruption we have seen over the last 18 months, understanding your customer is more critical than ever. AICC partner OTB Solutions will interview your customers and help leaders gather the data needed to make strategic decisions to continue to profitably grow your organization and improve customer experience. Teams that participate in this research will receive a one-hour data debrief with OTB Solutions CEO Mark Roberts, with recommendations based on actionable insights discovered and the research data file by the customer by question for business development in the future. Learn more at www.aiccbox.org/voc.

See all upcoming events at www.aiccbox.org/calendar. Questions about training and the value a well-trained workforce brings to a company can be directed to Taryn Pyle, director of education and leadership development, at tpyle@aiccbox.org, or Chelsea May, education and training manager, at 703-836-2422 or cmay@aiccbox.org.

BOXSCORE www.aiccbox.org

The Associate Advantage

Make the Most of AICC Events BY GREG JONES

JOE MORELLI HUSTON PATTERSON PRINTERS VICE CHAIRMAN JMORELLI@HUSTONPATTERSON.COM

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

E 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 November/December 2021

ngaged Associate and general members are reaping the benefits from a successful SuperCorrExpo® 2021! Not only were we rewarded with relevant and informative education sessions, but we were also able to reconnect in a safe and productive manner thanks to the efforts of AICC and TAPPI. I would be remiss if I did not also recognize and thank Jay Carman, with the unwavering support of his wife, Terry, for his leadership over the last two years. Building on this legacy, there is excitement as Gene Marino steps into his new role as AICC chairman. While attendance was nearly half that of 2016, those who made the decision to attend definitely made the decision to also engage. With the COVID-19 pandemic still in flux, most participants came from the United States and included all the major integrateds, who were well represented by their top capital equipment decision-makers. In addition, a vast majority of leaders from independent box plants also made the commitment to attend. Combined, the event delivered on high-quality visitors. If you were to compare the domestic attendance

of 2021 versus 2016, we were sitting close to 75%—a great testament to the industry and commitment of all involved. With that noted, there was also a strong contingent of influential decision-makers representing North, Central, and South America who came from Smurfit Kappa of the Americas. Beyond networking, the event programming was also strong. From the keynote speakers to educational breakout sessions, there were valuable takeaways throughout. Pete Watson, CEO of Greif Inc., shared insights into the culture his organization has built. He also highlighted the company vision around industrial packaging and their desire to be the best-performing customer service company in the world. While he acknowledged they may not achieve it, he reinforced how imperative it is for the organization to constantly strive for that in all it does and the culture it develops. This “servant leadership mentality,” as he put it, is about understanding that “before you can lead, you must first learn to serve—it is not about you!” This came as no surprise to me, as I had been blessed

The Associate Advantage

by interaction with not only Watson himself, but also Tim Bergwall and Chris Krumm, who are all leaders who walk the talk. It’s these interactions and friendly business insights that make it all worth the investment of attending, exhibiting, and engaging. Another highlight of the week was to witness the well-earned induction of Doug Muller, of The Haire Group, into the AICC Hall of Fame. He has obviously impacted many lives, and I would strongly suspect he has also demonstrated a strong servant leadership presence within his organization, community, and home. Muller’s humility, love for his family, and respect and efforts for the industry and his team at Haire were well captured during his acceptance and created a very moving moment—a true gentleman whom all of us are better for knowing.

And while I am certain that Muller and Watson had great experiences, it was certainly a celebration for any attendee. There was ample opportunity for visitors and exhibitors alike to reap the rewards of a stable and thriving industry. However, success comes only to those willing to engage. When I joined SUN in 2012 and would attend these events, SUN did not make the most of them. Few colleagues had attended the programming that was being provided, and even fewer volunteered their time to serve on committees or participate in events. Three years later and under new leadership, SUN’s team committed to fully engage and has truly reaped much more in return than we invested. In fact, I had a fellow exhibitor approach me at SuperCorr and ask, “Should we join AICC as an Associate member?” I replied, “If you invest and

engage, it will be one of the smartest and best investments you make.” As we look to future events, I strongly urge you to participate and engage. SuperCorrExpo 2024 is already gearing up to exceed expectations, with event space already reserved at the size of the past event. I anticipate the next three years will only solidify it further as the leading global corrugated event. In the meantime, we all have the AICC Spring Meeting in Palm Desert, California, April 6–8, and Corrugated Week in San Antonio, Texas, September 18–21, along with several regional events, to look forward to. Act and take advantage of the opportunity. I plan and expect to see you all there! Greg Jones is executive vice president at SUN Automation Group and is vice chairman of AICC’s Associate board.

