How the Tough Get Going
1. Winner and Still Champion, Ennis
Although not wishing to divulge specific acquisition targets at this time, the Ennis corporate team, headquartered in Midlothian, Texas, is continuing its strategy of acquiring companies that offer complimentary products to its existing line as, well as companies that offer products that could be sold through the existing distributor customer base. The strategy is obviously working, as the company again claims the top spot in Print Professional’s top 100 manufacturers ranking.
And, while some in the industry fear the larger consolidators are creating pricing pressures that will ultimately commoditize products and services, Keith Walters, president and CEO, stated Ennis feels quite the opposite. “The downward pressure of the last three to five years has been driven by manufacturers and distributors struggling to compete and stay in business. A large number of manufacturers and distributors in our industry do not know their real costs of doing business. Failure to know your real costs in a shrinking market most often cause returns to not be as good as expected,” he explained. “When the returns have not been acceptable, it limits manufacturers’ abilities to move out of commodity products, which in turn causes further downward pressures.
For reporting purposes, Ennis is now divided into two distinct segments: printing and apparel. The print segment is seeing success in several new sales programs. For instance, growing its envelope business has been a particular priority for Ennis this year, as evidenced by recent key acquisitions of Block Graphics, Portland, Ore., and Trade Envelopes, Carol Stream, IL.. Furthermore, Walters noted the Enfusion line of integrated products has exceeded company expectations, and the Uncompromised line of security checks is one of the most highly requested products currently sold.
Walters went on to say the apparel segment has solved its recent inventory issue that limited sales of some hot selling items, and has developed several new products for 2008.
And, although the company is seeing some interest from the print segment for green products, there is more demand on the apparel side of the business for eco awareness. “In 2008, Alstyle Apparel will be debuting [its] new ‘AAA Organic’ line of products,” continued Walters. “These T-shirts are made with organic cotton and dyes, and meet the apparel industry’s guidelines to receive the designation of ‘organic’. Additionally, our Admore Line of presentation folders is currently in development of [its] green initiative promotion.”
The company recently appointment Irshad Ahmad vice president of technology to develop a corporate IT strategy that can change with the company’s needs. “Irshad has been challenged with developing the long-term strategy while continuing to integrate the IT functions of our manufacturing locations with our ERP system,” Walters explained.
As for challenges distributors face, Walters cited, are technology, partner stability and lack of sales programs. Ennis currently assists distributors with their needs for technology through our its proprietary solution, Changing Inc., and several third-party industry software companies. “We offer partner stability by maintaining regional manufacturing locations that can quickly react to the needs of the local distributor base,” he added. “[Furthermore], our financial strength and national footprint allows distributors to leverage these strengths with their larger customers. Lastly, we have focused a large percentage of our marketing resources into developing programs for our distributors. No longer does the Ennis distributor have to sell an integrated label or a laser software-compatible check. They now have the ability to walk into a customer with an award-winning, non-branded sales kit and sell the Enfusion or Uncompromised line. The success of these two programs [has] allowed numerous distributor partners to increase their margins while offering their customers a better overall product.”
2. Champion Industries Remains Upwardly Mobile
Led by President Toney Adkins, Champion Industries, Huntington, W. Va., held on to its second place ranking this year. Strategic mergers and acquisitions over the years have helped Champion Industries remain a consistent top producer. The enterprise consists of 15 divisions: Blue Ridge Printing Company, Carolina Cut Sheets, The Chapman Printing Company, Consolidated Graphic Communications, Consolidated Graphics, Champion Graphic Communications, Champion Output Solutions, Donihe Graphics, Interform Solutions, The Merten Company, US Tag & Ticket, Stationers Inc., Capitol Business Interiors, Champion-Clarksburg and Smith & Butterfield.
The company completed the $77 million purchase of the The Herald-Dispatch newspaper. “The Herald-Dispatch is an integral addition to the Champion portfolio,” Chief Executive Marshall Reynolds said in a statement. “We relish the opportunity for Champion to further serve its home community by providing a first-class newspaper.”
Champion believes owning the newspaper will generate numerous expansion and growth opportunities, Reynolds added. The Herald-Dispatch has a daily circulation of about 28,000 and a Sunday circulation of about 33,000.
Commercial printing still accounts for the majority of company’s sales, followed by forms products. However, the various divisions that comprise Champion Industries together offer a full range of products, including forms, cut sheets, tags, direct mail and digital printing.
3. 100 Years Strong
Established in 1908, Western States Envelope & Label, Butler, Wis. is preparing to celebrate the company’s 100 anniversary. Mark S. Lemberger, president, said the company is both proud and grateful to have grown from humble beginnings into one of the nation’s largest envelope manufacturers over the past century. “We owe our longevity and success to the clear vision of our founders, the loyalty of our valued customers, the talents of our dedicated employees and suppliers and to our determination to continue to change and grow with our customers’ needs,” he observed. “Over the years, our suppliers have become aware of our eagerness to try new things that might prove to be of benefit to our customers. Our primary focus for the coming year will be the continuation of our efforts to improve and evolve to better serve our customers’ ever changing needs. Our desire is to be a valuable asset that contributes to their success in every possible way.”
