Sustainability is a goal that practically everyone in the packaging industry is working hard to achieve. In this podcast, Greg Berguig joins Nathan Dube in a lively discussion about new materials and techniques.

Industrial Packaging Podcast Episode 20: Interview With Greg Berguig of PAC Machinery


Video Transcript

[Music] greetings everyone and welcome to another episode of the industrial packaging podcast with me your host nathan duby digital marketing specialist at industrial packaging on today’s episode we have special guest greg your geek vice president of sales and marketing at pac machinery greg welcome to the show thank you thank you very much nathan you are most welcome so before we get started can you tell me a little bit about your background of fact pac machinery and uh what it is uh your role entails yeah sure so i am the vice president of sales and marketing at pac machinery so my role and you know i get involved in sales projects with our team as well as marketing and getting the word out about all types of uh cool solutions that we have for uh flexible packaging whether that’s the shrink wrapping of products shipping of products and mailers flow wrapping all different you know vacuum packaging bag sealing etc awesome great thank you for that background information so without further ado we’ll jump into the first question which is who is pac machinery i mean what do you guys do uh what is your main focus yeah so pack machinery manufacturers obviously packaging equipment and packaging materials we make machines that allow you to put a product in a bag really quickly seal it print on it we make machines that vacuum the air out of products for extended shelf life flow wrapping of products like you know energy bars cookies things like that sealing of bags you know anything that goes into flexible type material we typically have a packaging machine for it and we also make the associated packaging materials so to provide a complete system for our customers awesome thank you very much that kind of answers question two which is what do you do so we can move on from there um so next up we have and we’ve been doing it for a long time sorry so we’ve been doing it since the uh essentially the 1950s oh wow that’s uh that’s a long time to be in business fantastic yeah well i wish you all the best going into 2021 and beyond um so that being said we’ll move on to the next question which is what will be the major trends for packaging and e-commerce in 2021 well there’s certainly a lot of them um you know the the you know just take a step back and we know that uh e-commerce and online ordering and direct-to-consumer shipments have been have been growing you know tremendously pre-pandemic and uh you know as if you talk to anybody or read what’s happening i mean uh you know the pandemic and kovid really accelerated that right forcing us you know people at home who wouldn’t normally uh order things to go to a store right that wasn’t really an option so things are being ordered and and the growth has been tremendous um so you know we kind of as an industry and that industry in particular right had to catch up really quick and put systems in place uh equipment processes things along those lines to catch up with that um and uh you know what you kind of now see is manufacturers um uh or packagers kind of speeding up with that uh speeding up with that growth and uh apologies somebody’s that’s that’s okay no worries uh huh you see people speeding up with that growth so the trends that we really see are uh you know i i you know we hear from customers right i can’t hire enough labor uh to show up and and do you know pack out what i need to get shipped whether that is uh prepping products and clear bags with a label and a suffocation warning for shipping to fulfillment center right or getting those products out the door to ship in a poly mailer directly to a customer so we see a couple trends happening uh one automation right if i have one person doing one pack a minute now i can have one person let’s say five or six times as productive the next thing we see is the right sizing of materials right so going from a one size fits all package to really fit for whatever the product is being shipped um you know we we’ve all had that experience where uh you get a package at your doorstep whether that’s a box or a bag and it’s like 10 times too large for the product that’s inside so right sizing that and then the third thing that we see is materials being used right so now we’ve got all this packaging that’s showing up at the consumer how do we come up with more environmentally conscious materials absolutely yeah these are trends that we are seeing here in industrial packaging as well i mean the supply chain really got hammered this year and you know despite that i mean obviously for consumers that was probably a big issue but um it’s been a welcome challenge we’ll call it a silver lining uh to uh 2020. um you know here at industrial packaging we we had to play ketchup a bit because demand uh increased practically overnight um so yeah we’re seeing a lot of the same things here too now on the topic of e-commerce uh to take that a little bit further um we’ve come to realize that some manufacturers will not sell direct to consumer do you guys do that and do you have an e-commerce store where people can come to purchase your products on your website uh no i mean we deal with customers who typically can do that uh you know our focus is really to go through the distribution channel you know people like industrial packaging right you guys are are local you can provide the service and support to customers for many companies uh as you know this is their first piece of automation or this is their first piece of industrial