See How You Stack Up

Learn more at www.AICCbox.org/Store

BOXSCORE www.aiccbox.org

Strength in Numbers

The Benefits of Creating Cost Centers BY MITCH KLINGHER

have spent a lot of time over a great number of years talking about various ways of defining variable profits and measuring them against time (throughput and velocity), both on an order-by-order basis and globally within your estimating and financial reporting systems. From a big-picture point of view, variable profits less fixed costs equal operating profits. The variable profits and resulting dollars per hour can then be looked at by machine center or centers, by customers, by categories of business, etc. The aggregated fixed costs can be divided by the number of shipping days to give you a sense of the variable profits needed to break even. So, if your total expected fixed costs for a year are $25.6 million and there are 256 shipping days in a year, then you need to generate $100,000 per day in variable profits to break even. But what about the $25.6 million in costs? What information do you need to manage them properly? Most financial statements contain very broad expense classifications such as factory overhead, selling, and general and administrative, and there is no universal method in determining what expenses belong in each category. For example, some of you include customer service salaries in general and administrative expenses, and some of you include them in selling expenses. The real issue here is not which of these categories should contain certain expenses, but rather whether these categories have any real meaning in terms of understanding and managing your business. In my opinion, you should be focused on creating cost centers. A cost center is an aggregation of costs that pertain to a specific function within your operation. It should be a key function and be large enough to have its own manager, who is in some way

BOXSCORE November/December 2021

% OF SALES

MSF shipped Sales

$/MSF 175,000

$20,000,000

100.00

15,000,000

75.00

$85.71

5,000,000

25.00

$28.57

Selling

2,000,000

10.00

$11.43

General and administrative

1,500,000

7.50

$8.57

3,500,000

17.50

$20.00

$1,500,000

7.50

$8.57

Cost of goods sold GROSS PROFIT

$114.29

OPERATING EXPENSES

OPERATING PROFIT

$ Sales

$20,000,000

KEY STATISTIC $114.29

Per MSF shipped

10,000,000

$57.14

Per MSF Shipped

10,000,000

$500.00

PER MAJOR MACHINE HOUR

Plant labor costs

2,000,000

$38.75

Per labor hour

Plant costs

1,500,000

8.57

Per MSF shipped Per MSF shipped

Materials Throughput dollars FIXED COSTS

Maintenance department

500,000

2.86

Shipping and delivery

1,000,000

$1.75

Per mile driven

Sales department

1,250,000

6.25%

As a % of sales

Design department

650,000

$162.50

Average cost per design

Customer service department

550,000

52.75

Average cost per order

Accounting department

400,000

2.00%

of Sales

Office and administrative

OPERATING PROFIT

charged with managing those costs. In most companies, customer service would be considered a separate cost center, but in a very small company that has one or two customer service reps who are managed by an office manager, this may not be the case. Therefore, the definition of what is a cost center is also not universal and must be determined on a company-specific basis. Examples of potential cost centers that come to mind are plant, maintenance, shipping, design, sales, customer service, office, accounting, and warehouse— although not all of these would apply to every operation, and some operations

650,000

3.25%

of Sales

8,500,000

$32,692

Per shipping day

$1,500,000

might have other departments. Each department should have a detailed listing of its costs, a budget, and prior period data that they can be compared to as well as information as to the key metric that drives the departmental costs and can be used to help evaluate departmental efficiency. For instance, the customer service department may want to keep track of the number of orders processed, the design department may wish to track the number of designs produced, and the shipping department may be interested in the number of trips made or the number of miles driven.

