1 + 1 = $1.2 Billion
The union of WorkflowOne and Relizon forges a formidable link in the ever-evolving supply chain
WELL, 2005 CERTAINLY went out with a bang for Greenwhich, Connecticut-based WorkflowOne, and the new year is off to a fantastic start. On Nov. 30, Greg Mosher, chairman and CEO of parent company Workflow Management, as well as WorkflowOne, and Rodney Hedeen, president and CEO of Relizon, Dayton, Ohio, officially sealed the deal on WorkflowOne's acquisition of the largest major direct competitor to the independent distribution channel. Surely, the co-mingling of these two dichotomous sales cultures will have monumental ramifications for the industry. Or not.
After all, for years now, top-level executives and sales professionals from the ranks of the major directs have been seeking out new opportunities with independent distributorships. And, as Mosher pointed out, "WorkflowOne and Relizon, both with manufacturing and fulfillment capabilities, are really not that dissimilar."
He explained that Relizon manufactures roughly 55 percent of its goods, the balance coming from other manufacturers referred to as trade partners. WorkflowOne currently manufactures approximately 25 percent of its products while remaining a significant player in the outsourcing and independent model.
As Mosher sees it, the greatest impact of the acquisition will be direct benefits to end customers. "Customers demanding complete solutions to their supply chain needs are driving dramatic changes. Unfortunately, the industry has never been particularly good at logistical supply chain management," he observed. "Together, WorkflowOne and Relizon can respond much better than either company could individually."
Unite and Conquer
The acquisition combines a solid manufacturing base with the fact that WorkflowOne will now have the largest outsource independent spend [approximately $600 million currently] of
any company of its type in this business sector. "We've created a seamless supply chain and logistics powerhouse for a best-of-breed, end-to-end solution, including execution, warehousing and delivery," Mosher stated.
The objective is to do what is best for end-users, whether products are internally manufactured or outsourced, while allowing them to focus on their core businesses and save money. "With this acquisition, we are far more nimble than anyone else, and we intend to execute our plan with a full measure of vigor and integrity," continued Mosher.
The recently launched Relizon Idea Center in Columbus, Ohio, is the first of five or six facilities helping to support outsourcing strategies. "Again, logistics is the key to an end-to-end solution that includes first-class, state-of-the-art warehousing, distribution, pick-and-pack, shipping, digital print and print on demand," explained Mosher.
Everyone's a Winner
In addition, Mosher envisions the combined companies' sourcing engine generating more than half a billion dollars for other manufacturers in the independent supply chain. He emphasized that there will always be demand for products that will not fit his company's manufacturing network, such as very unique labels, high-end specialized direct mail pieces and magazine-quality printing.
"We have no desire to keep buying manufacturing equipment when it would be better to outsource," Mosher said. He went on to explain, "I believe Workflow Management, with its portfolio of companies, including Relizon, will be in the best position to supply independents with constant, reliable work. Preferred independents who do a good job for us will have more business than ever before. The industry struggles so much for growth and margin; I want this to be a company that thrives through those two factors."
His decision to purchase Relizon was driven by the complementary strengths the organizations share. "Both companies enjoy market-leading customer satisfaction, as well as market share and service capabilities in several growing vertical markets, including financial services, retail, health-care, government, non-profits and sports," observed Mosher.
Both companies have also invested heavily in proprietary information technology. Mosher said within the next year WorkflowOne will launch innovative IT services and software built around a series of independent systems that can be integrated to support and manage the entire business document communications life cycle. Users will be able to manage digital assests, orders, inventory and warehousing. "Our clients, suppliers and employees will work together in a seamless, transparent environment," Mosher said.
A Process of Assimilation
Of course, restructuring and rebranding an organization that now includes 5,000 employees, 32,000 customers and an annual revenue of 1.2 billion is no small feat. Mosher explained that several task forces have been formed, including a synergy committee led by Hedeen. "Synergy is critical. Rodney will be working very hard, but it won't be instant coffee," he stressed. "We'll be identifying company-wide best practices and implementing them across the organizations to drive added-value."
Both WorkflowOne and Relizon enjoy long-term clients with long-term contracts, and the senior management of both companies will be meeting with the leadership of key accounts to discuss offering the best in performance, goods and services. "Limited surveys indicate customers are very excited about the acquisition," said Mosher.
Blending these two distinct sales models will also require a significant amount of training.
"The independent distributors and direct sales reps must now become logistics solutions providers whose objectives will be to best serve the customers, whether it means manufacturing their goods or outsourcing them," offered Mosher. "Sales professionals who truly understand this elevate themselves from being peddlers to true assets and partners to their customers."
By Maggie DeWitt