Roy Grossman, Sandy Alexander Sandy Alexander is the country’s largest independently owned commercial printing company serving the high-end color market with 2000 sales of $137 million. Their extensive web and sheetfed printing capabilities are complemented by a wide array of digital and electronic media services. Over the past four decades, Sandy Alexander has served the corporate communication, cosmetic, pharmaceutical, automotive, graphic design, advertising, and promotion industries. They have consistently been recognized for their technical expertise, an innovative approach to business, and a desire to work as partners with clients. The company operates two facilities, one in Clifton, NJ, and one in St. Petersburg, FL. The St. Petersburg facility encompasses an in-line finishing operation, which includes the ability to ink-jet image directly on press. Roy Grossman is President of Sandy Alexander. Roy, we understand you will place a very exciting new piece of equipment this year. Tell us about it and what other equipment have you invested in recently? We have always maintained a very aggressive capital investment program. Over the past two years we have added capacity in the pressroom and expanded our pre-press capabilities. Specifically, in the New Jersey facility we added a new 6 unit web press, 2 new 8 color sheet-fed presses including in-line UV and interdeck drying, and a revolutionary off-line double coater. In Florida we installed a new 6 unit web press with complete in-line finishing. Our entire pre-press department has also gone through a thorough upgrade including, increased CTP capacity, new high speed servers, additional workstations, and internet based real time soft proofing. During the coming year we will become the first commercial printer on the East Coast to install an 8 unit single web press with in-line UV coating. We are also evaluating additional 8 color sheet-fed equipment. We mentioned that you have sales well over $100 million annually. We assume your relationship with your paper vendor is pretty tight. One of the reasons for our on-going success has been the strength of our relationships with our suppliers. One of the most important of these is paper, especially given that paper can comprise anywhere from 30% to 50% of the total cost of a job. By seeking out strong relationships with the best mills and merchants, we are able to provide our clients with both availability and pricing advantages that they usually can’t find elsewhere. What are your top clients telling you about their spending for 2001? As everyone has noticed, while leading economic indicators have not yet confirmed it, the truth is that we are in the midst of an economic slowdown. Hopefully it will not be long-lasting, however, based on spending forecasts we have seen from our clients, I’d be surprised to see much improvement (any time soon). We have already seen reductions in print spending in a number of industries including telecommunications, financial services, and corporate communications. Beyond the economic impact, traditional print as a communication medium faces other challenges, most notably the internet. There will be some segments of the print market that will be extremely vulnerable to new forms of communication, while other areas will continue to best served by traditional print. We are constantly evaluating both the needs of our current clients, and the changes in the overall market to ensure that we are well positioned for future growth. What is your take on recent happenings in the e-commerce space? The number of e-commerce providers in the print industry that blossomed over the past 12-18 months has been staggering. The demise of many of these has been equally staggering. We have investigated just about every one of the "major" e-commerce players. While each offer their own unique benefits, there are also many areas of concern, not the least of which is their financial stability. Many of our clients have also been evaluating which, if any of the e-commerce solutions will offer enough of a completive advantage to take advantage of. To date, very few have actually made firm commitments. Given the number of players that are still out there, I think it is still reasonable to expect consolidation in this market. One of the positive signs is that most providers have realized that a transactional based approach to e-commerce is not in either the printer’s of client’s best interest, and are moving towards more relationship based process. What would one need to offer to gain your business in this area? We have not made any commitment in this area for one simple reason: The existing solutions have yet to demonstrate any real value-added proposition. At best, what we’ve seen could more realistically be described as glorified e-mail processes. Should a system evolve that gives both the printer and client something more than what already exists, we would be happy to embrace it. How would you describe your sales force? The printing industry has typically been a very sales-driven industry. Over the past 5-10 years, partly as a result of widespread consolidation, many printing companies have focused their marketing efforts through avenues other than direct selling. Based on the segment of the market that we compete in, the extremely high level of personal attention and service required by our clients, and the