Reprographics 101

This is a rant, unrelated to the Reprographics business and industry. So, if you don’t want to waste your time reading one of my rants, skip this one!

I don’t know why people are so fixated on the AIG bonus thing. In “the scheme of things”, the AIG bonus issue is nothing more than a tiny pimple on a very large elephant’s ass.

It seems like every time our politicians get the opportunity to bash someone for something that happened that was stupid (or greedy or an oversight), they totally jump at the opportunity to climb on the bandwagon and shout-out about it, simply to get brownie-points and notoriety for shouting-out about it, even when the issue, in the scheme of things, is very minor. Do they not have better things to do with their time? Is that what we elected them to do?

Our Representatives and Senators and the Administration should stop the bull-shit about the AIG bonuses, and get down to the serious business of going after the ‘real money’ that was scammed from the financial system. That ‘real money’ is why we are shelling out billions and billions of taxpayer dollars.

I’m far less concerned about the recent AIG bonus issue than I am about the 60 some trillion dollars in insurance coverage that AIG evidently wrote on stuff that it insured, and because of that, the hundreds of millions of dollars, if not billions and billions of dollars, that AIG officers and executives and shareholders pulled out of AIG over the past 5 (or more) years!

What a scam! Can you imagine being in the insurance business and selling insurance coverage – in return for premium payments – even though your business will never be able to cover the claims? The premiums that AIG charged (for insurance on various types of debt obligations – what do they call that type of insurance, “credit default swaps?”) were enormous, and those premiums were, of course, considered “income” to AIG. And the “income” from those premiums was used to fund huge bonuses and compensation packages handed out to AIG officers and executives. How long did this damn scam go on? Was it one month, five years, ten years? Hell, I don’t know.

Since Congress sets the law, they should get down to the business of coming up with a “recapture tax.” I’m not talking about a recapture tax on the recent AIG bonuses, but a recapture tax that goes back five, maybe even more, years. Let’s get serious about this – what our congressmen (congresspersons, to be politically correct) should be doing is going after the earnings that were distributed that, in reality, were based on fictional income.

And, while they are at it, AIG is not the only financial institution that paid out huge sums of money over the past several years based on fictional profits. Go after the other insurance companies, investment banks, banking institutions, and mortgage companies and mortgage originators as well.

The other evening, one of the Sunday evening news shows, I can’t remember whether it was DateLine or 60 Minutes, aired several stories about the mortgage lending business. One of the mortgage companies profiled was “People’s Choice”. Is it not clear to everyone that People’s Choice, and other companies like P.C., knew that they were selling mortgages to lots of people who could not afford those mortgages, to people who had insufficient income to justify the mortgages, to people who would eventually default on those mortgages? Even the mortgage company insiders referred to them as “liars loans!”) Mortgage companies (I should say their executives, officers and insider-shareholders) didn’t care who got a mortgage, because they weren’t going to hold the mortgages they sold. All they cared about was earning fees on the mortgages they put out. They earned fees from the people who got the mortgages and they earned fees when they sold the mortgages to investment banks and other financial institutions. God damn greedy SOB’s. Everyone one of us (I’m talking about every U.S. taxpayer, and eventually, all our children, once they become taxpayers) will pay dearly for that greed. Damn it, our congresspersons and the administration need to get serious about this. They should put into place a five-year (or more) recapture tax to get back the money that these greedy people scammed from the system.

My ATF comedian, Lewis Black, would likely say something like this ….. holy-shit, somewhere, someone is getting fucked!

Reported in the Saint Petersburg Times on March 23, 2009:
OSI Restaurant Partners Inc. got some much-needed breathing room from its debt burden by buying back some of its high-interest junk bonds at about 33 cents on the dollar. In a tender offer managed by Miller Buckfire & Co., OSI, the Tampa parent of Outback Steakhouse, Bonefish Grill and Carrabba’s Italian Grill, paid $73 million to retire $240 million in high-interest, unsecured debt due in 2010. (It is my understanding that these bonds carried an interest rate of 10% and were due in 2015.)

