Success in the new printingindustry often requires

bringing the offerings ofdifferent manufacturers togetherinto a customized workflowthat meets the unique commu-nication needs of an individualshop and its end customers.

As printers increasingly seekout “solutions” rather thanmachines and software products,vendors have been challenged tobring a similarly collaborativeflavor to their marketing. Theresulting partnerships helpvendors to improve theirofferings, reach new customers,and deliver “big company”resources combined with “smallcompany” agility.

“Multi-vendor cooperationefforts are definitely on the rise,”says Sophia Farina, StrategicMarketing Manager at Quark.“Companies that have madesignificant investments inresources – whether in educationof their workforce, their ITinfrastructure, or in enterprisecontent management and digitalasset management solutions –are constantly looking forsolutions that leverage theseinvestments and expand therange of their offerings intothe marketplace.”

One factor contributing tothe rise of partnering andcollaboration, Farina adds, is“the adoption of open industrystandards. We are seeing moreand more vendors supportstandards, such as XML and JDF,which in turn allow customersto benefit from their ability tostreamline workflows.”

Since it has become mucheasier to combine differentproducts and processes intocustomized solutions, customersincreasingly want to see thosesolutions demonstrated. Vendorsare responding creatively.

Several Vendors, One SolutionINDUSTRY COLLABORATION SPURS DEVELOPMENT AND CO-MARKETINGOF CREATIVE OFFERINGS FOR CUSTOMERS

INSIDE:

Chairman’s Perspective...............2

One on One: John Hamm ............4

NPES Annual Service Personnel Compensation Survey ..........................................5

Targeting Unique BusinessOpportunities in a “Blue Ocean” ..........................................6

News and Notes ..........................8

Early in 2006, for example,MacDermid, Inc. launched a“road show” to demonstrate itsnew Lava digital platemakers toaudiences of prospective cus-tomers. MacDermid planned theseries of events together with itsdistributor, EnovationGraphic Systems, to takefull advantage of the closelinkage between Lava and thecolor proofing devices and Fujiplate materials Enovation alsodistributes.

Heather Perkerson,Marketing Communications

Volume XXV, Number 7 July 2006 newsT H E A S S O C I A T I O N F O R S U P P L I E R S O F P R I N T I N G , P U B L I S H I N G A N D C O N V E R T I N G T E C H N O L O G I E S

Manager at MacDermid, says thecompanies built a programaround a keynote speaker fromFox Valley Technical College inAppleton, WI, and a completeproofing-to-platemakingworkflow demonstration.

The keynote speaker “wasregarded by attendees as beingunbiased,” and gave the eventadded credibility, she says.The completeness of the demohelped impress audienceswith the comprehensivesolutions available from thetwo companies.

At companies like Océ, strategic partnerships continue to escalate.

Thomas SaggiomoNPES ChairPresident, Agfa Graphics NAFTA

Strategic Alliances YieldGreat Advantages

In my previous columns, I outlined the impor-tance of developing and sticking to a competitivestrategy for your business. Complemented byexciting new technology, this will help each ofour companies to gain new customers and helpcurrent customers stay ahead of the pack.

While the essential elements for businesssuccess remain constant, the prescription forsustainability continues to evolve. The last 25years have seen market leaders move from a fullvertical integration strategy, i.e., “let’s do every-thing ourselves,” to today’s full understandingthat companies attempting to do it all usuallyunder-perform. In keeping with our cover story,this month’s column is aimed at urging membercompanies to explore the benefits of partnershipand collaboration when developing long-termstrategies.

Some of the early drivers of fully integratedstrategies include quality control, supply chainreliability, employment, and keeping profits athome. Most importantly, enlightened managementrealizes that a company’s core competency is thecornerstone of business value. It makes themsuccessful because it is what they do best.

Understanding your company’s corecompetencies is crucial. Focus your company onits strengths and review all other activities. If theactivity is not core, it is a candidate for partnershipor outsourcing. Leave no stone unturned in yourreview, because partnerships can effectivelyaddress many areas of the business – from salesand marketing, to manufacturing, logistics andbusiness support, to back office.

