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The complete package: developing packaging solutions for a circular economy

Interview - July 28, 2021

Japan’s Takigawa Corporation has long been a leader of packaging solutions with a history stretching back to the 1950s when it first began extruding high-performance films for the packaging industry. Since then, the company has grown into the global packaging technology pioneer and is today able to count on some of the world’s most successful consumer brands as long standing customers. We sat down with president, Hiroyuki Takigawa, to learn more about how the company is turning its focus to developing environmentally friendly packaging solutions fit for a more sustainable future society.

HIROYUKI TAKIGAWA, PRESIDENT OF TAKIGAWA CORPORATION
HIROYUKI TAKIGAWA | PRESIDENT OF TAKIGAWA CORPORATION

The Japanese manufacturing spirit, known as monozukuri, has now gone beyond seeking just product perfection through craftsmanship. Nowadays, it now also involves responding to customer requests and providing added value to the final product delivered. Could you please give us your take on monozukuri and what for you is the essence of monozukuri?

We have more than a hundred years of history and this year marks our seventieth anniversary in the packaging business. Although the Japanese term monozukuri is getting more popular in the world, I think our company is not doing anything out of the extraordinary. We are just continuing what we have already been doing for the past seventy years of doing business. On that note, we have gained a significant amount of experience and expertise.

My grandfather started Takigawa as a factory that manufactured picks and other ivory parts used for Japanese instruments. Thereafter, my father transitioned to the plastic business. I am the third generation of this family-owned business which has adhered to one core standard right from the beginning: valuing quality over quantity. In truth, we could have been a much bigger company today, but we put more emphasis on quality and taking pride in our products.

At present, we have a little over eight hundred associates who truly understand the importance of our products and provide intellectual contributions to enhance them. The package is crucial in guaranteeing the quality and safety of the product it contains. Put simply, we need to understand the importance of our products. While it is true that we invest in new equipment and yearly upgrades to our machines, the quality of our products primarily comes from our human capital. I encourage my staff to see things the same way that I do. For this reason, our production stays unique despite the abundance of companies that use the same equipment and machines as our company.

We mostly conduct business in Japan, Asia, Europe, and North America. Many companies go to Vietnam for the cheap labour and costs that results in the use of inferior machines and lack of people training. On the contrary, our company follows the Japanese standard for everything. For instance, I brought the first thirty-six employees that I have hired in Vietnam over to Japan not only for technical training but also to help them develop the same vision as the company.

It may be hard to believe, but I have an employee working at this company for fifty-six years now. Still, I am working towards unifying my staff, both old and new, with regards to new technologies, thinking, and perspectives.

 

Over the last thirty years, Japanese manufacturing has been under sustained pressure from regional competitors like Korea, China, and Taiwan who take advantage of cheaper labour and economies of scale to replicate Japanese products. What can Japan do to overcome stiff price competition among these competitors?

I think that product differentiation comes from continuous product development and quality. I do not want to be the number one supplier, but I want to be the only supplier to my customers. Our slogan “Growing together with our customers and growing together with our suppliers” illustrates this aim that translates to having a mutual relationship with our customers. We make better products through the process of learning from each other.

We are very successful in the global market because we have been in this industry for a long time. To prove this point, there is a huge company, with plants all over the world, that only wants Takigawa as its strategic supplier, trusted partner, and solution provider.

 

What are the key technological developments in the seventy-year history of your plastic business that your father had started?

My father took over the company just after World War II in which he made the change from ivory to polyethylene plastic that he had to obtain from the U.S. Due to this transition, my father had to overcome obstacles along the way. One was the hardship of getting a passport and the absence of direct flights from Japan to America at that time. There was also the need to import because the resin supplier in America refused to sell the fresh resin to Takigawa. Subsequently, having started the business after the big regression, we lacked financial resources to purchase new equipment abroad.

My father taught himself mechanical engineering and designed and manufactured his own machines. Then, the economic boom further advanced our company’s growth and prompted us to manufacture hula hoops, toys and various other products. Moreover, utilizing my father’s technology for the extruding of film by inflation system, we expanded to more specialized packaging processes such as printing, lamination, bag making, and others.

One of the decisions we had to make that proved successful was having all our processes in-house for more conducive quality control. I believe it has been twenty-three years since I assumed this position at which I changed the direction from extruding film to a more combined governed business. I had two reasons for this change. First, the extruding business is a very standardized market. Secondly, I thought that it will not be long before China takes over this market. Thus, I decided to move to a more sophisticated and niche market that requires more technology and new ideas.

 

Due to the pandemic, we can see an enormous rise in e-commerce. In the United States, over three hundred million shoppers - more than ninety percent of the population are expected to be online by next year. Tell us more about how you are adapting your products for this e-commerce market.

E-commerce is a business-to-business (B2B) exchange, and it is much smaller than our regular Minimum Order Quantity (MOQ). Our packaging business is not so simple because everything is made-to-order wherein the printing, size, film format, formulation, and structure depend on what the product inside the package requires. There are so many details that we have to discuss and consider to better understand the options our customers have. Normally, we bring potential customers to our plant and show them our facility and how we take care of the production and safety. When they see and understand that we can satisfy their needs and meet their requirements, then they sign a contract with us.

Due to COVID, however, we have incorporated solutions to adapt to e-commerce marketing like investing in a video that features our factories. It was an expensive expenditure, but it proved to be an effective tool to introduce Takigawa and show what happens at our plants. We now also send product samples to help our customers look at the characteristics of the products. Further, we invested in portable small-sized machines and found ways to meet smaller orders.