Gee whiz, it would be cool if the bank that holds the mortgage on my house would accept my “tender offer” to purchase my mortgage from them for 30 cents on the dollar. If I originally paid $300,000 for my house and, at that time, took out a mortgage for $300,000, I’d have no equity in my house, but I’d be on the hook for $300,000.

Then, roll the clock forward about two years. I call the bank, tell them that I’m in financial trouble, may not be able to pay my mortgage payments, and that I may be on the brink of bankruptcy. And, then, I offer to buy my mortgage from them for $100,000 cash. If they accept my offer, the cost of my house would end up being just that, $100,000, instead of the $300,000 I had originally paid. Cool beans. Great deal for me, but someone got fucked.

Back to OSI, the parent of Outback Steakhouse (and several other restaurant chains), in 2007, Outback’s original founders teamed up with Bain & Co and Catterton Partners, two private equity groups, to take OSI private. Purchase price was somewhere around $3.2 billion. Most of that purchase price was financed with bond debt. In order to finance the LBO (leveraged buyout), a bunch of bonds, unsecured debt, what people refer to as “junk bonds,” were underwritten (by guess who – Lehman Brothers) and sold. To whom those bonds were sold, I have no idea. It could very well be that Lehman Brothers held onto some of the bonds for its own portfolio, and/or that Lehman Brothers sold the bonds to investors, and/or that Lehman Brothers packaged these junk bonds with other junk bonds into one of those indecipherable “structured investment vehicles” (SIV’s) and sold those SIV’s to investors. (Perhaps even some small town in Norway or Sweden bought these bonds as a “safe” investment.)

Well, roll the clock forward to “present day”; OSI’s business is not doing well (to put it mildly), chain restaurant businesses, Outback among them, are suffering because of lower revenues, and OSI is losing a lot of money. One cure to OSI’s problem – lower its debt. Well, with the purchase of some of their bonds at 30 cents on the dollar, they just did that.

Which provokes two questions:

(1) Where did OSI get the money to buy back its bonds? Well, I would imagine that that money came from OSI’s shareholders – Bain?, Catterton?, OSI/Outback’s original founders? All of them have “deep pockets.” As to Outback’s original founders, they got very rich when they took Outback public years ago, and they got even richer when the company was taken private. With the recent buy-back of bonds, the owners of OSI, just realized a $167 million reduction in the purchase price they paid for OSI.

(2) Inasmuch as $240 million in bonds was just bought-back for $73 million in cash, who got fucked? Someone did. Who “tendered” (sold back) their OSI bonds? Could it be that the firm running the liquidation of Lehman Brothers sold back to OSI, OSI bonds that were still in Lehman Brother’s portfolio? Could it be that some of the banks and financial institutions (those we are bailing out with taxpayer money) were holding OSI bonds in their portfolios (toxic assets?) and that they are using taxpayer money to cushion the consequences of losing money on their sell-back of OSI bonds?

(By the way, I do occasionally go to OSI’s restaurants, including Outback, Carrabas, Bonefish, Leroy Selmon’s and Roy’s, and I like all of them; I think they give you a good deal for your money. I especially like the 2,400 calorie “Bloomin’ Onion” at Outback, but I can only order that when my wife is not with me.)

Now, since my blog-site is supposed to focus on stuff and issues related to the reprographics industry, I think I should relate this OSI crap to the reprographics world ….. your world, your business.

We’ve talked about “right-sizing” your business during this recession. (I previously did a post on that subject.) In addition to all the other things that you can do to “right-size” your business, why not consider attempting a restructuring or buy-back of your company’s debt. Why not go to your lessors and banks and ask them if they’ll take 30, 50, 70 (or whatever) cents on the dollar for your outstanding lease debt and/or loan debt? Certainly some of you must have rich Uncles or Fathers or Grandfathers (or being politically correct, rich Aunts, Mothers or Grandmothers) who will, if asked, cough up cash to buy out or buy down your lease or loan debt? Well, that’s it for my ridiculous thought of the day.

Over the many years, one of the things that’s always bothered me about IRGA Convention Educational Breakout Sessions is when a specific Educational Breakout session covered anything having to do with “how to streamline / improve a reprographics business and make money”, but was led by someone who has never been in the reprographics business.

