Logo Label Printing
4416 Bennett Memorial Rd, Suite 101, Durham, NC
Logo Label Printing owners David Grossman, Tim Oates and Cay Bacon, have backgrounds in neither labels nor printing. Prior to Logo Label, the trio had a previous business that provided custom labeled bottled water for corporate and private events. They were label consumers, and they saw a need for services that traditional label printing struggled to provide – rapid and cost-effective turnaround of short run jobs.
“It became quickly apparent that the existing traditional label printing process – flexography – could not provide the services that the custom labeled bottle water industry required,” explains Grossman, Logo Label’s chief operating officer. “The market requires fast turnaround, small production runs, high quality and low pricing. Flexo printing has large minimum production runs, moderate quality, and is very expensive when only a small quantity of labels is required.”
With the custom bottled water industry growing, Grossman, Oates and Bacon felt that with the right equipment, there was great potential in the label printing aspect of the business. So when the opportunity was there to sell their business and enter the printing industry, they went for it. After researching the various digital printing systems that were available at the time, Logo Label Printing was created and acquired its first press, an HP Indigo ws2000.
Naturally, Logo Label’s initial target market was custom labeled bottled water. “We were able to establish a customer base quickly, as a result of our knowledge of both the needs of the industry and the companies that were involved,” says Oates, president of Logo Label. “Getting new clients was easy for us, as everyone that we approached had experienced the same issues with flexo printing that we had. The service that we offered – fast turnaround, low production requirements and low pricing – was extremely attractive.”
The bottled water industry is cyclical, with a severe peak during the summer months, and an extreme valley in the colder months. Because of this, for the company to survive it became imperative to identify and approach short run markets that would benefit from Logo Label’s digital printing advantage: small wineries, gourmet coffee roasters, specialty sauces and salsas, microbreweries, micro-distilleries, personal care products and nutraceuticals.
“Each of these markets faced the same issues as the custom bottled water industry. Their label needs were immediate, their volumes were relatively small, their budgets were limited, but their quality requirements were very high. With our digital press, we were able to meet all of their needs and stabilize our month-to-month sales levels,” Grossman says.
Expanding with inkjet
Logo Label Printing has experienced strong positive annual sales over its first eight years in business, with the exception of the recession-riddled 2009. Grossman attributes the lone drop-off to a significant decrease in sales of bottled water labels due to the reduction in advertising and marketing dollars spent by corporations for trade shows and other events, functions where custom bottled water is often a marketing giveaway. Despite the loss in sales for that market, during the same time period, Logo Label expanded its efforts into the wine, personal care products, and coffee roasting arenas, which resulted in making up for the loss in bottled water.
Over the last three years, Logo Label has enjoyed its most significant growth period, which the company accredits to the 2011 addition of its second press – this time an inkjet machine – a 6.5-inch wide EFI Jetrion 4000. The new press paved the way for sales efforts directed at new markets. Grossman says, “We had built the business to a point where our clients demanded faster turnaround for much larger runs then we ever ran previously. Our existing digital press could not keep up. If we did not add the Jetrion, we would have been walking away from a significant amount of business.”
Inkjet printing is faster that EP technology, a benefit that Logo Label leverages to expand beyond typical short runs. “Normally with digital printing, you might have a 45-minute start-up where you calibrate the press and waste 100 feet of material in the process,” Grossman explains. “When we added our first Jetrion press, we had jobs ready from the start, and the press was consistent all day.”
While short runs are Logo Label’s specialty, the company’s efficient production operations make it a cost-effective choice for higher-quantity versioned and regionalized jobs. In fact, the company has run orders as large as 280,000 labels on its Jetrion 4000. Inkjet label printing with the Jetrion 4000 became such a key part of Logo Label’s business, the company decided to meet its growing capacity by installing a second inkjet press, a 9-inch wide EFI Jetrion 4830, in October 2013.
The 4830 can print highly opaque, bright white ink, which Grossman says is the best he’s seen. “It’s created a huge advantage for us, particularly with the significant portion of work we do on clear substrates, metallic foils and colored films. The addition of the Jetrion 4830 gives us even more opportunities in markets where foil and clear labels are requested and opaque white ink is needed. Also, sandwich label capabilities and specialty substrate printing that we can do on the Indigo has opened up several markets for us as well,” he says.
