Print Solutions July 2006
manufacturing
IN BRIEF:
2006 Manufacturer and Supplier Print Conference
Manufacturers discuss changing trends and strategy in vertical markets.
Digital Printing Creates Buzz at Manufacturer and Supplier Conference
By Lashell Stratton
Though digital print technology wasn’t the theme for DMIA’s 2006 Manufacturer & Supplier Print Conference, it was a hot issue during panel sessions at the
3-day event held May 17-19 in Philadelphia. The buzz from the AIIM/On Demand
Conference and Expo at the Pennsylvania Convention Center influenced a lot of
the discussion among DMIA conference attendees who talked about trends in
digital printing, the sales potential of variable data printing and
print-on-demand, and how to use non-traditional channels to make print sales.
Steve Martin, president and CEO of 4Site Systems, Brooklyn Park, Minn., recaps
the On Demand Conference and Expo in Philadelphia and shared updates about the
digital print market.
“P.O.D. is estimated to grow at a 12 percent accumulated growth rate, mostly in
high volume black and white and production color areas,” Martin said. “Web-to-print items like stationery and envelopes that are static are not growing
as much as other areas.”
“There’s a different mentality with selling this stuff rather than traditional forms,” said Steve Martin of 4Site Systems. Martin, president and CEO of the Brooklyn
Park, Minn.-based reseller and integrator of digital software and equipment,
opened the educational program sponsored by the Print Education
& Research Foundation with a recap of the AIIM/On Demand event.
Some attendees thought it was a smart move on the part of DMIA to draw tie-ins
between the two events.
“Having the conference the same week and same location as On Demand was
beneficial so that we could make one trip,” said Ken Sperling, CPSS, CDC, president of Printco Inc., Omro, Wis.
The Manufacturer and Supplier conference was also thought to be particularly
good this year.
“I personally think that it is the best conference for manufacturers and
suppliers that we’ve had in many, many years,” said DMIA President Timothy Mehl, CDC.
DMIA President Tim Mehl, CDC, CEO of Dispatch, moderated a discussion where
attendees talked about digital print technology, selling programs and new
avenues for manufacturers to make print sales.
“I personally think that it is the best conference for manufacturers and
suppliers that we’ve had in many, many years,” Mehl said.
All Things Digital
Martin noted during his presentation that selling digital printing not only
requires a different mentality but also can mean pitching to different buyers.
“People who are starting to buy printing aren’t necessarily purchasing agents, but are in IT divisions,” he said. Martin said this means printers must develop a set of best business
practices to close digital print sales. They include:
• Selling solutions that address business problems
• Talking to the right people
• Offering web-to-print solutions
• Knocking on open doors but knowing when to stop
• Pricing services separately from printing
• Using ROI models to close the deal
“I don’t ever go into these big corporate places and say I want to close it,” Martin said. “I try to figure out what piece I want to do for them. That’s what printers should do.”
Pat Veverica, principal at What’s Your Plan, Chicago, shares ways for manufacturers to find new print channels
to increase sales.
“You have to figure out if you’re going to go through a really savvy distributor who can get you before the
customer or choose to do this directly because of how much investment and
distinct expertise it requires,” she said.
During a presentation about print channel development, Pat Veverica, principal
at What’s Your Plan, Chicago, shared other ways that manufacturers and distributors can
sell digital printing.
“Everyone had been sold the promise of digital, but the results didn’t live up to the promise,” Veverica said, adding that companies that have already purchased digital print
equipment
“have now taken care of 30 percent of their investment.” They will also have to make financial investments in software and staff, as
well as:
• Learn the lingo of direct marketers and their concerns (Think like a marketer,
not like a printer.)
• Call on an ad agency professional or an MBA to help pitch sales ideas, if
necessary
Veverica also discussed different marketing channels for digital traditional
print.
“You have to figure out if you’re going to go through a really savvy distributor who can get you before the
customer or choose to do this directly because of how much investment and
distinct expertise it requires,” she said.