How in the world can any person give relevant advice as to how to operate, change, revise, update, streamline a business, or improve profit, when that person has not had (himself or herself) any direct experience operating (and, along with that, managing the top, middle and bottom lines of) a reprographics company?

Many, many years ago, after listening to a speaker at the IRGA and shaking my head “where in the world is this guy coming from? I don’t agree with 80% of what he just finished talking about” ….. (I can’t even remember what the topic of that particular Educational Breakout session was, but that’s not the point of this post) ….. a friend of mine (one of my mentors), also in the audience, leaned over to me, and said, “Joel, consider the source.”

After hearing those words from one of my mentors, I have, ever since then, told friends that, when they attend IRGA Educational Sessions and hear “experts” talk about various subjects, “you must first consider the source” (meaning, who said that, what is that person’s background, and what is that person’s direct experience?) if the speaker has had considerable first-hand experience, that would give me reason to think hard about what was said, and, just to the opposite, if that speaker has not had any first-hand experience, that would give me reason to wonder if I should even think, even a little bit, about what was said.

CONSIDER THE SOURCE!

On March 3rd, I did a post about the idea of developing and periodically publishing a “reprographics industry” barometer.

To date, I’ve had not a single response about that.

What that “zero response” means to me:

a) that no one trusts that I would keep their sales numbers confidential
[Even though I pointed out in that post that I would not be the one privy to individual company sales numbers. Damn, several years ago, a poll taken by People Magazine said that CPA’s were the most trusted professionals. And, I am a CPA. Well, frickin’ Enron changed all that, huh?]

b) that having a barometer is of zero importance to all of you.
[One has to wonder about that one, because if I were still in the reprographics business in the U.S, I would definitely want to be able to compare my company’s sales trends with a barometer compiled from the sales results of other independent reprographers. While not a genius, I do consider myself fairly smart (my wife would disagree). Therefore, if I think it is a smart idea, but none of you do, then you can probably well imagine what I’m thinking about your “smarts’ at this moment.]

Okay, the “barometer” project is not going to happen.

As of March 23rd, my blog-site has been visited by 100 “unique” visitors! To me, that number is a significant milestone.

– European reprographers from Germany, France, Belgium, The Netherlands, Sweden, Switzerland, The Czech Republic and the U.K.

– U.S. reprographers from Maine to Florida, from New York to California, and from Minnesota to Texas (visitors from 24 U.S. states so far.)

Please kindly refer my blog-site to your friends and associates in the reprographics community. You never can tell when I’ll finally post something that’s good information.

To those of you who have let friends know about my blog-site, thank you, much appreciated.

One of the worst things about a recession, if not the worst, is the fact that people are laid off (softer way of saying “terminated’) when a company “right-sizes” its business.

The other day, I received an e-mail from a former associate in the Washington, DC area; he sent me that e-mail to inform me (and a few others) that Mr. Leon Porter was terminated from MBCPI, the ARC-owned division that operates in the Washington-Baltimore Greater Common Market Area.

Mr. Leon Porter is 73 years old. Mr. Porter had been with MBCPI (or, I guess I should say, with the entities that are now a part of MBCPI) since around 1958. If I’ve done the math correctly, Leon worked for the company for some 51 years [except for two years off for military service, 1960-1962.]

Around 1958, Leon became a team member of Max Scher Blueprints (Max Scher Blueprints was founded in 1922.) In 1979, Max Scher Blueprints merged with Rowley’s Blueprint Service to form Rowley-Scher Reprographics. (My company, Allied Reproduction Service, merged into Rowley-Scher in 1981.) Around 1992, Rowley-Scher’s name was changed to Reprographic Technologies (RTI). And, not long after ARC acquired MBCPI, RTI was rolled into MBCPI. Leon survived a whole host of mergers, name changes, ownership changes and consolidations – some 51 years worth!

My ex-partner, John Scher Zeller, sent me a copy of a letter that he, a few days ago, sent to an ARC senior operations officer about Leon Porter. I’m not going to post the entire letter on my blog-site, but I did want to share with you some of John’s comments:

Leon, began working as a 17 or 18 year old, with no direction in life other than knowing he needed to earn a living and did not want to be on the streets as they existed in Washington, DC in the 1950s. My grandfather, who was an excellent judge of people, hired Leon and told him that as long as he showed the desire to learn and grow and performed his job well, he would have a job with the company.