Strength in Numbers

The resulting face of the P and L, which used to look like something like the top table on the previous page, should start to look something like table below it. Both statements contain the same amount of sales and report the same operating profit, but they contain dramatically different information. The first is very big-picture, and every line item is compared to the same metrics—sales and MSF shipped. Every column adds down and adds across neatly, which we accountants generally like to see, but it doesn’t really offer any actionable information. The sub schedules that go along with the statement are general listings of costs with no real metrics attached to them. The second statement is a little busier, but it breaks down your costs using the concept of actionable and manageable cost centers. Each expense or category of

expenses should be compared to its own key metric and not just looked at as a percentage of sales or per MSF shipped. Every company keeps data on such things as machine hours, labor hours, overtime hours, miles driven, orders processed, maintenance purchase orders, and many others, yet it is very rare that this data is ever utilized to understand the financial results of the company. The sub schedules that backup these departmental costs can contain information such as head counts, hours worked, overtime costs, and information about the output and timeliness of the departmental efforts. Please give this some serious consideration, and in future articles of BoxScore, we will start to take a look at what the sub schedules that back up these cost centers might look like. We will also revisit how to create meaningful profit centers and how to relate direct costs to each profit

center. The bottom line is that financial reporting can and should be flexible and dynamic. The same income statement can be presented utilizing different formats and different metrics while still using your existing systems. Your software and plant reporting systems are tracking a lot of information and are robust enough to support many different types of reporting. The time has come to get creative and begin to integrate this information into your financial reporting to help you better understand the results of your operations and, ultimately, help you make better decisions. Mitch Klingher is a partner at Klingher Nadler LLP. He can be reached at 201-731-3025 or mitch@ klinghernadler.com.

IN N OVATIN G RELIABLE, PROV EN , COST-SAV IN G SOLUTION S FOR TH E CORRUGATED IN D USTRY SIN CE 1 9 3 2 Silver Sponsor

BOXSCORE www.aiccbox.org

Foundation for Packaging Education

What a Year!

n November 2020, amid all the uncertainty of the COVID-19 pandemic, AICC launched the Foundation for Packaging Education. What a year it has been! AICC created its second 501(c)3 education foundation (the other being the International Corrugated Packaging Foundation; see related article on page 68) for the purpose of ensuring a reliable source of funds for AICC and related education programming, all aimed at people already working in box plants and the industry. Studies have also shown that providing a robust training program is a strong factor in attracting and keeping talent. In these times when finding workers is difficult, AICC and the foundation offer a difference maker as a benefit of AICC membership. The Foundation for Packaging Education incorporated, satisfied the tax authorities, and organized a board of directors (the AICC Executive Committee) in summer 2020 that brought about the one-year-ago startup. The response of the AICC member community was both overwhelming and gratifying. At the time of this writing, 40 AICC member companies and individuals, both General and Associate Members, have made pledges or contributions that total nearly $1.5 million. The generosity of the AICC membership knows no bounds. Most of you are aware of the million-dollar match. AICC’s board of directors added $1 million more to that total when they voted to move that amount from AICC’s long-term investments to the foundation’s coffers. This was done when pledges reached the million-dollar level. The foundation’s board of directors has set the goal to have a total of $3 million

BOXSCORE November/December 2021

in pledges and funds on hand. Please help your Association, your industry, and yourselves by making a pledge to the Foundation for Packaging Education at www.packaginged.org. Now that the foundation has reached its first birthday, some of the creative and entrepreneurial tendencies of AICC members are also beginning to flow into the foundation. These can be just as vital as the funds that are required to create the programming. With several creative members, a committee is now working on an annual Foundation for Packaging Education fundraising event. We hope to share more information with you on this in the very near term.

Several donors have come together, led by Michael Levin of the Paige Co., Mitch Klingher of Klingher Nadler LLP, and Freedom Corrugated, to create a scholarship within the foundation to honor the memory of Steve Narva. Narva was a corrugated industry veteran and a creative dynamo who made a difference at several companies. The Steve Narva Scholarship is the second scholarship program being administered by the foundation. AICC’s longstanding Richard Troll Memorial Scholarship has moved to the foundation as well. Donors may direct their contributions and pledges to the foundation as they see fit. Thank you for your continuing support and generosity.

EMERGING LEADERS The Emerging Leaders (ELs) program is a series of training, networking and leadership opportunities, designed to provide ambitious young professionals with the opportunities they need to become reliable future leaders in their company and the industry.

Who is an Emerging Leader?

