Diversification, Tech Investments Distinguish GH Companies
by Gary Scott Beatty, Editor, On the Shore Magazine
In 1991 Graphics House was a startup company with three full time employees and ambitions of becoming a national supplier. Today GH Companies has grown to become a major force in the national, digital printing arena, though GH does operate five retail outlets in west michigan. the emphasis at GH Companies has always been on wholesaling products throughout the United States. On the Shore magazine talked with GH Companies President Dan McKinnon about attention from megacorporations, emerging technologies and the need to always look ahead.
"Our emphasis is wholesale to the trade. We have, basically, five vertical markets with 4,000 customers throughout the United States. We try to specialize in a particular market and bring the services to that market that will really appeal to them.
"We wholesale to ad agencies, commercial printers, traditional sign companies, professional sports teams and transit authorities, or city bus companies.
"We have a total staff of 65, including eight graphic designers. We sell our products with a staff of 12 customer service/salespeople that call various companies around the country, find out what they want and sell them products to complete their projects.
"We've built our business on four principles: buying state-of-the-art technology, being price-sensitive nationwide as a wholesaler, being an expediter of our services, so we're kind of the 'Fed-Ex of the graphics business,' and we use the We Principle.
"The We Principle is we work together with our wholesale clients in a partnership. We're trying to accomplish something together. It's not us selling something to them, but we are working together, because the more successful they are the more successful we become."
GH Companies offers so many products - offset printing, custom apparel, vehicle graphics, bulk mail services, all kinds of signs and large format DIGITAL PRINTS. Explain the five markets and what you offer them.
"Ad agencies, traditionally, have no equipment, so they
outsource anything they would resell to their clients. It could
be any sort of large format graphics like a billboard graphic, trade show display, it could be vehicle wraps to wrap a car or truck.
Also, it could be traditional printing, like brochures, sell sheets
and company catalogs."
Ad agencies come up with creative ideas and need a company with the knowledge, technology and equipment to make those ideas a reality. Can you give an example of a project?
"For an agency in the city of New York, we did something real creative in Central Park. We transformed a blacktop parking lot into a piece of art. The project was a collaboration between the Public Art Fund, Whitney Museum, City of New York and Central Park Dance Skaters Association. The artwork was produced by Vivid Astro Focus, aka Eli Sudbrack. Their agency searched around the country for someone that was capable of doing the job and found numerous large format digital manufacturers like ourselves, but no one could guarantee the safety and longevity of their product. We worked together with some of our raw material vendors and came up with the perfect product and produced what was, then, the largest floor graphic ever to be produced and installed in the United States.
"Another one that was quite interesting was an ad agency contracted us to do a 50 foot diameter Oreo cookie. It was in conjunction with celebrating Oreo's 90th birthday, so, of course, the Oreo was dressed up to look like a cake. The large mesh banner was used in a variety of photo shoots for advertising purposes, including ones at the Indianapolis Motor Speedway. The giant cookie was placed in the infield and required photographers to go into the grandstands to get the cookie in frame."
How does GH Companies work with printers?
"There are 70,000 printers across the United States, most of which do not do four color process work. Only about 22 to 23 percent of printers actually do that work in-house. So we sell process color printing to smaller printers around the United States, who, in turn, sell to their local customers."
How do transit authorities and bus companies use your products?
"Traditionally, a city transit authority will generate extra revenue by selling ad panels that will go on the side of their bus, or ads that will go on the interiors of the buses. They, certainly, don't have the equipment to produce that, so they find a source like ourselves to do that production work. We've done campaigns that have promoted Coca-Cola, McDonald's and a variety of other national and local companies doing the production work and sending it to that transit authority, be it in Dallas, or Atlanta or some other large city.
"By getting involved with transit authorities, we've also become quite involved with doing bus wraps, where you take an entire city bus and wrap it in graphics, from the bottom of the bus, all the way across the windows, across the top and down the other side, a complete body wrap of graphics.