Throughout the years Leon progressed in his knowledge and abilities in what was at first a slowly changing industry but one that has had many changes over the past 25 years. Leon Porter was consistently a steady and reliable employee for whoever owned and operated the business. In my humble opinion, he is the ultimate team player, the type of person who is essential to the success of any people-oriented business. Thus, I felt a great deal of sorrow and a certain amount of anger when I heard that Leon had been recently laid off.

One of the greatest regrets former business owners have is the fact that once we sell our companies, we cannot control the destinies of our former team members; the team members who worked with us in the trenches, toiled by our sides, did whatever was asked of them.

Leon Porter is an outstanding individual. Inasmuch as there is no “I” in Team and inasmuch as teamwork is necessary in the reprographics business, I should not fail to say that Leon was the “exemplary” team member. Anyone who worked with Leon, whether in the 50’s, the 60’s, the 70’s, the 80’s, the 90’s or in the 21st century, would, I’m sure, share John’s opinion (and my opinion) of Leon Porter.

Companies in the service industry – and the reprographics industry is a service industry – are built on their “people-assets.” If a company has great people-assets, it will do well. When you lose (or terminate) great people, your business can and will suffer. Leon Porter was respected by everyone who worked with him and by the customers he served. For ‘survivors’, it must be very heart-wrenching, and, yes, demoralizing, when a loyal, long-standing team member such as Leon is let go.

After procrastinating for at least two months, I finally got around to registering for the IRGA Convention that will be held in Pittsburgh this year.  I always look forward to attending the IRGA convention; great opportunity to greet vendors, greet friends, make new friends, learn new things (what’s working and what’s not working), and get educated.  (One is never to old to learn!)

FM 2.0: Take Your FM Business to the Next Level
Panelists: 

I’m pretty sure I explained in a previous post that my hobby is following the reprographics industry. That simply means that I do my best to follow what companies (reprographers) in our industry are doing and what industry associations are doing, among other things.

Today, while surfing the web for reprographics-related information, I came across a presentation that Shaun Meany, President of The PEiR Group, posted on the web. The title of that presentation, “PEiR Executive Briefing 2009”, and, if this works (and I never know that it will work), here’s the Internet address where you can access that presentation:

http://www.slideshare.net/shaunmeany/PEIRExecutiveBriefing-2009

In that presentation, Shaun shares the benefits offered to reprographer-companies that join the PEiR Group. Shaun’s presentation was very well done; brief and to the point.

I’d like not to play favorites (and I don’t really have any favorites), so if ReproMAX, RSA and GlobalGrafixNet would like me to point blog-visitors to the lists of benefits their associations offer, I would be more than happy to post that information (or links to that information) on my blog-site.

As of March 17, my blog-site has been visited by 85 “unique” visitors.

The number of visitors to my blog-site jumped up substantially over just the past few days. I think that’s because I returned from Europe this past weekend and finally had a chance to go through the business cards (i.e., e-mail addresses) I’ve collected since i retired from NGI in Dec 2007.

– European reprographers from Germany, France, Belgium, Sweden, The Czech Republic and the U.K.

– U.S. reprographers from Maine to Florida, from New York to California, and Minnesota to Texas (visitors from 23 U.S. states so far.)

Please kindly refer my blog-site to your friends and associates in the reprographics community. You never can tell when I’ll finally post something that’s good information.

To those of you who have let friends know about my blog-site, thank you, much appreciated.

The post just before this one revealed the 5 worst decisions I made in the reprographics business. While I had given some thought to writing a post about my 5 all-time best decisions, I’ve decided, at least for now, to talk a bit about the FM business, because getting involved in the FM business was, without question, one of my 5 all-time best decisions.

As I look back over the two extended careers I had in the reprographics business, I cannot find a single decision that had more of a positive impact on our businesses than getting involved in the FM business. For those of you who are in the reprographics business but who are not now, or have never been, involved in the FM business, I don’t know what you’re thinking (or smoking?), but you’re missing the boat, don’t have a clue and are leaving your flank open to attack.