equipment right and uh being local and able to hold their hand and make sure that they have the right consumables that they have the the air and electrical that they have the training things like that um that’s really where the distribution channel is so critical and also you know being there to help people uncover ways that they can improve their process absolutely great thank you for that information so moving on from there the next question is what new developments can we expect to see in outbound mailing so i i think it touches on the trends that i mentioned right so automation is number one uh and there’s systems that have been out there that for a long time but what we see is uh you know and personally i’ve witnessed this robotics you know where a [Music] un uh where a robot that hasn’t had any additional programming can take a bin of items can pull the item out and scan it and can place it into an outbound shipper whether that’s a box or uh some type of bag so it’s pretty amazing what has happened there right i mean if you’ve seen these you know the work of a packer you know that there’s while fine you know there’s a big push to reallocate labor for higher level tasks and robots have been you know able to do this job and people are starting to implement them especially as volumes increase right so you can imagine you have a person that was traditionally a packer that goes essentially they call them a bot tender right they’re they’re bringing bins of goods to robotic packing stations they’ll take the items and pack them in out into shipper so that’s the first thing um the second thing is you know i mentioned right sizing of the packaging and that’s something we’ve been focused on where uh you know with um outbound shipping and you know a lot of times your batch quantity is one right you’re putting in one item that’s one particular size uh in our case we deal with bags right but it could be in a box into a bag right and that item could be going from uh a pair of underwear to a pair of pants uh to a shirt to some type of uh tchotchke you know that that somebody’s purchased a little table fan or something something that ships well into a bag right and the idea is that the package will adjust in width and length to be right sized um there’s a few benefits for that um one you know from a branding perspective you know you imagine that uh in many cases these brands their only touch physical touch point with the customer uh is receiving of the goods at their doorstep right so nobody wants to be perceived as wasteful in today’s uh you know environmentally conscious world that’s one two imagine the space that an oversized package takes up in the transportation system right i mean we know that logistics uh they came to the point of being broken during copious yeah but you know now imagine all of a sudden like everybody’s optimizing their packaging so i can fit more products have more packages per let’s call it a truck right whatever carrier using or airplane or whatnot right because everything is efficient more efficient in terms of the packaging yeah so that’s two and then 0.3 on there right it’s less expensive i’m using less i’m using less material so my costs are going to go down right so everybody wins you your your your the supply chain wins the packer wins the consumer wins so that’s the second trend and then i think the third trend and you know we talk about the environment a lot is really seeing new uh packaging materials coming out we see a lot of customers who start packaging in a box right and then they find that to be expensive and labor intensive and difficult to automate and they move to a bag and they find that hey our product in a bag holds up extremely well um but you know most of these are polyethylene bags and polyethylene is fine and it’s you know technically it’s recyclable i mean it’s uh right you know there’s a shortage of uh consumer recycled polyethylene uh the problem is our recycling supply chain and where do i go to recycle this material right i mean uh you know how do recycles done a good job of uh teaching customers on this and uh store drop off well if i’m not going to stores as much you know i’m probably not going to go and drop it off at the store and my local recycling center doesn’t accept it because it you know gums up their equipment they’re not equipped for it so what do i do so the this third trend on environmentally conscious materials um you know we’ve seen things we recently launched our wrestling bland blend of poly mailers uh it has over 50 recycle content and that’s a mix of uh consumer recycled you know plastics think about like your high density milk jugs and things like that as well as industrially recycled resin we’re able to push that to higher content levels we have biodegradable compostable materials for shipping that will be you know we’ve tinkered around with and we’ve got some testing going on with that and some pilot customers and then uh i think the big one and uh the big rush will be in uh uh you know curbside recyclable materials uh think about paper right because that’s the easiest thing to curbside recyclable your your paper bat paper bags corrugated boxes things like that uh we’re gonna see that in the coming uh i would be willing to bet we see that uh the next you know holiday season you’ll be seeing more uh curbside recyclable bags i mean this trend has started there are some companies using that now uh in a manual packing format but we’ll see automation of that for sure i mean all of the topics you just listed out are things that we’ve been watching and i’ve produced some content on it this year automation is certainly a big one i wrote a couple articles about collaborative robots and how automation assurance is in a way i mean in the middle