Along with the Jetrion 4830 being added in 2013, the company also upgraded its HP Indigo equipment, trading in the ws2000 for a ws4600. “Our operation now covers every level of quality and color availability that anyone could need in the label industry. We operate at highly efficient levels with minimal staff, expert personnel that have a commitment to both our company and the clients that we serve, and equipment that is the latest technology,” Grossman says.
“Digital printing eliminates the significant minimum runs lengths needed to justify the cost of plates, make-ready and die tooling in conventional flexo printing,” explains Tim Oates. “For our customers, that means design, production and roll-out of a new product label can take days instead of weeks. Customers can get their products to market faster, with an attractive label that has just as much pop and visual appeal as major brand name products.”
Logo Label runs lean. There are currently 11 employees at its 4500 square foot facility in Durham. Two operators run all of the company’s presses, and a third operator runs a Rotoflex rotary finisher that laminates, underscores, diecuts, strips and slits in a single pass. All operators, as well as Grossman, are cross-trained to operate everything in the pressroom. In addition, all of the prepress designers are cross-trained to operate the Jetrion and Indigo presses.
Along with Logo Label’s growth, the company has added graphic design to the services it offers. “Rather then going to expensive design firms for their artwork, we provide this service to our clients at a nominal fee, and it has led to more sales.” Other departments have been enhanced as well, with the company recently adding personnel for administrative support and a production manager.
Logo Label has succeeded in serving the niche markets it initially targeted at its start. Going forward, Grossman and Oates emphasize that the goal is to get a larger market share in these markets while giving extra focus on those that allow for the largest profits, specifically the coffee, distillery, brewery and nutraceutical markets.
With the global nutraceuticals market projected to exceed $200 billion by 2017, Logo Label is targeting it above all others. “What we
have seen is that a large percentage of the companies that provide private label nutraceuticals are small companies that are not at the point where they can order 50,000 or 100,000 labels at a time – a requirement for the unit cost of a label to go down with flexo printing. In addition, these firms generally offer a very large assortment of products, but only need a smaller number of labels for each item. This is a perfect scenario for digital printing. Flexo simply cannot compete when a client has a large number of SKUs but a small number of labels to be printed for each one. Our customers can’t go to flexo because their ingredients might change often, or they need to introduce new flavors of products quickly, or because there are elements to their labels that change frequently,” Grossman says.
While Logo Label has a rather small share percentage of the nutraceuticals market at this time, Grossman says if they maintain the growth rate they’ve had over the past four years, its market share will become significant. He explains, “Our current client base is spread all over the US, with a few clients in Canada and even overseas. We base our pricing by incorporating every cost that we can think of into a spreadsheet, and then insuring that at the highest print volume discount we still maintain a minimum 35% gross profit margin.”
With micro-gourmet coffee businesses cropping up all over the country, Logo Label is a regular at international coffee trade shows, and the same goes for small-batch distilleries and microbreweries. “We are already printing for many of these distilleries in North Carolina and are expanding our services to other parts of the country. Getting exposure at trade shows is key to getting known to these businesses, and a greater effort is scheduled for 2014,” Grossman says.
Along with trade show success, word-of-mouth has driven the company’s sales and marketing efforts. Recently, Logo Label added its first dedicated sales rep, opening up previously untapped resources for new business. Grossman says, “Our growth to this point has come mostly from referrals, and although that’s been great, we realized that we need to increase our efforts in advertising and personal selling.”
Logo Label’s strength has been the fast turnaround time it offers customers along with high quality product and service, and competitive pricing. The result has been customer loyalty, and Logo Label has enjoyed growing with the businesses the company prints labels for. “The markets that we are targeting are either already serviced by other digital printers, or are being targeted as well. It’s not a secret that these markets are almost wide open at this time, so capturing these clients quickly is vital. Our experience has been that once a client starts dealing with us, there is a very small chance that they will leave us. In our eights years of existence, we have only lost a handful of clients,” adds Grossman.
Partnering with printing companies that do not have digital capability has been another avenue for growth. “We are constantly reaching out to traditional printing companies that do not have digital printing, to partner with them in offering this service,” Grossman says. “Traditional printing has been on the decline for the past few years. These printers have seen that they can no longer turn their back on smaller production runs. However, they also do not have the funds required to set up a digital printing division, therefore, more and more of these companies are turning to us to be their digital printing partner.”