"The graphics for windows is unique. It's a material we print on called one way vision. When you're inside the bus you can look out the window and as if it were tinted, but from the outside of the bus you can actually see the graphic that was printed."
What do you do for sign companies?
"There are sign companies all over the United States that do a variety of things for their local market, but they don't have enough demand to invest the millions of dollars it takes to do digital printing. So when they have a job that would require a very elaborate print to complete their sign project, they outsource that to us.
"It could be a billboard we produce for them with a picture of the local eyewitness news team. It could be a backlit shopping center sign, where they want very elaborate, multi colored graphics. They would outsource the production of that sign face to a company like Graphics House."
Didn't your work with sports teams lead to your interest in digital technology?
"Yes, that is how we became involved with the digital side of our business. In 1993 we bought our first digital printing device so we could produce graphics in an expedited manner for, at that point, hockey teams. Hockey clubs have championship or player banners that hang from the rafters of their arenas. They also have ad panels that are attached to their dasher board systems that advertise their sponsors, like Comerica Bank or Wal-Mart.
"So from the beginning of working with hockey teams, we expanded into handling virtually all sports. We now do graphics for football clubs, baseball clubs, soccer clubs, lacrosse, tennis events, virtually anything involved with sports.
"We produce not only sponsorship graphics, but also, on our offset printing side, any type of printed material they may need. For example, we print baseball trading cards, game night programs, souvenir programs, team posters - anything they might need to promote and benefit their team."
New Equipment Purchase Transforms the Company
GH Companies has always been in the forefront of digital technology, bringing the advantages of digital printing to customers and working it into your business model. What's new at Graphics House?
"To explain that, I need to back up a little. In the spring of 2000 the company made the largest commitment it ever had made in technology - we bought a German built, offset printing press from Heidelberg. At the same time, we bought our first super wide digital printer, a printer that would actually print 16 feet wide, full color photography.
"The machine we acquired was from a company called Scitex, an Israeli company. They were, at that time, the world leader in the super wide, digital printers when we started our relationship with them.
"In early 2006, Hewlett Packard (HP), which has been involved with ink jet printing and a variety of less than industrial grade printers, decided they wanted to go into the heavy, commercial, super grand format digital printing area. So they looked at companies all over the world and the company they discovered was the premiere company in the world was Scitex.
"So HP negotiated and bought Scitex. Now the new company name is HP/Scitex. They have North American operations in Atlanta, Georgia, however product manufacturing remains in Israel. We've been proud to belong to the Scitex family. Now we're that much prouder to belong to the Hewlett Packard family.
"Once HP bought Scitex they decided they would have a worldwide conference of owners of their equipment, so they arranged a trip for owners to Barcelona, Spain. It was a five day event and the main purpose was to welcome the Scitex owners into the HP family. Secondly, they were introducing the new influences of HP on Scitex entering the market as a megacorporation. They introduced new technologies that were way beyond what any digital printer in the world has been able to produce.
"So on that trip I took my wife and we spent five days in Barcelona. It was a chance of a lifetime. We had never been to Europe. It was one of the most thrilling events we'd been to because we could mix both pleasure and business, and we came away from that event dreaming about an equipment purchase that our company could make.
"We came back, had meetings with our staff, and that purchase was placed on our dream list. It really wasn't something we could easily acquire at the time because of the investment and size requirements.
"Five months later, the president of North American operations for HP/Scitex flew into Muskegon and had a meeting with us. He cast a vision of where HP thought the super wide, grand format business was heading. His vision was that there would be, in the United States, 50 major production centers that would have the technology and the industrial grade equipment to be able to serve the larger needs of the nation. To our surprise, he put Graphics House, Muskegon, Michigan in that category.
"They then made every possible effort, working closely with ourselves and financial people, to put in this equipment that could, literally, transform our business.
"That equipment is due to be installed and operational this month.
