PressOn has become a high-profile company within the large-format sector having made a number of ‘firsts’ in terms of kit investment over the last few years, and having taken a decision to make more noise about what it can do. It’s a strategy that has put co-founder Andy Wilson centre stage, but is it paying off? I went to the firm’s new home in Chatham to find out.
By Lesley Simpson
You and Nigel Webster had something of an epiphany in 2012 when you decided to rebrand and refocus what you had co-founded in 2000 as PressOn Digital. Since then you’ve taken on new staff, launched new online services, moved into larger premises and invested around £900,000 in new kit. That’s ambitious for a company that expects to turnover around £3m this year. How do you square all that financially?
We’ve got an interesting approach to financing the business; we have this concept of saving up for equipment! We do get finance for our equipment, but we also put large deposits down on the very latest technology, literally as it comes onto the market, so we pay off the initial depreciation. I ask the manufacturer and finance company ‘in a year’s time what is this kit going to be worth?’ – and it’s usually about 50% of the price. So I normally put 50% of that price down when I buy it.
The thing is, no one knows what’s around the corner. We’re talking about a recovering economy but I’d point out that the economy normally takes a ten-year dip, so we’re due another in five years’ time. So I want to be in a position where we have funds in the bank and money in our equipment, so if push comes to shove we have low outgoings in terms of equipment finance repayments, but we could even refinance that kit if we wanted to. Or we could sell it, because it’s young enough.
I think that nowadays, if you’re buying a machine with a 10% deposit you’re brave – you’re stuck with that bit of kit.
We have had a lot of investment here as you say, but it works out that about 7% of our total revenue goes into repaying for equipment; I don’t think that’s an unreasonable amount. We’re not in the pile it high, sell it cheap end of the market and the more bespoke work we do means we have a decent profit margin overall.
You have become the UK poster boy for HP large-format, a position cemented by signing off on the first HP Latex 3500 after beta testing it since last November. That follows other kit ‘firsts’. Has that decision to become a test site/early adopter shown quantifiable results for PressOn?
It has been an immeasurable success. I was recently talking to others with a similar ‘open door’ kind of approach, and we agree that it’s important to share information and take a lead. The people in the printing industry - like those I came up through the ranks with – have always tended to have this closed door mentality. The advent of social media and better communications, and the need over the years to diversify, has opened up companies. And that’s our thinking in working with HP. We’ve always said ‘this works and that doesn’t work’. Because we like talking about issues and sharing our experiences, people share with us. And I think HP saw us, especially in terms of the latex printers, as a good vehicle for product development.
We were lucky enough to go and see the first latex 3000 when it was being developed and we were asked for our opinion. We already had latex machines – the 850 and 65500 – but when we saw the 3000 we thought it was just what we wanted, so we sat with the engineers and developers at HP in Barcelona and explained what we were doing with the other latex machines and how we were pushing them etc. Then a few months after we’d taken the 3000 in 2013 - which was doing everything we had wanted it to do - HP came with a team of people and said ‘OK, what else would you like it to do?’, so we again gave our feedback, pointing out that a dual roll that could take more weight would be useful, and ways of being able to leave it running longer unattended etc. When we saw the 3500 everything we’d talked about was on that machine. They said they’d had similar feedback from other users and they’d listened and acted upon that feedback.
We’ve worked out a way of using TeamViewer and CCTV cameras that mean we can run the new HP unattended during the night while still monitoring it. It means we can now design jobs that run when we want them to. Say we have to wrap 300 Vivaro vans and a 250m roll will print 10, we can print 20 in a night, which makes the whole job much easier to plan into the workflow. And it’s done without anyone being here so we’re slashing costs. And when the finishers come in in the morning the print is there for them to start on.
The new site has also helped in that we used to have two units – so four floors – and a warehouse. Now everything is in one room and there’s a more logical set-up. And it means whereas we used to have guys up in finishing on level two – because with health and safety we had to have two – it means they can now move to wherever they're required so efficiency and productivity have taken a massive jump.
You print a lot of vinyl. Was the move to latex an environmental decision, and do you think that the environment is a key issue for vinyl printers?
We print about 150,000m2 of vinyl a year. And when we moved to latex it wasn’t for environmental reasons, it was to solve the ongoing problems we had with solvent printing. So we could print faster, finish quicker, apply sooner. However, as the latex technology has advanced we’ve started printing on fabrics, which is much more stable with the 3000 and 3500.
We’re also printing PVC-free wallpaper. A lot of our marketing attention is going on that as we’ve got new products coming out. We’ve tied up with Robin Sprong Wallpapers (a surface design company for interiors. http://www.robinsprong.com) who we met at Heimtextil with HP. He’s doing some fabulous things with environmentally-friendly wallpapers and we see huge scope there (see news).
And we hope to bring to market before the end of this year some PVC-free self-adhesive products having sourced materials from Australia.
We see that greener substrates are coming to us because latex is a more mature technology now and a bit more versatile so more products are becoming available. Customers aren’t breaking the door down for green alternatives, but PVC has a high impact on the environment and the responsibility lies with us to find other solutions.
The European DScoop event in Dublin last month drew a number of large-format PSPs. What prompted you to go, what did you get out of attending, and what value do you place on such peer-to-peer forums?
It was actually quite interesting as a large-format producer to talk to the guys running Indigos and see how similar an approach they have to new markets etc. And also, the speakers weren’t just focused only on Indigo, but topics that will impact upon print and business in general – for instance one chap was talking about futurism. The point is the discussion wasn’t about what we’re doing now, but what we’re going to be doing in the next few years. I find that very valuable. Dscoop is the Fespa Global Summit but better.
So where next for PressOn? Last autumn you appointed a key project manager, partly to explore new business opportunities, and to expand the events and exhibitions sectors of the PressOn portfolio. Has the shape of PressOn’s customer base changed much, and do you think it will change much more?
It’s very important to us that we do not rely on any one specific area. If you look down our top 20 clients we’ve got high-end retailers, advertising and design agencies, fleet livery companies, exhibition companies…it’s a good mix and something we look at annually so that if times do get tight, you’re not focused on any one area. We do a lot of hoardings, but when the construction industry takes a dip you don’t to be just specialising in that market. I’m not saying our strategy will armour plate us, but specialising is dangerous ground if you want a sustainable business.
I think it’s important that the customer-base is always changing. And we don’t have a typical profile of a customer that we want, because we draw on so many different sectors. We have taken on lots of new staff over the last 18 months, including a project manager who brought knowledge that we lacked of the exhibition market, and now we’re looking at getting in people to direct sales in certain areas.
We’re really excited with what we think we can do with wallpaper for instance, but it’s a market that may need a more direct approach than others where we generate a lot of business though online and social media activity. We still have no direct sales reps, but I think it might be a good idea to get a couple of graduates in and train them to collaborate with wallpaper pattern designers etc.
What do you see as the key influences on future business development?
We’ve got to be mindful of a shaky economy and be ready for the next dip. The economy has a great impact on what we do and brings us back to how we finance our kit. And it’s imperative to keep up with technological development – and I see 3D printing having ramifications for us. I think in terms of markets, wallcoverings are where it’s going to be at for PressOn.