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Wednesday, Oct 5, 2022
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Labeler Gets Stuck on Suds

Stan Avery started an empire based on one bright idea: a self-adhesive pricing label that store clerks like him could stick on any product without extra gum, glue or moisture. Eight decades later, the company that bears his name, Avery Dennison Corp., is still coming up with innovative ways to make labels stick, including its newest invention: a self-adhesive covering for aluminum and tin cans, something that could be a big deal in the growing craft beer business. The Glendale firm, which has a market cap of $5.37 billion, plans to unveil its trademarked AeroDress technology at an industry trade show in the Netherlands this month. The breakthrough process involves a newly designed, white filmic paper on which labels are printed and then heat is applied to the film at the top and the bottom to shrink the material around the curves of the can. “Current self-adhesive labels cannot provide full-body coverage of the can,” Rob Groen in ’t Wout, leader of Avery Dennison’s home and personal care and beer and beverage segments, said in an email from his office in the Netherlands. “They leave a small gap at the top and bottom of the can. AeroDress technology covers a can completely.” He said the innovation will be marketed to labelers of aerosol cans used for home and personal care products as well as to beer canneries. While the company would not comment on how much it spent to develop AeroDress or what it expects to earn from the innovation, it plans to sell the technology through its existing sales channels, said Groen in ’t Wout. Can do Danielle Jerschefske, North America editor for London-based industry publication Labels and Labeling, said Avery Dennison’s innovation is likely to appeal to the growing craft brewing industry. Breweries are increasingly packing their suds into lower-cost aluminum cans rather than glass bottles. “Avery Dennison is the world’s most prominent supplier of pressure-sensitive labels across the board,” she said. “That a company like that is paying attention to the craft brewers shows the growth in that market.” As of last year, there were more than 2,500 craft breweries operating in the United States. More than two-thirds of them use wet-glue-applied labels, with only 30 percent using pressure-sensitive labels like Avery Dennison’s at that time, according to the trade journal. It’s likely that Avery Dennison hopes to make further inroads into that market with AeroDress, which is designed to be cost-effective for production runs of 20,000 units or fewer – an appealing feature for small-batch brewers. The technology allows for complete coverage of obsolete, preprinted cans, which many smaller manufacturers hold in inventory as they must buy in large volume to keep prices low. The labeling innovation can be used with a wide range of printing techniques, including letterpress, flexo, gravure, silkscreen and foils – another appealing aspect for craft breweries that seek unusual and creative labels to add shelf appeal to their products. Avery Dennison’s pressure-sensitive materials division accounts for more than 70 percent of the firm’s total sales. In the second quarter, the company reported adjusted net income of $63.3 million, an increase of nearly 14 percent from a year ago. Its pressure-sensitive label business increased sales 4.5 percent to $1.1 billion, while sales for its retail branding and information segment declined 7 percent to $384 million in the quarter, according to filings with the Securities and Exchange Commission. The global self-adhesive labels market is projected to be valued at $36.9 billion by 2020, growing at a 4.8 annual percentage rate from 2015 to 2020, according to a report last month from research firm MarketsandMarkets. Because the market is highly fragmented, Avery Dennison and others must turn out new products to bridge gaps in their offerings, end-market requirements and geographical constraints, the report said.

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