2022 Midyear Converters Roundtable
By AICC Staff
July 7, 2022
At the AICC Spring Meeting in Palm Desert, California, members were treated to several compelling addresses, plant tours, networking opportunities, and informative sessions and panel discussions. One of those panels, moderated by Joe Morelli, vice president of sales and marketing at Huston Patterson and Lewisburg Printing Co., offered various key insights from a handful of leaders on the Association’s board. That session has been transcribed for BoxScore and is as follows.
Joe Morelli: [AICC President] Mike D’Angelo and I did a session with [OTB Sales Solutions CEO and Founder] Mark Allen Roberts; if you haven’t heard him speak, he’s incredible. He’s got an incredible amount of data behind him. A lot of stuff he talked about was how the [COVID-19] pandemic was going to change sales forever. So, the first question, gentlemen, is: As you’ve come out of the pandemic, has it altered the way you’ve dealt with your suppliers?
Gary Brewer: I’m back to normal, no restrictions. I encourage the face-to-face—it’s what we all like, right? Whether somebody wants to shake hands with me or not is up to them. But back to what we used to do. I like the face-to-face.
Finn MacDonald: Yeah, and I’d add to that it’s not only what we’re doing outside as far as letting folks in—it’s what we’re doing inside as far as getting groups together for training, trying to have working lunches, trying to put emphasis on getting ahead of problems rather than reacting to them. The past couple years have been a high percentage of reaction. The fact that internally we’re trying to open up and do more as a group, I think, only opens a door to our supply base.
Morelli: One of the statistics that Roberts threw out there was 70% of business-to-business buyers are comfortable purchasing up to about $50,000 worth of something without ever meeting their supplier. Is that something you think applies to you, or is that perhaps in a different industry?
Matt Davis: Yeah, I think it applies. It depends on the product and if it’s something you’re familiar with, maybe a bander or something like that. I think you can make those purchases without ever meeting the person.
Morelli: I think more staggering—he threw out a half-million dollars, 30% to 35% of buyers and purchasing agents would be comfortable purchasing up to $500,000 worth of product without ever meeting one of us.
Brewer: I would say so. As long as you had a good, solid out if it didn’t meet your expectations. I did something recently—wasn’t that level, but it was more than $70,000—never met the folks. All email.
MacDonald: I’d say 50-50. Certainly if we know you, or we know of you, you’ve got a better shot at that. Carte blanche is still something that we’re not natural with.
Morelli: On the same line of the buyers and the purchasing agents that you guys have been working with, you look around the corrugated industry, and it’s aging. It’s a very experienced industry; I think that’s widely said. What we’ve noticed is a lot of the purchasing agents are the younger generation, they’re more millennial. They’re definitely younger than the bulk of us. Are there any tips on how we need to adapt to perhaps that younger buyer?
MacDonald: I’d say from our perspective, the mix of your experienced gatekeepers versus your newer entry-level buyers, or whoever a buyer is, the problem is you still have a gatekeeper. The gatekeeper is going to start the conversation by telling you how long they’ve been in the business, and then it’s going to go on and on and on. It’s nothing but a series of formed opinions. Usually, they’re blocking a lot of good effort and a lot of good intelligence and a lot of good education from even getting into the company.
Somehow, you’ve got to find a way to get around the gatekeeper and get to all the hungry fish. Because we’re doing our job—we’re diversifying our company, we’re building for the future—but we’ve got plenty of departments throughout the country that need help from everybody in the room. I can’t sit there and open the door and get you through that gatekeeper to get there. I’m willing to help, but we’ve got to find a way to get around it, because it’s what’s going to get everybody to stay in the industry. And it begins to form the relationships that bring us all together.
Morelli: Gary alluded to the relationships, the handshakes. Post-pandemic, I think a lot of people started to figure out you could be a lot more efficient with your time if you’re not dealing with suppliers day in, day out. How much of that do you think is still true, or do you think old-school relationship-type sales is going to be around forever?
Davis: I think it’s going to be around for a long time. Kind of dovetailing on your question earlier, being a smaller business, about $70,000 would be our threshold, but any bigger purchases, we do want to have that relationship. The nice thing about the box business is throughout this whole pandemic, we never missed a shift. We’re used to going in to the office; it’s still kind of business as usual, and it’s definitely getting back to business as usual. I would say that we want that. At least, that’s how we’re still making decisions. We want to see the suppliers.
Morelli: Moving out of the post-pandemic discussion, one of the questions that we get quite often is: What makes a great supplier? You were talking about getting around the gatekeeper and figuring out a way to make yourself known to your team of people. In your opinion, other than a great product, how can you be a good supplier if you’re Independent II?