Business is a war. Unfortunately, it is a war that never ends. (Or, perhaps I should say that it does not end until you retire from the business or sell your business.) To stay ahead of your enemies (your competitors are your enemies), you’ve got to win more battles than they do, and your victories have to be more significant than your defeats.

Those of you who know me personally and/or who have heard me talk about the FM business, have heard me say, “an effective FM business segment can be your best offensive weapon AND your best defensive weapon.”

Speaking in the present tense …… Our objective (well, at least it was my objective) is to grow our business to be the “market-share” leader in our particular market (or, if you are a multi-market enterprise, to grow your business to be the “market-share” leader in all of your markets.) An effective FM business segment not only helps achieve that objective, it is, IMHO, essential to achieving that objective.

100% market share is the sum-total of all of the individual “account shares” in a particular market. What I’m getting at here is that, if you manage to lock-up an account’s business, you score 100% account share. And, if you repeat that success with the majority of the accounts in your market, well, guess what you end up with? Majority market share. And, when you are in that position, then your sales should be higher than your competitors’ sales, and, if you are selling “service” and “solutions” rather than “price”, your profits will also be larger than your competitors’ profits.

An effective FM business segment can position you to grab 100% account share with customers who were not previously your customers (or with customers you were sharing with competitors). That’s the “offensive” nature of an FM business segment. Provided you know what the hell you are doing, FM’s can be a very powerful offensive weapon.

An effective FM business segment can position you to secure 100% account share with customers who were already your customers. Regardless of whether your FM strategy allows you to grab and lock up new business or allows you to lock up existing business, the “lock up” nature of the FM business is a very powerful defensive weapon.

To me, the FM business has two parts – unstaffed FM’s, which, to me, are kind of like the vending machine business – and staffed FM’s, which, to me, are kind of like “our store inside the customer’s office.” The FM business is not all that difficult to get into or operate, but it does take a lot of thought and concentrated focus. While many reprographers have the same FM-business-strategy, some reprographers’ FM strategies are different. I’m not going to get into a discussion of FM business strategy. I could, but I’m not going to.

How does one learn what the FM business is all about?

Well, the best way to learn is to learn from your friends in the industry who are not competitors. That’s one of the reasons why I am a huge proponent of reprographers being members of the IRGA. When you attend IRGA conventions, you meet reprographers from all over the U.S. (and some from Europe and Japan), and some of those you meet are, if you simply ask them, willing to share their FM experience. Don’t just take one person’s word for what the FM business is, talk to several people who’ve had experience in that business.

I mentioned in an earlier post that ARC’s PEiR Group has held at least two FM Sales Schools, open to PEiR Group member-companies. For any reprographer who is interested in getting into the FM business, attending a PG FM Sales School is a must. When I attended both of the PG FM Schools I went to, I was very surprised (or should I say “shocked”) that the number of attendees was low. Are there that many clueless reprographers out there? I guess so.

I have no idea if ReproMax or RSA have held FM schools for their member-companies. I they have, or if they plan to in the future and if you are members of those organizations, go to those schools.

The more you learn about the FM business, the better positioned your company will be to get into the FM business, or, if you are already in the FM business, to improve the FM business you’re already in. Sorry, there is no easy way to learn the FM business; it takes a lot of time and effort to learn the various parts of the FM business (concept-pitch, survey-analysis, account-deal strategy, proposal development, selling the deal, invoicing, and operations.)

