July 2013 / Folding Carton Industry

Turkish carton packaging industry review by Nick Coombes on his visit to Duran Machinery and three of Turkey’s leading carton houses during Printtek 2013 Exhibition in Istanbul.

Turkish carton packaging industry review by Nick Coombes on his visit to Duran Machinery and three of Turkey’s leading carton houses during Printtek 2013 Exhibition in Istanbul.

The recent Printtek Exhibition in Istanbul was the 12th time the Print Technologies and Paper Fair had been held, attracting 28,000 visitors to the six-day event, where 520 exhibitors from 39 countries had gathered to show machines and ancillary equipment. One of the largest exhibitors was local Turkish manufacturer Duran Machinery, whose Omega range of folder gluers has been attracting increasing interest from İnternational converters. Nick Coombes visited Istanbul to meet the manufacturer and speak with three of Turkey’s leading carton houses about the current state of the country’s market...

To many people in Europe, Turkey’s packaging market is unknown. Situated on the crossroads of two continents, and a mix of Christian and Muslim religions, Turkey has been for centuries a major trading post between east and west, and today with a population in excess of 75 million, is the world’s 18th  largest country with a total GDP of around US$ 850 billion. It sits slightly ahead of the world average consumption per capita of paper based products, but is still well behind the figure for Europe, and statistics for 2010 (the latest available), showed 18kg of carton and corrugated board consumed per head of population, compared with 48kg for the UK.

In 2012, Turkey produced 400,000 tonnes of cartonboard, against a total consumption of 650,000 tonnes, making it a major importer. The two main domestic suppliers are Kartonsan and Muratli-Kombassan. Mills in Europe, China and the USA currently supply this market. Converter Turned Manufacturer With 60 years involvement in the carton industry, and more than 20 in the design and manufacture of its Omega folder gluers,Duran Machinery has become a highly respected supplier, with a five-series machine range that varies in sizes from 35 to 165cm, and up 230cm for corrugated.Still essentially a family owned business, the company employs a staff of 70 at its facilities in Istanbul and has a global sales and support network of 19 distributors, with machines installed in more than 50 countries. Fundamental to the company’s record of growth is its commitment to innovation. According to Sales & Marketing Director, inar Kucukaras, “One of the secrets to our continued success is speed of response to changes in customer demand. We are committed to design innovation, high quality manufacturing and  customer-oriented after sales service. If you combine this with competitive pricing and an extensive range of attractive machines, it’s not difficult to see why we have grown so fast.” Another key factor is Duran’s strategic decision to retain all manufacturing procedures, including software, in-house. Seen as important for machine reliability, it also allows the company to update existing customers’ equipment on an ongoing basis. The five machine range, beginning with their entry level gluer are: Performa, Performa Plus, Allpro, Hi-Line, and Magnus he latter being specifically for corrugated. The Performa line, which was launched in 2007, offers straightline, double wall and crashlock capability with an option for 4-and 6-corner, inner partition, Z-fold, conical crashlock and CD boxes at speeds up to 300 metres/minute. It can be motorised and fitted with a side register section. Performa Plus, which was launched in 2012, is for quick changeover work and has a faster belt speed  of 400 metres/minute. Both ranges have been well received, and in the short time since their launch have been installed in 14 countries. The Allpro has the widest range capability in seven widths from 55 to 165cm and the capacity to handle cartonboard and corrugated at speeds up to 400 metres/minute. It is available with special features including Omega Turnpro, which turns the carton flow through 90 degrees, and the Omega Nick Breaker and Ejection units, as well as a Pre-Feeder and Pack Station. The Allpro is a highly versatile folder gluer that can handle complex carton styles and be customised for special applications.Duran’s new Omega Hi-Line model comes in four sizes from 90 to 145cm and is designed for maximum versatility and productivity. Launched at Drupa 2012, the company has already completed six installations of this highly productive machine, which has an optional top speed of 600 metres/minute and can be customised like the Omega Allpro Line.

On Show

An Allpro 45 was exhibited on the Duran stand at Printtek 2013, where it attracted great interest from visitors which resulted in 12 sales of a variety of Omega models from various countries. Commenting on the exhibition, Pinar Kucukaras said, “We were very pleased with the attendance overall, and the number of carton converters who visited our stand and asked for the machine to be demonstrated. As usual, our representatives from all over the world joined us at the exhibition, which made it a very effective event for sales like other exhibitions we have attended recently. ” In addition, the Expo gave Duran Machinery the opportunity to show its new OCBM – said to be the world’s first fully automated carton bag making machine. Designed to improve productivity of what is traditionally a manual operation, the servo driven machine automatically inserts top and bottom stiffeners (from 200 to 400gsm), as well as producing a great range of carton bags from 45 to 145 cm in open carton width. Duran Machinery believes launching the OCBM is timely as the global packaging market comes under increasing pressure to move to bio-degradable substrates. The Omega Carton Bag Machine was one of the main attractions of the exhibition, and Kucukaras said that two sales agreements were made at the exhibition one with a printing company in Turkey. There were also many contacts made with highly interested companies from around the world.

