How the Bigger Get Better

Part one of a two-part series exploring how some of the largest prepress companies achieve major-league technology initiatives.

by Terri McConnell, Prepress Editor

Here we are again. At the point in the grand American economic cycle where it seems that big companies just keep getting bigger, while small companies battle for survival among the giants. As consumers languishing on the other end of perpetual hold, we might wonder just what's so great about the race towards consolidation. Frustrated with the complicated, sometimes dehumanizing experience of doing business with a corporate Goliath, it's easy to believe that mega-companies are endless, faceless entities where nothing ever changes except a few letters in front of the Inc.

Within our own industry, however, it is often the biggest firms that bring about the most significant changes. Endowed with financial and human resources beyond the reach of companies with less revenue, the $200-million-plus prepress corporations are transcending technological boundaries and re-engineering the way the packaging world goes to print.

Expansion into the end user arena

Chicago-based Schawk, Inc., is a case in point. Last year, over 70 percent of the company's $207 million in sales was from the packaging industry. Nearly 90 percent of those revenues were generated not through printing companies, but directly from end users—the consumer product companies.

Explains President and CEO David Schawk, "Since we first started to present technology solutions to the CPCs over 25 years ago, we've seen the end user/trade shop/printer business model change dramatically. While at one time trade shops and printers were adversarial about their relationships with the CPCs, today's technology allows us to provide unique services to the end user that get him what he wants, and benefit the printers and converters at the same time."

Those services include an expansion from traditional image carrier production into a suite of new Web-based products designed to help CPCs and pharmaceutical companies manage their products' brand identity. "It might not show up on the company's balance sheet, but a product logo is a huge asset," says Schawk. "The value we provide is in preserving brand equity by protecting the integrity of a brand's logo and key image elements, no matter where across the world they may be printed."

To ensure this level of service, Schawk has aggressively built its own worldwide presence. According to Brian Weissmann, the company's director of global sales development, Schawk is the largest U.S.-headquartered prepress company in Southeast Asia with over 250 employees in the region. "We also have a very strong presence in Canada, with our acquisition of Batten Graphics and Herzig Somerville—two of the largest prepress companies in Toronto. And we're continuing to strengthen our position in Latin America."

"Being a global company has unique advantages. We can help our clients define and use a system of standard 'best business practices' and we can provide a single point of origin for critical images. This makes it possible to replicate the same results in different printing plants in a number of countries, where the conditions vary widely. Plus it bridges a lot of communication gaps."

Weissmann explains the process as "product profiling," and says its main purpose is to alleviate clients from having to do field press checks. When a CPC or pharma is preparing to launch a new brand, Schawk performs a press run on everything using actual inks and substrates. Then, using spectrophotometry, they record all the critical press parameters according to a range of acceptable Delta E color variations. Those profiles are then distributed to the individual printing facilities accompanied with a visual contract proof. In addition, all alternate versions of the job, such as additional SKU sizes, are produced at the same time, under the same conditions.

The process is similar whether the job is to be printed litho, flexo, or roto, and the profiles themselves serve as blueprints on how the package is manufactured through prepress. As well, after the campaign or product launch, these profiles can be used as masters for establishing color benchmarks for future line extensions.

Managing clients' "big picture"

Beyond this fundamental profiling function, Schawk serves its CPC and pharma clients as a consultant for evaluating print process workflows, coordinating all vendors, and finally, for actually going onsite and implementing the necessary and support technologies. "By re-engineering our clients' workflows, we can allow them to recapture as much as 75 percent in speed-to-market revenues," explains Weissmann.

He points to an instance where a major consumer product company was using 23 different printers and 23 prepress companies. Schawk recommended a source reduction program that realigned vendors and saved the company 15 percent in print services expenditures. Even more significant was the fact that the new workflow reduced concept-to-shelf turnarounds from 161⁄2 weeks down to four weeks. Shaving months off the production cycle has the effect of saving the company as much as a half million dollars a day in speed-to-market value.

According to Weissmann, part of the success of that workflow might depend on enrolling the client in one of Schawk's new brand management programs, such as PaRTS™ (Production and Resource Tracking System). "By implementing an open, online asset management and project tracking environment, the client can monitor the job 24/7, wherever there is Web access or a phone line. From the moment a new product goes into design and has been assigned a UPN, the client can check status, receive e-mail notifications of schedule changes, and view annotated visual representations of the work in progress. Essentially, the client can 'come to' the job at any point in the cycle, rather than waiting to have it sent to them by a CSR."

By taking the lead in managing the critical end-user relationship, and by streamlining approval and production oversight, Schawk believes it is playing an important role in helping printers and converters to improve their margins. And, according to Weissmann, you don't have to be a "big" printer to take advantage of it. "When they look at the process model of product profiling, for instance, many printers and converters have reservations about the time and money involved in on-press proofing. But when they look at the actual ROI, they realize they can save as much as five or six times by letting us do all the legwork."

Weissmann explains that in the case of the printing company Pechiney, with whom Schawk works both through common clients and directly, his company has become a key partner in research and development. Acting as an independent testing arm, Schawk evaluates new film and plate processes, and tests ink formulations for the multinational printer. He states proudly, "With facilities all over the world, Pechiney entrusts us to make those decisions, without bias, for them."

Next month, Terri takes a look at the approach of another of the world's largest prepress suppliers to the packaging industry, Southern Graphic Systems, Inc.