Funny FM story #1 – in 1997, my company, employing our FM strategy, managed to grab 100% account share in two different “major” accounts in one of our market areas. One of those accounts was already our customer (we were handling most of that customer’s outsourced reprographics work (but not all); that particular customer had, for many years, been (and still was) operating a significant “staffed” in-house print room. We convinced that customer to allow us to implement a staffed FM program. Overnight, (at the moment we implemented our staffed FM program) the competitor who was selling paper/toner/developer/service and leasing equipment to that customer was, as they say, “out the door.” The other account we took away from that same competitor (likewise, scoring 100% account share) was not our customer before we implemented a staffed FM. So, for us that deal was 100% new business. And, it turned into a multi-market FM deal. Prior to the implementation of our FM deal, our competitor was selling paper/toner/developer/service and leasing equipment to that customer. Like in the other case, our competitor lost its business overnight. In May 2008, several months after I retired, I ran into one of the partners who owned the competitor that we took those accounts away from. Very, very nice guy. He was aware that I’d retired from NGI. I asked him “how’s business?” He said that “of the many years we’ve been in business, we had our worst-ever December, not to mention a bad year overall.” And, then he said and asked me, “you took two of our largest accounts away from us in 2007, we thought our relationships with those accounts were solid and, as you know, we had our type of “FM” deals in place; how did you manage to take those accounts away from us?” I apologized for taking those accounts away from him, explained to him that we did not do that with “low pricing”, but I did not get into the details of how our FM strategy was different (and more pervasive) than his company’s FM strategy. FM strategies, reprographer to reprographer, can be very, very different.

Funny FM story #2 – in late 1983 at my first company, we got into the FM business at the request of a prospect! In other words, we had not done any planning, had not given it much thought, even though we were aware that reprographer-friends in NYC were doing FM’s. What happened? Well, a NYC-based Architecture firm had recently opened a branch office in Washington, DC. They called us to ask if we could provide reprographics equipment for their DC office, we told them that we did not sell equipment and that we would be more than happy to do their reprographics work at our production center, but the guy who called said, “I don’t think you understand what I’m asking you for. I don’t want to buy (or lease) any equipment. I want you to do that and place it at our office, and, oh by the way, I want you to provide all of the reprographics supplies we’ll need, and I want you to put one of your reprographics operators over at our office to operate the equipment you provide to us.” Okay, we finally “got it”, commenced our first FM program, and never looked back from there.

Funny FM story #3 – In 1986 and 1987, not long after we purchased a company in Boston, we sold and implemented 4 staffed FM deals. One of those FM deals was sold to a company we already counted as a customer. But, three of those FM deals were sold to a competitor’s customers. The competitor we grabbed those customers from was Charrette. For those of you who are too young to know this, Charrette was the largest reprographer in the Boston market at that time (and probably still is), Charrette later became Charrette ProGraphics (when the Charrette “supplies” business was split off into a separate division), and, later on, Charrette ProGraphics became Service Point U.S. When we sold those four staffed FM deals in the Boston market, Charrette was not in the FM business. (In other words, they had left their “flank” open to attack.) I know that our FM deals took Charrette by surprise. Many years have gone by since then, and, today, Service Point (who some older folks like me still refer to as Charrette) operates a very significant FM business, one of the large FM businesses in the U.S. I’d like to think that our entry into the FM business in Boston gave Charrette “food for thought” and eventually forced Charrette to begin its own FM business. Charrette went on to develop one of the most successful FM business segments in the U.S. reprographer community. (The SP parent company, HQ’d in Spain, says that SP, world-wide, has over 800 FM deals in operation.) A few years ago, I learned how they managed to become so successful in the FM business in the U.S. For about 12 years, SP’s FM business was led and managed by Mark DiPasquale, one of the brightest talents in the reprographics industry. Significant contributions were also made by Jane Simmons, another “bright (scary-smart) star” in the FM business in the U.S. reprographer community. Mark and Jane are certainly a “power duo.” (Neither Mark nor Jane are now with Service Point, having gone on to greener pastures.)