of the pandemic when you think about it automating is another way just to make your distribution center safer because you’re going to have less people working near each other the less possibility of transmission of uh you know the virus or you know just regular cool and cold symptoms for that matter so it’s kind of a you know a weapon against uh copen so to speak in some cases we’ve seen a lot of uh rise in interest from consumers on the environmental side of things and as you mentioned you know things can get a little complicated with single stream recycling particularly when we’re talking about polyethylene and some of the other plastic formulations of flexible packaging because well yeah they are technically recyclable most municipal compounds uh you know don’t have the infrastructure to recycle it a lot of people don’t really want to take the extra step to kind of get into more complicated things and those who do you know um we have spoken to some people who’ve been like well i’m willing to pay a third party to do it but then when cost comes into it you know sometimes they change their tune so yeah that’s another trend that we saw as well so uh all great stuff and i really appreciate your feedback yeah excellent answer yeah and i think actually just to touch on what you mentioned about automation it certainly makes things safer right having less people near each other um you know it’s also a better use of your resources right how many people have a building that they pay rent on and they pay utilities and everything else that are only running at one shift or maybe two shifts you know because uh you know primarily because you know having trouble finding people to work that third shift right so now if i have a row if i have a system of robots or i can do it more efficiently you know instead of needing 20 people to do my packing maybe i can do it with three or four so yeah certainly some advantages there you know it’s interesting talking about having a warehouse that’s you know completely or mostly automated i read an article i can’t remember exactly the details off the top of my head but there was a guy who was brought into a company and uh you know they said i guess he was an economist or he was specialized in saving large corporations money and they said can you identify some things in our company to help us save money which was you know basically what he does professional consultations for fortune companies or whatever so as it turned out whoever this company was they had a lot of warehouses that were completely automated and he said uh you know there’s three ships they said yep all day all night he said we’ll shut the lights off they said what do you mean so they had the overhead lights that you would normally have you know for a human workforce and so that’s literally all they did is they just shut the lights off in the building except for when the inspectors came in to make sure that the machinery was running as it should and they sold they uh they saved um in excess of i think six million dollars uh just from this little change and that doesn’t even include all the other things that he consulted them on so when you look at you know this new world we’re going into with robotics with automation i mean i think we’re going to see a lot of unexpected opportunities for cost savings yeah definitely it’d be exciting to see what what else comes up and changes right yeah yeah for sure all right great so moving on from there the next question is um what are some of the things that can impact pricing for fulfillment centers particularly in regards to packaging yeah so there’s a few things a great question by the way obviously uh uh you know where we focus is on your variable costs right so labor is one that i can think about right if i have one person who is able to pack out you know 100 to 150 orders an hour right but now all of a sudden they’re able to do uh three four even 500 orders an hour with automation right that’s going to be my per unit packout cost has now dropped dramatically so um and it’s not just for that it’s uh you know balancing that labor right you mean you think about uh you know right now we’re off peak what you think about the peak holiday season right how much temp labor needs to be brought in and trained and all this extra overhead and liability that comes in right right you know those are what i consider hidden costs there so um that is extremely important um you know the other thing is your packaging material uh there can be a lot of savings there right so if you’re using boxes now and you go to bags that’s tremendous savings if i go to bags with automation that’s even bigger savings right and then if i go to bags of automation where i’m you know creating the material on demand and function of the size of the product that’s even further savings um you know and as we talked about that doesn’t just reflect the um that doesn’t just reflect the material cost savings all of a sudden now i have freight savings as well right you think about dim weight pricing and what’s going on there you know people switch from boxes to bags because they’re smaller right but now people are getting dinged for dim weight on bags um you know because you know carriers need their business and they need to make money as well so you have that benefit and then additionally uh you have further benefits just from uh you know i don’t need to inventory as many skus right if i’m using uh you know a 10 by 13 and a 14. by 19 19 by 24 poly mailer uh if i have one size of film that accommodates for all of those right it’s less used to inventory and uh it’s higher volumes of a particular sku so you know as volumes go up price goes down um so i think you see all those things you know you mentioned the lights right