Archive for November, 2002

  • CPI reviews terms of trading with FujiFilm

    Steve Somogyi, Chief Executive Officer of CPI, confirms that the company is holding discussions concerning terms of trading with Fujifilm, its supplier of CTP equipment, film and printing plates. Describing the talks as “open and robust” he said this was part of a continuing review of the company’s business. “We turn over all the stones.”

    In recent weeks, industry reports have had Fujifilm executives sounding out other suppliers as possible alternative distributors for its products, both in Australia and New Zealand. Jonathon Clarke, managing director of Print & Pack, one of the most frequently mentioned alternatives, would make no comment, other than to rebut the report that his company was attempting to recruit Agfa employees in New Zealand for the venture. “Categorically no,” he said.

    Print & Pack, the Man Roland distributor and wholly-owned subsidiary of the Man Group, has long been keen to acquire a consumables agency in order to level out the erratic revenue stream of its equipment sales.

    Times have changed

    The CPI negotiations are part of a pragmatic response to the continuing slide in profit margins in the graphic supply industry. While acknowledging the price support of Fuji Photo Film on film and proofing that enabled the company to sustain gross profit margins on these lines, Steve Somogyi said that margins in other areas were, “substantially lower than they were two or three years ago.

    “We have to find a fine balance between the interests of our shareholders, our customers, our suppliers and our staff. The terms of trading that were suitable five or ten years ago may no longer be appropriate. We have to examine carefully every product line to see if it is adding or taking away from our profits.”

    CPI can point to an increase in sales of printing plates of 3.1% and a doubling of its Fujifilm CTP installed base – mostly with consumables contracts – over the past year. This was achieved at a time when the graphic arts industries in Australia and New Zealand suffered a fall of 6.5% in consumption of fine paper and board, according to figures in the CPI annual report.

    The company’s paper sales for the year increased 3.5%, with ink and pressroom solution sales 28% higher than the previous year. Steve Somogyi attributes this to the success of the company’s new account manager methodology, “where teams in each of our branch operations share a manageable client base and are rewarded for the quality of their client service and range of product sales.”

    The Fujifilm business contributes between 10% and 15% of CPI’s turnover, but if the agency was to change hands, Somogyi is confident other manufacturers would be more than keen to access the company’s wide-ranging distribution setup. “There are lots of people out there who would want an alternative distribution network such as ours,” he said.

    It sounds like CPI is playing hardball and maybe it is, but then, it is a tougher game these days.

  • Heidleberg takes over Gallus

    Heidelberg held a 30 percent participation in Gallus since 1999 and its full integration was expected. It gives Heidelberg a ready-made strong presence in label printing, especially in the rapidly growing flexo sector.

    “With six to eight per cent growth, flexo printing represents a rapidly growing segment of the print media industry,” Bernhard Schreier, Heidelberg’s CEO, stated. “By further intensifying our cooperation with Gallus, we will be able to benefit even more from the growing demand for labels and packaging.”

    In Australia and New Zealand the move was welcomed by Andy vels Jensen, (pictured) managing director of HAN who applauded the work James Rodden, MD of Gallus Australia has done and said there were no immediate changes on the cards.

    “James Rodden and Gallus Australia have been doing a fantastic job with limited resources. No changes have been agreed upon as of today. However, if it makes sense to Heidelberg, Gallus and, most importantly the customers, changes will happen as we move ahead,“ he said.

    The integration of the two companies will see HAN move further into the consumables market in the strategically important flexo and label markets. The company is already looking at ways and means of expanding its existing consumables business into its traditional customer base

    “Heidelberg in Asia Pacific, excluding Australia and NZ, has been representing Gallus for a number of years, very successfully with increasing market shares,“ said Mr. vels Jensen. “This requires involvement in the consumables aspect of the business. We would follow a similar concept if/when we get more directly involved with the Gallus product and thus in flexo.“

    There will undoubtedly be many synergies to flow from the integration of Heidelberg and Gallus in the region. Many existing Heidelberg customers are also Gallus users. Mr. vels Jensen is looking for general efficiency improvements, better market coverage, increased focus and approach to all market segments.

    “[It will give us] the ability to chase more business without having to worry about limited service support, on the spot and immediate response through HAN’s existing service network through Australia and NZ, access to PMA training and programmes, and access to Heidelberg Print Finance, just to name a few that come to mind.“

    In 2001 Gallus had sales of €120 million, with approximately 500 staff members worldwide. The company develops and produces narrow web printing presses, mainly used for printing labels by way of flexo printing, letterpress printing, screen-printing and offset printing. It has been a leader in the development of combination presses, combining different printing methods including digital.

    With a 30 per cent market share, the company is the world market leader in label printing. It is also present in other narrow web printing sectors (e.g. folding carton printing), due the modular structure of its printing presses.

    For the past six years Gallus has had direct representation in Australia and New Zealand. During that time James Rodden, managing director, has overseen a rapid expansion of the company’s customer base.