Intelligent Buhrs packaging solutions improve efficiency at Japanese (non-store operations) specialist PAL System Coop

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PAL / March 2014 Case study

Business Case Summary PAL System Coop is a consumers’ Co-operative Union that delivers goods and food to some 780,000 members of its home delivery service every week. Together with their weekly delivery, members receive a customized mail pack containing a personal selection of brochures and leaflets and an order form they can use for next week’s shopping list. Already operating four Buhrs systems for many years, PAL System Coop decided to replace two of these systems – installed in 2000 – with two new state-of-the-art intelligent Buhrs 3000 packaging solutions. The systems – fully customized to further improve operator ergonomics – are capable of putting together a selection of up to 26 different items in one run, by using a gathering section with selective feeders. Both systems are equipped with highly intelligent Buhrs Data Controller software.

Improve accuracy, reliability and efficiency The Pal System Consumer’s Cooperative Union was established in 1977 as a co-operative with a mission: ‘to improve the living culture of union members’. In 1990, a ‘Personal Delivery System’ program was started by some of the Coop-groups. Today, the PAL System Coop operates as a mail-order company that delivers goods and food to members in Tokyo and nine other prefectures on a weekly basis. Out of a total of 1,370,000 members, some 900,000 subscribe to the program with 780,000 members actively using it every week.

“The mail pack will also contain a personal selection of up to 20

brochures and leaflets.” Although an internet-based ordering system – ‘On-line PAL’ – was introduced in 2001, and members can also buy the products at retail PAL shops in town, PAL System puts great effort in sending out printed mail packs together with the weekly home deliveries. Mr. Atsushi Ishida, Executive Director explains: “A typical mail pack consists of a series of personalized documents: a statement of the ordered products, an invoice (once a month) and an order form for next week’s shopping list. Customers could also receive a reminder concerning any unpaid invoices, and twice a year a seasonal gift order form will be included.” “The mail pack will also contain a personal selection of up to 20 brochures and leaflets.

This selection is based on database analyses and profiling customers by order behaviour, age and family structure. People can order via the Internet or by sending back the paper order form – in which case the information is fed into the ordering system using OCR-technology.”

“The reliability of the systems has been proven in the past 13 years.”

PAL System Coop installed its first Buhrs systems in the year 2000. Today, it employs four such systems to ensure a smooth and secure production of all its mail packs. As the organization manages to grow its membership base (from around 1 million members in 2005 to its current 1,37 million members) and plans to achieve an annual 3 per cent growth for the next five years, it needs to keep its operation up to date. That is why it decided to replace the two oldest systems by two new state-of-the-art mail systems. Choosing Buhrs as the provider for these new systems was the obvious choice, says Mr. Ishida “The reliability of the systems has been proven in the past 13 years. Plus, Buhrs delivers a very good after sales service.” “This is truly a very large project and an important investment”, says Mr. Koichi Kobayashi (MD-Buhrs Japan K.K.). “PAL System Coop is planning to run the existing application on the new systems and could therefor order a dedicated system that exactly fits their needs and at the same time enables them to increase productivity, reduce waste and optimize quality control. The customer insisted on a more user-friendly overall design to improve operator ergonomics. Also, our new and advanced Buhrs Database Controller (BDC) was to be included to ensure high accuracy, reliability and efficiency.” “By sharing experience and expertise

with our customer, we were able to build a highly dedicated solution.”

Building a highly dedicated solution PAL System Coop has been running the ‘Personal Delivery’ application for many years on Buhrs equipment already. “However, these systems do not use the Buhrs Database Controller yet”, says Mr. Arjan De Vries, Buhrs’ Engineering Manager. “This time, we are able to offer our complete solution. And that gave us the opportunity to fine-tune both hardware and software for this customer and this specific application. By sharing experience and expertise with our customer, we were able to build a highly dedicated solution.”

The two new Buhrs 3000 systems have the same configuration, offering a gathering section of 21 selective feeders. On request of the customer, this complete section has been lowered to allow the operators better access to the units, says Mr. De Vries: “Additionally, this section of these systems has been built asymmetrically to make it even easier to fill up the feeders with printed materials.” A line of five feeder units has been placed at a right angle with respect to the rest of the system. This not only reduced the total length of the system (still stretching an impressive 36 meters) but, more importantly, allows for a series of lightweight inserts to be collated before joining the central lug chain. Mr. De Vries: “In this way, we reduce downtime that paper jams from these units could cause.”