MacDonald: I guess I had to learn my way up, so a lot of the memories that have built the relationships that allow us to do large amounts of business without seeing anybody, they were built press-side. They were built at dinners. They might have been built out in the lobby. By just the exchange of information, not even related to what you’re selling and what I’m looking for, but general stated business, “How are things going? What are you hearing?” I think if you can hit press-side, if you can hit dinner, if you can hit context, then you’re bringing value.
I’ve got a plant. Half of my production staff is not the same production staff that anybody in this room knew three years ago. I’ve got a new head of maintenance that was not here three years ago. I’ve got a new design department that wasn’t here three years ago. We’re open for new opportunities, for relationships, but we’re in a desperate need for knowledge, and we need that information to be brought to us in a way that’s accessible by a lot of folks who’ve never been in the business. Don’t tell me how much you know; help somebody who knows nothing learn something. Make that first step. If you can bring that to us, then you’re going to be able to crawl, and then walk, and run pretty successfully.
Brewer: I’ll add to that. I say, “Educate me.” Us three guys, we sell for a living, right? We’ve got our customers, we’re in all shapes and sizes, different industries. We see all different methods, practices. We try to help those customers, “Hey, I’ve seen somebody do this a certain way,” build their trust. I say the same thing of you guys. You go in all different types of plants, locations—you see everything—so come into my plant and educate me on something that you’ve seen. It may not even be related to the product you’re selling or offering, right? Show me something. There is no chip on my shoulder—I want to work smarter, not harder. Help me and educate me, and that, in turn, will grow.
Morelli: I think what you’re alluding to, and one of the questions, actually, I had from somebody in the audience today was, during your onboarding process for new employees, is it something that you lean on your suppliers for, to help them get caught up to speed quickly? Or is that something you just take internally?
Brewer: I would encourage that. That just makes you deeper with me, right? If you’re an ink supplier, come press-side and help that operator or assistant operator understand what the ink is, and how to adjust it, and how to make it perform properly. Bring your knowledge and experience and help me; take that burden off.
Davis: I would agree with that. Help us establish some best practices. The sale doesn’t stop after you get the PO—we need that help all the way through. And then after, come back six months later and do an audit or help us put processes in place that catch any inefficiencies or bad habits. That’s what we would definitely appreciate.
Morelli: One of the big questions, I know, especially when I was a young sales rep in the industry, was, “How do we get to you?” Finn, you mentioned maybe it’s just at a coffee break. But is AICC a good platform for one of these people to come and put the hard sell on you on their product, or is it more to make the introduction and get to know you first? What would you say to this group in terms of how to get to the 400 general members that are here?
MacDonald: It’s tough. [Laughter.] I mean that in a loving way to everybody in the room. It’s kind of tough to get to me, and that’s a lot on me. We’ve got a lot going on, but everybody has a lot going on, right? There’s not a person in the room who’s twiddling their thumbs. If there is, shame on you. It’s tough, but getting to me is really, really different than getting to my plant manager, my design manager, my buyer, my sheet buyer, and my maintenance manager. We’ve got to find a way to get to those folks. It’s the groups working under them, in our company—they’re not folks who’ve been there for 25 years. They’re folks who’ve been there for three months, a year, for three to five years. So there’s plenty of opportunity for them to learn.
As far as getting to me, the one thing I was going to ask the room would be this: You guys have such a great network. Chances are, if five of you want to get to me, one of you is getting to me, so I would try to use the network to say, “Who in the hell’s getting ahold of Finn right now? Can you let him know that we’re trying to get ahold of him?” Let’s just help each other out. I think you do a natural job with that. But I’d say I could use the help there, because a lot of times you just get inundated, but there is somebody who’s “I’m picking up the phone to talk to Greg. Greg and I are doing something.” So, you’ve got the access. Use your coconut line, your coconut-palm tree line, and help each other out that way. We’re OK if you’re a little devious in how you get to us. You’re a resourceful group.
Davis: I would say for all the newer members, I would encourage you to come to the meetings. I know some Associates skipped some of our meetings because they might feel a little boring or not as informative to you, but the sessions we had this afternoon applied to both boxmakers and Associates. And the nice thing about those meetings is the boxmakers are at the tables. You can even pick who you want to sit with. If you’re new to the group, I think that’s a great way to try and get to know some other folks. And then I would just encourage you to keep coming, because with that repetition, you really get to know people. It’s hard that first or second time, but my advice would be to keep coming, and we’ll do what we can.
