Interview for NV by Mykola Livshuk, founder and CEO of Rivne Flex

We help brands grow. How Rivne Flex managed to establish a stable operation during the war and how it plans to develop

Read the article on NV website - Interview for NV by Mykola Livshuk, founder and CEO of Rivne Flex

Founder of Rivne Flex, a flexo printing and packaging company Mykola Livshuk spoke about increasing production volumes by one and a half times, further expansion of production and plans to recycle polymer film

Sixteen years ago, entrepreneur Mykola Livshuk was engaged in the production of groceries. Deciding to print labels for them on his own, he bought his first portable machine, and that's when his journey in the flexography industry (a modern technology for applying images and text to a flexible surface) began. 

Later, packaging printing became the entrepreneur's main business, and the project, which was initially run by three people, grew to become one of the five largest Ukrainian enterprises in the field of flexographic printing. Today, the Rivne-based company produces roll packaging and bags for goods in various industries. Rivne Flex's clients include more than 200 companies, including Zhytomyrski Lasoshchia, Galician Traditions, Prydniprovskyi Plant (Zlagoda TM), Yarych, Lubystok, and others. Despite the war, the Rivne Flex team managed to increase production by one and a half times and fulfill all orders on time. This is rare, given the unstable situation in the country due to the full-scale war. In the interview, Mykola Livshuk explains how the company survived the first year after the Russian invasion, how it managed to keep the team, increase production, and how Rivne Flex plans to develop and pay attention to corporate social responsibility initiatives.

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How has the full-scale war affected Rivne Flex's operations and the flexible packaging segment in general? What are the biggest challenges the company has faced?

Russia's war against Ukraine has had a catastrophic impact on all Ukrainian businesses. Unfortunately, many of our manufacturing colleagues from eastern Ukraine have temporarily suspended their operations since the beginning of the war. The West has become a kind of production rear. And this applies not only to our company. 

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It was especially difficult in the first week after the invasion, when everything stopped. I remember how all of us manufacturers were gathered at a meeting at the Rivne Regional Military Administration to motivate us to move forward. Rivne Flex had been out of business for only three days. Why did we have to launch the plants on February 27-28? Because we produce food packaging. Because we are also responsible for the country's food sector, for ensuring that food and essential goods, including humanitarian aid, reach people from different regions of Ukraine. There were also cases of delays in the delivery of raw materials, and we agreed with our customers on a simpler and faster design, without pictures, and there were cases when we simply printed the words "sugar" or "buckwheat" on the packaging. At those moments, product advertising took a backseat - the most important task was to preserve the product's properties and send it to consumers as soon as possible.

In general, there were many other challenges during the war: suppliers' reorientation to European markets, changes at many stages of production, suspension of partners' activities, and problems with electricity supply. However, they made the Rivne Flex team even stronger. 

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How has the situation changed in the year since the war began? Are you getting new clients?

First of all, the main task at that time was to support regular customers who have been working with us for 10-15 years. However, my partners (as I call them) and I went through many different stages even before the war - crises, currency fluctuations, COVID-19. As for the organization of the production process itself, at the first stage after the outbreak of the war, the shortage of materials was more than 50%. However, we did not sit idly by, we coped with it and created a double stock. Manufacturers quickly realized that we had the raw materials and continued to work.

The number of orders was gradually increasing, including new customers from the east or south of Ukraine, and we had to think about increasing production. After analyzing our weaknesses, we were able to increase production by 20-30%. And this process continues. We have now reached 150% of our 2021 capacity and hired additional employees.

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Did you change processes to achieve such results?

Yes. We also discussed this with our employees, explaining why it was important. And, you know, it worked. So now we are looking for additional opportunities for expansion.

Rivne Flex works steadily despite the war

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What is the current range and production capacity of Rivne Flex? Do you plan to expand services or buy new equipment? 

Today, Rivne Flex produces roll packaging and ready-made bags of various form factors: sachet bags for dry goods, gusset bags for coffee or tea, stable bags, center seam bags, and doy-packs. By the way, the doy-pack, a stable bag with a flexible bottom that allows it to stand up even with a light product, is now very popular among manufacturers. Such packaging helps to reduce the cost of products, which is important for consumers. Another service Rivne Flex provides is lamination.  

We help companies to have a beautiful "face" and convey the uniqueness of each brand through high-quality and attractive packaging. It is important for us to respond flexibly to market requirements, as our clients develop, rebrand, change label design and use the latest developments. While for us roll packaging is a final product, for our customers it is a semi-finished product, because they have to produce the product and then pack it on their equipment. That is why we are constantly looking for new solutions, offering new materials and testing them together with the client, and they are already adjusting their design and assortment to them. 