Gain Valuable E perien e

Professional Development

ELs are less than #5 years old and are employed by an AICC member or associate member company. These are young professionals that may be new to the industry or are looking for networking, mentoring and professional development opportunities with other top talent in the industry.

Each year, ELs are invited to attend a "field trip" in a new location, which includes plant tours, networking events and trainings. Quarterly C-suite webinars, events and trainings are offered in-person and virtually at a minimal e pense (normally less than $500 per year). Participation is based off your availabilty and budget.

This is a well-respected program within the AICC, that introduces ELs to a vast network of industry professionals, while developing a deeper understanding of the industry and offering ELs opportunities to learn and grow their leadership skills.

Our Mission

To encourage, engage, and support young professionals in the paper and packaging industry as they find their voice, grow their network, and develop vital skills to create value within their industry, company and career.

Interested in joining? Visit us at AICCbox.org/Leader for more informaton!

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

In Their Words

Kelsea Potthast, Part Two After ICPF’s 2020 Teleconference, I communicated to ICPF’s president how much I learned and was inspired by my experiences that week. I transparently explained how I had an internship offer that I was prepared to accept before attending this event. However, I expressed that I would much rather pursue internship opportunities in the corrugated industry that had made me feel excited and motivated all week during ICPF’s Teleconference. Mr. Flaherty assured me that ICPF had many resources to help make that happen. The excitement, support, and confidence ICPF showed in me that winter was contagious. I was astonished that ICPF not only wanted me to consider a corrugated packaging career but believed in abilities I did not even know I had. This organization, its Dialogue Dinner, Teleconference, and especially its president contributed to a huge turning point for me personally and professionally. Personally, ICPF has dramatically impacted the projection of my career path by introducing me to opportunities, scholarships, executives, and students that have aided my understanding of the corrugated packaging and display industry and packaging in general. I wanted to get more involved with ICPF to help further their mission to spread awareness, provide resources, and connect students with opportunities “to generate a stream of increasingly qualified individuals to enter the corrugated packaging industry, now and into the future.” The following year after the Teleconference, I sought out and moved

BOXSCORE November/December 2021

Photo courtesy of ICPF.

ollowing is the second part of the article provided to ICPF by Kelsea Potthast that outlines her recent journey through ICPF to a career in the corrugated packaging industry.

Kelsea Potthast served as the student moderator at ICPF’s virtual Teleconference on the Business of Corrugated Packaging in April.

up through various leadership roles with both the University of Florida (UF) Packaging Club and ICPF. I was elected president of the UF Packaging Club and worked toward expanding our diversity and inclusivity of students from other majors and backgrounds. During this time, I also became an ICPF student UF campus representative, which allowed me to expose students around me to ICPF events and resources. I later became an ICPF student advisory board member and ICPF’s student program manager intern. These ICPF positions allowed me to take on more significant roles, such as helping to plan ICPF’s first virtual Dialogue Dinner and its first virtual Teleconference, contributing new ideas to ICPF programs, and connecting personally with students across the country who sought to get more involved in learning about corrugated packaging careers. It was incredible to help guide these students to having the same eye-opening experience as I had at my first ICPF event. I was honored to be given the opportunity to moderate ICPF’s 2021 Teleconference on the Business

of Corrugated Packaging & Displays. Despite the difficulties of planning and producing an impactful Teleconference during a pandemic, the unique layout we organized for the virtual Teleconference was a complete success. Not only were students able to virtually attend to hear from industry leaders such as Brian McPheely, global CEO of Pratt Industries in the United States and Visy in Australia, but they were individually placed into smaller breakout rooms according to their industry interests, where they asked questions and networked with executives and students from across the country. The 15 participating executives represented corrugated companies that had active career, internship, and co-op openings posted on ICPF’s Career Portal. Speaking to 400 talented students from diverse educational backgrounds about career opportunities in the corrugated packaging industry truly made me feel as though I had come full circle. There are many other resources ICPF has to offer, from helping to organize guest speakers in the classroom to

WHEN YOU INVEST & ENGAGE FREE ONLINE COURSES Over 90 free online courses to help your employees build their industry knowledge & skills! (Spanish and English available.)