 

Besides your company’s two different divisions which are the market and the material products, your customizable products are also integrated. What is your bestselling product that you are currently offering? Also, please tell us more about the synergies that you are able to create between these two different divisions as well alongside the customizable part.

Our best-selling product is the flat bottom bag that we started making about twenty years ago. Now, we are producing more than a hundred million bags annually which shows that it has veritably created growth in the global market. It takes around two years to train the operators of the machines because of their high complexity. Still, we have twelve machines in the world that run twenty-four seven for adequate production.

The resistant matte printing was also well received by our customers. As one of the first companies to bring in this technology, we have created a new market and expanded our customer base. Our products are very simple yet remarkably competitive in terms of appeal, stability, efficiency, and numerous options. The products we promote are in the premium range but are still highly requested by our clients. So, whenever companies need something specific and tailor-made, I customize the products accordingly.

 

Many countries are conforming to the ban on all non-biodegradable / non-recyclable plastics; the United Kingdom since 2015, only last year in Japan, and China by 2022. Could you tell us more about your efforts to develop biodegradable and environmentally friendly materials for packaging?

I believe that switching to biodegradable materials is not a solution. In fact, biodegradable materials make micro-plastic too. I take a great deal of responsibility for the global issue associated with plastic not just to comply with European regulations but also to contribute solutions. In response to this global concern, we have been trying everything we can in our packaging business to reduce both plastic and carbon dioxide emissions. We upgrade our machines every year, install solar panels on the roof, and use hybrid or electric cars for the efficient use of energy.

We have successfully developed mono-material and fully recyclable bags. However, success is not limited to one product; it entails continuous development of its features that are advantageous to the environment. Let us take for example the protein powder pouch. While it is true that adjusting the shape means lesser shelf space, it also reduces the use of film by about 13%, hence reducing CO2 emissions.

 

To what extent do you think plastic manufacturers should take responsibility for the situation regarding the problems with plastic waste?

I think there are two ways that plastic manufacturers should take responsibility. First, plastic manufacturers should strive to reduce CO2 emissions from the production processes. Second, they should contribute by recycling and reusing the products after use. This also means educating and creating new habits for consumers.

 

We know that you are working on new packages and developing new products.  In addition to that, Japan is famous for the level of spending that it has towards Research and Development which is up to 3% of annual Gross Domestic Product. Could you elaborate more on your R&D strategy? Are there any products that you would like to share with our readers?

We develop our products in harmony with the requests, recommendations, and feedback from our customers and suppliers. When our suppliers develop new things like the Easy Lock closure, they introduce to us their new packaging technologies and ask for our cooperation. The co-packing machine manufacturers provide valuable input to enhance our packaging processes.

We are working to develop products that promote recycling and safety. In Japan, the new closure features are geared towards the safety of both children and older consumers. Our basic philosophy about development is taking on a challenge. We never say that we cannot do it, instead, we try and do it. It does not matter if throughout the process we fail or use a lot of money, but what matters is that our team learns from it and continues to attempt towards success.

 

Regarding licensing agreements, you have one with Aplix where you share the trademark Easy Lock and another one with Dow Chemical for Pack Xpert for your products. Are you looking for co-creation partners or more license agreements for your business?

To be honest, I do not want to produce something that everybody else can recreate very easily. It is a big challenge since we also design our machinery. But as I mentioned before, we want to grow together with our suppliers and customers. I invest when I see that it is something pertinent to my customers. Moreover, I endeavor to be very open-minded.

 

I want to ask you about your international operations because you started your factory in Vietnam in 2012 and more recently you established a base in Kentucky, USA. What are the benefits of this international sales and production strategy that you have adopted?

We used many outside small companies in our production when we only had one plant in Japan. The earthquake that occurred in Tōhoku in 2011, the same time as when we reached our full capacity, facilitated our expansion to Vietnam. I realized the need for a backup plant outside Japan because of the frequency of earthquakes and typhoons in Japan. In view of this, I chose Vietnam as Takigawa’s overseas production base wherein we started production within one year. It was a great time for us, and I reckon that it was an excellent decision for our company. Correspondingly, we transferred the exporting business from Japan to Vietnam in 2012. We have great memories of playing football or tennis at the plant’s massive field. After nine years of operation, however, the plant is maximized and there is not a place to install any more machines. Likewise, we built a plant in the U.S. three years ago that greatly benefited us through a more globalized perspective, varied technology, and taxation advantages.

 

Moving forward, are there any places that you are looking to further expand to? For example, Europe, Australia, or more so in Southeast Asia. What methods are you looking to employ for expansion? Will you open a new factory or just a sales office?

If the need arises, we may expand somewhere in Europe where many of our customers are. We chose America over Europe for our recent expansion because of the higher demand. Our U.S. plant is four times bigger than the one in Vietnam and more machines will be installed next year. Many of my customers are planning on expanding in the U.S. as well. As they have been asking our company to supply to them, I think our current goal is to take care of our current customers.

 

Imagine we will come back in five, ten, or fifteen years from now, what would you like to tell us? What legacy would you like to leave for the next generation? What are your dreams for your company?

I would like Takigawa to be known for the best quality, the best service, and as a customer-oriented company. I want it to be a trusted company that customers seek for solutions and the creation of new products. I strongly believe that this is already happening.

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