Margins are high and the future is bright for this market niche
MOST DISTRIBUTORS KNOW commercial printing is not the typical sale. It involves greater interaction with manufacturers and end-users. Most orders are not simple reorders of the exact same product. There are a lot of colors and shapes and innovative designs and, for some distributors, that is a lot of work compared to a basic form sale. But, for those wondering whether or not commercial printing is worth the effort, a pep talk from John Andersen, sales manager for Admore, a division of Ennis, Macomb, Mich., just might change things. To him, commercial printing is more than worth the effort.
"Some distributors are not on the commercial printing bandwagon. What is taking so long?" he asked. "There are decent margins on this work and the reruns are the bread and
butter of the business. For
distributors who think, 'why should I be selling commercial printing?' think again," Andersen commented.
"Distributors who leave this crumb for the next guy are opening the door for another printer or distributor to walk in and eventually take away all the business," he added. "Service the account, and take the small orders, too. Distributors need to offer one-stop shopping. Don't send customers looking somewhere else."
Andersen, who worried about coming across too preachy, felt compelled to emphasize the significance of commercial printing today. "It is a niche that offers an attractive margin," he said, "and it's a line of business that will never feel dull."
Ennis produces a line of commercial printing products under the name ColorWorx. It includes four-color process with UV coating business cards, postcards, brochures, letterhead, rack cards and door hangers. "We are also introducing several new items such as table tents and greeting note cards," said Andersen.
He reported that standard mark ups are 30 percent to 40 percent. "In some cases, distributors can mark up a job in the 20 percent to 30 percent range, but charge additional creative fees for composition and design, services that are difficult to shop around. I know of distributors who create logos used in national campaigns and they make more money on this than on the printing," he said.
Mike Schaefer, CEO of H.C. Miller, Green Bay, Wis., could not agree more about commercial printing's worth. His company works within various markets, including health-care, financial and law. He said custom products yield some of the highest profit margins distributors will experience in the industry.
"Generally, distributors can command a healthy mark up on these products since
they are custom and cannot be resold anywhere," he explained. "Bandits [less than admirable resellers] cannot get in on the sale of these types of products either, so distributors are not competing with them or with large office supply stores. And, they are consistently in great demand."
In Demand
Where is commercial printing in demand? According to Andersen and Schaefer,
almost everywhere. Specifically, Andersen recommended promoting to realtors, mortgage companies and car dealers.
He's found such industries purchase a lot of four-color process business cards. "And the sales people in these industries like to use color photos," he added.
In addition, the health-care industry, food and beverage market and financial institutions are hot buyers, according to Walter Sansom of Champion Industries, Huntington, W.V. "We produce a wide array of commercial printing work from catalogs and digital four-color printing to folders, flyers and envelopes, favorites among buyers in all of these markets."
Work Smarter
While many distributors are promoting commercial printing, they may not be doing so at optimal levels. When asked if he believed they were selling up to par, Andersen said, "yes and no."
"Most distributors who want to sell commercial printing don't make use of it for their own purposes," stated Andersen. "They should get plenty of samples from their printer to be shared with their customers. Also, I suggest they partner with their printer and make use of the sales tools available. This partnership will help when educating their customers and, in the end, sell more."
Andersen also recommended requesting additional flyers and distributing them in a monthly mailing.
"Hand these out at the trade shows you work," he said. "Selling commercial printing is not scary. The distributors who do their homework are the ones who are going to succeed."
Future Outlook
So how does the future look for commercial printing? Generally good, according to those
interviewed.
Schaefer is confident business for commercial print products will not disappear any time soon.
Andersen cautioned, however, that one trend involves increasing online purchases for items such as business cards and others similar to those found in Ennis' Colorworx line. "The question distributors should pose is whether or not they feel comfortable buying printing through the Internet," he said. "I think distributors will feel better about the decision to get into commercial printing by having a successful relationship with the printer and sales rep."
Sansom concluded, "In the coming years, we believe commercial printing will thrive, changing to digital output. But, distributors should keep in mind commercial printing is most successful when it involves partnership. That's the name of the game."
By Sharon Cole
- Companies:
- Admore
- Champion Industries
- ColorWorx
- Ennis
- People:
- John Andersen
- Mike Schaefer
- Places:
- Macomb, Mich.