Oh, to be a flexographic printer these days. With all the doom and gloom surrounding the slumped economy over the past year, flexo printing remains and will continue to be a true bright spot for the package-converting industry.

According to the Flexographic Technical Association (FTA), North America's 6,000-plus flexo-printing establishments will produce in excess of $85 billion of printed work in 2002. That volume will be spread across several distinct market segments, such as flexible-film packaging, paper bags and multi-wall sacks, labels and tags, corrugated/preprint, folding cartons, envelopes—and even newspapers.

In a recent report, FTA forecast that growth of the flexo-printing industry will outpace the performance of the Gross Domestic Product, coming in at somewhere between 4 and 5 percent, as compared to the less than 2 percent improvement expected in the U.S. government's benchmark index. In 2001, flexo printing grew by approximately 6 percent and now controls 74 percent of the North American package-printing market—as well as 24 percent of the global printing and publishing field.

From a business-based analysis of the size and scope of the industry, FTA president Mark Cisternino reports that, "Forecasts within the food packaging and pharmaceutical marketplace continue to show strong growth expectations. Ongoing developments in flex-pack substrates and converting technology have contributed to the healthy market gains of the past few years and will continue to do so in 2002."

Cost reduction is a major trend throughout the flexo-production process, Cisternino notes, "due to heightened demands being put on printers by consumer-product companies to maintain or reduce prices to keep the business."

Digital imaging is also hot. "Incorporating digital-imaging technology within the prepress arena and the use of thinner, digitally produced printing plates and sleeves have allowed printers to achieve better and more consistent quality," he says.

Substrates advancements are also a driving force helping to move flexo forward. "They have been contributing to the migration of print jobs from offset, letterpress and screen over to flexo," Cisternino says. "Whether it's stand-up pouches, in-mold labeling, thinner-flute/higher-quality corrugated or fiber substitutes for traditional envelopes, flexo remains best suited to use these new substrates."

Of the market segments studied by the FTA, corrugated/preprint production will lead all flexographic business segments in terms of the value of product produced. Revenue should total $29 billion, representing 34 percent of the industry's volume. Some 1,400 facilities produce flexo-printed corrugated boxes and preprinted linerboard within North America.

FTA's corrugated-converter members report that to keep customers happy they're being forced to provide additional services and meet increased demand for shorter delivery cycles and enhanced graphics. At the same time, these companies—like all converters—must maintain a competitive cost structure.

As for flexible-film packaging, it will lead all sectors in terms of percentage growth charted in 2002, says FTA. Revenue is expected to reach $20.4 billion, representing growth of 3.5 to 4 percent over 2001 levels. Flexible-film packaging will account for 24 percent of the flexo-printing market.

Some 950 North American printers/converters are engaged in the flexo film-print process. They indicate that flex packs will continue to gain market share as the material replaces rigid containers in current product lines and is identified as the most viable option for new products.

Food manufacturers are expected to continue to generate the lion's share of flex-pack orders, followed by health and beauty care and pharmaceutical product producers. Transition from rigid containers to stand-up pouches is becoming more and more popular, and the trend is anticipated to continue to drive the industry in the foreseeable future.

In a separate flexible-packaging study, FTA reports that today's flex-pack printers are faced with a variety of challenges. Most are related to cost pressures and retaining competent employees. The flex-pack printer's mantra has become: "Reduce costs. Meet and exceed customer expectations. Maintain a competitive edge. Grow profit margins."

"A major challenge to every printer is, and will be, having experienced, hands-on operators," says one survey respondent. Another FTA member adds, "Quick turnaround is critical to printers. We need to discover a method to acclimate converters to continuous-replenishment demands placed on the retail sector." He also adds, "Everyone wants product on-demand and reduced or lower inventories. No one in the supply chain wants to be left holding the bag in terms of working capital (i.e., ink, raw materials inventory). The key is to not have high downtime, high spoilage or high inventories."

A tremendous opportunity for flexography awaits for the folding-carton sector, says FTA. At present less than one-quarter of all output is printed flexographically, and 125 plants produce the materials. The sector currently represents 19.3 percent of flexo-printing revenues, with 2002 business expected to translate to $16.5 billion.

UV inks and increased reliance on flexo's in-line converting capabilities continue to influence migration of business away from offset and gravure and toward flexography. Increased reliance on computer-to-plate technology has resulted in significant enhancements to tonal range and detail rendition that aligns well with needs dictated by short runs.

As for North America's 3,000+ label printers, FTA saw volume grow by 3 to 4 percent in 2001, but increased competition and tight operating budgets contributed to a small erosion in margins. Revenue is estimated at $10.5 billion in 2002, about 12.3 percent of the flexo-printing business.

New labeling regulations in the pharmaceutical industry, soon to take effect, will drive growth further. FTA forecasters predict a return to historically higher levels of 5 percent or better within 12 months. Converters using digital technologies increasingly claim that their ability to produce short-run work quickly, with excellent results, is enhanced.

Envelope shipments will remain sluggish through the majority of 2002. Revenue is forecast at $3.8 billion with volume growth approximated at 1 percent. With some 260 converters flexo-printing envelopes, work turned out to represent 4.5 percent of total flexo print volume.

Paper bags and multi-wall sacks are seen as a flat market segment for this year with revenue remaining at the $3 billion plateau, accounting for 3.5 percent of the overall flexo market.

All in all, the future is shining on the flexo-printing industry with nary a cloud in sight.