Fast-track Firms --Thriving, Not Just Surviving
By Erik Cagle
Breaking even is considered an accomplishment given today's economic environment, so it's difficult to believe that a number of companies managed to use some black ink in their ledgers during their last reporting date. The following is a look at how a number of companies managed to find new revenue streams while maintaining existing ones. (Sales figures are in millions.)
Menomonee Falls, WI
Most Recent FY Sales: $231.9M
Previous FY Sales: $213.40M
Number of Employees: 675
Number of Plants: 1
Arandell Corp. bowed in 1949 under the leadership of F.E. Treis. In 1981 the company began to expand its business and acquired a company that opened the door to web offset printing. By the end of 1982, the printer had shed its general commercial offerings, such as annual reports, calendars and brochures, in favor of a developing marketing media known as catalogs. Its first major client was Neiman Marcus, and that was the gateway leading to clients in major cities such as Atlanta and New York, followed by an expansion throughout the country.
"We've been mailing since 1985 and been working in database marketing since 1989," says Donald Treis, son of the founder. "Those are the services that have really been drivers to growth as we compete against alternative media.
"We've managed to stay state-of-the-art in technologies. We were one of the first to implement Heidelberg's M-3000 ("Sunday") web press technology. We have one of the largest concentrations of M-3000s to serve the catalog marketplace in one location."
Treis notes that the catalog marketplace has driven his operation to continue to expand all its technology. "We have dedicated ourselves to watching our larger competitors—copy what they do and try to do it as well. We're comfortable that this has been a factor in our ongoing growth."
Treis feels the catalog production marketplace has been one of process flow. Customers want reductions in turnaround times and pricing. "To the consumer, this has driven the whole software explosion, certainly in our plant," he says."It's driving the other technologies.
"A few years ago, we moved from analog technology into digital prepress. We're going to be fully stochastic (screening) within a couple of months. There's been a lot of conversation about proofing over the Internet, greater capacity in archiving and managing images. We need to remain on the cutting edge to be a capable supplier of what we believe will be a continually growing, dynamic catalog marketplace."
In order to keep competitive, Arandell purchased a large tract of land that will enable it to triple capacity in Wisconsin. The facility is currently under construction.
North Chelmsford, MA
Most Recent FY Sales: $211.9M
Previous FY Sales: $192.2M
Number of Employees: 1,508
Number of Plants: 6
Launched in 1824, Courier Corp. is one of the oldest printing companies in the Unites States. Courier concentrates exclusively on book manufacturing and specialty publishing. It focuses on three major book markets: educational, religious and specialized trade. Courier delved into specialty publishing with the acquisition of Dover Publications, of Mineola, NY, in September of 2000. Dover was a 50-year-old company owned by a husband-and-wife team.
In choosing its markets, Courier Corp. has managed to stay ahead of the curve, according to James Conway III, chairman, president and CEO. "The markets we've chosen to compete in over the last five years have had compound annual growth rates in excess of other markets," he notes. "We picked markets that grew more rapidly than general publishing.
"At the same time, we've designed our service offerings in each plant to service those markets and to be highly responsive. By doing that, not only have we picked markets that are growing faster than most, we're gaining share as our compound annual growth rate is about twice that of the market. On top of that, Dover has experienced a nice double-digit growth—11 to 12 percent. Those numbers are solid, given the economy."
In order to augment its capacity, Courier recently added press and bindery equipment. A four-color Heidelberg web press went online in Kendallville, IN. A new bible press, a large-format Timsons double circumference web, was installed last year in National Publishing's plant in Philadelphia.
One way for Courier to maintain growth in 2003 and beyond is through research and investment. Courier is talking to its customers to see how they feel about their own business prospects. That will go a long way toward determining whether the printer will add another four-color press at its Indiana facility in 2003.
"We will continue to upgrade the prepress portion of the business," Conway notes. "Going direct-to-plate in all of our plants has worked well for us so far, and we want to continue to be sure that the front end of our business is technologically advanced and very responsive."
Trend Offset Printing
Los Alamitos, CA
Most Recent FY Sales: $182M
Previous FY Sales: $151.12M
Number of Employees: 1,033
Number of Plants: 3
The new kid on the block has kept a consistent product line since its inception in 1985. Trend Offset Printing has found an embracing audience for its heatset/coldset web combination offerings. The company hammered away at finding new core businesses that benefit from its facilities and maximizes margins and revenues, according to Jeff Sweetman, CEO.
"Thanks to Bob Lienau, we became a better printer via technology and positioned ourselves early with computer-to-plate in 1995," he says. "We installed the highest quality heatset and coldset web offset equipment, purchased automatic plate changers on our new press lines, and were the first closed-loop color web installation on a Heidelberg M-600 in the world.
"From what we see and read, we were and are a trailblazer purchasing, installing and becoming operational with these technologies—at a substantial capital expense—well ahead of the printing industry as a whole. As this recipe for success manifested itself in California, we expanded with the same basic ingredients (manufacturing assets) into the Texas market. Our Texas facility grew revenues by serving Texas and the surrounding states. We then did the same thing again in Florida—the same recipe, combination of equipment and technology."
Over the years, Trend has reduced the percentage of retail circular printing at its facilities and increased publication and catalog production, which gave the company more balance at its California facility and the opportunity to increase sales and margins. That opened the door to larger, enhanced press lines, binders and postal ink-jet technology.