Funny FM story #4 – in October 1988, shortly after I retired from my first company, I was invited to go out to Los Angeles to meet with J.C. Smith, who was then the owner of Ford Graphics. The purpose of my trip: I had sent a letter to J.C. Smith to introduce myself as the recently retired CEO of Rowley-Scher Reprographics, and, in that letter, I explained to J.C. that my company had been very successful in developing an FM business segment, and that I was prepared to serve as a consultant to help certain select reprographers better understand and get into that business. After that letter, we spoke on the phone, and we agreed that I would come out to L.A. to discuss the FM business. As most of you are aware, ARC did not exist at that time. But, as most of you are also aware, Ford Graphics was the first “ARC” operation. So, I got out to L.A. and managed to find Ford Graphics’ office, which, as I recall, was in a building in Pasadena upstairs from one of Ford Graphic’s stores. We talked for about 3 or 4 hours. J.C. concluded that the FM business was not of interest to Ford Graphics, explaining to me ….. (and, although I’ve put “quote marks” around the following, there is no way I can recall verbatim exactly what J.C. said, but I think this sums it up pretty well) ….. “well, we have quite a number of large A/E accounts, and, if I get into the FM business all that’s going to mean is that I’ll have to purchase reprographics equipment for their offices and take people from my stores to operate that equipment; doing both of those things will drive up my cost of doing business, and, considering the fact that I already have their business and a good market share here in L.A., it doesn’t sound to me like getting into the FM business would be a smart decision for me to make.” I left that meeting a bit mystified as to how he came to that conclusion. But, oh well, what’s that old saying, “different strokes for different folks?” The other thing I would like to mention about my visit that day to Ford Graphics is that during the meeting, J.C. called his fairly new CFO into the meeting to introduce me to him. That was the first time I met Mohan. I don’t think that Mohan was in the room for very long, but anyone who had been there would have quickly realized, as I did, that Mohan was a very, very smart young man. It is my understanding, from reading ARC’s history that appears on http://www.answer.com, that Mohan, not long after I visited in October 1988, purchased Ford Graphics from J.C. Smith. We ALL know what happened after that! Anyway, now I’m going to move the clock forward to around May or June of 1995. That was around the time I decided I needed to get back to work (by then, having been retired from the reprographics business and industry for several years), and, after sending out resumes to a few reprographers I’d met over the years, Mohan introduced me (via phone call) to Suri. At that time, Suri was running Ford Graphics San Fran, and I flew up to San Fran to “interview” with Suri ….. for a “sales” position. Most of the interview consisted of me responding to Suri’s questions about how I took my former company public, but we also talked for a while about the “FM” business. Around 1990 (I may be off by a year), Ford Graphics San Fran was operating one staffed FM program, but this particular FM program was not sold by Ford Graphics, but, rather, was “inherited” by Ford when Ford purchased “Graphic Reproductions” from a guy by the name of Walt Walker.) In the words, even though Ford entered the FM business by buying Graphic Reproductions, Ford, several years later, had not expanded its FM business. Well, that would not have been easy to do in the San Fran market even if Ford had gotten serious about the FM business, because Paul Koze, back then, was the CEO of Blueprint Service Co. (BPS) and, for those of you who know (knew) Paul, one of the very scary-smart people to ever be in the reprographics business, you would know why I said that Ford would not have had an easy time growing its FM business in San Fran, even if it had wanted to, which, back then, did not appear to be a core growth strategy for Ford. (To digress for just a minute; I did not get the “sales” job; Suri, as I recall, tactfully said that I was “overqualified.” No hard feelings, I think he made the right decision.) Okay, let’s now roll the clock forward to the first week of December, 1996. Several months prior to that, I had made the decision to leave the “large-format color” enterprise I had joined in July/August 1995. I had decided, in the summer of 1996, that I wanted to get back into the full-blown “reprographics” industry; that being in the “large-format color business “only”, was not where I wanted to me. Sometime during the first week of December 1996, Suri flew down to have lunch with me in West L.A. It was kind of like another interview. And, given my experience with and the result from my previous interview with Suri in 1995, I was not anticipating a different result. Anyway, at our lunch that day Suri said something along these lines, “we are going to make 1997 the year of the FM at ARC.” In other words, ARC was planning to get seriously involved in the FM business. Well, Suri is the type of person you can take very seriously. Today, some 12 years later, ARC has over 5,000 FM deals in place. The only comment I can make about all that is that, while some get the point sooner than others, if you want your company to be a serious player in the reprographics business and industry, you will eventually have to understand that being in the FM business is essential, and “get to it.”

Back in my formative years in the reprographics business (1970-1980), I had “no clue” about the FM business. Had I attended IRGA conventions during those years, I probably would have heard of the FM business. At least one reprographics company in NYC had been operating FM’s for years. But, because I did not attend the IRGA conventions during those years, I was not aware of what the FM business was all about. As I said, some “get the point” sooner than others. And, some never get the point.