Shrink-Label Able: Verst Pack Leverages Its Logistic Expertise Right into Efficient Contract Packaging

http://www.packagedesignmag.com  ~ by Debora Toth

As marketers seek to find every available method to draw a consumer’s eye (and wallet) to their product, one of the fastest growing areas is shrink labeling. Take a stroll down any supermarket aisle and look for all of the varying sizes and shapes of product packaging. All of these products, whether they be in plastic or glass containers, are candidates for colorful, eye- catching, shrink labels. For most every size or shape, manufacturers can now put a shrink label on the product in a timely, cost-effective, and consumer-grabbing manner.

One such firm was Welch’s, the world’s leading manufacturer of juice, jam, and jelly products, who wanted to expand sales of its sparkling grape juice cocktail. The company turned to Verst Pack, a Walton, KY, custom and contract packager. Verst Pack worked with Welch’s to create brand new premium markets for their sparkling grape juice cocktail tied to particular holidays and events by adding eye-catching shrink labels on their bottles. Now consumers can easily find the Welch’s product for special holidays, such as New Year’s Eve, Easter, Valentine’s Day, and Fourth of July, where a toast of sparkling grape juice might be used. The Welch’s product has experienced significant growth due to this unique labeling alternative.

In just five years, Verst Pack has become one of the leading full-service custom and contract packaging solution firms in the nation. Verst Pack combines premium-quality shrink labeling, assembly, cartoning, display, and fulfillment experience with the expertise of its parent company, Verst Group Logistics, and utilizes its vast warehouse space, nationwide transportation network, and labor flexibility.

Verst Pack’s establishment and growth are one of its unique aspects. Unlike its competitors, who start out as contract packagers and then seek warehousing and trucking facilities, Verst Pack took the reverse route. The company used its ample warehouse space and logistical expertise to move into custom and contract packaging.

“There were two reasons that we started Verst Pack,” says Paul Verst, president and CEO of the company. “First, we had customers of Verst Group Logistics who were asking for us to get involved in the packaging end. These customers were having us send their products to a third party to be shrink labeled and this became time consuming and costly for them. With our company adding a packaging division, we were able to save our customers money.”

Verst continues, “Secondly, our company was going through strategic planning and looking to diversify. This type of market was a perfect complement to our business and displayed significant growth opportunities for us.”

Verst’s acumen proved correct. The custom and contract packaging industry was in its infancy five years ago with a bright potential. Today, Verst Pack offers single-source capabilities including shrink label, assembly, L-Bar sealing, bundle wrapping, cartooning, multi-packing, display, POP display, and fulfillment on glass and plastic containers including PVC, PET, and HDPE and works with a variety of shrink materials including PVC, PET, PET-G, and OPS. The firm is scheduled to label over one hundred million containers this year. The division has grown from five customers to 50, and less than five of its customers use Verst Pack for cyclical projects–the majority use Verst Pack for monthly projects. Verst estimates that Verst Pack will be posting 30% to 70% annual growth for the next five to ten years.

To enter the business, Verst Group Logistics sought to purchase a small packaging company based in Cincinnati, OH, that held an impressive customer base but limited equipment and space. Within three months of the purchase, Verst had moved the Ohio firm from its 15,000 sq. ft. facility into a new 180,000 sq. ft. building at its Kentucky headquarters with over three million square feet of rack/floor warehouse space and state-of-the-art facility with advanced EDI and WMS (warehouse management system) technology. The facility features 24 dock doors and rail access for fast and timely transportation into the customer’s hands. Its high-tech automated equipment quickly applies shrink labels onto the full or empty containers and bulk palletizes or boxes them in any outbound configuration for shipment all over the country.

Verst Pack’s automated and manual shrink labeling lines can handle multiple projects simultaneously, which translates into unparalleled flexibility and timely packaging solutions for its customers, even with unusual or custom projects.

For example, Brown-Forman approached Verst Pack for the shrink label application of its one-liter Kentucky Derby Mint Julep bottle. The limited-edition square glass bottle uniquely displays the official portrait from the Kentucky Derby. “Not only did the unique shrink-wrap label draw customers to purchase the liquor,” says Jason King, director of sales and marketing for Verst Pack, “but I would estimate that perhaps many of the bottles have never been opened because they are now collector’s items. The shrink-wrap label looked so good that customers saved it.”

But providing an eye-catching yet economical packaging method is not the only card held up its sleeve. Verst Pack prides itself on investing in machines and infrastructure to bring costs down while increasing its speed and efficiency. The firm has spent considerably in installing a radio-frequency integrated system at its facility to track all of its incoming and outgoing pallets and scan the ID on each pallet into their computer system. Specialized robotics work to smoothly move all of the pallets through the facility and automatically band products onto pallets through a completely computerized system. Maintenance personnel diligently watch over the systems and an extensive quality control program is in place.

“Our goal is to make shrink labels the value option for marketers,” says King. “We’ve spent millions of dollars to invest in proprietary designs of shrink labeling systems, but the benefits are worth it.”

Each of Verst Pack’s customer jobs are approached as individual projects with unique configurations. Coca-Cola began to use Verst Pack to set apart its Coca-Cola products for particular groups or geographic regions. The cola manufacturer launched regional promotions for the Final Four basketball tournament in St. Louis this past spring with shrink labels designed especially for the basketball fans. Coca-Cola also uses this type of marketing for other sports teams, such as the football teams of the Tampa Bay Buccaneers, the Ohio State University Buckeyes, and the Florida Gators. The firm even sent some labeled soda bottles to the Cleveland Cavaliers market and the hometown of LeBron James with the young star basketball player’s image on the shrink label.