'I think a UK firm with sales of £100m is possible'
Thursday, October 17, 2019
He might have been a relative latecomer to print, but Northside Graphics managing director Gary White has certainly made up for lost time with his multi-faceted award-winning digital print business.
While the legacy brand is Northside, a traditional ‘offline’ commercial print business that only serves customers in Northern Ireland, its best known brands are its online pureplays: trade-only tradedigitalprint.co.uk and B2B print specialist digitalprinting.co.uk.
And although all three might have different models and raisons d’être, they all run out of the same Belfast factory with the same guiding principle: exceed their respective customers’ expectations.
Darryl Danielli You must be coming in to peak season; how’s it gone so far?
Gary White September was a record-breaking month for us, which is a nice way to start our financial year after the summer. I think everyone’s the same, especially if they’re seasonal – whenever it quietens down you always wonder if it’s going to get busy again. Thank goodness it always does!
That must be especially challenging for businesses in your market though, because you don’t even know what’s going to be on the presses in the next six hours, let alone the next day or next week?
That’s right. We do same-day or next-day dispatch, so it really is dealing with one day at a time and hoping the funnel builds up again. Years ago we used to have jobs coming in that had to be ready in two-weeks’ time, that’s just gone – it’s not part of our world anymore.
Does that make it particularly difficult?
I don’t think it does. I think we in the printing industry might think it’s special, but for everyone outside of this industry it’s just what they expect. My goal is to deliver a bespoke, personalised product in the same timescale that an off-the-shelf product can be picked and shipped. That’s the goal, because that’s what people want.
Is that really achievable, though?
Absolutely. We, and others, are already doing it on a daily basis. If someone orders before midday, then they can have it the next day before 9am. We charge a premium for that, not a big one, but it’s there and it’s well utilised.
But you guys didn’t start off as an online printer, in fact how did you get into print in the first place?
Our first business was a petrol station, would you believe. So, we had absolutely nothing to with print.
My brother Neil and me. We’ve been working together for 33 years, since I was 20-years old. I’ve always been on sales, but he’s always dealt with the solicitors, accountants, the bank – all the people that I don’t want to talk to [laughs]!
But how did you get into service stations then?
My uncle had one and after my A levels I didn’t want to go to university. So, I thought, well he does quite well out of that. It’s hard, hard work and long hours – but at the age of 20 you make a lot of mistakes, but you learn very quickly. So it was a very good grounding.
So you owned a petrol station at 20?
We rented the premises from the petrol company, which meant we had to buy our fuel from them. We then bought the site around three years later and redeveloped it.
Still a petrol station though?
Well, yes. But because of the Troubles cornershops disappeared [in Northern Ireland] and petrol stations took over. We were at the forefront of turning petrol stations into shops.
Why was that?
We all remember when petrol stations used to be just a few pumps and a little kiosk. Well the reason that they turned into shops in Northern Ireland was that there were always plenty of people coming and going, so they were viewed as safe. Whereas you could go into a cornershop and you might be the only person in there. So we ended up redeveloping the petrol station so that it had a 250sqm shop selling everything, we were a convenience store that had some petrol pumps outside.
And you were running that with Neil?
Yes, but we actually started working together well before that. Neil was 15 and I was 13 and we both worked in the Arts Theatre in Belfast, working behind the bar, backstage, showed people to their seats, sold them sweets, sold them alcohol...
…Even though you were underage?
[Laughs] It was a different time.
So you and Neil have worked together a long time then?
40 years. The reason why it works so well is that we both have different strengths.
So back to the original question then, how did you get into print?
We had one petrol station and another piece of land with a convenience store on it that we were going to redevelop. But then we decided to sell because seven days a week, 18 hours a day does start to grind on you and we decided to try something different. So we sold the petrol station and the land in 1997 and had a deal lined up to buy another company.
A print business?
