The suppliers with whom we regularly do business are integral to helping Quad/Graphics sustain our hold as the low-cost producer in the industry. For the second year, we honored those suppliers who contribute key value-added services to our operations. Quad/Graphics' Supplier of the Year awards were held Thursday, June 16, during a dinner ceremony at our Sussex headquarters. During the event, we took time to recognize those suppliers that have proven to be the "Best in 2004." Winners are selected in five Supplier of the Year categories; each category has three winners. Celebrating with the employees who work most closely with them, our suppliers had a chance to tour the plant and get the inside scoop on our operations. Quad/Graphics has five Supplier of the Year categories: Maintenance, Repair and Operations (MRO) suppliers, parts needed for the daily operation of the physical plant and equipment. Service/Administrative Supplies, administrative supplies and all services (including facilities). Capital Expenditures, large production and facilities equipment. Outside Service Suppliers, finished product related outsourced services. Consumables , products that become part of Quad/Graphics' finished products. "The suppliers here tonight are the best of the best," said Quad/Graphics Senior Vice President of Finance & CFO John Fowler at the awards ceremony. "We need you to continue to partner with us in a culture of continuous improvement through cost reduction and product enhancement. We need ‘out of the box’ thinking, and we need you to tell us how to do things better. We will be demanding, but that should make us a better customer and you a better supplier." "Quad/Graphics has a unique economic model investing in technology and modern capacity across our entire manufacturing platform in every plant. Our objective is to offer more capabilities that drive our customers’ revenues at a competitive price. We have been the low-cost producer throughout our history." Extensive selection process Determining the award recipients was a four-month process, combining an extensive supplier self-assessment, an objective survey and the subjective experience of end users at Quad. Representatives from each department refined and improved last year’s questionnaire and survey, looking at performance measures such as order fill rate and on-time delivery. They also considered how closely each supplier reflects Quad's values, such as quality improvement, environmental stewardship and community involvement. Most important was the documentation of "value adds," meaning becoming the low cost producer, enhancing the profitability of both themselves and Quad/Graphics. Of the 381 companies polled, almost half returned the survey. The responses were audited for accuracy and the top 20 percent in each category were asked to provide additional documentation to validate the results. Next, end users at Quad with first-hand knowledge of the suppliers completed a survey evaluating the performance of the top 10 percent. To ensure every supplier was awarded appropriate points for outstanding service, Quad end users could nominate a wild card supplier. Any company nominated was given additional consideration by the selection team. Three winners then were chosen in each of the five categories, representing the broad spectrum of suppliers who do business with Quad. "The Supplier of the Year award goes beyond simply recognizing and thanking our outstanding suppliers," said Art Noe, Quad/Graphics Director of Corporate Purchasing. "We want to show them the way to becoming an outstanding supplier for Quad. Any supplier that reads the survey knows what we are looking for, and value adds are the way we will continue to keep costs down in the future." And the winners of Quad/Graphics' 2004 Supplier of the Year Awards are: Capital Equipment Gold: ITW Signode Silver: Kodak Polychrome Graphics Bronze: Gammerler Corp Service/Administrative Gold: Corporate Express Silver: Arbon Equipment Corporation Bronze: Spic and Span Inc. Maintenance/Repair/Operations Gold: Graybar Electric co. Silver: Kaman Industrial Technologies Bronze: Fastenal Outsource Services Gold: Western States Envelope & Label Silver: Admiral Packaging Bronze: Ad Tape & Label Consumables Gold: Performance Pigments/ Sun Chemical Corp. Silver: INX International Ink Bronze: Toyo Ink America