58k.com claims to be the only web site where commercial print buyers submit jobs and the country's 58,000 printers can bid competitively in open auctions. The company says printers of all sizes from every state participate, including 9 out of 10 of North America's largest.

In April, 58k.com opened its London office and it recently expanded into France with the Internet's first multilingual auction market. 58k.com was built from the ground up to automate the print procurement process. 58k.com claims buyers can save up to 50 percent off the cost of printed materials. The print auction is free and anonymous for buyers. Printers pay a small commission once a print job is complete.

Bob Rose, President of 58k.com, spoke to WhatTheyThink about their business model. Bob answers questions about adoption rates, their cash position and the perception among printers who view marketplaces as an unnecessary middle-man.

Bob, Tell our subscribers about your background, career highlights prior to 58k and how you became involved with this venture.

I have been in the print industry for over thirty years. I bleed ink. I owned a print company for 26 years and also sold print for many major players. My clients included Pepsi, Coke, Miller Brewing and Grey Advertising. As for a highlight - I sold one of the largest jobs in the history of print when Pepsi launched “Pepsi Stuff.” The paper for the job was $50 million and it was a thrilling challenge.

I knew David Robb, our Director of Marketing, from my days of selling print services. He owned a coatings business and came to me with the idea of an auction site for the print industry. At the time, I was in a position to consider the possibility and at first I was skeptical. I told David I would think about it and get back to him. Over the next two weeks, I went to my old clients and got their opinions about the concept. A majority thought it was a great idea. One client had 20 jobs on her desk that day and said, “You mean I can unload these jobs to your site and the prices would come back without the normal hassle I deal with now?” I decided to join 58k then and there.

You launched an initiative in Europe last year. What’s the progress?

Martin Tamlyn runs our office in London. It was a good move. Europeans seem to be slightly more open to "working" on the web. It took off very fast and we are very pleased with the amount of buyers and printers using the site.

At Graph Expo, you announced a deal with printCafe to support PCX and they also agreed to integrate 58k into their product. What is the status?

printCafe is still developing their open exchange which we are part of. We view the agreement as a great opportunity. As for our support for PCX, we are PCX ready and also support PrintTalk’s effort. Our position is to make sure we are compatible with any reasonable framework.

Some printers think 58k is a middle-man that should not exist. What are you doing to get the industry educated about your opportunity for printers?

There has been less finger pointing at 58k than one might think. I think most know that our site has a niche in terms of types of jobs placed and when a printer needs to bid on a job. We help our customers fill press time with quality jobs and more people are realizing our value. I tell printers that the internet will inevitably make many print jobs a commodity. We provide service and technology that does it right. As for further education, we market the concept in trade magazines and attend the major trade shows. When people visit our site, it all makes sense as to what we are about.

When we speak to companies really involved in the industry like Georgia Pacific, International Paper and others about our model, most all agree that we are the only real neutral site in the industry. We do not come between relationships, if anything we create relationships.

Speaking of Georgia Pacific, we recently reported their Unisource division will begin offering paper “consulting” to 58k's members with the option to buy from Unisource. Can you tell us more?

Our deal with Unisource has been well received within the 58k.com community. When buyers and printers come to the site they can now get neutral advice about the type of paper to use. And yes, the participants can use Unisource if they want for their paper. Unisource has created a dedicated team to help with all the inquiries from our members.

Sounds like a new revenue opportunity for 58k. Will you add other suppliers?

We would consider any alliance that brings added customer service. Obviously, pre-flighting, finishing, and other options could be included to make the site work even better.

PrintBid, another company in your space owned by ImageX.com, was shut down this month. In an interview with ImageX’s CEO Rich Begert, he told us the adoption rates by buyers was too slow which is why they decided to close PrintBid. What are your thoughts?

We were never in the same space as PrintBid. They had a different model as to the types of jobs and clients. They were more of a brokerage type company, where we are a freemarket place. When ImageX acquired PrintBid, I think their goal was to drive clients to ImageX. It is wrong to place us in the same category with PrintBid - very different models.

Again, on the subject of adoption rates and your cash position. Overall, there seems to be a race between adoption and available cash to build awareness. Will 58k be there when adoption really takes full effect in the e-community?

We do not have a high burn rate with our cash and we have not looked for huge sums of money to finance our business. It is inevitable that the internet will be used by most everyone as a vital business tool and we will be there as we are now. As for adoption rates with 58k, they are high. Service is everything. We really focus on new buyers posting jobs for the first time. We want them to have a good experience. Our rating system, which tells printers how many jobs a print buyer has followed through on, is a great service. If a buyer comes to 58k.com ten times and never carries the transaction through, then they will not get many bids from printers. Freemarkets work and 58k is the ultimate freemarket.

It appears 58k.com is the only player in the auction print market. If competition with deep pockets decided to enter your space thinking it is a simple model to replicate, would that be a mistake on their part?

We assume competition will come. Competition is always good and we will survive and thrive even more with competition. However, one should not underestimate 58k’s inner workings. We have great people, like Tom Reimer our VP of Information Technology. He and others have developed since our inception to keep us out front. We compete with ourselves to make the barrier of entry by a competitor even higher. If you look at our site from the outside, it may not look like rocket science - but it took rocket science to build it. Again, we would not run away if competition entered the market.

Many companies in the e-Print space have restructured and announced layoffs. What actions have you taken and when do you expect 58k.com to show a profit?

We will show a profit sooner than we thought. I would rather not comment on the specific date, but our team is very optimistic. As for layoffs, there have been none - in fact we are hiring.