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Kanaoka’s new Reiwa Plant a “world-first” for water-based inkjet printing

Interview - July 20, 2022

The company aims to achieve overwhelming productivity gains through digital and AI technologies and an industry-leading ‘decarbonized society’ solution.


In the last 25 years, Japan has seen the rise of regional manufacturers who have replicated Japanese monozukuri processes, taking advantage of cheaper labor costs and pushing Japan out of mass-production markets. Yet, we still see Japan as a leader in many niche and B2B fields. How have Japanese firms maintained their leadership in niche fields despite the stiff competition from regional competitors?

Japanese manufacturers are skilled at communicating carefully with customers and suppliers. The sales staff thoroughly find out from the customer what their requirements are in detail and take the necessary information from suppliers. These are then entirely integrated together internally and fully reproduced in the manufacturing process. As far as I have experienced, Asian manufacturers are not very good at that approach. If the sales staff can fully penetrate the customer, get hold of their real needs and satisfy them in manufacturing, they will be able to sell at a relatively higher price and overcome the difference in manufacturing costs. This approach is particularly effective in the assembly industry, B2B, and custom-made.


Kanaoka Holdings Co., Ltd. was established in 1951 and for almost 70 years, you have been meeting the requests of your customers. Could you share with us more about your history? What have been your key milestones during these 69 years?

One day, shortly after my father founded the company, he met a great entrepreneur. The development of our company began on that day. That great entrepreneur was Mr. Tojuro Iijima, the founder of Yamazaki Baking. He told my father repeatedly that if he had high-quality, inexpensive wrapping paper and lots of trucks, he could mass-produce and sell his bread. In 1962, cast polypropylene film was launched and Mr. Iijima's vision was realized. Yamazaki Baking has expanded its business nationwide and is now one of Japan's leading business groups with a turnover of over 1 trillion yen. We followed the company's great leap and were able to expand our business successfully. The previous day's orders determine bread production for the following day. It is a food product with an extremely short production cycle. Therefore, packaging materials also had to be provided with extremely short delivery times. Our company's first distinguishing feature, "short lead-time," was developed during this process.

The second major milestone was the entry of a major CVS in 1998. Subsequently, the CVS stepped up its sales of home meal replacements. These are takeaway foods such as cooked noodles, salads, desserts, and prepared foods, in addition to boxed lunches, rice balls, and sandwiches. As these foods are not heat-treated, they require "super cleanliness" in the packaging material. We responded to this demand with the slogan "Packaging is a part of the food." We built state-of-the-art plants such as the Saitama Plant No. 3 (2006) and the Kansai Plant (2011). We have also acquired international food safety certifications such as AIB (2006) and FSSC 22000 (2013). It means that the company has taken both hardware and software measures. Afterward, food safety and security have become widely sought after in Japan, and the "super cleanliness" of our packaging materials has become our second distinguishing feature.

We expect that the completion of the Reiwa Plant in January this year will be the third major milestone. The Reiwa Plant is the world's first commercial production plant for water-based inkjet printing. The plant will enable us to achieve overwhelming productivity gains through digital and AI technologies and industry-leading    "decarbonized society converting" through water-based inkjet printing.


Can you tell us why your company is able to maintain stable growth?

Two huge printing companies, Dai Nippon Printing and Toppan Printing, occupy nearly 40% of the Japanese flexible packaging market and have had a significant influence. To avoid competing with them, we have looked to "what they don't do'" and "what they can't do". In other words, we have tried to pursue our uniqueness and create our market. Specifically, we have used features other companies cannot easily imitate as selling points, such as "short lead-time" and "super cleanliness".

We have also always tried to read the trends of the times and stay ahead of the curve. Specific examples of this are our pioneering work in supplying CVS and our current focus on developing water-based inkjet printing (in which no one else in our industry is involved).


You utilize water-based inkjet printing for your packaging, which is an environmentally friendly alternative to solvent-based printing. Your Reiwa Plant offers the world's first commercial production of flexible packaging using this water-based method, however if it does not dry quickly, it could mix which can create blurry images. How did you overcome this challenge for commercial production? Besides this, have there been any other obstacles to the realization of commercial production of water-based inkjet printing?

Achieving vivid printing with the water-based inkjet printing without blotting was a challenging task. It is because, of course, water-based inks do not penetrate plastic films. We have developed coating materials that pre-treat various kinds of plastic film surfaces so that water-based inks can be successfully printed on them, as well as a high-performance dryer that dries them in a short time. With them, we have solved this problem. The coating material and the dryer are proprietary technologies developed by our partners and us.

In the development of water-based inkjet printing, there was a tough problem before achieving vivid printing without smearing. The problem was how to match the color tone with other existing printing methods. It is tough to reproduce the same color tone when different printing methods and inks are used. We have developed an "Automatic Color Matching System", which combines our many years of experience with digital and AI technologies. In the past, color matching required a long time by skilled workers. With the newly developed "Automatic Color Matching System" it is now possible to reproduce color tones as closely as possible to the customer's desired color tone in a short time, no matter the printing method used.

Our ''Automatic Color Matching System” is a groundbreaking invention that will have an extremely significant impact on the entire printing industry. In the 700 years since Gutenberg's printing press, a great variety of printing methods (offset, flexographic, gravure, screen and inkjet printing, etc.) have been invented. All these printing methods can now be color-matched in a very short time.

