- January 01, 2001, Claudia Hine, Senior Editor
When managing director Tom Findlay suggested to the Teich board members that they should be considering Poland as a good location in which to open a flexible packaging converting plant, he knew that Teich's chief executive, Jan Homan, would give the idea serious consideration.
Teich is part of the $2 billion Vienna-based Constantia Group, and as Findlay explains, "The Austrian-based Teich packaging group is innovative and very close to its customers. Expansion is governed by some well-thought-out principles. The main principle is that Teich follows its customers, moving into a new country once existing and potential customers have developed their facilities there. Other considerations include infrastructure, trained labor, sound local economy, and reasonable development costs.
"Poland offers all of these things and has other advantages, too," notes Findlay. "It's emerging fast; there's a high level of investment, it's now in NATO, and it will probably be in the EU within the next few years. It is also well situated to serve both Eastern and Western Europe."
He adds, "More specifically for the Teich group, Poland has many of the major supermarket groups, a large number of international food manufacturers—many of whom are already customers of Teich's other plants—and an increasingly demanding population of 40 million people."
Twenty companies in the Constantia Group are totally focused on flexible packaging, primarily serving the food and pharmaceutical industries. With major food producers such as Bestfoods (which owns Knorr, among other brands), Cadbury, Danone, Nestle, Ferrero, and Wrigley already in Poland—all importing their packaging—the time was absolutely right.
Build or Buy?
Findlay explains, "We began by working out the costs of a greenfield development and, at the same time, looked around for an existing company to acquire, using the estimated greenfield costs as the benchmark.
"Sharp Hanmar in Belchatow, about two hours southwest of Warsaw, was in the right place, had exactly the right equipment, very good staff, and excellent potential."
Founded by Marcin Kowal, Sharp Hanmar started production in 1997 and had a gravure press as well as coating/laminating and slitting equipment, all manufactured by Schiavi. The company was doing well with medium-sized local customers, but as a relatively small, independent supplier, didn't have the power to secure orders from international brands. As part of the Teich group, the company could have the credibility and support to win orders and compete successfully at the multinationals.
"There were many advantages to buying an existing company," says Findlay. "First, there was a young, enthusiastic workforce already working together successfully, and secondly, the acquisition of a going concern gave us a two-year headstart. The advantages include supply chains that are being built now and working customer relationships now being established."
Sharp Hanmar had a comprehensive laboratory, excellent equipment, newly redeveloped premises on a 110,000-sq-m site with room for expansion, and good relations with the local community.
Teich bought Sharp Hanmar in 1998. Kowal continued to serve as president until January 2001 when he moved to the supervisory board. "It's a good marriage," reports Findlay. "We still service many of the company's original customers, and we are adding the large international brands. The group's investment policies will ensure that Teich Poland, as the company now is known, can continue to grow and improve."
After completing the acquisition, Teich made investments in warehouse facilities and additional equipment. "We started with the warehouse," says Findlay. "Seventy percent of packaging used in Poland now is imported, and there is a great advantage for customers to have materials on hand for JIT [just in time] service. This gave our customers an additional and immediate benefit." This past summer, a new building was constructed so the company has all the necessary facilities for world-class printing and converting under one roof.
Satisfying Customers Is a Balancing Act
Ensuring quality with economy is the delicate balance that companies serving international brands must achieve, wherever they are operating.
"To get commitments from major customers, they must be satisfied that our equipment and procedures meet their exacting requirements," Findlay points out. "We have obtained ISO-9002 certification, and new equipment is due to be added—all of which will increase our competitive advantage."
Teich Poland runs all types of films, including metallized films, and foil. Substrate suppliers are proprietary. Because converted packaging substrates and films are expensive, print quality and low waste levels are especially important. A ninth gravure unit has been added to the company's Schiavi 1250-mm Roto Cadet press, and one of the early decisions was to invest in a new web inspection system to ensure quality and reduce waste.
"With today's long-run jobs, waste can quickly become a significant expense of the run and affect profitability," according to engineering manager Jacek Piotrowski. "So we began to look for a system that would help us meet our requirements—and those of our customers.
"Another factor is the range of substrates we run, some of which are difficult to print," Piotrowski adds. "For example, 15- to 40-micron oriented polypropylene and 30- to 40-micron materials for lidding for dairy products."
In his investigations, Piotrowski was supported by Teich's group technical advisors. Their choice of a PrintVision/9000NT defect detection system from AVT was made after studying all the systems on the market.
"If there was a single thing that attracted us to the PrintVision/9000NT," Piotrowski explains, "it was the ease of handling for the operator. It is very simple to use. The job setup is fast, and we were impressed by the option for cold seal inspection." One unit on the press can be configured for reverse printing for cold seal application or applying coatings or white ink, he reports.
The RiteSeal system inspects the underside of the web to ensure proper registration and application of cold seal adhesive, says Piotrowski, doing this simultaneously with the inspection of the printed surface.
"Cold seal is not easy to see as it has no color," Piotrowski adds, "but RiteSeal shows it as a black line, so we can be certain that the application is precise. I was also impressed with AVT's software. It has been designed to be simple, and since the PrintVision/9000NT has been built as a platform, it means that it is a machine for the future as well as one with immediate benefits."
Piotrowski cites other advantages he has found: "Setting up all eight colors on the PrintVision/9000NT takes less than two minutes, which is impressive. After a few weeks of operation, we could already see that it reduces waste and set-up time and helps to make shorter runs more viable. The operators like it; because it's automatic, they are free to work away from the console and carry out checks and make the usual press adjustments."
Piotrowski, who spent two weeks learning the system at AVT's headquarters in Israel, explains that the optical system on the AVT equipment can detect defects at an early stage so that remedial action can be taken before waste occurs.
"Depending on run length," he notes, "our speeds have increased five to ten percent using the PrintVision/9000NT."
One of the innovative benefits of the system is that it can facilitate the individual setting of tolerance parameters for certain print defects, according to Piotrowski. Color, register, print quality, streaking, and spotting can all be individually controlled. "Setting tolerances independently means that we can control the balance between quality and production viability carefully. Quality demands are very high in today's packaging, and this system will help our customers ensure that there is no difference in quality across a brand."
Taking a Long-Term View
"Teich Poland is a young factory," says Findlay. "For a gravure printer to have major international brands as customers in less than two years is remarkable."
Apart from investing in equipment, Teich Poland is investing in people and in its immediate environment. With 90-100 employees, the company subscribes to a voluntary Polish policy of employing the disabled, a policy that Teich Poland has found to be very successful as well as important in furthering the relationship with the local community.
The community has just installed a new road to the company called ul. Austriacka. Another visible sign of commitment is the recent planting of 1,500 plants and trees around the buildings. There are on-going exchange visits involving group companies in Austria, Germany, and the U.K.
Findlay sums up the venture: "The economic climate is positive overall; the workforce is excellent, well trained, and eager to succeed; and business conditions are dynamic. Of course, there are challenges, too. The market is already very competitive, and consumer prices are lower than in Western Europe, so the supply chain must adapt to that and keep operating effectiveness high."
But on balance, he says, "It's been a very satisfying venture."
Teich Poland Sp.Z.o.o.
Rogowiec, ul. Austriacka 5
PL-97-410 Kleszców, Poland
+48 (0) 44-7315800; teichag.com
AVT (Advanced Vision Technology), Hod-Hasharon, Israel; +972-9-761-4444; avt-inc.com
Schiavi SpA, a Bobst Group co., Piacenza, Italy; +39-0-523-4931; bobstgroup.com