We carefully select the technical equipment. In its arsenal, Rivne Flex has a large "fleet" of machines, including Soma Midi, Soma Optima 820 of the latest model with the function of applying selective matte varnish, Soma Pluto cutting machines, Schiavi solvent-free laminator and others. We do not plan to stop there, but only to improve and expand our production capacity, and in a month we will receive additional equipment.

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What kind of packaging is most often ordered nowadays? 

For the first six months after the war started, it was packaging for food, particularly for pasta, cereals or bread. However, this did not apply to confectionery; the demand for their packaging appeared later, around August last year. Spice producers have also returned. 

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Technologies are developing rapidly, how quickly do you implement them in your country? Do you attend exhibitions and watch large advertising campaigns abroad?

Of course. In particular, since 2021, Rivne Flex has become a member of the Brotherhood of Gutenberg Knights (an association of European printers), actively launched a campaign to exchange experience with European partners, but unfortunately, the war has put this process on hold. In general, we have friendly and partnership relations with European companies, where all the components of our product are manufactured. The share of imports is 90%. Polymers, paints, adhesives, solvents - everything is supplied from companies located in the EU. That's why technologies are developed there, and manufacturers tell us about their achievements. They are interested in cooperating with Ukrainian companies because Ukraine has great potential.

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Future plans 

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Your company is engaged in the production of packaging, an area that attracts the attention of activists and officials. Ukraine is tightening control over its use. Do you plan to organize its recycling?

From the very first days of the company's establishment, we realized that we were producing a product that was polluting the environment and that it was important to recycle packaging. My team and I began to pay considerable attention to the issue of sustainable development, which has become one of our core values. That's why the first thing we did was to start sorting our production waste. A lot of polymer film goes through our production, some of which is recyclable and some is not. We launched a pilot project, studied and experimented for two years, and now we process our waste into special secondary polypropylene pellets, which are used to create useful household items such as buckets, furniture fittings, scissor handles, etc. We plan to improve this area and produce some finished products. 

As for the raw materials that cannot be recycled, we take them to Brovary, where all such waste is disposed of using European technology. This production provides hot water to 80% of Brovary residents, and no harmful substances are released into the atmosphere. I hope that the situation with waste disposal and recycling will improve in Ukraine and that we will get rid of landfills. I believe this will happen in 5-10 years after our victory.

Many Ukrainian companies, such as Nova Poshta, Chornomorka, !Fest, and others, are opening businesses in Europe. Do you plan to attract customers from Eastern Europe?

Yes, we have such plans, and our team is actively working on this issue. We have even tried to cooperate with confectioners and manufacturers of household chemicals. In fact, it is very difficult for us, as a manufacturer of printed products, to enter the European market. Because we buy raw materials in the EU, pay 20% VAT and 3-5% customs duties for their customs clearance. And then we have to take it back. That's why European producers may have lower prices.  

However, the situation may change after Ukraine joins the EU. Not only for us, but also for European companies. As far as I know, large printing giants are already studying the Ukrainian market and want to work here. However, I think our producers have more advantages: we are faster, more mobile, think differently and are ready to work overtime. Ukrainian producers are ready to fulfill orders "for yesterday", while foreign ones are not.

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Do you have a development plan for the next five to ten years?

I always have it. When I started the printing production 16 years ago, I saw myself where I have already come. And I will go further. Despite the war, last year we invested UAH 10 million in additional equipment.

We are also increasing our production space, which now amounts to about 1.5 thousand square meters. We need to complete another 1 thousand square meters.

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Our team is our strength

How did Rivne Flex manage to plan processes and work within the company during the war? How do you motivate employees to work better in an era of instability?

With the outbreak of a full-scale war, I, as the founder and CEO, had to pay special attention to team building. We have a relatively small team of only 60 people, but to maintain team spirit and avoid panic, I decided to resume work quickly. I did not fire anyone. We held several strategic sessions to set goals and plans for the coming period. And we are moving towards them. Of course, now you always need to be ready for flexibility and quick adaptation, but the goals and plans we have set allow us to go in the right direction and keep motivated despite the circumstances. 

About 20% of your employees went to defend Ukraine. Do you help your colleagues, perhaps buy drones or cars?

I'm not counting anymore, but we allocate a lot of money to the frontline. We buy cars, drones, turnstiles. We even buy weapons to shoot down drones, and many other things - monoculars, thermal imagers, optics. I have forgotten whether I work or volunteer. We help in any way we can, as probably every Ukrainian does now.

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To run a business effectively, you need to be in shape. How do you motivate and support yourself?

The captain should be the last to leave the ship. Our team is the main value and strength for me. Because you can find iron, buy it, ask for it, rent it. However, people make everything with their own hands.

These are difficult times in Ukraine, and you need to make every effort to keep your business going. However, my motto in life is that the harder it is for me, the better. This motivates me. I have had many ups and downs in my 30 years in business. I have some experience of how to behave in a given situation and understand how to lead people.