that’s a great uh great example of uh additional benefits that can result and and you know i think yeah go ahead sorry oh no that’s okay um yeah so i like you know the discussion around boxes and bags uh it’s interesting because going back to the environmental side of things a lot of people have this idea in their heads that you know they want to use cardboard or or pre pandemic they didn’t some still do now but something that’s coming to light is that well yes cardboard is recyclable and you know the polybags are either not or they’re you can recycle them and they’re complicated but you use a lot less material when you’re using bagging versus the cardboard and one thing that a lot of people forget about when it comes to single stream recycling is that due to contamination a lot of the stuff that gets thrown into a single stream recycling bin uh specifically paperboard cardboard and paper is uh if there’s if there’s any drops of liquid or food particulates that gets onto that material it ends up in a landfill anyway um so when you think about listening to the environment yeah no i mean i was sorry it interrupted you know i went to a recycling center earlier in 2020 right before the pandemic started just to see with my own eyes what was going on at the local recycling center it is far different you know uh than what consumers expect when they just put things something in the recycling bin you know you know at the at the recycling center they call it wish cycling right where you know consumers are putting things in that they imagine are recyclable and in fact uh if you take a look there’s very few items that get recycled that actually have a tangible environmental benefit right uh yep uh aluminum cans fantastic you know that’s got a high you know you can make money off of that glass if you have a local glass place that can uh melt it down great if you have to transport it no uh you know i saw uh pallets and pallets of corrugated that basically gets shipped off to another country right it was a container gets loaded it was getting loaded right in the container gets shipped off somewhere else and who knows what happens here so so based on what you’re saying um you know using less material is better for the environment period i don’t care how it is right you if you can if you can use you know half the amount of material or even uh less than that it’s fantastic and you know you’re concerned about the poly and the recycling i mean i’m literally staring at um compostable plant-based poly mailers right here in my office so nice uh it’s there the question is you know is are people gonna pay a little extra for it yeah that’s been a big question i’ve written quite a few articles this year and last uh about uh bio-based um polybag string film and and the like and it’s you know it’s an interesting topic because i think we’re getting to a point where consumers you know uh rather than just calling for environmental friendliness some of them and maybe even more than some are are willing to pay the extra for it but the flip side of that point is when i was doing research about the companies that currently offer you know quality bio based films there’s really not a lot out there i mean i think i was able to identify between half a dozen to a dozen companies now is is bio based filter bag something you guys are involved with uh very much so like i said i have some that we uh some um sag on a roll automatic bagging materials right here in front of me that um we have uh pilots on now and uh you know it’s uh you know it’s basically something that can be taken and put right in the uh the industrial compost bin yeah that’s awesome i just wrote an article about this the other day that’s fantastic and um i’ll tell you what you know your industrial packaging um are sales reps we’ve been having discussions about this on and off so uh i’ll definitely be you know affording this information to my sales manager maybe they’ll reach out to talk to you about it because we are seeing a growing interest in bio-based uh films and materials so yeah i will make a note of it i mean i appreciate that i mean the uh the key is cost there right who’s gonna this is gonna cost it’s gonna cost more no question so who’s gonna pay for this cost is it the brand is it the consumer can it be passed off in some sense uh you know unfortunately what happens is you know with without marketing behind the product uh it’s perceived as an added cost and you know those things can add up um so you know these things are there and i think that’s going to be another uh portion yes and i think pushing it off or you know making the consumer pay a little bit more for that is uh probably the avenue that’s going to happen unless government steps in and starts imposing some uh packaging surcharges which i wouldn’t be surprised if something like that happens right we have it for for glass and we have it for other things where uh the government has some involvement right you know and and to see what’s going to happen there i would actually look to europe because their recycling processes and stuff are i always say far ahead of the things that we do here in the us yeah i’ve noticed that as well um so thinking about the environmental aspect of this and going back to something you said that i found interesting is that you actually took the initiative to go to your local recycling center and see this for yourself firsthand and um you know that’s a thought that i’m sure on the environmental uh movement side of things i’m sure people have done that but i think for the most part uh the majority of people in america probably haven’t taken that initiative and i think if more people were exposed uh to seeing that in action and seeing the truth of the matter they may be more inclined