What’s Next? Preparing for the Economic Recovery

Karl Fritchen, President of QuadTech

Almost every business in every industry is struggling with the current economic climate to some degree. Karl Fritchen discusses how printing companies and their suppliers can not only survive, but grow stronger during a downturn.

TT—What practical steps can printers take to weather an economic downturn?

KF—How does the old saying go? When the going gets tough, the tough get going! Tough economic times provide new opportunities to partner with suppliers, customers, or even people with whom you would not normally interact. The goal is to find new methods to add more value for your customers that allow them to generate more business. It helps you to do a thorough review of what the customers really value from the relationship you share and seek suggestions for improvement. Many times new business models are the result. I’d suggest you start with customers with whom you have a strong mutual trust developed. Both sides need to be able to hear the hard things and keep an open mind to possible new ways of approaching business. Be prepared to try things and give them a chance for success before discounting them as silly ideas.

TT—You’ve cited positive steps. Have you seen printing companies employing practices or tactics that you’d consider to be the wrong way to go?

KF—That is a tough question because we often don’t fully understand the rationale behind others’ decisions—which really puts into question our opinion of their actions. However, with that disclaimer, I do question why so many companies have maintained the excess capacity that they retain in their businesses. Many parts of our industry are in vital need of a reset in capacity if we are to return to some reasonable level of margins on print. I believe that those who are prepared to make the tough decisions and look for the opportunities that exist will come out of this downturn much stronger than their counterparts.

TT—What is your company doing to prepare for the other side of the economic downturn?

KF—Where there is pain, there is need for a solution. Providing solutions is the heart of our business. We are taking a close look at our costs like everyone else and making the tough decisions. We have streamlined our business around the items our customers felt the strongest about, to make sure that we are positioned well to help them as we enter the recovery stage together. But one thing that we refuse to cut back on is research and development. In fact, we’re taking this time to heavily invest in new technology developments, and show the market our ability to develop new, highly innovative products during this economic downturn. This year we will have more new product introductions than we have ever had in a single year of our company’s existence!

We’re focusing heavily on two major product introductions: AccuCam™ for Newspaper and SpectralCam™ for Packaging. They’ll be nice complements to our industry-leading SpectralCam™ for Commercial applications that was released last November. We’re also pushing forward with some game-changing features to our existing product lines, which I’m not ready to reveal just yet!

We have a financial strength and a commitment to employee expertise that our competitors can’t match. So when the world economy recovers, we believe that we’ll be exiting the downturn stronger than we went into it.

TT—What are the unique opportunities for printing companies? Are there specific things that they should be considering now to prepare for effectively handling an eventual recovery?

KF—I believe that all companies need to understand the leading indicators for recovery in their business areas. With this knowledge in hand it becomes much easier to take educated risks, to lead the competition into recovery, and take a lead position with your customers and potential customers.

Advertising has always been a strong leading indicator for the print market. As in the past advertising slowdowns, Print has always returned to favor with time. With popup blockers on the web, satellite radio, DVRs and automated muting of commercials in television, print will remain a strong media for reaching specific demographics that advertisers are pursuing. The more capability you have to target your audience, the greater the success you’ll see from your efforts.

Likewise, I feel that the Packaging market has a close link to consumer confidence. As consumer confidence climbs so does the need for more packaging. The more refined you can be in your assessment on consumer confidence, the more targeted you can be with the presentation you make with your packaging products—to appeal to the active areas of the market.

Regardless of your area of expertise, you want to lead the wave out of the downturn and have some insight into when the next downturn is headed in your direction. Those that do this best will have real, long-lasting success.