BRINGING EXCELLENCE TO A COMPLEX BUSINESS

Just another day at Arkay

By Jackie Schultz
Mitchell Kaneff

erving the high-end luxury packaging market is a lot like the game of tennis, says Mitchell Kaneff, CEO of US based Arkay Packaging. Youre only as good as your last shot. You hit that great shot, thats done, and then you need another great shot. Then you win the game and go to the next game. We try to run our business like that. Each day is a new day. Indeed, just another day at Arkay is not for the faint of heart. Focused exclusively on the cosmetics industry, the company deals with perhaps the most meticulous and high profile clients in the industry. Often Arkay is trusted with a fragrance or cosmetic packaging line as part of a multi-million dollar product launch. Earlier this summer teen pop singer Justin Bieber launched his new Someday fragrance. It was Macys biggest celebrity launch on record. Arkay produced the secondary packaging for it. A lot of people dont understand that this is a very complex business. This isnt just a printing business. Its print front side, back side, eight multiple colors, pearls, coatings, laminated, hot stamped, coated again, then send it to the diecutter, maybe twice for an intricate design, and then through a multi fold gluer. Youre looking at seven, eight operations and you want to make sure you get it right. If you dont, youve got to do all those operations again,

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Folding Carton Industry. September/October 2011

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Kaneff says. Its a very sexy looking business on the outside, but its probably the most demanding of all the folding carton niches. Whats Arkays secret? Kaneff holds close to the vest specifics about the ingredients necessary for success, however, its clear he relies on a talented and dedicated team, state of the art technology and going above and beyond for the customer. Like completing a rush order and driving seven hours to the customers house to hand deliver a proof, or creating a successful design from scratch. Were constantly focused on ways to wow our customers, Kaneff says. That has always been the secret ingredient, he says, even when his father, Howard, ran the business. Weve had people come in with lampshades, he says, recalling when Leonard Lauder (Estes son) took the tortoiseshell lampshade from his office desk to Howard and said, I want to make this into my next fragrance launch. The fragrance was Aramis, a successful mens cologne. Even going back to the late 50s and early 60s, thats the history of how we run our business. People are giving us swatches of this and that and colors to make things happen, he says. format machine that will stamp all in line and have the capability of laying six colors after the stamping it down and multiple coatings on the end of the machine, says Walter Shiels, Chief Operating Officer. Thats what weve done with that new machine, and it will run in the 10,000 to 11,000 sheets per hour range. The cold foiler also has the ability to step, meaning it does not pull the foil leaf around the entire 28-inch cylinder. This reduces the amount of foil used. Arkay has already printed several fragrance cartons on the press, including Coach for Estee Lauder, Elizabeth Ardens White collection and Juicy Coutures Peace, Love & Juicy. Peace, Love & Juicy was a job that could not be done conventionally where you print it and stamp afterwards because of the registration, Shiels says. When we built that file we built it for cold foiling and there was no other way to get the registration you needed. We were rewarded that business based on the technology. Arkay has six offset presses, four Heidelberg and two manroland. The entire operation is sheetfed with a 28 x 40 inch format strategy. We do that for color control and consistency, Shiels says. The products we produce are demanding. They dont allow hickeys, and color variation is critical so when you get into the larger format, it is very difficult to maintain premium color control. On the finishing side, Arkay runs primarily Bobst equipment. The most recent investment is a Bobst Expertcut diecutter. Last fall, Bobst invited Kaneff to speak about zero defect manufacturing at its Competence 10 open house in Switzerland. His talk focused on benchmarking performance indicators like quality, on-time delivery, and customer satisfaction. What doesnt get measured cant get improved, he says. We developed a score card that we still use to this day. I started measuring the business by numbers, believing the maxim: In God we trust, but all others bring data. I may trust you, but show me the numbers. Those who couldnt do that left and those who could excelled at Arkay.