ADVISORY GROUPS

ACCESS TO THREE INDUSTRY EXPERTS

AICC HEALTH CARE VIRTUAL SEMINARS/ WEBINARS AICC has hosted more than 70 industry specific virtual seminars and webinars this year.

Unlimited access to our three technical advisors in folding carton, corrugated, and safety & risk management!

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!

DELIVERS SUCCESS RENEW YOUR COMPANY’S AICC MEMBERSHIP AICCbox.org/Renew

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

PACKAGING

mentor-mentee programs to scholarship information and more. However, one of the most valuable resources for me was the ICPF Career Portal. I made a profile online at careers.icpfbox.org, searched through available jobs and internship positions from leading companies within the industry, and applied easily. I began using this tool right after my first Teleconference, and I was offered and accepted a special internship opportunity with Hood Container for the summer of 2020. My internship with Hood Container exposed me to so many corrugated facilities and caring people who wanted to help me learn about the industry. I traveled to seven Hood facilities in North Carolina,

South Carolina, Virginia, and Illinois. Actually seeing the large equipment I had learned about in my college lecture hall allowed me to develop a much deeper understanding of the overall processes. During the internship, I worked on numerous projects that ranged from sales and marketing research, to CAD table design, to providing input on further developing Hood’s internship program. During the fall of my senior year, I once again returned to the ICPF Career Portal to explore career opportunities for new graduates. I applied to and was honored to be offered a commercial sales trainee position with WestRock. Through this program, I also would have the

CORRUGATED

F O U N D AT I O N

chance to again use my voice in working with the company in further developing a program that would appeal to new hires and best prepare them for a successful path into the future. After graduating this past May, I have been enjoying every moment and the mentors who are supporting me in my role with WestRock. I could not have asked for a position that is more up my alley. I look forward to pursuing my career in the corrugated industry with WestRock for years to come. I also plan to continue connecting students with the corrugated industry by spreading awareness of ICPF and its corrugated packaging and display industry resources.

ICPF Vocational, Technical, and Trade College Initiative

ver the past decade, opportunities for recruiting new graduates into the corrugated packaging industry through ICPF have expanded dramatically. During this time, ICPF developed new formal partnerships with an additional 20 university partners; used its educational partnerships and social media to expand its outreach beyond packaging engineering and packaging design college students to include majors and minors in marketing and sales, business, supply chain management, chemical engineering, industrial engineering, process engineering, mechanical engineering, and related disciplines; and grew its existing programming to engage 1,000 or more students annually. As a result, ICPF annually recruits and maintains up to 1,100 current college students in its corrugated packaging career network who specifically are interested in a corrugated packaging

BOXSCORE November/December 2021

career. Each year, there are many more students and new graduates in this network who are seeking entry-level positions or student internships than related openings in the industry. ICPF’s Corporate Partners continually use ICPF’s Career Portal and Résumé Bank, its Student/Executive Dialogue Dinners and Teleconferences, and other resources to successfully recruit. Through these ICPF resources, over 120 students with diverse educational backgrounds are recruited annually for production, operations, sales, and design. With this success in creating and maintaining an ongoing pipeline for the corrugated paper industry’s future managers and executives, ICPF is now additionally focusing on needs for the plant floor. It is currently developing a database of local vocational and technical colleges (listing administrators and career college counselors) for key

metropolitan areas. The database will be posted on ICPF’s website to assist firms in recruiting for the plant floor. In 2022, ICPF also will identify entry-level plant floor position needs and position descriptions through a survey of ICPF Corporate Partners that it can use in working with two-year vocational colleges in launching a regional pilot program. The pilot will provide steps that ICPF and partner corporations can replicate across the country. ICPF Corporate Partners that are interested in participating in ICPF’s pilot program in the Chicago or Atlanta areas can contact rflaherty@icpfbox.org. Richard Flaherty is president of the International Corrugated Packaging Foundation.

a s g n i h

? ff O e l t t i L

Ask AICC Technical Advisors Recent topics include: • Adhesives • Smudging • Breaking PDQ Perforation • Theorectical Box Compression

Tom Weber Folding Carton Technical Advisor

Ralph Young Corrugated Technical Advisor

Doug Friel Safety & Risk Management Advisor

Ask Your Questions AICCexperts.org

The Final Score

Survey Says!