"What makes the HP Turbojet 8500 different is the quality of the work it will produce, the speed and the durability of the machine, making it a dependable, high speed production machine.
"The Turbojet will produce the quality of graphics you would see in an airport concourse, backlit transparencies/photograph of a Rolex watch, for instance, or the kind of quality you see in a cosmetic store on backlit transparencies of photographed models.
"It's very high quality, but also one of the fastest pieces of equipment of its kind in the world. So where other technologies were used in the past to produce very high end graphics, those technologies may have been very labor intensive and high in setup costs. On the Turbojet, as quickly as a designer can capture an image on his computer, within a few minutes he can be at top production speed, producing very elaborate graphics.
"This particular machine prints a variety of sizes, but the maximum size is five foot wide by 12 foot long. It will print on a variety of substrates - plastics, traditional backlit materials, card stock, vinyl. Because the print size is so large, it's very easy to gang up smaller images on that larger print size, increasing productivity.
"We have three pieces of Scitex equipment. About two years ago we were searching for a device that could print directly on rigid material. We purchased a piece of equipment from Leggett and Platt, a Fortune 500 company with five billion dollars in sales that has an equipment building division. They built us a Virtu that can print on virtually anything - wallpaper, directly on half inch glass, a variety of plastics, you name it.
"We even have an order pending right now from a national restaurant chain where we're printing a food scene on a rubber floor mat that would greet their clients as they come in the front door of their restaurants.
"Up until now, the Virtu has been one of the wisest purchases our company has made. This particular machine was configured exclusively for our needs. We opted for a high speed capability. At the time we purchased it there were only two machines in the world configured to these requirements and today there are only about four worldwide.
"The Leggett and Platt company also has similar equipment configured differently and they have less than 40 of these throughout the United States, one of which was purchased by Best Buy, who looked at the tremendous amount of graphics they were buying for their stores and felt they needed to bring some of that production in-house. So they searched, as we did, to find equipment that would meet their needs and they felt Leggett and Platt's Virtu was the right fit for them. They acquired their technology at about three quarters of a million dollars."
So what distinguishes GH Companies from other companies in the digital imaging arena?
"When HP/Scitex came here and said there are going to be 50 production centers in the country, the reason they had us in that category is because of our diversification. Not only do we do large format digital and grand format digital, but we also do digital offset and screen printing. So they considered Graphics House because they know the suppliers of the future are going to be able to do any kind of graphic. So, even though we may be a smaller company, we have ventured into all areas of printing.
"Early in 2006 we added our fifth offset printing device, a Shinohara, 23 inch by 29 inch sheet size, process color press. It has an auto plate load, digital color monitoring console with an X-Rite scanning densitometer. That particular press will print 15,000 sheets an hour at maximum speed, so it can tackle jobs anywhere from 250 sheets to 250,000 sheets. It's really been a press that has fit a niche for us, not only for brochure printing, be it a sell sheet, a business trifold or a product catalog, but it also complements our larger digital area, in POP graphics.
"Since 1993 when we acquired our first digital printer, the price of these technologies has dropped and also the grade of machines has dropped, so there are now digital printing devices that the homeowner can have, digital printing devices that small businesses can have, digital printing devices that some of the pay for print people can have. But, in most of those cases, those are low level, low investment types of equipment. So even people who are competing in our world, may be competing with machines that look similar, or possibly even have the same size specifications, but they're not true, industrial grade equipment.
"What distinguishes us from someone else is our ability for throughput, our ability to handle large projects and our ability to have the highest possible standards in quality, service and price.
"As a company, we refer to ourselves as a company with a servant's heart. We really care about the people that we serve. That's why we have the We Concept. We're not trying to do business with someone to try and see what we can get, we like to do business with people so we can succeed together.
"So that's part of the concept, the servant's heart. But in addition to that, this is a family owned operation and there are family members heavily involved with the business. We think digital is a very exciting part of the future of American business and it would be a wonderful thing if our business could continue on through the generations."
