The Industry Turns in the Right Direction
Despite a tight year, future indications look hopeful for printed products.
Transcontinental is no longer reporting its sales in the independent segment of the printed products industry. The company's departure cuts the Top 100 revenue figures almost in half. Removing Transcontinental's sales of $2 billion from last year's numbers shows a drop in Top 100 sales of three percent or $90 million to $2.78 billion.
But, Transcontinental is not the only change in this year's Top 100 Manufacturers list. Calibrated Forms is now part of Ennis Business Forms, propelling Ennis to the top of the charts with sales of $240.8 million, just ahead of PrintXcel, which reported sales of $240 million. GBF Graphics was acquired by Crabar/Witt to form Crabar/GBF, the latest company to reach $100 million in sales.
Another change this year was the creation of UnigraphicsUSA, an alliance of nine manufacturers with combined sales of $166.6 million. These manufacturers include Wright Business Graphics, The Flesh Company, New Jersey Business Forms, B&D Litho, Woodbury Business Forms, Printgraphics, Specialized Printed Forms, Skyline Business Forms and Superior Business Associates. While individual members of the group remain independent, the group hopes to take advantage of its size with combined marketing programs, national coverage and combined buying power. (See related story on page 8.)
Facts and Figures
This year's $2.78 billion in sales broke down into $1.27 billion in forms (45.7 percent), $621 million in labels and tags (22.3 percent), $164 million in commercial printing (5.8 percent), $130 million in promotional products (4.7 percent), $112 million in direct mail (4 percent) and $486 million in other products (17.5 percent), mainly plastic cards, services and office supplies.
The total number of employees reported by the Top 100 this year was 19,360, a decrease of 302. The total number of locations dropped by three to 366.
Productivity, as measured by sales per employee, dropped to $143,733 from the $158,805 reported last year. Sales per location also dropped to $7.6 million from last year's $11.7 million.
Top 10 Manufacturers
The overall Top 10 Manufacturers generated $1.24 billion in total sales and employed 8,718 people at 187 locations. This represents 44.4 percent of the overall Top 100 sales, 45 percent of total employees and 51.1 percent of total locations.
In terms of productivity, the Top 10 generated $141,833 in sales per employee this year, compared to $168,072 last year. For sales per location, the Top 10 generated $6.6 million vs. $17.8 million one year ago.
Tops in Their Class
As seen on the accompanying charts, the Top 10 manufacturers of forms reported sales of $721.7 million, compared to $695 million last year. The Top 10 label and tag suppliers sold $347.7 million, compared to $376 million one year ago. The Top 10 commercial printers sold $126.3 million, compared to $1.47 billion ($1.3 billion from Transcontinental) last year. The Top 10 direct mail suppliers generated revenue of $86 million, compared to $243 million one year ago (Transcontinental accounted for $167 million).
Operations
New business activity declined among the Top 100 Manufacturers this year, as 56 percent expanded manufacturing capabilities, compared to 70 percent last year; 14 percent purchased or acquired facilities vs. 18 percent last year; and 3 percent built new plants, compared to 4 percent last year.
Layoffs were less of an issue this year, as 26 percent of the Top 100 reported downsizing due to slowdowns in orders, discontinued operations, new technology and discontinuation of unprofitable products. On the positive side, 42 companies added employees in the production area, 34 companies added staff in the sales area, and 13 companies added administrative help.
Profitability
Because most of the Top 100 Manufacturers are privately held companies, they are not required to publicly disclose their profits. However, to generate an idea of what the Top 100 Manufacturers experienced this year, we can look at Ennis Business Forms, a publicly held independent manufacturer.
Ennis reported net earnings of 6.3 percent for its latest fiscal year, the same percentage reported for the previous year. The company's sales increased slightly due to the acquisition of Calibrated Forms.
With economists forecasting a turnaround in the U.S. economy, the hope is that manufacturers have held on to profits over the past year and will look forward to increased sales this year.
Note: All numbers used for this analysis are based on the sales totals provided by the manufacturers listed in BFL&S's Top 100 chart. All of the manufacturers included in the chart indicated that significant portions of their products are sold through the independent distributor channel.
By Bill Drennan & Pam Newman