Our inkjet printing can produce almost the same color tone as gravure printing without requiring time-consuming color matching. Therefore, we can select the printing method according to lot size, inkjet printing for small lots, and gravure printing for large lots. It leads to less waste of packaging materials for the customer. Together with our customers, we can also contribute socially to the environment.


Japan is the oldest society in the world. In the next 15 years, one in three Japanese people will be over the age of 65. This presents two major problems for Japanese firms. First is a labor crisis and second is a shrinking domestic market. What challenges and opportunities does Japan’s demographic situation present for Kanaoka?

As you have pointed out, an aging society with a declining birthrate brings a very serious labor shortage and loss of demand. It is becoming increasingly difficult to secure labor in our factories yearly. Our company accepts technical trainees from abroad as a result.

However, the essential way to solve the labor shortage is to reduce the number of people on the production floor. Among all manufacturing industries, flexible packaging manufacturing lags behind in digitization. Therefore, we are considering applying our knowledge of digital and AI technologies developed in inkjet printing to existing gravure printing to reduce the impact of the labor shortage. Specifically, using the “Automatic Color Matching System” for gravure printing can significantly reduce the time required for color matching, which requires skilled workers. It prevents differences in color tone in the same or multiple lots. In addition, our “Automatic Roll Feeding System”, which fully automates the transport of film rolls within the factory, can significantly reduce the number of workers in the factory.

To compensate for the shrinking domestic market, we are actively expanding into the growing Asian market. In addition to China, Thailand, and Indonesia, where we currently operate, we are planning to expand into Vietnam next year. As I answered at the beginning of this interview, Japanese manufacturers place great importance on internal and external communication and work carefully. We believe this way of working is particularly effective in the flexible packaging manufacturing industry, which is the epitome of B2B and custom-made.


Japan is a leader when it comes to process automation, however when it comes to the adoption of digital technologies, it is only ranked 28th in the IMDs digital competitiveness ranking. You have just constructed the Reiwa Plant which utilizes digital and AI technologies through autonomous mobile robots, as well as your “Automatic Color Matching System”. In a few years, you are planning on having fully automated operations in this factory. What challenges and opportunities are there for Kanaoka as you transition to fully autonomous operations?

We are focusing on upgrading our inkjet printing press, which we aim to complete within three years. With this upgraded model, we aim to store printing data in advance and link it to an AMR(Autonomous Mobile Robot). As mentioned earlier, automation is significantly behind in producing flexible packaging materials. By combining our inkjet printing press with the “Automatic Color Matching System” and the “Automatic Roll Feeding System”, the so-called Industry 4.0 (fourth industrial revolution) can also be achieved in flexible packaging manufacturing. This has probably never been done in the printing industry before in the world. We built the Reiwa Plant as an experimental plant for this purpose. We intend to apply and expand these mechanisms to gravure printing in existing plants once they are completed.


What role does collaboration and co-creation play in your business model? Are you looking for any overseas co-creation partners?

We are currently working on research and development to realize a "decarbonized society". The water-based inkjet press is at the center of this. The water-based inkjet press is now being put to practical use, and more new technologies for inks and dryers are needed to evolve and perfect it. The theme of completing “decarbonized society converting” is of enormous social significance, and we believe that development must be hastened. The product has been carried out in collaboration with a limited number of Japanese inkjet printing press manufacturers and Japanese specialty ink manufacturers. From now on, we would like to increase development speed by taking an open innovation approach and collaborating with manufacturers with superior technology from around the world. We look forward to participation and co-operation in our project with manufacturers interested in this subject.


What countries or regions have you identified for further expansion into and what strategies are you looking to employ? Can you please elaborate on your international business strategy?

As I answered earlier, we are already present in China, Thailand and Indonesia. Next year we will expand into Vietnam. We are exclusively present in Asia. It is because Asia is a growing region, but there is another reason. In my opinion, Asian people's preferences for printed material are much more sensitive than those in Europe and the USA. In Europe and the US, flexible packaging is generally printed using flexographic printing.

On the other hand, in Asia, gravure printing is the preferred method. Gravure printing is far more beautiful than flexographic printing. The inkjet printing we have developed matches gravure printing in terms of printing quality and is an environmentally friendly method that reduces CO2. We are confident it will be as widely accepted in Asia as gravure printing.


Your company is celebrating its 71st year anniversary. If we come back for your 75th anniversary, what goals would you like to have accomplished by then?

I have two primary goals.

The first is to complete the concept of “decarbonized society converting” and digitalized factories - at the heart of which is the water-based inkjet press we have developed. Then, we want to spread our systems (the water-based inkjet press , “Automatic Color Matching System” and “Automatic Roll Feeding System”) worldwide as the De Facto standard for supplying flexible packaging in a decarbonized and aging society.

The second is to establish operations in Vietnam successfully. Our involvement in Vietnam began several years ago when we started social contribution activities through a non-profit organization. We have so far built three schools in northern Vietnam. To provide a place for these graduates to work locally instead of working in the city, the local community asked us to build a factory. In this factory, we hope that by carefully transferring our company's way of doing things (so called “made by Japan” ), we will be able to produce high-quality, beautiful flexible packaging materials.