Packaging/Equipment Developments In Japan
Space considerations shape the market.
By Ron Bailey
Visitors to Japan are always impressed by the quality and variety of food packaging on the retail store shelves. The packaging graphics and presentations are of uniformly high quality and the range of packaging forms available, from traditional to modern, are particularly interesting. Although not usually seen by the casual visitor to Japan, the processing and packaging machinery used in the production of processed foods is equally interesting and often unique to Japan.
Driving Forces Behind Package Developments
Predictably, the Japanese lifestyle is the basis for many packaging developments. Japan is an extremely crowded country and space is at a premium in all large cities. Smaller package sizes and smaller food portions are therefore the norm and smaller neighborhood stores accessible on foot are much more common. There are now over 50,000 convenience stores (“konbini”) in Japan, led by 7-11 and Lawson’s, subsidiaries of supermarket chains Ito Yokado and Daiei respectively. These convenience stores operate with limited inventories, both in terms of numbers of products offered and the quantities of any given item available. Many of the recent packaging developments, therefore, have resulted from the special needs and requirements of the convenience stores.
Similarly, the limited space available (and the propensity to walk rather than drive) has led to the development of a large Japanese vending machine industry for all types of foods and drinks. There are now well over 2.5 million beverage vending machines in Japan, dispensing hot and cold canned, bottled and cup beverages (including hot canned soup in the winter, for example). Several packaging developments have come from the specific needs of the vending machine industry.
Most Japanese believe that the overall quality of their consumer goods packaging (not just foods) is the best in the world and that their consumers are the most demanding. It is very difficult to find a food product with any type of packaging defect on the store shelves in Japan. Care is taken at every step, from manufacturing through distribution to placement on the retail shelf, to maintain the built-in packaging quality characteristics.
At the same time, growing environmental concerns are mandating changes in the food packaging industry. An increasing amount of food packaging is required by law to be either incinerated or recycled rather than placed in landfill and major infrastructure changes are underway to handle the packaging waste generated. In the beverage industry, the rapid shift to PET bottles has spawned a new industry dedicated to reclaiming the bottles and new recycling plants are currently under construction to handle the increased volume of returns. In the cup noodle and cup soup categories, more products are being switched from polystyrene to paper to eliminate consumer concerns about harmful chemicals. Dioxins generated from plastic waste incineration have become a serious issue in Japan in recent years and the public is concerned about the presence of incinerators close to very crowded residential neighborhoods.
It is also worth noting that since most packaged foods in Japan are quite expensive, it is somewhat easier for the food companies to absorb the costs of special packaging systems as part of the cost of goods. This is one reason why it is common to be able to find relatively expensive “active packaging” systems such as the oxygen absorber tablets and sachets and ethanol-releasing mold inhibitor packets used in packaged foods for the enhancement of shelf stability.
Food equipment manufacturers are faced with many of the same challenges. The very high cost of land and the extremely high cost of utilities are incentives to design compact processing equipment and support systems. There is the added incentive of reducing high labor costs, which has resulted in the automation of even traditional manufacturing processes. This has been the basis for such specialized equipment as the popular robot sushi-making machine.
Major equipment manufacturers generally have a strong overseas presence, since it is very common for Japanese packaged food producers to specify the use of Japanese processing equipment at their overseas sites. It is common for foods to be processed in bulk overseas (frozen vegetables from China, for example, or sembei rice crackers from Thailand), then shipped to Japan for final packaging.
Japanese food equipment makers have also decided that the inclusion of sophisticated computer-controlled features are usually helpful in attracting buyers. It is very common to market complete automated processing systems rather than individual pieces of equipment, even for such traditional processes as ramen noodles or cooked packaged rice.
The ongoing economic slowdown has had a serious impact on equipment sales in Japan, however, as capital spending has been reduced by most companies. Competition from other countries, including Asian neighbors Korea and Taiwan, has increased and often overseas equipment suppliers are able to offer comparable quality at a much lower cost. Japanese equipment manufacturers try to argue, however, that the important after-sales service is often lacking when purchases are made from overseas manufacturers rather than from those in Japan. Conversely, it is not uncommon for small Japanese companies to be unwilling to sell their processing equipment to overseas markets, for fear of being unable to provide the high level of after-sales service typically expected in Japan.
There is no question that Japanese companies are willing to consider the purchase and/or licensing of new packaging technologies and processing equipment from overseas companies. It is less common for such systems to be transferred intact to Japan, however, given the different requirements in that country.
Packaging technology licensing examples include the James River microwave susceptor system (still not popular in Japan), the “Doy-Pack” stand-up pouch (very popular in Japan for a range of liquid and dry foods) and the “Cartocan” composite paper can (becoming more popular for vending machine beverages). It is not uncommon to discover a new packaging concept in Japan only to learn that the base technology was licensed from an overseas company. Patent protection is critical to protect the overseas developer of new packaging technologies.
Processing equipment licenses are also possible, although less common. More often Japanese companies adapt the equipment concept to a specific Japanese market need, usually (but not always) carefully avoiding patent restrictions in the process. Some Japanese companies are aggressive patent filers in their own right.
Japan should be viewed, therefore, as an excellent source of new ideas and concepts when considering new packaging and equipment developments. Japan should also be considered as a new market opportunity for new packaging and equipment technical developments, especially when the developments are properly protected by strong world patents.
NW
