While some forms are experiencing a serious decline in sales, others are experiencing great innovation.
Form sales are not declining as much as they are changing. It's a classic example of out-with-the-old and in-with-the-new.
Clearly, multi-part forms are heading for that big collator in the sky. Yet industries such as health-care, retail, insurance and education are giving birth to a whole new generation of innovative form applications. In fact, solution-oriented distributors are discovering that opportunities abound for new form designs that facilitate today's workflow systems, particularly when marketed with value-added services such as on-demand production, warehousing and distribution.
To find out how our interviewees fared in forms business, review the following report.
Sales Report
According to Bob Troop, CEO of Westlake, Ohio-based The Shamrock Companies, traditional forms products accounted for 10 percent of the company's business, or $4.5 million in sales. His highest selling form products were 81⁄2x11˝ and 81⁄2x14˝ cut-sheets. He reported that the two industries responsible for the lion's share of the cut-sheet orders were insurance and health-care. Conversely, Troop noted that multiple-part continuous forms and unit sets performed poorly.
Graham McClean, president and CEO of Global DocuGraphix, Chicago, offered the same sentiments. While he didn't provide specific figures, he reported that traditional forms still represent the single largest product category sold through his company. "There's no question that this marketplace is declining," he said. "However, our margins are still very good."
According to McClean, this is due to several vertical niche markets the company services, such as travel agencies, end-users for financial software companies, beverage distributors and education. He added, however, that as one-part forms take on greater popularity, multi-part forms are experiencing great decline—a direct result of computer technology taking over the functions of multi-part forms.
Brian Wiedenmann, general manager of Monroe, Washington-based Merrill Corporation indicated that this past year has shown an increase in the sales of forms. "This is due to several large accounts that were sold in 2002, as well as the further penetration of existing accounts," he said.
With 10 percent of his company's business catering to forms, Wiedenmann reported there has been no decline in the performance of cut-sheets, unit sets and continuous.
For Cleveland-based Proforma, tremendous growth of forms is occurring in the mailing-application sector. "Our proprietary line called Proforma Promail, and other products, including labels, are on a dramatic upturn," said Greg Muzzillo, founder and CEO.
With $125 million generated in revenue last year from traditional forms and printing, Proforma's basic forms business has not been significantly affected by the prevalence of digital applications and improved desktop-publishing capabilities in the forms industry.
"I'm not worried about the market, there are probably some forms products that are going away and some that are being invented, but I know every business in North America is buying a lot of what we sell," said Muzzillo.
What's Going On
To maintain and/or increase sales and to better service end-users, we found that our interviewees are adding value and function to form design and service. "We have a multi-million dollar marketing fund, and we have great relationships with our manufacturers that give us the best value available in the industry," reported Muzzillo. "There are probably forms products that are coming and going and maybe a couple of customers are more price sensitive or less price sensitive, but for organizations like us, who have an insignificant market share, the market isn't what's important, it's the competition."
In order to boost sales at Merrill Corporation, Wiedenmann said the company has continued to sell its print and brand management solutions. In addition, providing training for its sales representatives and offering technology solutions have contributed to increased sales. He added that the medical and retail industries continue to be the highest selling.
While many industry experts report a decrease in the need for traditional forms, there are some basic forms that are experiencing greater demand. In fact, McClean reported that there are a few newer product offerings within the forms category.
For instance, pressure-sealed mailing products are bringing in very high sales. The reason, he noted, is that there is a system of orientation to that product. "The salesperson and the manufacturing plant add value to the form's construction and the functionality it delivers," he said.
On the other hand, Troop reported that Shamrock wants to boost its forms sales through outsourcing, fulfillment and distribution services. Energies have also been centered on marketing the company's in-house data services profit center.
"We provide an outsourcing service to our clients and pro-spects," Troop explained. "Our primary focus has been on statement billing and municipal tax programs and direct-mail."
What to Expect in 2003
As for what to expect for future forms sales, our interviewees offered varied opinions.
According to Troop, distributors can expect a continued drop in sales.
Wiedenmann, however, believes that sales will continue to flourish. "Forms are still a core product and distributors continue to look for additional products to add to the mix," he said.
Offering advice, he added, "Look for a total value proposition when selling to clients. The selling environment is easier if you look for areas where your client has a need."
McClean believes forms sales will decline in general over time. However, he predicted that independent distributors should not be overtly affected, since they tend to diversify their offerings, unlike the major directs. "Companies like Moore, which have depended almost solely on forms production, have suffered greatly," he said.
"That's the benefit of being an independent forms distributor, we don't have to depend too heavily on one area of the industry."
By Sharon Cole, Maggie DeWitt, Cynthia Graham and Jennifer Hans