The news about AlphaGraphics and Allegra combining forces to host the first joint technology expo in franchise print history was likely met with cheers from our vendor community.  At FESPA last month in Munich, I spoke with several executives who were quite emphatic that something needs to change in terms of the numbers of shows and events they are expected to support.  As the industry consolidates, the number of events seems to be expanding, with even drupa introducing a new print show.  AlphaGraphics and Allegra should be congratulated for this level of collaboration.

I spoke with CEOs from both companies following release of the news.  Carl Gerhardt of Allegra said, “We have been talking about this for two or three years or more with some of the franchise companies.  Most of them were favorably inclined to it, although there were many issues to be overcome, not the least of which is scheduling. Some had already booked facilities through 2012. And others felt it would be too difficult to coordinate. We also began talking to some of the key vendors. They were really enthused about the idea and gave us their full support. Anytime they can eliminate going to a show, it saves them a boatload of money. Although the vendors have been great supporting all of our individual meetings, we also felt that it may get more difficult to gain that support in the future.”

According to Cushing, “This makes supporting our show and conference so much more economical for the vendors, and we hope it encourages them to bring even more resources because of the ability to leverage one investment of time and expense to speak with more customers in a much calmer and more targeted environment than a large show can deliver.”

One question that comes to mind is whether the two networks ultimately plan to merge.  They both say there are no such plans on the table.  Cushing said, “The results of combined cooperative efforts in the past stand on their own as motivation to find more ways to enable our systems to benefit from future combined efforts such as the joint Technology Expo.” Gerhardt added that each franchise will be holding its separate annual conference in conjunction with the Expo, and each franchise will have a separate day on the show floor.  “This is better for us and for the vendors,” he explained. “They have only one set-up expense, and they have more quality time with members of each franchise.  At big shows like Graph Expo, visitors are much less targeted, and it is so busy that they often must hold quality meetings before or after show hours.  This way, they have a more targeted audience, the show is very focused on our needs, the vendors sell stuff and our franchisees get targeted information that is of value to them. It is a win/win all the way around.”

Cushing commented, “When I became CEO of AlphaGraphics, Carl was one of the first to welcome me to the leadership group of the franchise part of the industry.  We have also had a great working relationship with the Lowes at Franchise Services and have been able to put friendly competition to work for the benefit of the franchisees in all of our organizations.”  Cushing also points out that these relationships have been put to work to address other issues for the benefit of all of the networks, such as the Adobe flap over the Print to Kinko’s button proposed for Acrobat, the change in strategy for HP’s MarketSplash and more recently 4Over’s introduction of the Red Tag initiative. The franchise coalition has come together quickly to address these perceived threats.

Cushing also points out other benefits, such as the ability to leverage their combined negotiating muscle to obtain favorable pricing on rooms and other aspects of the combined event, allowing both organizations to put on great conferences and a trade show with a more economical package for franchisees. He adds, “We don’t compromise anything, and we get the benefit of the working partnership with Allegra on this.”

Franchise owners from both networks were also receptive to the move, indicating that anything that gives them a bigger and better show and more vendor support is a  benefit. When asked whether he thought other franchise operations would join in over time, Gerhardt said, “We don’t’ know if other franchises will join us in future years with this same model.  We are certainly open to that.”

While on the surface these networks appear to be competitors, and are competitors especially when their individual centers are located close to each other, Gerhardt asserts that they are “friendly” competitors in the broader sense of the market.  “The way we look at the world, we have bigger fish to fry,” he says. “Bigger competition comes from vendors putting highly functional printing devices into businesses, companies like VistaPrint and the office superstores, as well as the structural changes the industry is undergoing. If we can get most of the independents to convert to franchise, which could be seen as another area of competition, we will all get our share.  We have more things in common than we do in terms of competitive threats from each other, and that is what enabled us to put this together.  We have to look beyond corporate politics and get our staffs to communicate with each other on this level. That has been a good process so far.”

Cushing added, “As strong as each of our brands is, we are still a minority share in the marketplace compared to the industry at large.  Collaborations like this help bolster that share for all of us.”