The Next 
Big Thing

As reported in the October issue of Print Professional, total annual sales figures for the Top 100 Suppliers took a small hit. Would the industry's leading distributors follow in their footsteps? This year's numbers proved to be a mixed bag.

Total revenue for the Top 100 Distributors wasn't as high as last year's $2.6 billion, coming in at $2.3 billion. It is important to note the absence of one major player in the 2011 list. Dayton, Ohio-based WorkflowOne LLC put forth an admirable showing with annual sales totaling $580.7 million. However, because the company could not disclose how much of that figure consisted of distributor sales versus manufacturing sales, Print Professional was not able to accept WorkflowOne's submission.

A low participation rate offers another explanation for a decrease in sales volumes. Similar to the suppliers, some companies opted not to participate this time around—perhaps they were privately owned or simply hesitant to release any financial shortcomings.

Something interesting did happen with the individual product sectors. In last year's analysis, Print Professional anticipated a possible upset for business forms as promotional products and commercial printing inched closer to the defending champion. Our predictions came true. Business forms fell to third place with sales of $183.2 million—a major fall from $446.5 million in 2010. Commercial printing nabbed second place, with sales averaging at $236.8 million (2010: $295.2 million). Promotional products took top billing with sales totaling $261.9 million (2010: $285 million).

Overall, many distributors failed to break down their total revenue according to individual product sectors. As a result, there wasn't a single hint of improvement (as partly seen above). And, some losses were more significant than others.

Labels & tags accounted for $84 million (2010: $131.6 million) and envelopes/folders/stationery comprised $60.2 million of sales (2010: $106.8 million).

The "other" category suffered greatly only reaching $53.4 million (2010: $171.1 million). Common responses for this sector were: CDs; freight; binders; packaging; jumbo rolls; barcode equipment; statement processing; large format signage; and office supplies and furniture.

Some of these entries may skew the "other" category because the decision to consider packaging as something miscellaneous instead of commercial printing, for example, is left to the distributor's discretion.

The remaining categories saw a more modest decline. Digital print reached $110.1 million (2010: $139.6 million); direct mail averaged $66.3 million (2010: $68.3 million); plastic products/cards landed in at $17.9 million (2010: $20.7 million); and e-commerce came in at $125.6 million (2010: $126.5 million).

Print Professional also added a new product category this year. In line with the tech-savvy suppliers, distributors are seeing new trends such as cross-media marketing campaigns and mobile marketing. In response, distributors could select web solutions (e.g., PURLs, QR codes and software). It finished off with $14.3 million in sales (only slightly above the suppliers' showing of $14.1 million).

Once again, take some time to evaluate your current business strategy and make some tweaks if necessary. This year's top five distributors firmly believe companies have to embrace and adapt to change if they want to avoid closing their doors (see p. 28). Don't think of this as a dying industry, but rather, an evolving industry.

We congratulate each and every distributorship that made this year's list and hope for better times in 2012.

(*Factors to consider when interpreting sales figures are ongoing industry consolidations and responses reporting idiosyncrasies.)