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AIPIA mission: to decimate supply chain costs and increase members' turnover by the implementation of high tech solutions in packaging

AIPIA, the Active & Intelligent Packaging Industry Association is a young organization, set up at the beginning of 2012 at the behest of its current head Eef de Ferrante. In the light of a personal experience with hi-tech logistical industrial platforms and associations, de Ferrante grasped the importance of packaging technologies in the supply chain, and after further studies he reached the conclusion that the many forms of A&IP (Active & Intelligent Packaging) were ripe for greater commercial development and exploitation. This led to his setting up AIPIA (whose mission is to decimate supply chain costs and increase members' turnover by the implementation of high tech solutions in packaging): the fact that, in a short period of time, the organisation has grown to comprise 400 members, including big brands and blue chip segment packaging concerns, shows that it has truly filled a gap.
In the near future, at FachPack, Nuremburg, the association will hold its first congress (see box).
In this exclusive interview given to us, as well as market considerations Eef de Ferrante also offers interesting food for thought on A&IP.

Can you illustrate figures or statistics on the size of the active and intelligent packaging market? How much has the use of A&IP grown and what are the forecasts regarding growth potential?
Various studies have been carried out on the subject, some of which analysing specific aspects such as RFID or Smart Packs. A recent survey made by Visiongain estimates that by 2016 the A&IP sector will stand at around 17.3 billion dollars in value within a global market that will be worth more than 800 billion dollars. It is estimated that overall the sector will grow by 7.7% per year, attaining 60 billion dollars by 2021. As soon as the distribution chain becomes fully aware of the benefits of A&IP in terms of safety and a better management of supply and procurement, with a reduction in waste and “losses” (also in terms of theft), the market will grow extensively.

What are currently the most common forms of A&IP on the market?
Let’s first try to distinguish between “active” and “intelligent”, that at times can be one and the same. ”Active” refers to safety-, anti-counterfeit-, oxygen scavenging devices, time/temperature indicators, innovatory materials and, no less important, nanotechnologies. “Intelligent” packaging refers to sensors/RFID, mobile commerce, telecommunications/TIC, shipment monitoring and, not least, printed electronics, that has had some truly interesting recent development.
The A&IPs are what is more part of a global market, where some “rules” are changing, starting from the greater attention to food waste in the supply chain up to a need to contrast the wave of fake and counterfeit products plaguing various sectors (pharmaceutical, cosmetics, wines, spirits).

How much does adopting A&IP cost? What are the advantages in terms of savings or ROI?
The subject of “costs vs. benefits” is central to Aipia. And if in the recent past RFID technologies have created some problems along these lines (the tags cost between 5 and 10 eurocents) but also due to some structural limits like fragility, unreliable performance in damp and cold environments and longterm legibility, today, thanks to research, the latest generation of tags is much improved. All the same in our opinion the real revolution lies in printed electronics: if producing a tag still costs a few cents, the price of printing is infinitely lower and a printed tag is also simpler to apply. Here too some aspects need improvement (print speed, inks, substrates) but the solution is not far off. We believe that the tagging item-level is only a question of time and that it only needs to be adopted by one big chain and the way will be open to others.
At the same time, on the “active” packaging front, if one is able to reduce food waste in the supply chain thanks to the identification of goods before they deteriorate or reach the retailer, or if one can demonstrate the quality and the duration of storage with condition indicators rather than by labels (which simply bear the wording “best before xx” or “sell by xy”), the economic savings will be enormous. The effect on the pharmaceutical market will be even greater. On this count I reiterate that the UK Health Service estimates that 300 million pounds sterling are wasted due to unused pharmaceutical products. Likewise in the US it is estimated that 40% of administrated pharmaceuticals are not taken by the patients. If the reduction of A&IP technologies managed to reduce this waste, improving customer awareness, the benefits would be enormous.

What factors should a brand owner consider in choosing A&IP packaging?
Certainly the cost, even if safeguarding one reputation and the guarantee of product authenticity are factors that are equally decisive. We are all fully aware of the costs and the damage caused by alerts regarding forms of foodstuff and their withdrawal from the market, the same way as we are well aware of effects of counterfeiting for many luxury brands…
Also to be considered is the A&IP’s potential as a marketing tool. One only has to think of the use of QR codes and NFC tags that interact with smartphones, that are recognised to be on the increase. These technologies among other things enable the immediate gleaning of sensitive data on purchasing habits, in that the consumer only needs to scan the product and the information reaches its destination. Scanning the QR codes with your smartphone allows you to read the warnings on medicinal packs or likewise assembly instructions elsewhere, avoiding the use of costly paper labels, that might be printed in as many as 16 languages!

Is there some resistance by brand owners or goods producers to the introduction of A&IP technology?
The fact that Aipia has reached the level of 400 members in just twelve months, mostly big brand owners or packaging agencies, implicitly answers your question. In actual fact, the association wishes to stimulate a different forma mentis: adopting new A&IP technology in fact enables one to modify the conception of packaging as a “cost” or as a “something that surrounds a product”, turning it into an “active” marketing tool. And even if changing people’s mentality takes time, it is clear that the process is already underway.

AIPIA Congress: the whys and wherefores
Scheduled Nuremberg 23rd to 25th September, during the exposition FachPack, the first Aipia congress of promises to be a unique event, totally one of a kind, both due to the issues to be faced as well as for the representativeness of the speakers who will intervene.
As pointed out by Eef de Ferrante «in one solution we have gathered together the leading names in the growth and development of A&IP, to discuss what already exists and what will soon be available on the market. We will look at the tools for combating counterfeiting and their success in the commercial field, and the efficiency of supply chains and types of packaging solutions for retail. Nanotechnologies will be discussed along with how their use can bring further benefits to packaging materials, for example by reducing overpackaging or energy consumption in the production of films.
The encounter will feature an exchange of ideas and opinions between brand owners the calibre of Nestle, McDonalds, Bayer and Marks&Spencers, and technicians and developers. The launch of a new smart packaging item is also scheduled.
Never before has the entire A&IP world gathered for a discussion of such a wide scope. In addition to reviewing the most important issues, we will be in a position to establish a program for the further commercialization of technologies and the most effective way of putting the same into practice».
 
For information on the program, the list of speakers and presentations as well as the booking form please refer to http://www.aipia.info