I’m Cliff Hollingsworth, Vice President of Workflow Systems at Consolidated Graphics.
Regarding the question of offset to digital, I guess migration was the question. Yeah, honestly, the pundits like to talk about their view, their world view. I think really what it comes down to is that at the local operating company level, what is the vision of the actual… of the President of that company? I’ll give you an example, Keys Printing in Greeneville, South Carolina, the President of that company, his name is Joe Mabry, he came to me in 2003, and his vision in 2003 was to have his… have 50 percent of his revenue be from digital, which you know, this is 2011 now and he’s approaching 50 percent. So we didn’t get the five-year… he wanted it in five years, but he didn’t quite get the five year vision, but we got an eight-year vision.
And being in the business and the business management part of print, if you do digital production well, you know what the margins are. And so if 50 percent of your business in a $13 million company is coming from digital, you can kind of do the math and go, wow, that’s pretty astounding numbers. And then, you have… as long as your mix is right, as long as your offset business is doing what it needs to do from the metric you’ve given it, letting the digital business grow as a priority will help you achieve those goals, but you have to have stated goals to have the migration.
I think if you’re just taking work from the pressroom, the offset pressroom, putting it into digital, that doesn’t necessarily mean you’re having success. I think the other thing that makes it successful, I would rather not even take work from the pressroom if I could avoid it because all that does, all you’re doing is being transactional. As a program sales rep, I want to go out and find those annuities, bring them into digital. Those types of things that continue to give and give and give because ultimately I think we all know, we all say it anyway that offset is going to continue to decline, if that’s the case that means if all we’re doing is taking work from the offset room to the digital room, all that business is going to decline as well.
It takes too much effort in the digital space to take a transactional job through the process usually. And I think with zero touch being to goal, those programs and annuities is really where you’re going to make your money. Now, the sale cycle is longer and you may have to take some of those transactional jobs just keep your face in front of the client, but that doesn’t mean that that’s your goal.