Acquisitions Reach A Crescendo

As detailed in our Upfront News section, industry consolidation continues, with the big news for independents being Crabar/Witt's acquisition of GBF Graphics. Crabar/Witt, which purchased Edison Business Forms earlier in January, has added all four GBF companies to its fold, instantly propelling the company into the top 10 independent manufacturers.

Another January acquisition was the Wise Business Forms purchase of Fidlar Doubleday's business forms division. The move pushes Wise's revenue to more than $70 million and increases its foothold in the Midwest.

On the Direct side of course, was the huge $1.1 billion acquisition of Wallace Computer Services by Moore Corp., creating a $3.6 billion industry giant. This move strengthens Moore in the large corporate customer market, where the company makes best use of its equipment and resources. The technologically nimble Wallace could also help Moore in emerging markets, should the new Moore Wallace choose to continue investment in that arena.

What does the acquisition activity mean for distributors? First, it means that the base of available independent forms manufacturers is shrinking. While distributors should still have as many choices as they need to find the right manufacturer for a given job, the manufacturers are becoming larger and more sophisticated. These larger firms will then want to deal primarily with larger distributor-ships where orders are bigger and more plentiful, and credit is more secure.

Moore's Wallace acquisition will undoubtedly lead to plant closures and layoffs. Expect the ranks of independent distributors to be swelled by downsized salespeople. Experienced customer service representatives and skilled press operators should become available. The good news is that Moore Wallace will probably focus on the very upper end of the market, making a growing middle market more accessible to the independents. When the economy in-evitably turns, distributors should be in position to claim an even larger share of the market.

Bill Drennan

Editorial Director