Supply chain logistics represent a vital part of label manufacturing. Over the past few years, the supply chain has been placed under a microscope, as more challenges are cropping up. The Covid-19 pandemic played a role in manufacturing challenges, but it was not the only culprit. Natural disasters, strikes, and workforce shortages – among others – have taxed the system.

OMNI Systems, a custom label manufacturer and supplier based in Ohio, has conducted a deep dive into this topic, with an emphasis on domestic production. The company has instituted processes and procedures to navigate obstacles as they arrive. Most recently, port strikes have added complexity to an already extended supply chain, especially for products coming from Asia.

“Delays at ports disrupt timelines, impacting businesses that rely on a just-in-time approach,” explains Mike Murton, president and COO, OMNI Systems. “The potential for new tariffs under President-elect Donald Trump adds another layer of complexity. Companies may face increased costs of 10–20%, raising questions about customer price acceptance. International supply chains now have more variables at play than ever before, making flexibility and planning essential.”

OMNI Systems has predominantly functioned as a domestic-based company since day one. According to Murton, OMNI values quality and service more than anything else, which has spurred the company to partner with domestic suppliers. They have consistently delivered the quality OMNI expects and the responsiveness on which its customers can rely.    

“Over the years, I’ve analyzed numerous international supply chains – particularly those sourcing materials from Asia and Europe – and I’ve yet to see a model that makes financial sense for us,” states Murton. “While some may argue that offshore sourcing offers cost savings, our experience with domestic procurement has proven to be far more efficient. Offshore sourcing often requires massive upfront orders, which carry risks like quality issues that can disrupt production and drive up costs.

“At OMNI, we already buy in bulk, which is one of the key ways we keep costs low, while leveraging domestic suppliers who deliver consistent quality and responsiveness,” adds Murton.  “Ultimately, our domestic approach allows us to maintain flexible inventory programs and solve problems quickly, keeping our customers’ operations running smoothly and cost-effectively.”

OMNI Systems’ proactive approach to cost reductions has helped strengthen its client partnerships. As supplier costs drop, the Ohio-based label manufacturer is able to relay savings to customers who partnered with OMNI during the supply chain challenges. This transparency shows customers that the company values their business, which is designed to distinguish OMNI from its competition.

Currently, the label supply chain is in a healthier state than it’s been recently, with many of the disruptions originally stemming from the pandemic. Companies continue to invest to position themselves for future success.

“Vendors on the paper side have made significant investments such as adding coating lines and increasing automation,” notes Murton. “Companies have also adapted by testing alternatives like thinner liners, positioning themselves to better handle future disruptions. A post-Covid-19 market reset has shifted focus to cost reductions, making streamlined supply chains critical for driving down label costs.”

Establishing strong partnerships with those vendors is critical in fostering success. That is a key step that label companies can begin exploring and nurturing today.

“It is difficult to extract as much value as you can from a supplier unless you treat them as a valued partner,” comments Murton. “At OMNI, we nurture those long-term relationships, fostering collaboration on cost-saving innovations and new material development. The more that supplier learns and gets to know you as an organization, the more they can really partner with you to drive solutions. This ensures mutual growth and efficiency.”

In the future, companies willing to invest and remain flexible will find success. This includes meeting customer demand for new technologies like sustainability, short runs, variable data, and countless others.

“The label industry today is stabilizing and returning to steady growth, which was the norm prior to Covid-19,” says Murton. “Ultimately, companies driving the most value and solutions are the ones that will gain market share, while those focused solely on margins risk falling short. Advancements in barcoding and print technology – including RFID, linerless innovation, and potential changes to barcode requirements – are other big-wave trends to impact our industry in the coming years.”

From a sustainability standpoint, more brands than ever are making environmental commitments, and the packaging plays a huge role in those endeavors. Cost, however, will continue to be a focal point.

“Suppliers are working to lower the cost of sustainable options, making progress toward real solutions,” says Murton. “At OMNI, we are committed to exceeding applicable environmental laws and regulations, and as a result, made significant internal strides. In addition to our domestic supply chain and geographic footprint, which reduces the environmental impact of transportation, we’re diverting 80 tons of waste each month from landfills by recycling it into energy pellets. While this initiative doesn’t save us money, it reflects our commitment to doing what’s right for the environment and our community.”