MacDonald: Joe, I think I’d add to that. I tell you, I still dedicate a good amount of time to old media, to our publications, and I’m extremely bullish and optimistic about our new media. There’s a new channel that the Association’s working on, and I think the combination of that and our existing print media—we’re down a publication, but we’re also backfilling that—that is something that I guarantee you our leadership group, we get two copies of each. We take it home, we do go through that page by page. Normally, it’s when we’re not at the office and there’s not a lot else going on, so it’s really, really good learning time in our example.
With the new channel that’s coming, I tell you, the amount of times we go through the break room, look out on the parking lot, we see our production staff looking at their phones. They’re looking for something. They want to see how something runs or how you set something up better. It’s such a golden opportunity to get right to the ground level, and I think we’re right at the dawn of that. I think it’s going to actually be easier that way as you work through new and old media to augment what you’re trying to achieve.
Brewer: Something I’ll add—and I think bankers are extremely effective at this—call us after 5. Because we’re there [all nodding in agreement] and nobody else. And guess what—answering the phone.
Morelli: Better be careful what you wish for, Gary. [Laughter.] It makes sense, though.
You talked a little bit about machinery in this last topic. There’s a lot of machine reps in the audience today, a couple up on stage, too, so please chime in, if you have anything to add to the discussion. Considering today’s business conditions, the climate we’re in, the machine lead times, how are you guys projecting? How are you looking so far down the road to say, “Oh, I need a new flexo. I need a new die cutter.” How can you possibly be looking a year, year and a half down the road and say, “I need something,” when that’s the kind of lead time you’re getting at the moment?
Brewer: I don’t buy it and build the book of business on it. I build the book of business and then buy it to support it. I’m not looking at two years down the road, what do I think I’m going to need. I develop that need and then maybe find a partner—a friend with a boat—and have them take care of it for me until that new machine comes in.
Morelli: Finn, I don’t know if you can speak to this. You’re putting a brand-new, beautiful facility in and, I’m sure, putting new equipment in. What are your thoughts on how you project down the road?
MacDonald: My only thought was, 10 or 12 years ago, when we signed a 10-year lease, it wasn’t a 14-year lease. Time just allowed us to get ahead of this tightness that we’re in. Because of that, the one thing that’s kind of interesting is there’s an opportunity for a lot of different folks to be a part of our growth. If you can’t get something new, but you need something, then you might get something used. If you can’t get something used, but you need to retrofit or refurbish or build up, then you can do it. There’s a lot of options out there. There’s a lot of great options. There’s a lot of ways to get around this. I think if you develop a network of folks who can say, “Listen, let me understand what your end game is, but let me help you move the pieces to get there”—we’ve got partners out there who are that creative. They’re thinking the way I think, and then they come to me, and they bring me that, and it’s very, very refreshing to have those sort of allies. I tell you, if you’re one of the few who do that, then you’re going to be in the mix for a long time. Great opportunity.
Morelli: Does the uncertain time today, over the last couple weeks with everything going on in the world, put any hesitance in your mind right now? Is there any hesitance to the risk level that we might be living in right now?
Davis: I think a little bit, for sure, but the encouraging part, we’re blessed to be in this industry, and this industry has been pretty good throughout the pandemic. I do feel that habits have changed. Whether it’s out of fear or convenience, people are ordering stuff online. And it’s kind of “What do you want to do with your Saturday?” and it’s not “Go shop at Target.” The two of the three economists that spoke this afternoon, they encouraged us to buy equipment. That kind of stuff helps reinforce what we’re doing and gives us some confidence that the industry is strong and going to continue to be. Even though there is inflation and some uncertain times ahead, again, we’re blessed to be in this industry.
Brewer: Yeah. Hesitancy is not on the table now. Our industry’s doing well. We have our challenges, but we have to just press forward, make the decision, and keep pressing. There’s no bubble out there, in my mind. I’m not worried about that. We’re just on a trajectory.
MacDonald: If you think about where they project the ripples, I don’t know if they project that there are going to be fewer problems, and the world is going to slow down, and folks are going to want much, much more of the same and much, much, much less of something unique and different and very focused on their business. And that’s the heart of what we do. There might be some layers above and below that could change, but the heart of what’s going on, I think, still has a bright future. It’s hard to solve labor, but we can throw technology at more quickly, more efficiently diagnosing a machine problem, get there before it happens so we save the downtime. We can communicate more easily within the plants. We can’t throw people at problems, but we can throw communication and labor and process. I think if we can do that, our little sector of manufacturing can remain bullish.
Morelli: Gentlemen, I just want to thank you personally for helping me out in doing this today and bringing something a little different to this meeting, something that might change the pace a little bit and hopefully brings a bit of value to everybody in this room. Hearing directly from you on things that matter to these people is what we were trying to accomplish as a team. So, thank you all very much.