Manufacturing partnerships could includeoutsourcing for components, assembly or totalproduction. Support and back office partnershipscould include payroll, IT, accounting, A/R, HR andtraining. Marketing and sales partnerships includeprivate label agreements, channel partnerships,agent models, co-marketing, and could eveninclude a competitor. Yes, a competitor.

Working with competitors denotes co-opetition

Even better, she says, was the opportu-nity to recruit Nilpeter, Inc. for one ofthe road show events. Nilpeter’s pressproducts added a hard-copy outputdimension to the demonstration. “Wewere able to show people the print sam-ples as well,” Perkerson says. “We thinkthat’s the way to go,” she adds, notingthat other press manufacturers may alsobe included in future events, dependingon geography. As many as a half dozenadditional events are slated for the fall.

Perkerson reports that “we have somevery hot leads” from the road shows.“This has been a very successful partner-ship.” While a conventional trade showcan deliver a large and broad audience,the road shows are an opportunity “tobring people in, show them exactly whatour machine does and how it runs, andprovide them directly with additionalinformation.”

Prepress software vendor Rampagewas also part of the road show agenda,Perkerson says, and a number of“co-suppliers,” offering such ancillaryproducts as inks, participated throughtabletop displays.

Jim Hughes, Director of ProductManagement, Finishing and ContinuousForms at Océ Digital DocumentSolutions, says that forming partner-ships is a key strategy for the company.“We started in the late nineties, and itsimportance has doubled every year since.The whole strategy of selling is verydifferent today from what it was ten yearsago. Every day, I work with a partner.”

Océ looks for opportunities todemonstrate and promote its digitaloutput systems together with vendorsof peripherals such as unwinders andrewinders, cutters, slitters and UV coatingsystems – because, Hughes says, customerstoday aren’t solely interested in theprinting engine. “People don’t just wantto print, they want to do somethingunique with it.

“The sales guys will always say, ‘we sellprinters,’ and of course we do,” Hughesgoes on. “But we need these other guys tohelp us sell a total solution.” Customers,he notes, may feel bewildered by thenumber and variety of options in today’smarket, and they want a single sourcethey can count on for advice and support.

2

chairman’s perspective

– a blend of cooperation and competition.“Co-opetition” is the title of the 1996 best seller byAdam Brandenburger of the Harvard BusinessSchool and Barry Nalebuff of the Yale School ofManagement. They suggest that companies cangain strategic advantage by forming businessrelationships with firms that produce complemen-tary or related products, leading to expandedbusiness opportunities and market opportunitycreation. While this has been seen most oftenin the automobile and software/hardwareindustries, there are a growing number ofexamples in our own industry as well.

Through careful strategy development withina co-opetition model, each firm can maintain itsidentity while forming joint value that enhancesboth companies. For more information onco-opetition, visit http://mayet.som.yale.edu/coopetition/index2.html.

Strategic alliances, when undertaken in aform that meets your business objectives, canyield great advantages. While many variationsare evident in the marketplace, the end payoffis always the same: the needs of existingcustomers are fulfilled in new and effectiveways, and entirely new sets of customers canbe attracted into the fold.

SEVERAL VENDORS continued

SAVE THE DATE!NPES ANNUAL CONFERENCE

NOVEMBER 4-6 PONTE VEDRA INN & CLUB

PONTE VEDRA BEACH, FLORIDA

3

Océ’s ongoing partnering effortsinvolve other such vendors asHunkeler, MBO, Muller-Martiniand others. Activities can range fromjointly published success stories and casehistories bearing multiple corporatelogos to extensive collaboration at majortrade shows like GRAPH EXPO® andCONVERTING EXPO®, and AIIM/OnDemand.

As part of the value proposition tocustomers, Hughes adds, Océ applies astringent qualification process to prod-ucts of other vendors who want to part-ner. “We bring the equipment here andtest it,” he says. “If they say the productdoes A, B and C, it had better actuallydo A, B and C.” Once they are acceptedas a partner, “it is a big gain for them,”Hughes says.

