ICONEX announces $2.8 million investment
The cost-benefit analysis for a $2.8 million equipment investment, described as game changer for ICONEX by management, included a tangible production benefit and a pathway to future growth.
The manufacturer has been in Morristown since 1968 and was until three years ago known as National Cash Register. The strong bursts of growth — experienced since 2016 when Atlas Holdings bought Interactive Printer Solutions, a division of NCR Corporation, and launched Iconex — are producing numbers rivaling the new industrial players in town. The company stands at No. 1 in square footage expansions over the past year, No. 3 in job growth, and its capital investments during 2018-19 totaled $10.9 million.
Then there is the Christmas season, known in Iconex-speak as Amazon.
Iconex is the largest thermal paper supplier in the world. Major retail customers who use the paper to print receipts include Lowe’s, Burger King and Walmart — “If you’ve shopped anywhere, you’ve touched our product,” Plant Manager Tammy Casteel said.
In addition, the plant maintains a large label footprint with Amazon, particularly with sequential bar-coded labels. Iconex is the sole supplier for the online retailer in Canada, feeding all its distribution centers in the country.
Amazon was in fact a major determining factor of the capital investment in the game changer, an ET12 coater.
“As we get ready for Q4 (fiscal fourth quarter), everybody knows Amazon business picks up, mainly because we as consumers have switched so much to ordering online,” Casteel said. “Previously, we would have had to start in July or August, running their product, to even cover their busy season. With this new machine, we’re running labels like crazy, so we are so much better prepared this year to service them.”
The ET12 began production in late September.
“The new technology allows us to be more cost-effective,” Casteel said. “That’s always a bonus. The top speeds are 500 feet per minute, which again allows us to better serve our large customers such as Amazon when we’re coming in to peak season.
“This is double our capacity for this type of equipment,” Director of Technical Information Jim Price said.
The press make pressure sensitive labels, such as the address labels on Amazon packages and bar code labels that provide individual, sequential tracking of Amazon packages.
The press enables the plant to make laminated pressure-sensitive labels completely onsite versus having to buy pre-made elements. It’s more cost-effective and efficient, which means more production, more business and more jobs in the Morristown community, according to Casteel.
A pressure sensitive label is made up of four layers: liner paper, silicone, glue and face paper: the top portion that is printed or written on. Price said traditionally, companies have invested in label presses that required purchasing pre-made label material from suppliers in large rolls.
“So if you wanted, you could have this great big long label: 10,000 feet in length and so many inches wide. The label press would cut out the individual label shapes and print on them. Then you would finish the roll in a size that would fit into a printer, or for people to use,” Price said. “The ET12 makes the four-part pressure-sensitive ‘sandwich’ of those components, and then we print on it and dye-cut it and finish it. This machine is built so that it does all that inline, together.”
The large incoming rolls are automatically replenished on the front end of the machine and the resulting smaller rolls are automatically finished on the back end, so they can be immediately loaded into boxes. The ET12 has been fitted with both barcode and QR (quick responder code for smart phones) printers.
“It can run 24/7 nonstop, if we want it to. So that’s how it’s a little bit different,” Price said. “The advantage to making your own label material is that you can save the margin, or money, that you are normally paying to the maker of the pre-made sandwich. It’s more cost effective for us and more efficient to produce. We get some advantage over traditional manufacturers who don’t make their own material.”
Another jewel in the Iconex crown is the company’s sticky media production, its patented type of labeling allows for easy removal (think Post-it notes) that has proven successful with customers like Dunkin’ Donuts, Chick-fil-A and the golden arches.
“You order a Big Mac with no pickles, it’s on there – that’s us,” Price said. “We really have a good footprint in that area, and we’re growing.
Expanding production capacity requires a team effort between operations and sales; in the case of Iconex, the team looked at its existing platforms to determine whether they were adequate to meet the forecasted demand of future business, according to Price.
“If the answer to that question is ‘no,’ then we have to design a solution for that, whether it be going out an buying an ETI coater, or designing something unique and special that’s built just for us by another company; i.e., like the sticky media press.”
The sticky media press will involve an investment of $5 to $6 million; installation is projected to be complete in early 2020.
The expansion of Morristown operations over the past year has encompassed 200,000 square feet of additional space located in a building shared with Odello Manufacturing, just a mile down the road from the Iconex plant located in the East Tennessee Valley Industrial District, allowing for efficient shuttling from the production floor to the warehouse.
“We’ve doubled our distribution and logistics; we were at 50,000 square feet, now we’re at 100,000 square feet of space,” Casteel said.
“We looked at every building in Morristown that was available, trying to find the right space for us,” Price said. “And there were some logistics involved.”
“We’re truly honored by the community’s support and are excited about our continued growth in Morristown.”
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