When Graphic Systems’ new 35,000-square-foot building was custom-built for the lab in downtown Minneapolis, “we could bowl down the center of our building,” jokes Herm Kauls. Business has changed significantly since then, with the graphics house going all digital three years ago.
Now the floor, and the distribution center, whirs with spinning inkjet rollers, hums with cutters slicing, and purrs with the fwoop, fwoop of packing tape on shipping boxes.
Success has come to this imaging business, which does about $10 million in business annually, according to Kauls, who has served as owner and president for the past 16 years. It has seen a steady increase in business every year, with growth in the high teens in the last few years.
In business for 36 years, the firm started out doing catalog work for national retailers like Montgomery Ward and Spiegel. Now the company has a very broad customer base, ranging from The Sharper Image and Williams-Sonoma to Target and Yankee Candle. If one had to characterize the work it does, it could be said the lab’s niche is specialty POP for large national retail chains.
With 85% of its business out of state, rather than competing with other photo labs, the printing side of the business has been its main competition, as Minneapolis has been long known as a printing mecca.
Acknowledging what has been said for the past several years, Kauls notes the photography and printing businesses are “all converging.” “The front end is the same; it’s a matter of output on the back end that’s different,” he says. While screen printers and conventional printers can print shorter runs, photographic imaging houses can print larger runs.
Distribution has also become a critical component for a company that does business on both coasts and everywhere in between. A 5,000-square-foot distribution center ensures poster roll-ups and extra large signage is on its way via all the major couriers each evening. “Assembly and distribution is key,” says Kauls. On the night prior to the interview with this writer, Graphics Systems had shipped a job to 415 of a customer’s locations for something that needed to be there the following morning.
Secrets of Their Success
What are the secrets of success of an imaging business that has experienced double-digit growth while other firms in the same arena are flat—or worse? Kauls attributes some of the success to technology. “We invested in it, and it really streamlined our whole product,” he says.
The Minneapolis lab uses all Kodak products, including Duratrans and C- Prints. The lab also does a large volume; it’s not unusual to print “500, 600, 700, up to 1,200 pieces from one image,” says Kauls. These are numbers that would have been unheard of in the past. For large-format digital work, they employ four Durst Lambdas and three Durst Rho printers, which Kauls extols: “[Durst] stands behind their products and provides good service when the equipment is down.”
In fact, about 25 percent of the lab’s work is fulfilled on its three Rho 160 Plus printers, and that figure is growing, Kauls says in press materials. “The Rho machines are responsible for some pretty significant growth,” he adds, “both in creating it and then satisfying it.” The white-ink-capable Rho 160 Plus UV inkjet printer Graphic Systems purchased last June made them, at the time, the first imaging service provider in the US to offer production large-format white ink printing.
White ink printing, also available on the Rho 205, allows users to produce a white background on nonwhite and clear media. Creative staff can overlay white areas and detail, produce cleaner backgrounds and create more contrast in images.
With some of its areas humming 24/7, it is standard procedure to turn around large and precisely color-calibrated jobs in three or four days. “We can turn 3,000 Duratrans in four or five days,” notes Kauls.
Graphic Systems is proud that it holds no house accounts. Each account is singular and has its own sales rep to take ultimate responsibility that a job is completed and shipped on time, maintaining high quality. “There is that old adage about service, quality and pricing—that you need to pick two to succeed,” says Kauls. “Today, you had better do all three.”
Early Entry Into Digital Market
Another graphics lab in Canada has also driven its success through technological innovation. Champion Imaging in Montreal, Quebec, now celebrating its 30th anniversary, has outfitted itself with two full-size Lambdas and a new Rho 205 (80-inch) flatbed UV inkjet printer to complement its wide range of imaging capabilities. The latter can print on just about any media.