Custom Designed Technology

To meet customers needs, Arkay invests significant amounts of time and money in new technology. When youre dealing with very tight registration requirements you have to have the latest most effective equipment, Kaneff says. Today, youre hoping to make money on the first run. Consistency is one of the key ingredients of our success we have to be perfect all the time. This year Arkay is installing a Heidelberg XL105 eight-color 40-inch offset press with double coater, cold foiler, and all Interstation UV. The technology is our special sauce, Kaneff says. Arkay built a prototype for high speed cold foiling on its 28- x 32-inch seven-color Heidleberg CD 74. Once we developed the recipe, we said, Now lets build a larger

From left, CEO Mitchell Kaneff; Eric Simon, Corporate Director of Print Management; Walter Shiels, COO; John Sheridan, Corporate Quality Assurance Director; and Brian Hopkins, Corporate Vice President of Operations.

Folding Carton Industry. September/October 2011

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ARKAY PACKAGING
Kaneff is a staunch proponent of training, especially for the press operators. He believes its another key to the companys success. The operators routinely attend courses sponsored by the Printing Industries of America and the Graphic Arts Technical Foundation. They recently completed advanced UV training for first, second and feeder operators. Their framed certificates are displayed on the reception area walls of Arkay. Training also extends to customers. They will spend two days in the classroom and on the production floor and leave with a signed plaque from Kaneff, Shiels and Brian Hopkins, Corporate Vice President of Operations Howard left his mark with several noteworthy developments, such as hot foil stamping in the 60s, bringing CAD/CAM technology to the United States in the 70s, and developing UV printing in the cosmetic industries in the 80s. Although Howard Kaneff is no longer involved in the day-to-day operation, Kaneff says, Hes my confidant. I share with him whats going on in the business and his enthusiasm is always great. When I was younger I was more defiant and wanted to create my own path; today Im grateful for my fathers feedback. within the next 10 years youll have to be unionized, and I said, Im never coming back. Where do I sign the document? Howard and Mitchell Kaneff hired a site surveyor in the mid-90s to choose a new location. Virginia, a right-to-work state with its lower operating costs and tax incentives, won hands down. And Roanoke is not only easily accessible to the entire Eastern seaboard, it is located within minutes from Elizabeth Arden, one of Arkays customers. The facility, more than 130,000 sq ft on 10 acres, has already been expanded three times. When we first moved down here we were $30 million in sales, Kaneff says. My goal is to be around $60-$65 million and I can easily do that with the firepower thats here in this facility.

Managing Change
Kaneff is the third generation to run Arkay. His grandfather, Max, founded the Arkay Printing Co. in 1922. Mitchells father Howard ran the company until turning it over to Mitchell in 1997. Before retiring in 2004 Arkay employs 200 people and operates three shifts. The company was originally based in Manhattan and then moved to Hauppauge on Long Island. In 1996, manufacturing was relocated to Roanoke, Virginia. The design and administrative offices remain in Hauppauge a few blocks from the previous manufacturing facility, and the sales office is in Manhattan where Kaneff is based. The relocation may have saved the companys life. My father had fought seven unions in 1974 and got rid of six of them. They wanted a 40 percent increase over three years during a recession. The only union left was a printers union and they wanted a 30 to 40 percent increase in 2000. I said, We are competing against China, Europe, South America and Canada. The first and second pressmen are making $34 and $27 an hour and now you want a 30 percent increase? I just built another plant. Im going to move all the presses down there. They responded, If you come back

Creative Outlet
At his core, Kaneff admits to being drawn to the more creative side of business, making the day-to-day operation of Arkay a natural fit. Among his own artistic endeavors are photography, writing his recent book, Taking Over: Insider Tips from a Third Generation CEO, has been converted to an eBook and routinely sells out on Amazon and being the bassist/vocalist for The Young Presidents, a rock band Kaneff started. Its kind of Red Hot Chili Peppers meets Train, he says. In response to the question, Did you always aspire to run Arkay? Kaneff says: I love my dad dearly. I always wanted to be around him and with him and I always enjoyed people and selling, so I asked him to give me a chance. He picks up the holographic embossed Justin Bieber carton and continues, When it comes down to it, were in the business of wrapping our customers fantasies. We use the latest design technology to do it and we rise to every challenge. Creating products like we do is uniquely rewarding and fulfilling. Just another day at Arkay.

On the finishing side, Arkay runs primarily Bobst equipment.

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