Top Shops 2012: Striking a Careful Balance

It’s all about profits and margins this year—at least according to Wide-Format Imaging’s 2012 Top 40 Shops. Whether you’re talking about the national economy, pricing, commoditization, the difficulties in hiring, training, and retaining employees, local, national, and international competition, credit availability, interest rates, government regulations, or sustainability, it’s all about the margins—and profits.

“We all have to become better business managers and sales aware,” says Vista Color Imaging Inc.’s CEO, Pete Gallo. “We need to run a tighter ship’and continue to become more efficient and cost conscious.”

“To remain competitive in the markets we serve, we at times must match price and lower our pricing to win jobs and retain clients. This, along with increased raw media and material costs, finds us yielding a lower margin than ever before,” says Gary Paulin, co-owner, Harmonic Media. “Without a doubt, the last few years have proved to be difficult for businesses in all parts of the globe and even though we’re only a few months into 2012, unsettled world conditions continue to make running a business anything but usual.”

“I think the overall economic uncertainty is the biggest threat to small business at the moment,” says John Rhodes, owner, Colorchrome Atlanta, Inc. “We need a more business friendly government to keep out of our way so we feel comfortable investing in our economy.”

While maintaining margins and growing profits is at the heart of everyone’s plan for 2012, where will this growth come from? According to industry leaders it’s from investments—investments in new technology and expanding marketing efforts into social media; an uncharted territory for some.

“It’s a balancing act,” according to Ken Madsen, owner, Graphic Systems Group. Shops need to balance between committing to new technologies that give them more efficiencies and cost savings on output and having the cash to invest in the technology without strapping the company.

“Costs have continued to rise, but selling price has not,” says Shane Beard, president, FastSigns of Naperville, IL. “To combat this I must invest in more technology that allows me to print faster and less expensively. Technology is moving so fast that leasing equipment is not as attractive as it once was, since the leases sometime outlast the useful life of the equipment!”

“I feel it in my gut that our industry is in an economic rebound. This has given us the confidence to start investing again in new technology,” says Gary Schellerer, VP Operations, Signs by Tomorrow of Bloomingdale, IL. “This year we have already invested in new equipment from EFI and Zund. The last time we invested this much money was in 2005.”

Schellerer continues, “Bringing in new technology always creates the need for change. Change can be one of the biggest challenges a team can face. But change is typically necessary to keep up with some of our competition. Although we expect this year to be challenging, knowing that this change is making our organization stronger gives these difficulties a lining of joy.”

“As we turn from survival to growth mode in 2012, our biggest challenge will be to recruit and hire great talent to keep up with our growth,” says Tom Truna, owner, Big Ink Display Graphics. “We will use social media such as Facebook, blogging, and LinkedIn to share our company core values and culture and to differentiate us from our competition.”

“We believe more than ever that with social media tools, effective networking, and by nurturing key relationships, we can grow our gross revenues by well over 25 percent this year, essentially doubling our market share in Colorado,” says Paulin.

The Numbers

Overall, the numbers for this group were very positive, even showing a substantial increase over last year’s numbers. As a group, shops gained on average about 14.29 percent, up from 7.82 percent in 2010—and owners were positive that 2012 would see growth again.