Next in line are 5 system channels, feeding up to five personalized documents to the matching mail pack that has been put together selectively. Every individual set is then film wrapped and sealed, ready to be sent out together with this weeks’ delivery of the ordered food and goods. Every pack has to be right The application has no need for inline printers, as all materials (including the personalized documents) for the mail packs are pre-printed. “That also means there is no room for mistakes and every pack has to be right. You can’t restore any mistakes by reprinting items inline. This demand for a ‘zero defect’ operation was the biggest challenge we faced: at the end of the line, every pack needs to be perfect.”

“The system also constantly knows the exact position of each and every

individual mail pack during the operation.”

As it is impossible to rule out malfunctions during gathering completely on systems as large as these, the solution lays in constant monitoring and providing operators with clear information in case of any failure, explains Mr. De Vries: “Our Controller allows us to monitor every feeder and detect any missing or double delivery of printed materials. The system also constantly knows the exact position of each and every individual mail pack during the operation. In this way, it can clearly indicate on two large screens to the operator where the failure occurred and what needs to be done to repair the mistake – for example: ‘brochure 13 is missing in the mail pack currently on position 45’ – and get the production started again. By making this information available in a very transparent way, downtime is reduced to a minimum and every mail pack has the right content.” Additionally, inspection cameras control the flow of the personalized documents

on the five system channels, making sure that the right information reaches the right person.

Integration of hardware and software Building an integrated solution of hardware and software also allowed Buhrs to implement other new features, says Mr. De Vries: “For instance, we have now introduced new functionality to the packaging module, where mail packs are film wrapped and sealed. In standard operations, we need a series of dummy-products at the start-up and at the end of each run to keep the film-module occupied with items to wrap and seal. Now that we monitor the entire system by our Buhrs Database Controller, we are able to keep the film-module from running until the moment the line is filled with actual products that need to be wrapped and sealed. We only need 7 or 8 dummy-products, instead of some 60 pieces, to get a new production running at full speed. This saves on printed materials and film, and reduces waste and time. Although this new functionality was not specifically requested by the customer, it proved to be highly appreciated.” True partnership In July 2013, representatives of PAL System Coop travelled to the Buhrs headquarters in The Netherlands for a Factory Acceptance Test. During a three-day session, the complete system was put to the test to make sure the application was running as required

before shipping the two systems to Japan. Mr. De Vries: “By working together with our customer’s experts and building on their experience in running this application, the test was completed successfully. This is always an important moment for us, because we need to be absolutely sure everything is exactly right.” To ensure a smooth start-up of both systems at the actual production site in Japan, Mr. De Vries will be at PAL System Coop for two weeks to give technical support. Mr. Kobayashi emphasizes the importance of true partnership in large projects like this: “Why did PAL System Coop again choose Buhrs as its solution provider? It is all about trust, quality, sustainability and our ability to understand and work with the customer to develop a perfectly fitting solution.” About Buhrs Buhrs is a leading worldwide provider of mailing and fulfillment solutions. The company develops, manufactures, sells and services systems for poly and paper wrapping and fulfillment. Buhrs systems prepare media products, such as magazines, newspapers, documents, direct mail products, books, videos, compact discs and cards, for distribution. Buhrs systems perform the following functions: collating (in- and onserting), addressing (inkjet or label), wrapping (in poly or paper), back-end sorting and stacking. Buhrs provides software solutions for database connections, read and print, closed loop, integrated systems control, production management and mailroom management. Buhrs systems can be equipped with reading and verification devices, such as bar code scanners, OMR readers and cameras.

Buhrs is partner to postal organisations, publishers, printers, binders, mailing houses, letter shops, banks, service bureaus, insurance companies, fulfillment companies and many other businesses, from medium-sized to large and leading. With a large installed base Buhrs is well- established and proud of its reputation for quality and reliability. Headquartered in Zaandam - The Netherlands, Buhrs has a network of subsidiaries in the United States and, Japan, as well as industry-qualified distributors to provide global coverage. Buhrs' long history goes back more than 100 years. Buhrs has been a subsidiary of Value8 (www.value8.com), listed at the NYSE Exchange Amsterdam, since 2010 and is part of the Value8 Tech Group Value8 and Value8 Tech Group Value8 is a company investing in medium large companies, aiming for long term growth and shareholder value. Within Value8, The Value8 Tech Group represents a group of technical companies (GNSBrinkman – Fire door & Shutters solutions, Axess - Lift Solutions and Haak-Production and Engineering Solutions), providing centralized management, financial structure and operational support to safeguard short delivery times. The company focuses on the wrapping & packaging market and delivers safety & entry solutions. More information On this or other customer cases: info@buhrs.com www.buhrs.com