to spend the extra money because they’d actually be seeing the impact that their decisions are making from an environmental standpoint so you know that’s something i’m kind of hoping to see from whether it’s the discovery channel or other media outlets who are uh you know producing information about our planet earth it would be great to see more interactive content whether it’s video or documentaries or whatever that shows that impact it would yeah yeah it certainly would i think uh it’s certainly a bit controversial right right you have this perception of recycling and then you go see it for yourself and you’re like oh i see right yeah it kind of it kind of reveal you know and if i’m a recycling center like why do i want to you know open that up but what you can find actually a lot of interesting stuff when we talk about automation is recycling centers that are implementing automation to uh make their systems more efficient and i think there uh you know instead of having you know essentially labor right it’s sending people on the line they gotta like sort out they gotta you know inspect they gotta do this and that you have robots with vision systems and there’s some pretty cool things you know uh quick google search will uh expose a lot in terms of recycling centers and automation and you know i think there there’s some really cool stuff going on for sure for sure great well that was a as an excellent topic to cover and i appreciate your feedback so from there we will move on to the next question which is what trends can we expect to see in the poly bagging market well i think uh as relates to e-commerce logistics and i think i kind of uh covered some of those right if it’s outbound shipping uh the materials and the right sizing of the bag uh the automation uh you also see uh another one we didn’t talk about is uh down gauging the materials right yeah so a lot of times people are just using a material thickness just because right they went uh yeah to that you know big catalog book that they they get or online and uh you know that’s just what somebody chose right and a lot of times you see people using like a three mil bag where you know what you should at least go to two and a half mil but even a two mil will work right yeah using thinner materials um you know right now there’s kind of a industry standard spec of two mil thickness for poly mailers um in reality you can go thinner uh you know it’s just a matter can the conveyor systems and everything else sander handle that thinner material um you know one thing that we have done at pac machinery we introduced last year you know we have automatic bagging systems that that print directly on the bag uh we also introduce automatic diagonal systems that print and apply a shipping label onto the bag you know one of the reasons that we we did that and it might seem counterintuitive right somebody says well why do i want to label i just want to print directly on the back well uh you know direct thermal labels oftentimes are less expensive than the spray the higher quality ribbon required to print on the bag and direct thermal labels i don’t need printer ribbon but more importantly with the stiffness of a label i can go to a thinner bag material and i’m not worried about scannability of the package through the supply chain right so a label maintains that stiffness i can go to a two mil bag and i don’t have any scanning issues or my carrier doesn’t have scanning issues i can even go thinner so uh i see that happening um the other thing that we see especially a lot with the label is you know we talked about outbound shipping but what about all the stuff that’s got to get prepped for you know a fulfillment center right you think about uh if i’m an apparel company right i obviously don’t you know don’t make my apparel in the u.s for the most part i mean some companies do right so i get you know pallets of clothing i get it from overseas they’re folded i’ve got to put it into a pot you know we’ve all gotten those clear poly bags with the suffocation warning right yeah and some type of product skew on it yep so we’ve been pretty involved in uh automating of that uh putting a label on it actually can help to reduce your overall uh material costs flexibility there so we we see trends happening and automation of that we see trends happening in um spill containment as well right again we’ve received these same clear poly bags of suffocation warning with you know a bottle of uh window cleaner or you know bleach or whatever it is right yeah you get it in the mail and you want to make sure it doesn’t if if it breaks it doesn’t spill so a lot of automation for um steel containment and for many people i’ll reiterate you know their packaging distributor somebody like industrial packaging is going to be there to to you know work with us the manufacturer and then the packager just to find the optimal solution for that yeah one of the things that you said there that i’d like to focus in on because it’s a topic that i want to try to drive home to our listeners which i’ve tried to done uh tried to do through our blogs and i’ve written about it on a couple a few different occasions and that is down gauging uh you know your films your bags or whatnot you know one of the things we do when we go into a new client is do an analysis of their packaging line their machinery their labor force other materials and one of the things that you know i think a lot of people you know just don’t think about is not enough they should is you know what gauge are you currently running and how much money can you save by simply going to a lower gauge i mean it’s so important but you know it also takes you you think about organizational change and change management and things like that changing