A completely different sector, but it fell through. So we asked our accountants if they knew of any businesses looking to sell. They told us about this guy with a small print business in Belfast and we thought we could give it a go. It was called POD Print.
So it was a digital printer?
No it wasn’t. It had a relatively modest turnover, maybe £250,000 and only four or five people, and Neil and I decided I would make it my full-time job. I was effectively the sales rep, out all the time selling. I met with this new client who needed a job the next day. I went back to the factory at around four o’clock and said to the press operator that I would need him to stay on for an extra half an hour or so to print the job for this new customer on our little two-colour B3 press. He said no, it didn’t suit him. So, I explained it was a new customer and customers paid our wages and I had promised we would deliver. He just said he didn’t care, he wasn’t staying.
So, that was the day I decided I would go digital only. Because I thought if somebody needed something in the future, then I could print everything I needed myself if I needed to. Then I wouldn’t be dependent on someone who wasn’t interested in helping move the business forward.
When you bought that business with Neil though, were you running it on your own?
I was, because Neil was focused on our other business interests – but he’s always been involved and there when I need him.
And how did the first year go then?
I added around 50% in sales, so I was very happy. Then in around 2006, one of other businesses was doing really well, so I took some time out from the print business to focus on that. POD was still making good money, because there were good margins in those days, so I just left it to trundle on. But after the financial crisis, so around 2009, I decided to come back to it. It had been stagnating really. It was still profitable, but we hadn’t really pushed it forward. We had a really good 2009, and then in 2010 I got a phone call from Northside [Graphics, another Belfast print firm] asking if I would be interested in merging.
Were they a competitor in those days?
They were, a wee bit bigger, maybe 25%-30%. I viewed them and a company called Bradbury Graphics as our main rivals. We agreed the deal and merged with Northside in September 2010.
Did the deal come about because the previous owner wanted to retire?
No, not at all. Knowing what I know now, it was because we were putting them under real pressure. Another reason they approached us was that there was hardly any overlap with customers. They also ran HP Indigo and I ran Xerox, which appealed to me, because at that time Indigo quality was perceived to be better, flatter, more litho like.
So, did the Northside owner exit when you merged?
No, no, he’s still a shareholder. But most of the [Northside] team aren’t with us anymore. A lot of them didn’t like the way I did things. I think only two are left out of the 12 or so that were with them when we moved into their site. Then a whole lot of other stuff seemed to happen very quickly.
Well I mentioned Bradbury Graphics; unfortunately they fell into administration and so we bought the company. From that point [around 2012] I felt we were in a really solid position, because, basically, the three firms that were all competing locally [in Belfast], were now all under my control.
Under one roof?
Initially we ran two sites, until we bought them all together under one roof in 2013 to where we are now. It was a bit of a nightmare running two sites, but once we got everything in one, it all came together quite quickly. It was around that time that I decided we needed to get online. I had always thought we were really good at what we did, and I still do, but we’re based in Northern Ireland and that’s a pretty small pond – so I wanted to grow beyond that. I firmly believed that people in the UK would want to benefit from our service, so I decided we need to get online.
Once you combined all the businesses then, what sort of size were you?
And you weren’t online at all at that point?
No. I probably started thinking about a year or so earlier, and was spending a lot of my spare time looking for web domains. I set up lots of alerts on various names, and then I got a notification that www.digitalprinting.co.uk was up for sale and I bought it within a day.
How much did you pay?
I’m not going to tell you that [laughs]. People often ask me, how did you get that website – and I just say I worked and worked at it, had alerts all over the place. I think it had been registered seven years earlier, but had been dormant. It’s really helped us though as it’s one of those domains that does what it says on the tin. As we all know, it costs a fortune to establish a brand name – but if your brand name explains what you do, you’re half way there.
You don’t get much better SEO than that.
[Laughs] If you Google digital printing, usually we’re first and Wikipedia is second.
When did you first start seriously looking at going online then?