Tim Combs, Senior Vice President,Sales and Marketing at Enovation, sayshis company, as a distributor, is heavilyoriented toward partnering. The jointventure road show with MacDermid

and Nilpeter was just one example.Enovation frequently hosts “lunchand learn” sessions at many of its 34locations around the country, and thesegatherings often include demonstrationsof products and systems from multiplevendors.

“It can be a challenge to get peopleout of their own locations,” Combssays. “However, if we didn’t do this, Idon’t think we would be able to get theundivided attention we need.”

Enovation’s salespeople frequentlymake joint sales calls with reps fromvendor companies, Combs says, andthey have the chance to call on thetechnical expertise of these vendors toanswer customers’ questions. “It hasworked well for us,” he concludes, “andwe’re going to continue to try and makethese things happen.”

Payoffs from effective partnering cango beyond immediate sales. At Avanti

Computer Systems, a small softwaredeveloper for the graphic arts industry,Executive Vice President StephenMcWilliam says his company’s long-standing alliance with Xerox has helpedboth companies significantly.

Most important, he notes, “we havereached the point where Xerox is actuallyout there selling Avanti products. Before, itwas just a referral business.”

“We just did a deal together at OhioState University,” reports McWilliam,“where we have Xerox equipment andAvanti software all integrated together in acomplete workflow. A key part of Xerox’sstrategy is to make sure the customer cancome to one vendor for everything theyneed. It really helps entrench Xerox in thataccount.”

In addition to selling, the Avanti-Xeroxalliance creates opportunities to collaboratein development of new products. “They testand bounce new ideas off us as one of thesoftware partners,” says McWilliam. “Wework in their labs and work with themon software tools they need to developinternally to round out their solutions.”

Partnering is becoming part of everydaylife on the marketing front throughout thegraphic arts business. And with printersputting ever more emphasis on one-sourcesolutions, the trend seems likely tocontinue in a big way.

Quark: StrategicPartnerships in Action

On a broad scale, Quark has established theQuarkAlliance, consisting of over 3700 membersthat work with the company on various levels. Someare XTensions developers; others are resellers andintegrators; and yet others are strategic partners,such as Apple, Pantone, HP, and PODi. These lastsupport research and development, marketing, andoutreach to end users.

Good examples of Quark’s knack for strategicpartnering can be found surrounding its QuarkDynamic Document Server, (QuarkDDS), whichautomates creation and on-demand delivery ofpersonalized communications across print, e-mail,and the Web. Through QuarkDDS, content designedin QuarkXPress can be integrated into workflows forWeb-to-print, one-to-one marketing, advertisingautomation, catalog generation, and other variabledata publishing applications servicing a host ofvertical markets. At the recent AIIM/On Demandshow, the company showcased the interplay ofQuarkDDS technology in tandem with severalstrategic partners, including:

• DeskNet, developer of ContentWelder, an enterprise platform for customer communications that focuses on needs of the financial marketplace.

• GLUON, developer of the HyperPublishing System for QuarkDDS, which gives database publishers extensive control in production of catalogs, circulars, direct mail, print services, real estate, car and apartment listings, and many other applications.

• LiveTechnology, an ASP that just released LiveAdMaker, the first application to provide marketers a single interface to manage the creation of advertising across all forms of media –including television, radio, newspapers, direct mail, out-of-home, in-store/POS and Online.

• IO Integration, specializing in high-end server-based automation, digital asset management and Web-based production tools to provide profitable workflow solutions for the graphics arts markets.

Says Quark’s Sophia Farina, “It’s a very collabora-tive process. We deliver the core engine, and ourpartners add business logic and adaptive layers tobuild an enhanced solution for their end users.”

Quark’s Sophia Farina: “It’s a very collaborative process.”

Strategic partnerships help vendors deliver ‘big company’ resources

combined with ‘small company’ agility.”

