“I saw an opportunity to implement higher quality and more cost-effective shipping materials for Chile's food exporters.”
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As the late Steve Jobs was fond of saying, “Packaging imputes value.” Nobody understood this more than Santiago Querol: a third-generation successor to his family’s wood packaging business, he founded Laserpack in 2009 with an original and thoroughly modernized packaging solution in mind. Traditional boxes—made of either corrugated cardboard or wood—are put together with staples or nails. Laserpack’s boxes are made from precisely cut planks of medium-density fiberboard (MDF), a splinterless and biodegradable material, and are easily assembled without cumbersome bits and pieces. This premium packaging solution is highly resistant to humidity, 3.2 times stronger than corrugated cardboard and roughly cost-equivalent to wood. Laserpack has already caught the attention of Chile’s premium fruit exporters, and Santiago will now turn his attention to the packaging needs of other product categories, such as seafood, wine and cheeses.
Growing up in Valencia, Spain, Santiago started working at the age of 15 for the wood packaging company that his grandfather had started in 1932. Rather than go to university, immersed himself in all facets of the family business, from machinery to accounting to marketing. In 1986, at the age of 24, Santiago took over management duties and steered the company to dominance in the Spanish market for wooden packages. Even as he thrived, he looked for ways to invigorate the mature business he had inherited—he introduced smaller-sized boxes for retail use, among other innovations. By 2000, demand for wooden boxes began to dip and competition increased. Santiago radically reconsidered the fundamentals of his business, searching for alternative raw materials and rethinking the packaging assembly process. Plank by plank, he put together a vision for a new type of packaging.
In the early 2000s, Santiago asked his suppliers about alternatives to wood, and he was shown medium-density fiberboard, a material recycled from sawmill waste. MDF had a history of being used for packaging but only for products of secondary quality; as a result, it was never developed to meet international standards for food transport or packaging strength. Where others saw recycled waste, Santiago perceived the potential for a strong, safe and eco-friendly material to replace wood in the packaging business. His breakthrough came in 2005 when he discovered laser-cutting technology, which has a sealing effect that increases MDF’s resistance to humidity and leaves a smooth finish for easy offset printing. After filing for a patent, he began showcasing his packaging process at international trade fairs. He partnered with Saudi investors to take the packaging process global, but the 2008 financial crisis halted progress and soured the partnership. Santiago divested in 2009 and used the proceeds to found Laserpack in Arauco, Chile—repurposing the sawmill his father had opened there to supply the family business in Spain—where a robust fruit export market already existed and raw materials were readily available.
Bringing his family and six of his top engineers with him, Santiago invested US$15 million to build proprietary machinery for laser-cutting and box assembly and US$5 million for a warehouse and office. With this infrastructure in place, Laserpack has the capacity to manufacture between 700,000 and 800,000 packages per month at an average price of $1.03 per unit—in line with its competitors. Advanced ventilation (slits maintain freshness for up to 60 days of boat transport), environmental benefits (MDF is recycled, reusable and efficiently transported) and a smooth surface (perfect for offset printing) differentiate Laserpack’s boxes from other available packaging options. Laserpack manufactures large boxes for wholesale packaging, as well as smaller boxes intended to accompany their contents on the supermarket shelf. Boxes are shipped to clients unassembled with machines to put them together on-site, and once assembled and filled, they stack perfectly atop one another for shipment to their final destinations, most commonly by boat.
Corporate social responsibility is a key component of Laserpack’s company ethic. In accordance with their commitment to environmental sustainability, their containers are manufactured from 100% natural and renewable material. Laserpack is also committed to socioeconomic change: Located in the impoverished Bio Bio region, where the unemployment rate is highest in all of Chile, Laserpack already employs over a 100 people and is a much needed jobs engine. CORFO has already granted the company US$1 million in subsidies to help retain the company and incentivize further employment. In 2011, Santiago embarked on a 24 million USD project to expand Laserpack, opening two more plants in the town of Tres Pinos, a disadvantaged area with a high rate of unemployment. Laserpack hopes to employ 450 workers by the end of this initiative.
While all current clients are premium fruit exporters in Chile, Laserpack’s patented packaging process is a potentially disruptive force in any export market, especially where product quality is at a premium. In 2011, growth-induced cash flow problems forced Laserpack to close its plant for four months of low fruit production. Santiago now plans to break into other Chilean export staples, such as salmon and wine, to counter this seasonality. Additionally, the company is developing third generation laser-cutting machines, which will be faster and increase the company’s capacity to process packages. With the right product-market fit, Santiago could soon take Laserpack global and open manufacturing plants elsewhere in Latin America and in the United States.