"Our marketing and sales culture is aggressive," Sweetman says. "We exposed the marketplace to our facilities and, as a heavenly voice spoke to Kevin Costner in the movie "Field of Dreams": 'If you build it, they will come,' and customers have and continue to come to our plants."
Sweetman credits hard work, relationships and making educated business decisions based on the numbers as being catalysts to Trend's success. Trend Offset Chairman Anthony Lienau taught Sweetman and President Todd Nelson to understand, evaluate and make objective decisions, "by the numbers." Thus, the company grew nearly 30 percent in a lackluster market. Sweetman also attributes the growth to maximizing "face time" with clients and prospects.
"Our relationships are key. We've built many that have lasted 10, 15, and 20 years of mutual growth," he says. "As time has passed and client acquisitions and consolidations have occurred, we have continued on this relationship path."
The growth was bolstered by a pair of high-profile installations: a new eight-color Heidelberg M-600 with Autoplate at the Texas facility, which was booked nearly solid inside of 10 months, and the building of Trend's new Jacksonville, FL, plant. The Florida facility came online in March of 2001, at a time, Sweetman notes, of dwindling print demand. Despite the climate, Trend generated nearly $20 million in business there from March through December.
Being a marketing-driven printer, Sweetman says that Trend's electronic marketing continues to expand its core business revenues, along with new publication, catalog and directory categories. "We have steered away from the acquisition road of other printers to buy market share and top-line revenues. We look to continue to focus and expand our core client model and revenues in California, Texas and Florida."
The Ramallo Group
San Juan, PR
Most Recent FY Sales: $60.83M
Previous FY Sales: $42.4M
Number of Employees: 545
Number of Plants: 2
Diversification is the name of the game for The Ramallo Group. The San Juan-based company is a printer by nature, but a print solutions provider for practical purposes.
The Ramallo Group purchased two businesses—a commercial printer and a business forms printer. The forms side entailed financial printing, which The Ramallo Group used as a springboard into different areas, according to Alberto Ramallo, vice president of operations. In subsequent years, the company added a fulfillment division, which tends to the printing management of all documents for financial customers, most of which are banks, and includes an office products division. With just one envelope manufacturer on the island, The Ramallo Group started its own.
"We have commercial printing, which is supplying the fulfillment operation," he says. "We have the business forms operation; forms, checks and deposit slips are printed in that plant, as well. We have envelopes that go into fulfillment and the mailing operation. So we are using our fulfillment programs to feed work to all the divisions. The goal of the group is to sell programs, not projects.
"We've also started a programming company. As we move into financial companies, they have needs for programming. So we're taking that programming company and creating products with different needs of our own customers. When a customer sees us, they know we're not only their printing solution, we're also their electronic solution."
The Ramallo Group has a head start on growth for next year after inking a 10-year contract with Verizon Information Services (VIS) to produce telephone books that will boost sales by $6 million. With VIS needing about a million books in six weeks, two times a year, the printer has installed a rebuilt Heidelberg M-1000A1 web press and a new Muller Martini 36-pocket Corona perfect binder. A Heidelberg M-1000B is also being installed, giving Ramallo six web presses.
What adds even more value to the VIS contract is the ability of The Ramallo Group to take on new work because of additional capacity. "Hopefully, this will let us show magazine and book publishers that we have the capacity now," Ramallo says. "We only print for Verizon two times a year.
"We're looking to add value to our product, and that's what we've done with the other divisions of our company. Anyone can print...you need to say that your company prints it, stores it, personalizes it, distributes it, mails it, builds the envelope to put it in and has addressing software to reduce postage costs and e-mails it. Everything wraps around the multiple products. They can run standalone or as a nice package. To me, that's the best way of sustaining growth."
Robot Printing (RPC)
Most Recent FY Sales: $22M
Previous FY Sales: $19M
Number of Employees: 168
Number of Plants: 2
Originally known as Robot Letters, Robot Printing (RPC) has evolved from a lettershop service source into the world of commercial printing. Robot has a number of multi-color presses, along with a new Heidelberg 10-color perfector that has paved the way to the short-run publications market. This, in turn, opened the door to fulfillment services. Fulfillment services generated demand for on-demand digital printing, which required the use of database management and custom publishing software.
"Custom publishing software makes on-demand, variable data printing a successful reality," notes Barbara Wolak, Robot president. "The reality today is offering our customers cross-media publishing: print, Internet and CD—all under one roof."
Wolak credits technologically advanced production and an aggressive sales force with driving sales. "Our efficiencies are possible because of customized 'workflows' for various clients," she says. "The ability of our production crew to customize quality and speed requirements means we spend less time processing their information. This increases throughput and lowers costs."
Wolak found that an upgrade of CD-ROM production was necessary to help Robot Printing meet customer demand. A complete paperboard packaging workflow was also implemented to limit outside servicing and to relieve current postpress operations. Utilizing Bobst equipment has taken Robot into "an entirely new market that doubles our opportunities to sell more to current clients and opens the door to new markets," she says.
Robot has its sights set on an integrated network with its clientele. "This partnership allows us direct access to our customers' data. This data is what we will ultimately publish through many avenues of media. It will supply all of the documents we print, code and archive. These initiatives will guarantee RPC a profitable future."