UK's biggest wrapping paper maker: 'It can be Christmas every day'

https://www.theguardian.com/business/2016/dec/23/uk-wrapping-paper-christmas

Version 0 of 1.

With deft accuracy, a design worker is sticking sparkles on a gift bag in an office festooned with crackers, wrapping paper swatches and shelves loaded with multicoloured glitter.

Based near a former colliery in south Wales, a team of 45 designers work on new creations for IG Design Group – the world’s biggest producer of wrapping paper and crackers. The team started designing for next Christmas in August. One worker says she often gets home to find glitter in her car, on her hair, even on the dog: “It can be Christmas every day here.”

Loss-making and struggling under a mountain of debt in 2008 after a string of acquisitions, IG has survived by restructuring, and broadening its product ranges to include stickers, gift bags and other new products alongside traditional wrap and cards. The wrapping paper is made in Wales while the design team’s other creations are turned out at IG’s factories in China and the Netherlands.

Paul Fineman, chief executive of the group, says order books for next year are “heaving” because the drop in the value of the pound post-Brexit has boosted demand from abroad.

The group produces 1bn m of wrapping paper a year, almost half of which is made in Wales. It supplies all the major supermarkets and major international retailers including Ikea and Costco. Upmarket crackers, under the Tom Smith brand, sell for up to £500 and will be adorning the royal Christmas dinner table.

In October, IG sent a selection of four specially selected cracker designs to Buckingham Palace so that the Queen could choose one to grace her Christmas table.

Its products may be swathed in glitter, but the factory in Ystrad Mynach, a short drive from Newport, is an example of gritty British survival against the odds.

Previously IG had three sites – one where wrap was printed, one where it spun huge printed reels of paper onto cardboard tubes and another where goods were packed up ready for stores. The group spent £8m on bringing the whole operation together in one site two years ago. It switched to using more environmentally friendly and efficient water-based inks and introduced new processes that can add glitzy touches such as holograms and shiny finishes.

“In 2008 we had to seriously think whether we could make this a viable facility,” says Fineman. “It was loss-making and had a lot of issues. We had choices and one of those choices would have been that this place didn’t have a future as a manufacturing site. But we felt if we could remodel, find different customers and channels and create a sufficient resource to invest that not only could we survive but it would be very profitable. It was very challenging but it is working.”

IG’s enormous printing machines have 10 heads that layer ink onto a polymer roll on which the design has been laser cut so it stands proud like a giant potato print. Paper from reels more than 1m thick is fed through the printing system before being dried in a long oven and then sliced in half as it is spun back into another thick roll.

The plant can print 72km of paper an hour, and employs up to 450 people at peak times about half of whom work in manufacturing.

From September the printing machines are working 24/7 right up until Christmas week to cope with late orders from British retailers. Production restarts for next Christmas almost immediately and shipping begins from June or July with boxes of wrapping paper packed off to Bristol docks and shipped over the Atlantic.

The company is having a good year. Underlying sales were up more than a fifth in the six months to the end of September with profits up 36% as gift bag sales soared.

Fineman says the fall in sterling will bring another boost. “The UK is going to be a very uncertain place. But over the next 12 to 18 months UK manufacturing, the number of cards sold is up 5% year on year.

“Sending Christmas cards has declined other than single cards to close relatives. “People aren’t just writing out cards to their colleagues at work. But there are new occasions and reasons to send cards all the time. People just see a card and think ‘that’s fun’ and get it. There doesn’t have to be a specific reason any longer.”

IG is also trying the same trick with crackers – with versions for Halloween and Easter. Some of the crackers are designed in Wales but they are made at the company’s factory in China from which it ships to 29 countries. Last year it imported 60m crackers to the UK – nearly one for every person in the country.

And who writes the jokes? The company employs a network of freelancers, but anyone can contribute an idea. Even Fineman claims to have contributed a couple over the years, although he won’t reveal what they are. Maybe it’s the one about “tinsel-itis”.