Labelling firm sticks to quality
James Costello is MD of Label Tech. He tells Sean Gallagher how the company has continued to expand and grow
The issue of how products are labelled has become increasingly important and more sophisticated in recent years. Not just because good labelling helps with branding and encouraging consumers to buy one product over another, but because a whole raft of legislation now requires that manufacturers provide information to potential customers on everything from ingredients and the 'best before' dates, to how to use a product properly. Professional labelling, therefore, is no longer a luxury but an essential part of any production or marketing process.
This week, I visited James Costello, MD of one of Ireland's premier labelling firms, Label Tech. Set up in 1992 by his late father, Padraig, who sadly died shortly afterwards, the company employs 40 staff and has an annual turnover of more than €8m.
"We specialise in the manufacture and printing of premium self-adhesive labels," explains James as he welcomes me to the company's modern production facility in Santry, north Dublin.
Around the office and production floor are samples of labels the company has produced. Ranging from SMEs to large multinationals, most of their customers are from the FMCG, food and beverage, logistics, pharma and retail sectors - among them many household names, such as Dunnes Stores, Aldi, Lidl, DHL and Glanbia. While many are Irish-based, the company also exports approximately 25pc of total sales, particularly to Northern Ireland and the UK.
"The production process starts with us receiving artwork from our customers in soft copy format," explains James. "Our dedicated graphic design team then work on it to fully maximise the colour and design combination to ensure a high quality label that will stand out on a shelf, or wherever it is destined for."
As we make our way around the production floor, there are numerous large industrial machines busily printing away in the background. Some are state-of-the-art digital printers, while others are of more traditional flexographical type. So, what's the difference?
"The flexographic machines use traditional printing plates and ink and, as such, require traditional skills to run them effectively," explains James. "Each colour is layered on individually by the printing plates before the next one is added. Therefore, great care and precision is required to ensure that, as it moves along the line, each new colour or pattern fits perfectly into the space designed and allocated for it. What we want is a perfect label with no gaps or overlapping of colours. In the industry, we refer to this as perfect registration. While they take more time to set up, these machines can achieve very high volumes and at very high speed, making them ideal for very large print runs where quality and costs are both important.
"However, because of the time and cost involved in setting them up, they are not as economical or suitable for shorter runs. This type of work is more suited to digital printing machines. These computerised and software-based machines use state-of-the-art one-hit technology, where all colours are applied at the same time. Because they require no set-up time or costs, these are ideally suited for use on the lower volume or shorter print runs."
There is little that James doesn't seem to know about printing, but that's not surprising, given that he started working in the industry straight from school. His late father had been working for many years in sales within the printing sector until, faced with ill health which resulted in him losing a leg, he had to give up his job. Determined to provide for himself and his family, Padraig decided his best option lay in starting his own printing business and, in 1992, having assembled a small team - including James who joined in a sales role - he struck out on his own.
"Lots of people thought he was mad at the time," recalls James. "He had no money, so he borrowed what we could from family and friends and was very grateful to receive a loan from Cambridge Finance to buy the machines we needed to get up and running. Perhaps the fact that we were all naive back then might have actually helped us, because we really had no understanding of the challenges that lay ahead. If we had, we might never have started."
However, his father had built up a very large network of contacts over his many years in the industry. Known as a decent man and a very hard worker, he had a real talent for establishing rapport and relationships with those with whom he did business. Once he was set up, many of his former customers rallied to support him. Everything looked bright for the new entrepreneur. However, Padraig's dream was sadly cut short when he passed away just 10 months later while on a family holiday in Waterford.
The management team at the time continued to run the business, even moving premises to keep up with growing demand. While it was a difficult time for the business, it was also a difficult time for James. Committed to making sure his father's legacy would continue, he immersed himself completely in his work. He also went on to complete an MBA, part-time, in Smurfit Graduate School - something that helped broaden his outlook and increase his confidence. In 2001, he finally took over as MD. The following year, seasoned financial director, David Keogh, joined the business, helping to put in place a strategy for further growth that included doubling the size of the factory.
"The introduction, in 2006, of the new digital printing technology was a real game-changer for the business and made us more versatile and flexible. Because there were no origination or set-up costs, it allowed us offer smaller label runs at more competitive prices," insists James.
Today, James and his team continue to focus on growth. His target now is to grow the company's turnover to €12m per year within the next five years. To achieve this, he is focusing on broadening his sectoral expertise to encompass major growth areas such as the logistics, drink and pharma sectors. Not surprisingly, James is continuing to adopt a similar approach to that of his father. For him, business is not all about making a sale, but about developing a long-term relationship with his customers.
"Key to this," he insists "is the ongoing loyalty and dedication of our staff, many of whom have been with the company for over 20 years."
James, like his father before him, is a decent and hard-working man. It is obvious from meeting him that he loves what he does. It is obvious too, that he and Label Tech have mastered their field. While Padraig Costello did not get to see his dream become a reality, he would no doubt be proud that the business he worked so hard to set up continues to flourish in the very safe hands of his son.
For further information: www.labeltech.ie
Sunday Indo Business