ICC partner the National Association of Manufacturers (NAM) has shared The Manufacturing Institute’s Center for Manufacturing Research and national CPA and advisory firm BKD’s results from their fall survey of small and medium-sized manufacturers (SMMs). The biannual survey looks at workforce impacts and the “new normal” for manufacturers with 500 or fewer employees. The most recent survey, from August, provided the following highlights. I have emphasized some of the content where AICC members have shared similar experiences and/or where AICC has provided programming to assist members in these areas: • Workplace safety: Nearly 79% of small and medium-sized manufacturers have enhanced workplace safety measures and requirements since the COVID-19 pandemic began. In addition, firms reevaluated their supply chain, increased worker flexibility, instituted more remote work, and reengineered their production processes with social distancing in mind. • New normal: Many of the survey respondents reported additional workplace flexibility, with others noting supply chain and workforce challenges. At the same time, several companies noted that the changes they needed to implement have made them a stronger company and more prepared for future crises. • New workforce models: Since the beginning of the pandemic, companies have needed to adapt, with more work taking place remotely, understanding that much of the production process is not able to shift work away from the shop floor. Still, for those employees, where it is possible, companies have shifted their perceptions of the value of remote work, and many see a hybrid model continuing post-pandemic. • Return to work: More than 71% of respondents said their firms had not received any resistance or hesitancy to returning to work, where working remotely was an option, with 18.4% saying they had faced some resistance. • Transitioning the business: Nearly one-quarter of respondents said the pandemic had changed or heightened their desire to transition or sell their business. Of those who said this, 68.1% were working on a plan, whereas they might not have before. • Disruptive technology investments: One-third of SMMs had accelerated their investments in disruptive technologies since the pandemic began, with 61.4% noting that such investments were done to improve the operational performance in production. Worker shortages were also a factor. There is a lot of very useful and interesting information in the survey. You can access the full report along with SMM comments at: www.themanufacturinginstitute.org/wp-content/uploads/2021/09/BKD-MI-Survey-Sept2021.pdf. It’s reassuring to see a survey such as this from the broader manufacturing community and to have AICC’s members’ interests represented by such a powerful organization as NAM. While we don’t always agree with every position taken by NAM, we do benefit from the partnership, especially at this superheated time in Washington, D.C. Our members are at their core manufacturers, and AICC is at its essence a manufacturers association. AICC members share similar challenges with other manufacturers. Speaking of similar challenges, I had the great honor to be interviewed at the beginning of September by Tim Gray, president of the U.K. Sheet Plant Association (SPA). We taped the interview, and it was presented on September 20 to SPA members gathered in Tewkesbury, England, during their first in-person meeting since the pandemic began. I made the point that like the SPA, AICC exists to bring members together, educate, and disseminate information and to provide a forum for them to learn from each other and to rely on each other. You and your U.K. colleagues share much. These are challenging times for AICC members. Labor issues, supply chain disruptions, transportation difficulties, a businessadversarial Congress and administration, and inflation. All these issues are churning while box plants remain busy, with many members suggesting demand will last well into 2022. And then what? Will we go back to the pre-pandemic trend? Or will some of the pandemicinduced disruptions continue to sustain the box business at better than historic growth? Independents have always been the leaders. The disruptors. The embracers of the new. The risk takers. You will show us the way. Michael D’Angelo AICC President

BOXSCORE November/December 2021

Planning for the future is one of your most important jobs. Selling your business, succession planning, equipment decisions and expansions require the best advice and strategy. We’ve been providing Business Planning Services to the independent converter for over 30 years. Need to make a big decision? Call us now.

STILL the Industry Experts 580 Sylvan Avenue, Suite M-A Englewood Cliffs, NJ 07632 (201) 731-3025 • Fax: (201) 731-3026 info@klinghernadler.com

Nov/ Dec 2021 AICC BoxScore: Building Better Boxes

Articles inside

THE FINAL SCORE

AICC 2021 ANNUAL REPORT

THE ASSOCIATE ADVANTAGE

BUILDING BETTER BOXES

MEMBER PROFILE

AICC INNOVATION

ASK TOM

ANDRAGOGY

LEGISLATIVE REPORT

ASK RALPH

MEMBER MEETING

SCORING BOXES

CHAIRMAN'S MESSAGE