A35-year veteran in thegraphic communications

industry, John Hamm has exten-sive applied experience on bothsides of the fence. Following nineyears in sales and management atXerox, he enjoyed a fruitful 20-year career in commercial print-ing, growing and presiding overan industry-leading firm in theDC area (Balmar Inc.). In 1999,Hamm rejoined Xerox to lead itsWorldwide marketing efforts andcreate market demand for a newbreed of innovative commercialprinting technology. Mostrecently, he launched his ownbusiness and market develop-ment consulting firm, John M.Hamm & Associates, LLC, basedin Annapolis, Maryland. Ourinterview took place in mid-June.

– Doug Sprei

You recently were commissioned to co-produce (with Boston-based State StreetConsultants) a major new market researchstudy for PRIMIR, entitled The DigitalPrinting Outlook in a ProductionEnvironment. How’s it going, and who aresome of the companies you’re interviewing?

I have been interviewing a variety ofcompanies from throughout the U.S. andCanada, and am thoroughly enjoying the

John Hamm4

project. Surveying more than 500 firms throughoutNorth America, State Street is performing thequantitative analysis, while I am conducting in-depth interviews with 25 firms. We’ve targeted awide cross-section of firms by geography, marketsegments, size, and the niches that they serve–such as those who are producing only digitalprinting, commercial printers who have addeddigital to complement their offset services, bookprinters, web-enabled digital print, direct mail, andmore. And we’re also talking with many of themajor suppliers in the digital print space.

Are you looking toward vertical markets and demandfor digital printing there; as for instance how one-to-one marketing might play out in a healthcare or realestate environment?

Yes. As an example at the moment, I am inter-viewing a large financial services enterprise that isusing personalized, digital printing to achievemeasurable business results with their documents.

What’s your access route into learning about howprint communication produces improved businessresults in such markets?

It’s through identifying document applicationsthat these enterprise companies are producing insupport of their go-to-market strategies. Amongthe most successful opportunities are multimediaprograms that create numerous touch pointswith the ultimate customer and drive themtoward buying decisions. Such cross-mediaprograms may include the combination of printwith personalized web sites (PURL’s), e-mail followup, and personal selling.

Any compelling findings in the early going?

We’re looking at companies with very interest-

ing sets of services. A good example isone I visited in Cleveland. They hadoperated as an offset lithographer sincebeing founded by a great-grandfather,nearly 100 years ago. Today, they offeran integrated set of graphic communica-tions services through three separatelybranded business units. One is theirdirect marketing arm, fulfillment centerand mail operation; another is theircommercial print operation; and thethird is a database marketing serviceunit that provides e-storefront, web-to-print access and digital asset manage-ment services.

Through this third business unit, cus-tomers can access their intellectual prop-erty assets such as images, documents,video, and more; and order the printingand distribution of documents, whilemaintaining control and brand integrity.This service provides customers with asecure DAM repository that they canaccess worldwide via the Internet.

This former printing company, nowre-engineered as a solutions company isdifferentiated, global and growingthrough providing ancillary value-addedservices to their customers in varioustargeted industry markets.

That’s a nice example of going after newopportunities without leaving your base,picking up ancillary revenue streams.

Yes, and I think it’s also a great storyabout branding – giving identity tovaluable, complementary service offer-ings instead of positioning oneself as aprinting company that also offers suchservices. We did that when I was thepresident of Balmar, successfully brand-ing our graphic design studio that washoused in one of our printing plants.

5

What was the advantage of doing that?Is it because you already had an embeddedidentity as a printing company?

When my sales associates visitedmarketing directors in prospective clientcompanies, they were able to represent ourdesign services value proposition as theintegration of design with the printingprocess. That type of brand identity andpositioning opened up many new marketsand revenue opportunities.

So then when it comes to approaching chiefmarketing executives, what are you learningabout the nature of the pitch?

I visited a large direct mail operation inPittsburgh that is providing digital print-ing and mailing of 400 million piecesannually. There are others that are largerin that segment, but one competitiveadvantage this company has created istheir teaming approach with designers andagencies. Rather than presenting them-selves as simply a mail house, they are apersonalized marketing communicationscompany, offering an integrated set ofofferings. And that’s enabled them tosecure important, major corporate andnon-profit clients that their competitorswould like to have.