She said to investigate different print channels, you should:
• Attend DMIA-sponsored conferences and trade shows as well as general industry
events such as the On Demand conference, Ad Tech 2006, Direct Marketing
Association events, PODi events, and American Printer’s Variable Conference
• Hold educational seminars
• Get referrals from customers
During a panel discussion, Paul Edwards, CDC, of FormStore Incorporated, Fenton,
Mo., admitted that there were challenges to making the shift to digital that
include training, staffing, and integrating manufacturer, distributor and
third-party software systems.
“Somehow, some way we have to figure this out into interoperability and
interconnectivity,” Edwards said.
Rick Roever, CDC, president of MAR Graphics, Valmeyer, Ill., also noted that it
could be equally challenging to integrate workflows that might include digital
technology. He advised
“get as much information as you possibly can. You can never have too much
information to make a decision.
”
Edwards listed several rewards for converting to digital print:
• Streamlined order flow and production efficiencies
• Interoperability between systems
• Potential for long-term agreements
• Increased business opportunities
• Access to new markets
• Increased profits
• A future in the industry
“If we can’t increase profits, then we shouldn’t invest in it,” Edwards said. “This isn’t a hobby.”
Keeping an eye on the majors
Paul Reilly of Compass Capital Partners, Littleton, Colo., and former CEO of
Cenveo Inc., shared candid and interesting tidbits about what the majors
—R.R. Donnelley & Sons Company, Standard Register Company, WorkFlowOne and Cenveo—are doing and how smaller companies can compete with them.
Paul Reilly, a partner in Compass Capital Partners, Littleton, Colo., shared
updates about the majors and also shared a few words about his experience as
former CEO and president of Cenveo Inc. Majors are finding it hard to win in
commercial print
“because its increasingly cyclical and now it is hard to distinguish yourself
because the technology has gotten so good. It’s a very difficult business. In the last recession, commercial print sales
dropped 15 percent and the cashflow at Cenveo subsequently dropped by 40
percent.”
Of R.R. Donnelley: “Their strategy is to be a full-service provider and they’ve made good investments in equipment and targeted acquisitions,” Reilly said. But they face the challenge of taking “this large company and integrating all its parts so that customers see the
benefit.”
Of Standard Register: “The challenge is to drive sales growth through their new processes and
businesses,” he said.
Of WorkflowOne: The company is winning because of its critical mass and
management, its nationwide representation demonstrated in its 50 manufacturing
facilities and 100 sales offices, and expertise of the company leadership
embodied in Greg Mosher, CEO of Workflow Management Inc. and Mike Zawalksi,
president and COO of Workflow.
Of Cenveo: “With the sale of their Canadian operations, they can pay off their revolving
debts. They will probably spend $54 million left over from the sale on
acquisitions or they will have to give the money back to bond holders by the
end of the year.”
Reilly also shared some industry advice regarding manufacturing competition
coming from China.
“China is not as much of a threat as it is in other industries,” he said. “The greatest threat China poses is gobbling up our resources that we need for
printers.”
Reilly advised that in order to compete with the majors, companies should:
• Pursue customers that are uninteresting to the majors—mid- to small-sized companies and companies that are geographically remote.
• Exploit their vulnerabilities. “You are more flexible as a company,” Reilly said. “You’re not the big ship that it takes a long time to turn. Use that to your
advantage.”
Attendees of DMIA’s 2006 Manufacturer & Supplier Print Conference listen with rapt attention to discussion about
winning the rebate wars.
Rebates and Snagging Distributors
One roundtable discussion focused on the touchy subject of offering rebates to
distributors. Panel members included a manufacturer, Casey Campbell, president
and CEO of Printegra, Peachtree City, Ga., and two distributors, Paul Keith,
former president of International Business Solutions Alliance and current
president and CEO of Best Business Systems, Bowling Green, Ky., and Graham
McClean, co-founder of Global Docugraphix, Chicago.
