Distributors Set Their Sights on Profits
2002 emerges as a year for change and transition.
The past year has certainly become one that is ingrained in the minds of many. Marked by a softening economy and the tragic events of September 11, it is one that many are eager to put behind them. But during a time when losses seemed unavoidable, signs of growth and innovation have managed to emerge.
Distributors searching for the best solutions to offer clients with modern demands are beginning to move into new markets. With this transition comes the need to refine their efforts while also producing profits.
To illustrate the transition, BFL&S interviewed distributors who have found profitable product niches within the industry. We asked them how they've been able to develop and strengthen those niches, which include commercial printing, labels and tags, non-form products, direct mail, value-added services and promotional products.
A recent BFL&S survey of its Top 100 Distributors indicated a significant potential for sales in most of these product areas. One such area is commercial printing, which ranked second only to forms with $481 million in Top 100 Distributor sales. Pulling in $221 million, promotional products trailed in third, while labels and tags, other products, non-forms and direct mail fell suit with 9.5 percent, 7.3 percent, 7 percent and 4.9 percent of Top 100 Distributor sales respectively.
These numbers reflect a shift from traditional products. In fact, according to Printing Industries of America, it is expected that traditional products will account for less than half of distributor sales by as soon as 2003. This is due to the fact that many business forms printers have found opportunities in other segments to substitute for, or supplement, their traditional forms businesses. These printers have reduced their core business as a proportion of total sales by investing in other higher-growth markets.
Given such changes, BFL&S chose to investigate those categories that represent the industry's movement and, in doing so, discovered a few new trends.
For instance, one of the distributors we interviewed now offers software strategies that combat the threat of recent anthrax concerns (see page 58). Another discusses e-marketing solutions as a way to overcome postal rate increases (see page 39). In addition, salespeople are finding profits from old standbys—such as labels with high-tech systems (see page 52)—as well as promotional products, commercial print- and e-commerce solutions.
For a better understanding of how the industry is operating today, read through the following articles, which reveal how distributors can find great success within specific markets.
By Sharon R. Cole, Maggie DeWitt & Allan Martin Kemler
- Companies:
- Printing Industries of America, Inc.