Do they go into the chief marketingofficer’s office with a story about returnon investment?

Yes, they are not talking about priceper piece; they are talking about R.O.I.,sales-per-piece, or donations-per-piece.And they present metrics and case studiesas proof of benefit for personalized andcross-media communications.

Our cover story for this issue focuses oncollaboration in the supplier/vendorcommunity. When I went to On Demand Iwas struck by how many vendors – includingmany NPES members – are teaming up. Bigand small players are collaborating in wayswe haven’t seen before.

I would say that’s true. Just look at anyof the digital press suppliers, such as HP,Kodak or Xerox, and their partneringrelationships. For example, one of Xerox’sstrongest partners is Adobe, and there aremany other similar examples. For ourPRIMIR study, I have interviewed a Minne-

apolis printing company who has posted apartners page on their web site, and theirtop partner listed is Adobe. I thought itinteresting that they had not namedHeidelberg, Xerox, or others that one mightexpect. When I asked their president why,he answered, “With a postscript workflow,Adobe is one of our most important partners.That’s how we get our work – through thesuccess of Adobe’s solutions and workingwith our customers in a PDF environment.”

You mentioned Heidelberg. When I worked attheir Digital Division in Rochester several yearsago, Xerox was their adversary across the river.Now Heidelberg and Xerox are collaborating.

That’s right, now they are partners,and their Prinect and Freeflow workflowsolutions offer interoperability. . .

So that their respective offset and digitaldevices can interact seamlessly?

In today’s printing environment, work-flow is increasingly instrumental in creatingmanufacturing efficiencies. People like tosay that digital printing complementsoffset; that’s particularly true when printersintegrate these technologies, creating anenvironment where their various presstechnologies operate as alternative outputdevices on a common workflow platform.For example, if your pre-press workflow isBrisk, or Prinergy, or Prinect, and youintegrate your workflow software with yourdigital press workflow, then any of thesedigital presses, sheet fed presses, web pressesand other machines are available for printproduction through your single workflow.

Going back to the digital printing studyyou’re doing for PRIMIR…any interestinganecdotes in the early going?

I was interviewing a Canadian printer,and asked him why he thought marketadoption for personalized printing hadtaken so long. After telling me that he didn’tsee it as such a big deal; it’s been around fora long time, and he’s not interested inpersonalized catalogs that had been createdfrom database decisions concerning hispersonal preferences, he added, “Print willbe around for a long time, because there’sno faster random access tool in existencethan the human mind.” That’s an interest-ing perspective, wouldn’t you say?

NPES ServicePersonnelCompensationSurvey:QUICK AND PAINLESS TO COMPLETE;PARTICIPANTS REAP THE BENEFITS

Are you aware that the averageannual salary for service personnel

of surveyed NPES member companies fellto $57,405 in 2005, down two percentfrom 2004? Or that the average basesalary for technical service personnel rose10 percent, to $54,854?

Vital industry information like this isrevealed in NPES’s most recent ServicePersonnel Compensation Results. Did yourcompany receive this valuable report? Ifthe answer is no, it’s because the report isdistributed exclusively to NPES membercompanies who complete and return theirconfidential Service Personnel Surveys.

This year’s survey has been re-workedfor quick and easy completion. There are11 questions and the survey takes only afew minutes to complete. That’s a smallprice to pay for the privilege of receivingessential industry data to guide yourbusiness’s decision making process.

Brandtjen & Kluge, Inc. is just oneof many companies that annually partici-pate in and benefit from these compensa-tion surveys. “The wage and salary surveysthat NPES conducts are a critical piece inour budget planning efforts,” says HankBrandtjen, President. “Successful com-panies are those that remain competitivewith what the market is doing. By takingpart in these surveys, we get the resultsin aggregate, so we can adjust ourcompensation program accordingly.”

Adds Bruce Goodwin, President ofGlunz & Jensen, Inc., “The NPES ServicePersonnel Survey serves up importantinformation that we use every year tomake sure that our Field Engineers arereasonably compensated and in line withour industry partners.”