Campbell advised that manufacturers who set up a rebate program should stipulate
that you need the contact information of all distributor sales representatives
and set up quarterly reviews. He also advised three things to consider before
implementing a rebate program:
• Carefully evaluate what is being considered
• Clearly understand how the program will directly result in new profitable
business for your company
• Analyze your local cost for a given preferred vendor program not just the
rebate
McClean and Keith also offered helpful advice from the distributors’ perspective. “Some distributors may feel it hurts the relationship because they’ve been working with you for years and they feel like they’re taking away your money,” McClean said. He also noted that “a lot of distributors have little feel for the market. So they don’t know how much rebate they can realistically get.”
Keith said he had witnessed the negative side of rebates while he was president
of IBSA.
“When you are going through the day-to-day activities of tracking distributors,
trying to see why they weren’t working with the preferred vendors, the constant tracking kept our eyes off
the ball.”
Another panel discussion focused on how manufacturers can attract and retain
more business from distributors. Roger Buck, CDC, national sales manager of the
forms division of Ward/Kraft Inc., Fort Scott, Kan., and Andy Kohn, CDC,
president of Jerome Group, St. Louis, shared ways that manufacturers could
market themselves and bring in more customers. Kohn admitted that
“leading distributors to water is like trying to herd cats or getting a horse to
drink. But the objective is to get them to understand you and how to benefit
their customers.”
Buck said that when Ward/Kraft sales reps go to distributors “we try to determine if they are in a customer acquisition mode or customer
penetration mode.” Buck also advised that when trying to get distributors’ attention, be aware of your marketing plan. “Are you blasting out a wide net and trying to see what you can get, or are you
doing focused marketing?” Also, “track where your responses are coming from.”
Buck also suggested specific ways to reach distributors: sales calls, seminars,
newsletters, statement stuffers, DMIA’s listservs (members-only email networks), envelopes, online blogs, press
releases and trade shows that include pre-show marketing.
“Make sure you target the right audience with direct mailers,” and use a clean database, Buck said. “Train your booth workers properly so they can qualify rather than sell. Save the
sale for the follow up. Just try to determine the customer’s needs.” He added that you should not forget the follow up call and the follow up sample
that must be sent.
Three Cheers
Attendees said the 2006 DMIA Manufacturer and Supplier Conference was one of the
best ever.
“As in the past, the manufacturer and supplier conference is so beneficial
because of our ability to network with other manufacturers
– some like ourselves, some very different,” Sperling said. “A vast majority of the sessions during the conference were excellent and allowed
insights to our business moving forward, how to build our relationships with
distributors and how to partner with them to move solution selling and program
sales forward to the end user,” he said. “Three cheers to the DMIA staff for making this educational opportunity available
to manufacturers and suppliers of the industry.”
Daniel Garcia Castillo, vice president of Grapho-Formas, a $12 million company
based in Caracas, Venezuela, said he found the information shared at the
conference particularly enlightening. He said he traveled to Philadelphia to
learn new methodologies because
“all of these American manufacturers and their way of doing things are definitely
different from the way we do things down there.”
Guest speaker Paul Reilly advised attendees to not only leave knowing that they
had learned something new, but also leave with the intention of implementing
what they learned when they arrived back home.
“The most important advice I can give you is that you’ve invested a lot of time,” Reilly said to all the conference attendees. “Do something with it. You’ve been at On Demand. You’ve been here. Just think of one thing you think is great and do it when you get
back home.”
Sponsors of the DMIA Manufacturer and Supplier Print Conference showcase
included Drent Goebel, Eerbeek, Holland; Forms Manufacturers Equipment
Inc.(FME), Maitland, Fla.; Kohl & Madden Printing Ink, Cincinnati; Printware LLC, St. Paul, Minn.; SICPA
Secureink Corp., Prilly – Lausanne, Switzerland; Strata-Tac Inc., Batavia, Ill., and Zentmeyer Paper
Sales Company, Mechanicsburg, Pa.
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