Scottish printer is finding new business opportunities in challenging markets

In 1894, just 15 years after it was formed, Stewarts of Edinburgh revolutionised the world of postcard production, sadly not by launching the first saucy seaside variety, but by producing the first full-colour postcard - a much more staid series on Edinburgh Castle. In more recent years, Stewarts has targeted the financial sector, although the recession has required it to broaden its market segmentation and prompted a move into direct mail, web-to-print and even print management. It has recently moved into a 3,350m2 plant located on five acres of land in Livingston.

Managing director Terry O'Hare describes the direct mail market as challenging. "Our direct mail customers have very demanding requirements. We have to provide a robust and consistent solution from an efficient cost base, but it is very difficult to pass on any price increase to clients in today's economic climate," he says.

Web-to-print is a significant growth area for Stewarts. O'Hare says the firm is determined to expand this division and expects it to deliver around 15% of turnover during the 2009/2010 financial year and 25% of turnover within three years. O'Hare also expects the print management side of the business to grow. This currently brings in 15% of revenue, but O'Hare plans to grow that to 25% over the next two years.

Printers working the financial sector are having to become increasingly competitive and there has been a distinct fall in demand from Stewarts' key customers. The challenges facing in the banking sector are being passed on to printers, O'Hare says. However, it's not all bad news.

"It has been very unfortunate for printers working in thissector, but we are also seeing new opportunities. We've had a robust sales performance this year and have looked deep into clients' business models. This gave us some confidence and we have seen areas of substantial growth," says O'Hare.

At the end of Stewarts' last financial year in March 2009, the company recorded a turnover of £6m and has plans to continue to grow this year.

New beginnings
O'Hare joined Stewarts in 1986 and under his stewardship it has grown rapidly in the colour print market. In 2004 he led an MBO along with operations director Kenny Murray and business development director Marion Reid. He says, following the MBO, the team set about reducing the company's cost base. "This has positioned us well in this competitive business environment," he says.

At its site, Stewarts has a six-colour Heidelberg Speedmaster 74 with coater, a 10-colour Speedmaster CD 74 perfecting press and a four-colour Speedmaster SM 52 Anicolor. Stewarts' customers are mainly based in Scotland, including financial services businesses and the National Trust for Scotland, although its move into print management has attracted clients from across the border - something that O'Hare is keen should continue.

The company also sponsors Scottish Athletics and The Traverse Theatre in Edinburgh.

In December 2008, Stewarts bought Summerhall Press, a 135-staffed local financial printer. However, less than one month later, Stewarts liquidated the business following "unforeseen circumstances". O'Hare, who's keen not to dwell on Summerhall, simply says the company has moved on from the experience and employs a small number of ex-employees from Summerhall.

Instead he cites a number of high-profile new business wins over the course of the first quarter of 2009 and adds that he expects to win more new business this year.

"Productivity is up considerably and this improvement is down to continued investment in our people and plant," he says. The company has added to its environmental certifications - it now holds ISO 14001, PEFC and FSC - and is designing a biodiversity programme at the site.

"Becoming green isn't about getting a few environmental badges or greenwash, it is about genuinely embracing and protecting our natural habitat," he says.

The company recycles all paper, wooden pallets, aluminum drinks cans and printing plates by waste segregation in the office and factory. A skip is being installed on the site to collect the cardboard boxes that it cannot re-use. A return
and re-use cardboard box programme is also being put into practice this month to encourage customers to return Stewarts boxes.

With its robust sales performance and environmental stance, O'Hare says things are looking up for the company despite the recession. "There is generally a cautious optimism that the economy will give some real opportunities to printers," he says. Having embraced sector challenges, Stewarts has looked outside the box and is set for another 130 years.

Stewarts factfile
Sales forecast for 2009/2010 £7.5m
Employees 69
Founded 1879
Sectors print management, digital, direct mail, print on demand
Clients Johnson & Johnson, The National Trust for Scotland and Standard Life