The 2006 Service Personnel Survey willbe distributed by mail to members in July.NPES will also e-mail you a link to whereit is located on the NPES website. Don’t letthis opportunity pass you by! For moredetails, contact Aaron Allenza at (703)264-7200, ext. 253 or aallenza@npes.org.

6

Instead of worrying about how to grabmore business from their competition,

or keep the competition from grabbingtheirs, more print companies and theirsuppliers need to focus on leavingcompetitors behind as they move intofertile new markets in which they are theonly player.

That’s the gist of “blue ocean strategy,”an approach to business planning thatemphasizes creating whole new markets,even new industries, rather than continu-ing the competitive bloodletting thatturns the familiar business “ocean” red.

“Print for the sake of print has becomea real red ocean,” says Larry Letteneyof Hubcast, who described the blue oceanconcept in a presentation at VUE/POINT®

in April and elaborated on its implica-tions in an interview several weeks later.

Targeting Unique Business Opportunities in a “Blue Ocean”

templatized methodology,” Letteney says.“It’s not a puff piece.”

Printing is, in many ways, a typical “redocean,” in which competitors fight to thedeath for shares of a finite or dwindlingbusiness volume. Technology has madeproducts cheap and almost indistinguishable,and global competition continues to squeezeprofit margins to extinction.

What’s needed is a breakout, a radicalre-definition that creates whole newcategories of business in which theinnovator can achieve and maintain along-lasting head start. Letteney suggestsplanners should think about all themainstream industries thriving today thatonce didn’t exist at all, from cellularphones to coffee bars to home video.

Then – here comes the hard part –imagine the businesses that will come intobeing in the next 20 years. Letteney hassome advice along these lines for printersas well as the manufacturers and supplierswho serve them.

Start by realizing that print is a small part,yet a very expensive part, of a huge market-

ing and communications mix. “If print is a$100 billion business,” he says, “it’s really atrillion dollar business if you think abouteverything that goes with it,” from design tofulfillment to administrative costs.

What’s more, print today comes withreliable quality and steadily declining prices,Letteney adds.

To begin building the mindset for blueocean thinking, printers should think interms of three “strata,” which he calls O, E,and I – for Output, Execution andIntellectual.

The O level is where the blood is beingshed. “The output you produce is notnecessarily differentiable,” Letteney says.What’s more, success on the output levelmay be a mixed blessing. “Many printers arethinking, this is such an asset-intensivebusiness that even if I grow, I’m in trouble.”

Many printers have differentiated them-selves, and built business in the executionarena through such tools as web-to-print,mailing and fulfillment services, databasemanagement and distributed, networkeddigital printing. Results can be good, but

Blue Ocean Strategy is the title of a2005 book by W. Chan Kim and RenéeMauborgne, published by HarvardBusiness School Press. Its subtitle sumsup its message: How to Create UncontestedMarket Space and Make the CompetitionIrrelevant.

“This is one of the few books thatdeals with business strategy but has a real

Larry Letteney

VistaPrint’s ability to stand out from the pack has netted the company six million customers in 120 countries.

7

Letteney warns that being effectiveon the E level does not meanyou’ll stay a differentiator for long.

The future action will come onthe intellectual stratum. Here iswhere printers can help theirclients build better communica-tion strategies and get more out ofevery aspect of their budget.“Printers are bringing people infrom marketing services andcreative side, showing clients howto tie things together and measurereturns. They’re doing things aclassical marketing team doesn’tknow how to do,” Letteney says.

For vendors, the challengemay also be to stop thinking ofproducts and technology. “Thefirst step for vendors is to figureout what role they can play. Thatstarts with understanding theneeds of the printer’s ultimatecustomers. Why does Product Xmatter to the client? What won’tbe a huge differentiator?”

Letteney says the graphiccommunications industry boasts anumber of firms that have success-fully implemented “blue ocean”strategies. Among them, he citesRastar Digital Marketing,which has developed automateddirect marketing, customerretention and similar programsfor auto manufacturers and dealersnationwide.

