We Have Your Back

“My 40˝ press just broke down, and my customer is insistent on the job. Is anyone nearby running a 40˝ press?” Fielding production back-up inquiries like this one is all in a day’s work for Andrew Willie, executive director of the Independent Carton Group (ICG). This 18-member association of independent folding carton converters strives to provide customers with competitive pricing, uninterrupted service, and cutting-edge technology and manufacturing capabilities.

According to Willie, repeated customer requests for carton production back-up were the impetus for the ICG’s founding in 1982, but by 1999, members had also banded together to negotiate raw materials contracts in order to capture vendor terms and volume discounts on par with larger integrated competitors. As a result, Willie’s daily role also commonly includes clarifying pricing contracts as converter members go about quoting jobs, and responding to prospective raw materials vendors’ requests to present their product lines to the group.

Working at the ICG’s operational headquarters in Newtown, Conn., Willie and his staff facilitate the group’s purchasing program by gathering and compiling pricing information from prospective vendors (including makers of virgin and recycled board, as well as providers of plates, inks, coatings blankets, rollers, and presses) for review by a four-member board of directors. Once the board members arrive at a recommendation for a designated raw materials vendor, a final vote for approval is conducted within the general membership.

Willie estimates at least 50 percent of converters’ sales dollars go toward the purchase of raw materials. With this in mind, it’s his mission to try to get ICG members rebates on everything they purchase—even down to pens and pencils. “Buying like a big company helps independents stay strong,” he says. “If there wasn’t a group like this, there might only be three to four big companies making cartons.”

Built on a foundation of back-up

The ICG was formed nearly 30 years ago when the leaders of five small to mid-sized privately owned, single-facility converting companies gathered at LaGuardia Airport and agreed to help each other through unexpected operational disruptions—everything from a strike, fire, or natural disaster to equipment or materials supply issues. Willie, a former owner of Sandy Hook, Conn.-based Curtis Packaging who attended that inaugural meeting, adds that ICG members also stand ready to back each other up in the event of capacity overflow, or the need for a specific type of converting assistance, such as cutting and gluing.

Jim Hamilton, president of Lake Forest, Ill.-based Colbert Packaging, recalls his company’s positive experience as a back-up production resource soon after it joined the ICG in 2005. That year, Hamilton relates, Colbert was the disaster recovery partner for Colonial Carton Company (now 3C Packaging) after a fire destroyed Colonial’s North Carolina converting facility. “During the four months it took to rebuild the plant, Colbert produced over one million dollars in cartons for one of 3C’s key accounts, giving them the chance to restore their operations while retaining the account,” says Hamilton. The two firms assured carton production consistency through team collaboration, transfer of customer documents, and sharing of quality procedures, he adds.

Counted alongside “back-up” as a significant benefit of ICG membership is what could be called “keep-up.” Explains Hamilton, “Our fellow members challenge us to think differently, and there’s always something to learn from each other.” He adds further, “This spirit of ’keeping up with the Joneses,’ where the Joneses are seventeen of your contemporaries, can only lead to positive improvements and successes at Colbert Packaging and at other member companies.”

A cornerstone of the ICG’s culture of sharing is the group’s open-door policy for checking out new presses and other equipment installations at member plants. “It’s so much more valuable to see a piece of equipment in operation on the shop floor than in a show room,” Willie notes. While raw materials are purchased collectively by ICG members, all capital equipment purchases are made at the discretion of the individual companies. The association staff retains a list of each converter’s equipment investments in order to efficiently direct members’ technology inquiries.

Hamilton, who compares the ICG’s group dynamics to that of a fraternity, holds this brand of camaraderie among the member companies as a highly important benefit of participation. “We challenge each other to raise the bar and excel as independently owned companies,” he says, “… through the exchange of best practices on things like technology and operations, inspiring each other to remain on the cutting edge.” Colbert Packaging, for instance, has proactively shared sustainability initiatives and successes with fellow ICG members, including customer case studies and insights on printing with environmentally friendly inks and coatings, achieving SFI and FSC Chain of Custody certification, and recycling scrap paperboard.

Strengths together and apart

Sharing among ICG members isn’t limited to ad hoc phone conversations and facility visits. The group holds quarterly meetings at members’ facilities, rotating in alphabetical order—an arrangement that Hamilton says enables each member to host and provide a plant tour approximately every five years. Additionally, ICG key department personnel attend biannual technical conferences coordinated by All Packaging’s Patricia Peterson.

Willie emphasizes this formalized sharing system has helped assure across-the-board exploration and wide adoption of the latest technological advances—such as computer-to-plate (CTP) prepress systems and digital presses—by ICG member converters. As an example, he relates how in 2009, following the realization that many members were not yet involved in digital printing, the group set up a three-day meeting at HP headquarters in Atlanta, where converters saw digital equipment in operation and queried a panel of technology experts.

At a more recent quarterly meeting hosted by 3C Packaging, Willie enthusiastically recalls that the members heard a presentation from Efficient Lighting Consultants, an energy conservation company that specializes in helping manufacturers reduce power consumption. According to Willie, the converters learned how they could cost-effectively install new plant lighting that works more efficiently and generates less heat, with the potential to halve electricity bills and reduce air conditioning expenditures. The vendor’s information was compelling enough, he says, to move three members to sign up on the spot.

Notably, the ICG’s strong tradition of transparency and free-exchange still allows each member ample room to carve an individualized niche in the carton converting marketplace. First, protection of members’ trade secrets is of utmost priority, and an attorney is present at each meeting to assure adherence to anti-trust regulations. Additionally, Hamilton notes, “While there are many similarities among ICG members, which is precisely why the ICG’s production backup program works so well, no two ICG members are an exact match in terms of product and service capabilities and markets served.” Willie explains that the membership roster is intentionally structured in this manner to avoid detrimental overlap in critical capabilities areas; converter members serve industries ranging from cosmetics to fast food, and operate in locations spread all across the U.S.

How the benefits add up

It may be difficult to calculate the exact impact of ICG programs on members’ bottom lines, but the strong overall performance and health of these converters leaves little doubt of the association’s financial benefits. “Almost all of our members have grown,” remarks Willie, “and I’d like to think some of it is because of the ICG.”

On a similar note, Hamilton observes, “We know that, collectively, the eighteen ICG member companies are approaching one billion dollars in annual sales,” adding, “[Colbert Packaging’s] membership in the ICG has certainly enabled us to gain entry into some customers because of the buying co-op benefits.” Willie further emphasizes that members have experienced growth from the standpoints of both sales and knowledge; one key, he maintains, is consistently bringing the right resources to ICG meetings.

Given such positive feedback and results, it’s not surprising that Willie reports a waiting list of companies interested in joining the ICG, including commercial printers seeking new growth avenues in light of the movement toward digital media. The group hasn’t taken on any new members for four years, in an intentional move to give current participants time to gain a greater comfort level working together. However, Willie hopes to bring on new members shortly—ideally two per year. He expects membership to cap at 25 to 30 converters, as this level of participation is the most manageable for the ICG’s quarterly meeting format.

In the meantime, Willie says the ICG plans to focus on helping its converters stay on the cutting edge, keep finding ways to conserve, and continue growing their customer base. And Hamilton plans to continue enjoying the powerful peace of mind he’s realized through the group’s interactions. “The ICG is composed of forward-thinking, entrepreneurial-minded, and highly enthusiastic owner-operators who face challenges and achieve successes that are similar to Colbert’s,” he states. “The fraternal nature of the group provides support and camaraderie benefits that are priceless.” pP