The Carton Market

To assess the current state of the carton market in Turkey, I visited three of the leading carton houses in the Istanbul area, and spoke with their senior management. According to Alican Duran, Vice General Manager of Duran Dogan Packaging, the domestic carton market has grown by an average of seven per cent in each of the past five years and shows no signs of slowing. “How many countries in the EU can remotely approach that figure?” he asked. He was also speaking as President of KASAD, the Turkish Carton Board Packaging  Manufacturers Association, and Vice President of ECMA, when he explained that his country processes 400,000 tonnes of cartonboard each year, making it the fifth largest in Europe, behind Germany, France, Italy and the UK and now ahead of Spain. “We are the fastest growing of the ECMA member countries and it’s not difficult to see why lots of inward investment by major groups, a high skill level and strong work ethic among our people, and, a central location that allows easy access to developing markets in Russia to the north, Africa to the south, Asia looking east, and to the well- developed markets of Europe in the west. We’re high on quality and highly competitive on price,” he added. Although the largest of the carton converters in Turkey, Duran Dogan accounts for little more than six per cent of the total volume in what is a fragmented market of some 200 cartonmakers, of which 160 are very small operations. It also has a plant producing micro-flute corrugated, and both this and the carton output is targeted at the high end of the market. Recently, the French group LGR International acquired a 23 per cent equity interest in Duran Dogan. With 11 production sites in France, Belgium and Spain, LGR is the third largest converter of pharmaceutical cartons in Europe and the specialised production synergy with Duran Dogan will be utilised to build strong growth. Asked about Turkey’s latest position on EU membership, Alican Duran commented,“We have a strong economy with a strong currency nd have no desire to underpin the EU’s flagging members.” Six and seven-colour printing is carried out on two large format KBA presses, one fully UV compatible, and two medium format, one a KBA, the other a Komori. Quizzed on this rather unusual mix of manufacturers, Mr Duran said each had its strengths, and the combination allowed a very flexible production capability. The company has its own in-house ‘Ink Migration Lab’, which is Government supported, and which acts as a great sales tool in the food sector. In addition, Duran Dogan has taken three years to develop metallised printing that requires no film so allows 100 per cent recyclability. In the finishing department, six Bobst die-cutters are complemented by six Omega folder gluers. Asked about the company’s decision not to standardise with one manufacturer, Alican Duran said that Duran Machinery proved to have a beter understanding of his company’s specific requirements and developed high quality technology that solved problems at a very competitive price. Kohmann and Heiber & Schröder window patchers complete the list of finishing machines, while at the corrugated plant, an Agnati single facer works inline with a Stock laminator. Duran Ofset, founded in 1953, and Dogan Packaging in 1934, were the pioneers in folding carton production in Turkey. The two companies merged in 2005 to expand volume and increase exports. Today it has the capacity to convert 30,000 tonnes of cartonboard a year, and plans to grow significantly from its present €42 million turnover, when the new investments kick-in. Assessing the overall carton scene, Mr Duran said, “Until the converting companies grow as big as their customers, downward price pressure will dominate the market. Global rationalisation will continue, and only the fittest will survive, but eventually they will be able to say ‘No!’ to the demand for ever lower prices. Brand owners seem to forget that packaging is the first point of visual contact for customers, so quality should take precedence over price.” Saying that the global economic model has changed, he suggested that the new generation of management needs vision to understand the market dynamics and be empowered to act quickly on changing market conditions. He also pointed out that the average age of the management team at Duran Dogan was under 40. “I think niche products more than niche markets hold the key to future success – and  specialisation is the way forward,” he concluded.