nature of the product we produce, we have invested in, and developed, what would probably be described as the most successful sales force in the entire industry. In fact, our sales effort would be best described a "consultative" process - our clients would describe their account representative as their individual consultant. We supplement the selling process with a variety of strategic marketing programs including very targeted advertising, promotion and public relation efforts. You mentioned that Sandy Alexander uses on-line soft proofing. What are some of the advantages of this process and explain other proofing systems you have developed? With what has become a nearly complete digital workflow process, proofing has seen a number of dramatic changes over the past few years. We have moved from what was a film-based process to an electronic based process. As a result of this shift, we have introduced new proofing solutions that work in a digital environment. This includes digital Matchprint and Approval, as well as "digital blueprints" which are now output on wide-format ink-jet printers. One of the side benefits of this new technology is that blueprints are now in color. In addition, we have also been a pioneer in internet based on-line soft proofing. Although not yet ready to be a final "contract proof", soft proofing allows clients to view and annotate ripped files, thus reducing the total cycle time in production and reducing costs as a result of fewer hard proofs being output. Some print buyers wait until their job has been designed and proofed before consulting their print vendor. How important is it to get the print vendor involved as early as possible? Involving the printer as early in the planning process is one of the most effective ways to ensure the smoothest possible production, and maximize cost saving opportunities. Often times projects are designed without taking into consideration many "printability" issues. When problem areas or cost saving alternatives can be identified at the beginning of the process, the time required making the appropriate adjustments, and the costs incurred will be substantially less. Everyone uses the word "partnership" to describe working with print buyers. What should a "partnership" really be like? A good idea is to really make your printer a real "marketing" partner. The idea of "partnership" in our industry has become an incredibly overused term, and one often without any substance other than price reduction. Clients should consider identifying a very select group of printing companies that have demonstrated the ability to help the client achieve their objectives, and then make sure that this group becomes an integral part of the production team. Not only will the printer be in a better position to help eliminate potential problems as early as possible, but they will be better positioned to make an investment in the client’s business. How does Sandy Alexander evaluate whether to attend or exhibit at trade shows? Industry trade shows come in two varieties: One where we are the buyer, i.e., Graph Expo, DRUPA; and one where we are the exhibitor. In terms of attending shows as a buyer, many of these are a tremendous source of information and education. The rapid technological advancements in our industry are difficult to keep track of, and trade shows provide an opportunity to stay in touch with what’s new. We are very fortunate, as a result of our size and position in the market, to have very strong relationships with many of the major equipment providers who exhibit at these shows, and as such, have the opportunity to learn about new products and technology very early on. As far as printing companies exhibiting at trade shows that attempt to attract buyers, we are very careful to evaluate what the end-benefit will be. While there are a few major national shows, many are regionally based, and end up requiring a significant investment in terms of time, personnel and expense. Our presence at these shows needs to be considered and evaluated as any other element of our overall marketing and business plan. As such, our presence at these types of shows tends to be very targeted. How important are industry trade associations to the success of a print firm with your size? Industry associations can provide a wide array of benefits and services to member companies. We have been very active in several of the print trade groups, especially PIA. In fact, I am one of two past chairmen of the Association of Graphic Communications (the metropolitan NY/NJ PIA affiliate) here at Sandy Alexander, and our CEO, Frank Stillo, is the current chairman of PIA’s Web Offset Association. Two of the most critical areas that trade associations need to be active in are education and government affairs. With the rapid development of new technologies, trade associations must take on the responsibility of ensuring that a skilled and well-educated labor pool exists for its member companies. Secondly, given the highly regulated state of the printing business especially here in New Jersey, the trade association can be invaluable in ensuring that federal, state and local regulations are clearly communicated to the industry, and more importantly, be a strong lobbying voice representing the interests of the printing industry with the various political bodies. Thank you Roy! We wish your firm continued success.