Discussion

By Hans Willems on Feb 27, 2012

Dear dr. Joe Webb,
thank you for this very interesting article!
Hans Willems
EBDA
The Netherlands

By Gary Ampulski on Mar 01, 2012

This article illustrates one of the fundamental issues with tracking the "Print Industry" using government economic reports where the data tracks NAICS reporting and NOT mix changes that are occurring by the progressive companies that are labeled in the NAICS 323 category.

While working in the Private Equity and Investment Banking communities evaluating printers through the toughest economic times in 82 years, I have seen a number of "Print CEOs" who are creating real value for all their stakeholders (clients, employees, suppliers and local communities, as well as owners) by focussing on three areas:

1. Always raising the bar on their internal efficiencies (Through ongoing process improvement)

2. Identifying those external companies and capabilities that can make them more efficient. (Tuck-ins and technology acquisitions)

3. Expanding their service offerings to address existing and emerging customer needs (off-line applications)

To thrive, a CEO must be successful in all three of these and requires thoughtful planning, good people, ability to invest, the willingness to take a measured risk and tenacity. With this focus and skill in running the day-to-day business, successful "printers" are enjoying 20% Growth and 20% EBITDA Margins.

Unfortunately there are far more companies that aren't doing this and eventually are either acquired in a fire sale by a stronger enterprise or suffer the inevitable Chapter 7 Bankruptcy filing. Overall, the industry will continue to decline until only those left are the one's who make this a way of life. In the meantime, they will continue to enjoy growth while others won't but the data collected by the government and used in most industry forecasts will give us little clue as to what is really going on.

There are lots of high value opportunities in this space if you just know where to look and know how to execute. The leading industry transformers are doing just that and creating real value along the way. The industry may not have it bottom yet. But the data reflects only a point on a curve. We need to look at the first and second derivatives (velocity and acceleration) which have both magnitude and direction. Its both rate of change AND direction that count.

Just like new offensive and defensive schemes change the way a professional game is played, there is emerging evidence to lay claim to a recent Superbowl ad metaphor for our Industry and state;

"Its Only Halftime in America."