Setting the Standard for quality cartons

If proof were needed that carton converters in Turkey are a match for the best that Europe can provide, recent years of the  ProCarton/ECMA Awards act as evidence. With three finalists and one winner since 2009, the Turkish industry is now seen at the leading edge of technology and knowhow. Family owned and managed PrintPark Design, Print & Packaging, is one of those companies carrying the flag, and was the first Turkish carton converter to win a prestigious ProCarton/ECMA Award in 2009 in the ‘Beauty & Cosmetic’ category. Its Gabrini Make-Up Kit Box was not the first ‘double-slider’ carton, but the Judges felt the easy opening and display of the make up, allied to the presence of a mirror in the top drawer, made it ideal for purpose. It also combined a quality finish with spot varnishing that gave the print a sparkle to make it eye-catching. Now in second generation management, with Ferit Dansik, son of founding father Mehmet, in charge, assisted by brothers Turan and Turgay, the company  has grown from a small 50 square metre unit in 1974 to its present 9,000 square metre facility that employs 85 and delivered sales of €6.4 million last year. The plant focuses on highend, high value luxury cartons for the cosmetic (perfume and beauty) market, with growing business in premium confectionary and liquor. “We have invested €9 million since 2005 to bring our plant up to this level, which will provide us with the capacity to boost export sales from around 25 per cent currently to 50 per cent by 2015. We have a very low board cost to sales value here because of the added value techniques we use, and see ourselves as something of a boutique company with a strong focus on customer service,” he commented. Part of the company’s success has been careful selection of technology and the ability to keep all production in-house. So, self-sufficient in pre-press, and with fiveand six-colour B1 and B2 size Komori ofset presses, PrintPark needed to process its printed cartons effectively to avoid a bottleneck on the production floor. It has Bobst Speria, IMG Brausse and Alpha Luna die cutters, an SBL litho laminator and Heiber & Schroeder window patcher and turned to Duran Machinery for folder gluer technology, which, according to Dansik, was a straightforward investment decision. “No other manufacturer comes close on specification, performance and value. In particular, they are the best at finding solutions for special or difficult carton styles, and will adapt and update their machines to meet changing demand,” he said. PrintPark has three of Duran’s Omega Allpro folder gluers, a 55, a 70, and a 110, which he says, “will glue anything including PVC and PET.” Claiming that the company’s minimum quantity is one carton, Dansik says he is quite prepared to turn down volume work to keep capacity open for regular customers who work on short lead times, sometimes of only three days. “In practice, we tend to work on runs of 1000 sheets and upwards and are geared-up to handle short run work at short notice – it’s all part of being reactive to today’s changing market conditions,” he explained. Looking ahead, Ferit Dansik says that the company is planning to invest in another B1 press in six-colour and coater configuration, but that it is unlikely to stay with its current supplier. “Our Komoris have performed very well, but we feel the need to add the versatility that one of the European manufacturers has to offer,” he concluded.

ISO standards

Omaks Printing & Packaging, along with sister company and corrugated box producer Verpak Ambalaj, generated a turnover of €20 million in 2012. Founded in the early 1990s by Burhan Ozdemir, the business enjoyed dramatic growth after its move in 2009 to new premises at Beylikduzu, on the outskirts of Istanbul. Carton printing is carried out on two manroland presses, a modernised 605 and  a more recent 706, both fitted with inline coaters and, according to Omaks, both arehighly productive machines with the 706 printing 20 million sheets last year. Diecutting is handled on medium format Bobst and Heidelberg Dymatrix machines, while other finishing techniques includes window patching, hot foiling, laminating and folding and gluing. For folding and gluing Omaks has always used Duran Machinery technology and at present has three of its Omega branded machines an Allpro 55, an Allpro 90, and a new High Line 110. Speaking for Omaks, Sales Manager, Alparslan Kaleli commented, “We chose the first Omega for the quality of its engineering, which brings inherent reliability to the machine. The Level of after sales support we have received from Duran made the decision to add two more Omegas quite straightforward.” He  said that over the years the two companies have developed a close working relationship based on mutual respect, and this has helped both to grow their respective businesses. One look at its portfolio of work is enough to raise Omaks above the level of carton converter into the realms of innovative cartonboard technologist. With leading retail groups like M&S and Tesco to satisfy, Kaleli knew that the ‘me too’ approach would not win business. “We participated at the Emballage Expo in Paris and Interpack in Düsseldorf to assess the market and see how we could differentiate ourselves from the mainstream competition and quickly realised that creativity was the way forward,” he explained. Today the company prides itself on being Turkey’s only carton supplier to meet, and in some cases exceed, the high quality standards that are the norm in Western Europe, and is anticipating that 2013 will see formal international accreditation for this. “Our current phase of investment is all  about consolidating the quality of our output. We are well equipped to meet the key international criteria and are investing heavily in staff training to ensure we can maintain the ISO 12467-2 standard required,” he added. Like most packaging printers, Omaks is experiencing a decline in run lengths, and Kaleli says that 10,000 sheets of five or sixcolours plus coating is now a typical job for the company. A new offset press with full UV capability and a new die-cutter are on the shopping list for late 2013 or early 2014 as the company looks to achieve its growth target of 50 per cent by 2016.

Conclusion

If Turkey really is the unknown neighbour on Europe’s south east frontier, it is one that needs to be taken seriously by both carton  converters and carton buyers. From the evidence I have seen, the Turkish market is buoyant, well-equipped and hungry to do business outside of its own borders. For those involved in the industry, this should make the upcoming ECMA Annual Congress in Dubrovnik an ideal occasion for both parties to explore mutually valuable business opportunities.