Southern Printers Unite Under Print Production Peers (P3) Group
The concept of joining a printing industry peer group is not for everybody. Some executives are uncomfortable with the thought of sitting down with a group of colleagues and sharing certain information regarding their businesses, particularly financial data. It's a somewhat progressive concept and, frankly, it may not appeal to execs who have been doing business for 30-plus years.
However, the commercial printing landscape may be experiencing a renaissance, of sorts, courtesy of a newer peer group that has taken sharing to the next level. There is a small cadre of mostly Southern printers in the $5 million to $12 million range that have banded together under the umbrella of Print Production Peers (P3). At first blush, they're no different than most peer groups in the industry, meeting quarterly at one another's facilities to discuss issues of the day and review best practices to improve top- and bottom-line performances.
But what makes this group special is its practice of not only sharing info, but also swapping work back and forth. Their tagline is The Power of Seven. These companies—BPI Media Group of Boaz, AL; Campbell Printing of Dalton, GA; Hederman Brothers of Ridgeland, MS; Marshall & Bruce Co. of Nashville, TN; McClung Cos. of Waynesboro, VA; Caskey Group of York, PA; and Woolverton Printing of Cedar Falls, IA—are reaping a multitude of benefits in selling P3 as a whole to customers, not the least of which is increased sales.
The most appealing aspect of P3 is that it fortifies a space within the graphic arts industry—the $5 million to $10 million general commercial printer—that finds itself under tremendous pressure from larger competitors and alternative technologies. These seven firms have commonalities, but each brings a certain technology/capability to the table that the others lack: package printing, variable data and wide-format printing, to name a few. Members can cross-sell P3 capabilities and thus maintain jobs that might have been ordinarily lost because a potential client is seeking single-source solutions. A number of these firms experienced handsome sales growth in 2014.
In a sense, what this group really represents is the next generation of printing industry consolidation. Call it a cloud merger, where companies are being combined without having to relocate, consolidate operations and lay off dozens of "redundant resources." Individual firms maintain their own autonomy, destiny and corporate culture, without fear of being engulfed in the bureaucratic quagmire often associated with rolled-up corporations.
But does P3 offer the perfect blueprint for printing companies looking to bolster their sales without the expense of individually adding significant equipment and capabilities? The answer to that may not be so simple.
P3 (www.printp3.com) was actually borne out of a previous peer group. Alan Davis, president of BPI Media, was one of the original members of the Cyan Peer Group, which was facilitated by Printing Industries of America (PIA) back in 1996. Cyan lasted 16 years, until 2012, and Davis looks back at the experience as one of the most beneficial things he'd ever done for his company. Davis notes that the only real difference between P3 and Cyan is the work-sharing characteristic.
"We had members come and go, which gave us new blood and rejuvenated the group again," Davis remarks. "It ran its course. We disbanded, but a couple of us got back together to catch up and organize a meeting, because we'd been doing it for so long.
"We decided to create another peer group and be really selective about who we allowed to join. We looked for companies that had complementary capabilities that we lacked. I've installed wide-format printers, and the group has a multitude of digital printing equipment that we can leverage. It's been a huge benefit."
Doug Hederman, president and CEO of Hederman Brothers, is one of the P3 newbies. He had considered joining the Young Presidents Organization, which has garnered rave reviews for its ability to cover business topics such as human resource, financial and insurance issues. But Hederman wanted insight into six-color, 40˝ presses, not general business issues. So at a Printing Industry Association of the South (PIAS) meeting, Hederman asked Alan Davis if he was involved in any industry peer groups. And it just so happened…
Joining the peer group has proven highly advantageous for Hederman. "P3 has been a fantastic experience," he says. "We're all located in different parts of the country, so we're not competing for the same business. All of our companies are similar in some ways, but very different in others. The collaboration is fantastic and we all speak the same language as presidents, CEOs and owners. We communicate well and have tremendous trust in each other."
Family Owned, Forward Thinking
Another family-owned company, Woolverton Printing, was a holdover from the Cyan Peer Group days. The company has been in business since 1900 and 15 percent of its work is in the niche church work space. And though many of the P3 members are longstanding family operations, Woolverton CEO John Lynch points out they share the same multichannel, multimedia approach.
Lynch also feels his company has likely benefitted the most from P3. Via the nature of its clients, Woolverton's work is of a seasonal nature, and the peer group came through in the clutch and helped to make December the largest sales month in the history of the company. With annual sales expected to show a 17 percent bump, Woolverton increased its tally to roughly $7.7 million.
"In the fourth quarter, we had to outsource quite a bit of work to maintain some work with another customer," Lynch notes. "BPI and Hederman were able to fulfill the client's demands. They produced between one and two million pieces of mail, each, during a short time period—printing, mailing, distribution, shipping—for a large customer of ours. As long as you manage the work well, most buyers do not care how it gets done.
The level of collaboration is not insignificant. Davis points out that two of the P3 members were among BPI Media Group's top 10 customers in 2014. The result was a 35 percent growth rate over 2013, though the numbers are a bit skewed, as BPI Media did acquire some new equipment, which was a contributing factor for its sales growth, as well.
The degree of engagement is impressive. Davis talks with numerous members on virtually a daily basis. In one recent call, Davis and another P3 member literally swapped jobs—Davis brought in a wide-format printing job and farmed out a mail match project.
Davis loves that he doesn't have to buy inserters and a camera system to maintain his customer. "I don't want another printer out there going after work that I can't do in my shop and possibly leach away some of my existing work," he says. "So, this is a good way to protect accounts and grow with customers. My sales reps are thrilled, because they basically don't have to say 'no' to a client."
Moving forward, Hederman would like to see engagement extended to various levels within each company's hierarchy, bringing CFOs and operations managers into the conversations. When a mid-level manager at one P3 shop can reach out to his counterpart at another company, Hederman believes it can improve the process from top to bottom.
Lynch is quite pleased with the peer group as currently constituted and feels it is more important to have members that are a good fit as opposed to a larger peer collective. "It's just a great group of guys. I love them to death," he says. "We're all very invested in our companies and in helping each other. We're constantly learning, helping and promoting each other. It's just been fantastic." PI