Rider Dickerson — Roommate WantedSeptember 2007 By Erik Cagle
What in tarnation does that have to do with commercial printing? you ask. Well, there’s a situation in the Chicago suburbs where two printing companies are enjoying the fruits of consolidation without taking the M&A plunge. It actually turned into a marriage of convenience, and the relationship, if anything, seems to be growing stronger.
The situation arose not long ago, when Rider Dickerson—a century-old printer based in Chicago’s South Loop along Clark Street on the once famed “Printers Row”—received notice that the building it had called home for many years had been sold for conversion into student housing for downtown universities. Bill Barta, president and CEO, wasn’t at all surprised, since real estate in the Windy City had become cost-prohibitive for many manufacturing sectors. Printers Row had become anything but that, with many of the old occupants having moved on.
No More Printers Row
“Originally, we wanted to stay in the city, but couldn’t find adequate space for what we needed,” Barta remarks. “We wanted to be able to expand. On Clark Street, we operated on several different floors, which is not the most efficient workflow for a printing company. Ideally, you want to be on one floor.”
Fortunately, Barta found 85,000 square feet of available space in nearby Bellwood, IL, a huge upgrade over the 50,000 square feet spaced out over several floors on Clark Street. There was just one catch: The Bellwood plant already had an occupant, and it was a printer, no less. Two printers would seem to be more than 815 25th Ave. could handle.
That wasn’t the case. Rider Dickerson moved in alongside large-format sheetfed specialist Sleepeck—another printer with more than 100 years under its belt—in March with a legal agreement to share certain costs. There wasn’t a merger agreement, definitive or otherwise, to be found. Yet the companies now leverage their complementary product and service capabilities. Rider Dickerson can enjoy providing Sleepeck’s in-store/show floor standees or book components to its customer base, while Sleepeck can go deeper with its own clients by offering them brochures, catalogs and direct mail printing.
“We looked at combining the companies but, for a variety of reasons, we decided not to do so at this point,” Barta says. “Basically, we decided to just be roommates for a while. It’s worked out far beyond my expectations. We’re able to share occupancy costs, so we’re able to drive some costs out of the equation. The building is much larger than what we had before, so it will also allow us to expand.”
With $10 million-plus in annual sales volume, Rider Dickerson has certainly expanded its equipment base with the recent installation of a six-color Heidelberg Speedmaster XL 105 press with coater (erroneously cited as a four-color machine in the March Upfront section of this magazine). With client turnaround time requirements becoming more and more compressed, the printer sought out a press that could help remove time from the production equation. Also helping address the need for fast turn times was Rider Dickerson’s acquisition of Kodak InSite and Matchprint Virtual Proofing (MVP) systems.
“The speed and efficiencies of the XL 105 are unmatched with other 40˝ equipment in the marketplace,” Barta says. “We’re able to get jobs on-press and completed much faster. That’s a huge plus for us.
“The Virtual Matchprint, for many of our clients, speeds up the process where they can view calibrated proofs onscreen,” he adds. “It eliminates the need to send them hard-copy proofs. We don’t have to overnight proofs or wait for them to be forwarded on to other people for their approval, and then wait for them to get back to us. We’ve taken a lot of time out of the proofing stage without sacrificing quality. That makes it easier to do business with us.”
Barta joined the fold in 1988, after working as a certified public accountant (Rider Dickerson was one of his accounts). In 2003, Barta, by then a minority owner, purchased full control of the company from the Madden family, which had a stake in Rider Dickerson for nearly 70 years. Though Barta now calls all the shots, he uses the same philosophy employed by the Madden family: Let the customer base drive your technological focus.
Rider Dickerson provides sheetfed offset and digital printing to produce items such as sales and marketing materials, brochures, annual reports, point-of-purchase materials and stationery for verticals including unions, advertising agencies, education, graphic designers and corporate accounts.
Technically, the digital end is on hold; when Rider Dickerson sidled up next to Sleepeck, the decision was made not to transport its digital press, which was older technology. But Barta is currently huddling with his team to decide upon a course of action to get the company back on the digital horse.
Online Ordering Growth
One area of growth has been Rider Dickerson’s online ordering system, which has helped grow its stationery line. Customers can customize their letterhead, business cards, envelopes, etc., see a proof onscreen and then place their order.
“The Website has two functionalities. One is variable data, like the stationery, where we set up a template for the client,” he explains. “We also print and inventory for a lot of clients—store materials and drop ship or fulfill for them.
“Our online system serves as a tracking system, where customers can go into a password-protected portal, view the items we’re storing for them, and see the quantities on hand for those items. They place an order, receive a confirmation number, we fulfill the number, and the quantity is automatically deducted. We set up reorder points, so if the quantity of an item falls below a certain level, customers will get an e-mail notification alerting them that they may want to reprint. That takes a lot of stress off our clients.”
Rider Dickerson has grown substantially under Barta’s leadership, from $7.4 million in revenues when he took the reins in 2003 to its current sales volume. He credits much of that success to a concentrated sales and marketing effort aimed at going deeper within existing client organizations, as well as drumming up new accounts.
Re-emerging on the digital scene (a Xerox iGen3 or HP Indigo 5000 press are being pondered) is another outlet for growth, particularly in variable data digital work. Barta is also keeping his mind, and options, wide open on other fronts, including a possible acquisition of a complementary printer.
“Our industry is still ripe for consolidation,” he contends. “There’s still too much equipment capacity and too many printers out there. And, it doesn’t make sense for a lot of smaller printers to stay in business, because they can’t afford ongoing technology investment. They don’t have the tools to grow.
“There are opportunities I want to explore to acquire or merge with other companies. It makes a lot of sense to take advantage of economies (of scale) by putting two companies together and driving some of the costs out of the equation. If there’s another commercial printing company out there that does something we don’t, like half-size offset or variable data digital, it might make sense to try to put a deal together.”
Barta has specific goals related to Rider Dickerson’s performance for 2007: He is gunning for a 15 percent sales increase and wants to bolster his operating margin of 15 percent over 2006. And, like his product and service portfolio, Barta wants to see his client roster remain diversified. Too often he has seen competitors realize up to 30 percent of their business from a main customer or two—creating a rug that is certain to be yanked out from under the printer.
“There’s a lot of consolidation going on in other industries. We’ve seen that, when you have a customer and they end up being acquired by somebody, nine times out of 10, you end up losing that customer,” Barta cautions. “So we’re careful not to put all our eggs in one or two baskets.” PI