Probably 2011, then I bought the domain in 2012 and then it was 2013 that the site went live. We actually had our first online order in July 2013; someone managed to find us and place an order, even though the site didn’t go live until September.
But presumably you’d spent a lot of time getting the business ready to go online before launching?
Well, because, A, I had no idea if it was going to work and B, we didn’t really know what we were doing – I mean, we knew we could print and dispatch efficiently. But that was all we knew, I didn’t know anything about marketing online, or the value of reviews – there was so much I didn’t know. But I think we were just early enough in the online cycle that we didn’t get completely crucified by Google PPC [Pay Per Click advertising].
Because it’s so expensive?
When I started, we spent a lot money with Google and got very little return, even with PPC it takes a while to get traction. With the internet it’s all about trust, that’s the biggest difference between an offline business and an online business. With my offline print business [Northside], I can go and see a client, build up a rapport, get the quality, the service and the price they want – and then their happy and they come back next time. With online, the quality and service has to be a given, other- wise you’re wasting your time – but the biggest issue is trust, and the only way you can demonstrate that is through independent reviews. So from day one I was always focused on reviews and the only way you can do that is by being better than everyone else and go above and beyond the customers’ expectations. That’s why the fast turnaround was so important to us.
Makes sense, the internet clearly creates trust issues?
If you think about it, before most of us engage with someone we’ve never used before online, we always read the reviews first. And the best example of an organisation that has cracked it is Amazon. Now it has got to the point, where people read the product reviews of what they’re buying from Amazon – but not the reviews of Amazon itself – we all trust its service. We have a score of 4.9 out of five from more than 4,000 reviews, which is what I’m most proud of.
So that’s been key to the success?
We look at absolutely everything from the customer perspective. In every situation we try to think like the customer: is this what the customer wants? When I look around a lot of people tailor to their production, but we tailor to the customer – and I think that’s right thing to do.
But you have two online brands right?
It was probably around two-years after digitalprinting.co.uk went live that we had some trade people tell us that they liked what we were doing, but they didn’t like that we sold to everyone at the same price – which is a fair point when with trade buyers the artwork is always right – so there’s less labour for us. But I thought that [having two tiers] would make our website a little too complex, so from a customer UX [user experience] it would have been a bad thing to do. So, we launched www.tradedigitalprint.co.uk around 2015 exclusively for approved trade buyers that want the benefits of running an HP Indigo, without the cost of buying one.
And That’s gone well?
Absolutely, but tradedigitalprint.co.uk will always be the younger sibling of digital printing.co.uk; it’s there as a service, it was never meant to be the forefront of what we do. The forefront is digitalprinting.co.uk.
So, the B2B brand is the bigger of the two?
Yes, and it continues to grow. On the trade side, everyone talks about price above everything else and there are certain online printers where you can place trade work very cheaply, but it might not turn up when you want it to. That’s the trade buyer’s choice. Everyone has a different take on the value for money equation. What we decided is that tradedigitalprint.co.uk is cheaper than digitalprinting.co.uk, but it’s still really for people that value service and quality. Most people in the trade probably have some sort of digital box, so we’re really for those that need us to produce a high-end job or for when service is critical because they’re machine has broken down – it was never intended to take over the world.
On that though, it does seem that there’s a still a massive growth opportunity in the UK for online print, especially when you compare us to, say, Germany.
I think so. If you look at the take-up there, we’re quite a way behind Germany – and if we just caught up to where they are now I think the market would triple.
So, do you think there will be UK online firms as big as those in Germany?
I think a UK firm with sales of £100m is possible, maybe even more. We’re still growing, repeat business is growing, new customers are growing. I hate to tempt fate – but every aspect is growing online.
We just need to get that pesky Brexit out of the way...
That’s exactly what I was just going to say. Brexit isn’t good for anyone at the moment, because nobody knows what is happening, which makes it impossible to plan for. So, we all have to plan for possible outcomes that may or may not happen. I do think the country is close to recession, and I just feel that a hard [or no deal] Brexit would be bad – I can’t see any positives.