The company’s lean initiative continues to influence every aspect of the organization, from order entry to shipping. Everyone and every department is involved in the process of continuous improvement.“We know that the better we become, the better our customers become,” added Lemberger.
From an operational standpoint, the lean initiatives are resulting in the generation of less manufacturing waste, and the company has also increased its recycling efforts. On the raw material side of things, Western States Envelope & Label is concentrating on dealing with suppliers who practice good environmental stewardship. “As a result,” Lemberger commented, “we have just received our SFI and FSC certifications. With these certifications, we are in a position to help our customers fill the needs of their clients who want to be good stewards of the environment.”
In cooperation with the Envelope Manufacturers Association (EMA), the company is participating in a major initiative to encourage the recycling of envelopes received by consumers. “We will be stocking a line of envelope products displaying a ‘Please Recycle’ logo, as well as offering to print this logo on custom products for our customers upon request,” explained Lemberger. “Our 100 percent post-consumer waste Recovery and Globe envelope products [as well as] our new reusable envelope products are excellent choices for the environmentally conscious customer.”
He went on to say the introduction of stock and custom pressure-sensitive labels has been instrumental in helping distributors grow their businesses by attracting new customers and showing new ideas to existing clients. “Many of our customers have enjoyed success with our label products as evidenced by our nearly 50 percent sales growth in labels this past year among our traditional envelope customers,” said Lemberger. “And, our long-standing membership and participation in the [EMA] has been a benefit to us in many ways over the years, from exposure to industry best practices and alignment with top suppliers to our industry, [to] participation in industry wide efforts [that] promote and improve the value of written communication delivered in an envelope.”
4. Exponential Growth
Retaining its No. 4 position in the ranking, Printegra, Peachtree City, Ga., and its divisions—National Imprint and Synergy Label—were acquired by Stamford, Connecticut-based Cenveo in February. They are now part of the Cenveo Custom Resale Group, which also includes DealerLabel, Discount Labels, Lancer Label, PrintXcel, RX Technology and Wisco Envelope.
Casey Campbell, Printegra’s senior vice president of sales and marketing, explained the trade-only companies’ goals are to increase sales by providing distributors with the products and services needed to grow their business. Printegra’s regional print shops are one way Campbell and his team are making it happen.
“Our five regional print shops are continuing to show significant growth,” reported Campbell. “We attribute this growth to our distributor customers beginning to rely on us more and more for these products. In the past, many distributors outsourced print shop work to local printers who sold both retail and wholesale. When given a choice, these distributors would rather do business with a reliable vendor that can meet their wholesale requirements.”
He acknowledged Printegra’s NIC division showed significant growth last year, as Printegra customers are taking advantage of purchasing the envelope and stationery products that NIC offers. Printegra’s cut sheet business is also enjoying steady growth, Campbell continued, particularly value-added cut sheets such as security documents, pressure-seal and integrated products. Not surprising, the growth in cut-sheets is paralleled by ongoing declines in continuous products.
Campbell said during the past six months, Printegra’s been focused on integrating its facilities and systems into the custom resale group. “Over the next year, our focus will shift to cross promoting the vast array of products that our nine companies can provide to our combined customer base,” he commented. To this end, the company is working with distributors to maximize sales within current accounts. “For example, if the distributor is only selling checks, maybe we can help [him or her] provide ... envelopes, labels, pressure seal [and other products],” offered Campbell. He stressed that while Printegra’s marketing and sales effort will help distributors uncover new business, it’s equally important to make the most of selling opportunities within current accounts where relationships are already established.
“By the end of 2007, most of our integration into the Cenveo Custom Resale Group will be complete,” stated Campbell. “We will focus on cross selling all the product[s] and services that we collectively offer, and will also look to expand our envelope offering nationally.”
Printegra currently offers recycled paper stocks, and Campbell said the company is keeping abreast of the most up-to-date environmental friendly raw materials and processes.
5. Moving on UP
Advancing two places in the top 100 manufacturers ranking to take the No. 5 position this year is New Albany, Indiana-based Discount Labels.
The company was founded in 1965 by W. Fred Conway in the basement of his home. Since then, Discount Labels has grown to be of the industry’s largest manufacturers of custom pressure sensitive labels.
Conway's business philosophies were simple, and are still carried on today Those business philosophies are treat your employees well, so they will in turn treat your customers well; treat every customer as if he or she are your biggest customer; and provide a high-quality product and a great deal of value at a fair price.
Today, Discount Labels' 200,000 square foot facility houses more than 80 proprietary presses that have been designed internally by the company’s research and development team. The sophisticated presses are just as adept at producing high-end full color work, as they are simple one- and two-color jobs.
Discount Labels also employs a team of more than 580, and each individual undergoes substantial training in order to provide the highest levels of service and quality.
Said Joe Cortes, executive vice president of operatons, “We also go to great lengths to service our customers in a manner, which will portray traditional family values throughout their label-buying experience.”
Related story: Top 100 Manufacturers Analysis