These programs enable dealersto communicate with customerson a more personal level than everbefore. Communications arerelated to where a customer standsin a 12-level customer loyaltymodel, and a powerful web-basedCustomer Relationship Modeltracks results, spots trends and

If you’re seeking to launch a profitable operation in today’s most promising global markets, treat yourself to a wealth of insights shared by senior international

print industry leaders, including:

You’ll also network with NPES members who are thriving in business overseas; learn first-hand how

to avoid costly mistakes; and take home a wealth of data on today’s hottest emerging print markets.

Economic forecasts and advisories will be presented for China, India, Brazil and India by NPES international

market representatives and other industry experts.

For details or to register for this outstanding and convenient event, visit www.npes.org, or contact

Mike Hurley, NPES Director of International Trade, at mhurley@npes.org, or call (703) 264-7212.

Map Out MarketplaceOpportunities in China, India, Brazil, and Russia

Profiting from the Big Emerging Markets of China,India, Brazil, and Russia –

Setting Up a Strategic Plan and Making It Work

July 21, 2006 • 8:00 a.m.– 3:00 p.m.Hilton Suites Hotel, Oakbrook,

Illinois (near O’Hare airport)

guides refinements in the program.Another example is VistaPrint,

which has innovated in using theInternet to deliver a complete suiteof high quality, custom-designedproducts and services. For exam-ple, the company recently formedan alliance with EarthLink toprovide high-quality businesscards at no charge to EarthLinksubscribers. This and similarinitiatives have helped VistaPrintserve more than six millioncustomers in 120 countries.

When vendors explore thelinkage between their offeringsand the needs of their customers’customers, opportunities emerge --whether it’s the ability to print onunique substrates, deliver fasterturnarounds, or connect peopleand processes throughout amarketing campaign.

Specifically, vendors need torealize that some long-runningtechnology disputes that mattergreatly to them may not only beunimportant to customers butactually counter-productive.“Things like the whole violet/thermal CTP tech wars createconfusion and destroy ourcredibility with our ultimateclients,” he says. “They assume astandard will emerge but theydon’t care what it is.”

It all adds up to a new approachto strategic planning. Traditionalbusiness strategy, say the Harvardbook authors, “is about con-fronting an opponent and drivinghim off. Blue ocean strategy isabout doing business where thereis no competitor...Looking forward,it seems clear that blue oceans willremain the engine of growth.”

DON’T MISS OUT!

• Ray Hartman, Group Executive Vice President ,RR Donnelley Company

• Lu Chang-An, General Manager, Beiren Manufacturing Company – the largest manufacturer of printing equipment in China

• Evgueny Boutman, President, ECS Corporate Group Moscow

What’s needed is a radical re-definition in which the

innovator can achieve and maintaina long-lasting head start.

NPES News is published monthly by the Marketing andCommunications team at NPES.

Managing Editor:Doug Sprei (703) 264-7215

Correspondents:Aaron AllenzaJohn McKeonMarisa Preuss

Circulation:Darcy Harris (703) 264-7200

The Association for Suppliers of Printing, Publishing, and Converting Technologies

1899 Preston White DriveReston, VA 20191 USA(703) 264-7200e-mail: npes@npes.orgwww.npes.org

news and notesGRAPH EXPO® AND CONVERTING EXPO® EXHIBITSALES BEATS 2000 RECORD

More than 400,000 squarefeet of display space has beenbooked at this year’s GRAPHEXPO® and CONVERTINGEXPO®, assuring that this will bethe largest national graphiccommunications and convertingexhibition since 2000.

NPES President Ralph Nappi,and President of the Graphic ArtsShow Company which managesGRAPH EXPO and CONVERTINGEXPO, says the show’s growth in2006 is striking for two principalreasons. First, we continue to“buck the trend” affecting trade

shows in the graphic arts arena –and capital equipment shows inparticular.

