Arpac Group has grown through acquisition and by delivering superior equipment to suit a wide variety of packaging needs. Scott Koegler tells us how this innovative company has grown to hold an 80 percent share of its market.
Every product that moves from one place to another is wrapped or packaged to protect it from the rigors of transport and keep the pieces together. When Arpac was founded in 1971, it focused on serving the market for shrink-bundling by making machines that would unitize and wrap its customers’ products. Since, the company has expanded its horizons and its abilities through a series of acquisitions and internal development to further enhance its capabilities with corrugated tray and case packaging equipment, horizontal form fill and seal and pallet stretch wrapping. “We look for technologies that we can sell through our existing distributor base,” says Sales Manager Greg Levy sales manager, “and manufacture with our existing engineering and manufacturing structure.”
Presently, Arpac’s product line includes automated packaging equipment that can wrap nearly any product that needs to be packaged. As the company likes to say, “Our equipment can package anything from toothpaste to tool sheds.”
As Romy Modlin, marketing manager for Arpac explains, “We develop our technology in response to the marketplace. Packaging requirements are always changing.” Most recently, changes in the films used to wrap products have been rapid and dramatic. New printing technology applies promotional images to film that Arpac’s machines use to wrap products. Unprinted film can be applied to packages without regard to the orientation of the package or where the film is cut. However, printed films must be applied in specific ways, and cut at predetermined lengths so the printing appears in the right direction and in the right spot on the package. This accuracy requires controls that simply didn’t exist in earlier equipment. “Our high-end machines are able to register and apply film wrap properly on up to 140 bundles per minute,” she notes.
“We see a tremendous change from paper packaging to plastic, and from clear to printed film packaging. These changes are being driven by the large capacity stores like Wal-Mart, Costco, and Sam’s Clubs in an effort to drive costs lower,” says Modlin. Companies transitioning from corrugated packaging are finding plastic wrap to be up to 40 percent cheaper. And the film manufacturers are continuously making better, stronger products. As an example, new film material used by Arpac, as thin as .2 mils in thickness, are able to support 24 bottles of water without the need for a cardboard tray.
A big customer base for Arpac is the contract packaging market. These companies need to be able to wrap packages that vary in size and shape for several different companies with a wide variety of products. These companies have
selected Arpac’s systems because they are designed to accomodate a wide variety of products and possess quick changeover features. “Our equipment can be reconfigured to handle up to 16 different product recipes, and quickly switch between them,” explains Modlin. “This is important when many short runs of different products need to be done quickly. Our systems can be reconfigured to handle this work as part of the normal routine.”
The printing industry is also an important market for Arpac. Packages of printed material vary in size based on the number of copies to be delivered to each location. Arpac’s machines are able handle the diversity of sizes, and can bundle up to 80 packs per minute.
All together now
Arpac’s 138,000-square-foot facility is located five minutes from Chicago’s O’Hare Airport. Says Modlin, “Everything at Arpac happens under one roof. Our 200 employees are all here and run everything, including engineering, machining, fabrication, painting, assembly, and quality assurance.” When Arpac bought its stretch wrapping facilities, it moved the entire operation from Tyler,
Texas to its Chicago building to preserve the consistency of its single location.
“In the last four years we’ve invested in capital equipment to increase capacity to manufacture a wide range of products,” Levy says. “We have experienced steady growth and we’ve done a lot of work to improve our processes using lean manufacturing techniques that have improved the quality of our products and our velocity to market.”
The Chicago plant also houses Arpac’s aftermarket services, which consist of technical service, a call center, parts department, and customer training. “We have over 20,000 installations in the U.S. so aftermarket is one of Arpac’s key competitive differentiators,” says Modlin. “We stay with our customers
and make sure they know how to use the important features of our systems through training, technical support, and our call center.”
Part of Arpac’s sales process is integrating its products into its customers’ existing production lines. Often a system can be installed, using one of Arpac’s standard forms in as little as two weeks. The modular design of its packaging machines allows Arpac to create customized arrangements that precisely fit its customer’s needs by mixing and matching parts. Sometimes, however, special components are needed to adapt to particular conditions. “One of our customers uses our equipment to wrap dry ice. Our engineers designed a specialized version of one of our standard systems that is able to handle the dry ice quickly and safely, and
continue to perform under the unusual conditions needed,” explains Modlin.
Specialized configurations designed to customer specifications require at least eight to 10 weeks from idea to installation and are done by the company’s 20 mechanical and electrical engineers with a combined 200 years experience in the packaging machinery industry. “We have taken on projects that many
competitors couldn’t because of their standard components.” To bring about the final product Arpac participates in every step of the process: customer conferences, engineering design, customer approval, and finally assembly of standard items and building of any customized parts needed.
Growing Market Share
The company’s dominance in specific markets is even greater because of its ability to work directly with distributors as well as developing direct relationships with end users to deliver solutions that precisely fit the packaging and service needs.
The roofing shingle market is one example of innovative packaging, and one in which Arpac holds an 85 percent share. Arpac machinery is used to wrap shingles in imprinted plastic rather than the traditional paper packaging. This protects the product on the job site and makes it easier to handle. In other area, Arpac has always been a leader in providing packaging systems to the printing industry, but over the last 10 years it has found steady acceptance in the high-speed bindery industry where it now dominates the segment with a 95-percent share. One of the last markets the company is addressing is orbital wrapping, where products like wood or pipe are bundled with stretch wrap.
Says Modlin, “Our product line is nearly complete in that there is an Arpac product for almost any product.”
Arpac expects to grow its market share within the segments it already occupies while expanding its skills to address the needs of the packaging industry. Its customers point to the company’s ability to provide quick and easy standard machinery as well as understand their needs to provide customized solutions when necessary as key decision points in their buying process. And Arpac prides itself on its understanding of the market and its continuing commitment to customer care and service after the sale.
With its dominant position in the market and its broad range of packaging abilities, Arpac continues to wrap up sales to a growing variety of customers. Its American made products are durable enough to run for years at high volume, and the company as a whole expects to continue to do the same.