something like that in a company depending on the size right takes buy-in from different departments and different groups of people and i think that is critical i mean nobody wants to be the person that authorizes thinner material and then you’ve got extra headaches and shipping or whatever else so uh i i think doing it strategically you know somebody somebody comes and tells us hey i’m putting stuff in a polybag and it’s six mil thick i’m like okay well and we can’t go thinner i’m like sorry if you’re using a six mil poly bag unless your thing is like 20 pounds heavy right we can design some resin formulation that will be half the thickness and will be if not equally strong stronger so you know yeah there’s a lot that can be done there yeah it’s looking at the bottom line and eventually you’re gonna cross a number on a on a quote and they’re gonna say oh i can save that much money well maybe this is worth the headaches after all totally and the environment right let’s not forget about that half the thickness you know yeah going into the wherever the waste room yeah um so aside from down gauging are there any other ways that companies can cut costs and optimize their production in 2021 you know the easiest is automation yeah i mean automate you know what something we didn’t touch upon um you know and and you’re talking about cutting costs well with automation you have to actually spend money to cut costs right right so it’s an investment uh you know something that we’ve seen yeah and it’s kind of like going the idea of going to thinner material and people don’t think about it is is financing of your equipment right and you know because well we don’t finance we buy out right i’m like this is pretty i mean this is not like an automobile lease where you give it up after 36 months right i mean interest rates are extremely low do uh you know 24 36 for whatever it is 48 months finance of your equipment you get a dollar buyout option yeah you know do that math see the labor savings you know if the thing is going to cost you you know a thousand let’s call it i don’t know a thousand dollars a month over 36 months right and then you’re gonna own it uh if you’re saving i don’t know two grand a month in labor and you know total roi on the system and our team can certainly help with that yeah if you’re saving two grand a month to spend a thousand dollar a month all of a sudden you know you’re essentially with that solution you’re saving a thousand dollars a month yeah right off the bat with financing yeah absolutely and that’s another thing that we’ve been trying to drive home to our clients and our new customers is you know comparing the lowest cost quote-unquote to the total cost of ownership and when you get into that discussion and you you see what you know leasing equipment is and how the process works oftentimes people are unaware of you know the the total cost of ownership and the savings that you can get uh because you know it’s new to a lot of people some people have never done it and sometimes you can’t see uh you know the tree from the forest in that respect so i’m glad you brought that up that was a very important topic and i didn’t even expect to speak about it today so thank you for that well then there you go see that’s what happens on a lovely discussion like this absolutely and it’s been a great discussion um but we are coming to the end of the episode and there’s only one question left which is where can people find machinery online well the easiest obvious is our website that’s p a c machinery dot com uh you know we have a whole host of equipment we’ve got overview videos um but you know really what we want uh don’t go go online send us a message and get one of our uh you know packaging pros involved or sales engineers that will really work with with them and their their just you know their packaging distributor if they have one something like industrial packaging and understand the scope of the project and what they’re trying to accomplish you know that our best customers are hey i have this problem help me right as opposed to hey i’ve been doing research what’s the price of this machine well how do i know that that that machine is even good for them or hey i’m looking at this you know competitive brand x of machine what’s the price of your closest one well how do i know that competitive brand x even quoted you on the right equipment i mean pack machinery we probably manufacture one of the broadest range or types of you know range of flexible packaging machines because there’s so many different ways to package a product right it’s not uncommon somebody comes to us and uh hey you know they i need a flow raptor oh well let’s talk oh actually you know what you need a side sealer you need an automatic bagger you know if you did x y and z here’s you know here’s what um here’s what can happen so go to our website do some basic research that’ll take you you know where it takes you and then let us you know help help them take them to the next level awesome well this was great um this is a really good interview and what i liked about it is that we kind of took some twists and turns from the questions that we had planned and we covered some topics that i didn’t expect to and i think this is going to be really valuable to our listeners so i want to thank you for your time today and coming on the show my pleasure nathan and it was great chatting with you well ladies and gentlemen that does it for another episode of the industrial packaging podcast with me your host nathan dube digital marketing specialist at industrial packaging i hope you enjoyed today’s episode as much as i did and i hope you tune in next time but until then have a great day you

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