“While many shows struggleto maintain their size, and mostare shrinking, equipment andservice providers in the graphicarts industry find that GRAPHEXPO and CONVERTING EXPOprovides a great return on theirmarketing investment,” Nappipoints out. “Some large showshave even disappeared, yet ourshow continues to thrive.”

Second, Nappi adds, “thetotal space occupied by ourlargest exhibitors has actuallydecreased, which means thisyear’s growth is broad andembraces our entire show floor,

8

Regional Markets US$ Exports Through US$ Imports Through Trade Year 2005 Trade Year 2005

European Union 589 million 1.4 billionAsia & Pacific Rim 530 million 540 millionLatin America 477 million 49 millionCanada 418 million 183 millionMiddle East 55 million 66 millionAfrica (Sub-Sahara) 29 million 10 millionEastern Europe 21 million 7 millionRussia & CIS 10 million 331 thousand

SAVE THE DATE!NPES ANNUAL CONFERENCE

NOVEMBER 4-6 PONTE VEDRA INN & CLUB

PONTE VEDRA BEACH,FLORIDA

WELCOME NEW NPES MEMBERS!

Innolutions, Inc.Windsor, NJwww.innoinc.com

Best GraphicsMenomonee Falls, WI www.bestgraphics.net

Graco, Inc.Minneapolis, MN www.graco.com

Cresswood Recycling SystemsCortland, IL www.cresswood.com

Tekmatex IncorporatedCharlotte, NC www.tekmatex.com

Gems Sensors and ControlsPlainville, CT www.gemssensors.com

Overbridge TechnologyEmmaus, PA www.overbridgetech.com

MCS, IncorporatedGaithersburg, MD www.mcspro.com

Aellora DigitalKeene, NH www.aellora.com

not just a few large booths.”It’s not too late to join the

excitement. Limited exhibit spaceis still available. To reserve yourspace now, contact the GRAPHEXPO and CONVERTINGEXPO sales department at(703) 264-7200 or visitwww.graphexpo.com.

INVESTMENT INCENTIVEEXTENDED

Good news for NPES membersand their customers is the recentextension through 2009 of theIRC Section 179 small businessexpensing tax incentive thatallows businesses to deduct up to$100,000 of depreciable assetsper year. Originally increasedfrom $25,000 to $100,000 in thetax cut bill of 2003, the provisionhas been a major incentive forrenewed capital investment in theprinting, publishing and convert-ing industry, as well as othersectors of the economy. Theconference report for H.R. 4297,Tax Increase Prevention andReconciliation Act of 2005, alsoextended through 2010 the 15%tax rate on capital gains anddividend that was set to expire in2008. NPES supported theseactions, and is an active advocatefor tax policy that encouragesand fosters capital investmentthat leads to greater productivity.

For more information, contactMark Nuzzaco, NPESGovernment Affairs Director,at 703-264-7235 or emailmnuzzaco@npes.org.

The NPES World MarketNews international trade bul-letin released its final quarter-ly report for 2005. Althoughthe economic data for the4th quarter 2005 is not com-plete, early indications showa negative trade balancewith total imports slightlyexceeding total exports.

The report shows thattotal U.S. exports reachednearly $2,150,560,000 insales dollars with the topbuyers being Canada,Mexico, Germany, Japan,Singapore, United Kingdom,Netherlands, Brazil, Chinaand Ireland. (See chart below)

The amount of printingmachinery imported into theU.S. topped the amountexported by more than $388

million, with the total exportsreaching $2,539,000,000.Leading sellers to the U.S.printing machinery market wereGermany, Japan, Switzerland,Canada, United Kingdom, Italy,France, Israel, China and theNetherlands.

The report predicts onelikely bright spot in the 2006economic forecast – the exportsector, both manufacturing andservice, will benefit from aweaker dollar and continuedrobust growth in the Chinese,Indian, Eastern European andLatin American markets.

To view the complete report,including top convertingimporters and exporters andregional breakdowns, visit theNPES website at www.npes.organd click on International Trade.

NPES WORLD MARKET NEWS INTERNATIONAL TRADEBULLETIN NOW AVAILABLE