I agree, anything that creates uncertainty in businesses is bad news, regardless of your political leanings.
I’m sure I’m not the only business owner that has delayed capital investment because of it. It would be foolhardy not to. Obviously we’ve got to respect the referendum, but it just feels that the government hasn’t thought through the impact of a no-deal Brexit, the reality on people’s lives.
Is a no-deal exit something you can prepare for though?
We’ve got lots of paper in stock, and have done since early March – we’ve container loads sat outside. We’ve stockpiled consumables and spares too. We’ve increased everything massively – and we’ve had to pay for all of that. We’re in a fortunate position, because of the nature of the business, that we’re very cash positive and can afford it. But a lot of businesses probably aren’t as fortunate.
Once Brexit is out of the way though, are there any barriers to growth ahead?
The problem we’re going to have at some point is outgrowing our premises, and we’ll have to look at splitting small- and large-format digital. But we’ve got a wee way to go yet, we’re 24/5 plus 18 hours one day, so we have more time too. And, of course, we can always look at getting faster machines. We want to grow quickly and we are, but it has to be controlled and profitable growth.
You’re around £6.5m now though, is that your ideal size?
If what I believe is right, in that the market can triple to match Germany, then there’s absolutely no reason why we can’t get to £20m – just not from these premises [laughs]. Brexit aside, I really believe that’s possible – online printing is well out of its infancy, but we’re still in a massive growth period. So, I think it’s going to be a while before we get into massive price wars, there are some that are selling at prices that I don’t understand. But that’s their model.
You don’t get into the dynamic pricing battles then?
We set our price and that’s our price. We tweak it every now and again – but that’s it. We know that we’re very competitive up to certain volumes, because we’re digital, and we’re super happy with our customer service and quality. So we’re happy to stand by our prices. We run promotions every so often, but they’re about rewarding existing customers not winning new ones. It’s about loyalty.
There’s been an awful lot of M&A activity in the online sector, have you ever been approached?
No, but a couple of years ago we did have a look to see if there’s anyone we could acquire – but we were only looking at online businesses and there just aren’t that many in the UK. There are some in land grab mode, there are others driven by profit, and others that are outsourcing – there are lots of different models, but it’s a small community and I wouldn’t be able to afford to buy any of them [laughs].
What has been the steepest learning curve?
Learning about online marketing and using PPC. You can hear a lot of expensive bullshit – excuse my language – from so-called experts – so it was very important for me to teach myself to understand PPC.
I forgot to ask, how old were you when you started in print?
33, so quite old and I literally knew nothing, so it really was a baptism of fire. The only thing I knew was that I hated litho [laughs]. I did try once to run a litho press, and I’m not exactly mechanically minded, so when someone tried to show me how to run one I just walked away saying that I was never going to touch one again as long as I lived. I have great respect for people that run litho presses, but I have no desire to be one.
Is there anything you wish someone has told you when you started out, other than never to touch a litho press?
[Laughs] I’m a great admirer of Aron Priest [joint founder of Solopress]. He’s an absolute pioneer of online printing in my opinion. I only met him after we went online and wish I had met him earlier and then I would have gone online earlier.
You mentioned it’s a small community, do you think it will get bigger or are the barriers to entry too high now, and the future spoils, in terms of market growth, will be shared by the current crop of online players?
I think there’s always room for craftsman with bespoke offerings for niche markets, but as for someone else coming in and saying that they’re going to be the biggest in the market, well, unless they have very deep pockets and an excellent team, I can’t see that happening.
It’s nice to hear that people are important, even in an online business that strives to reduce touch points.
The staff in any business are important, but in an online business even more so. I can’t praise my team enough – they just get more and more efficient the busier we get. Everyone in my business now is the exact opposite of the litho operator that drove me to invest in digital, which makes running it a real pleasure.
Which seems the perfect place to end.