“Carpenters make the best printers”

 

Guus Leguit and his good friend and colleague Theo Noordman used to supply electronic scales to butchers. When they decided to print and sell labels as well, they had no idea how successful their business would become.

 

It all started in a small workshop in Alkmaar

When butchers started switching from ordinary scales to electronic ones in the early 1980s, Theo Noordman and I were the first to sell those sorts of scales. Then we noticed that customers always ordered boxes of labels and till rolls as well. So, in 1995, that gave us the idea to sell labels too. We soon bought our first printing machine and started production in a small workshop in Alkmaar. That was the beginning of Optimum Group. In 1999, we were joined by Dave for the commerce, Karina for the data processing and Rajesh for the printing. Now we print labels of every type and size for thousands of customers. We do that on fine-tuned printing presses. Operating them requires real precision, that’s why we sometimes say that carpenters make the best printers.

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Switching to the euro

The big change-over in the world of labels came when the Netherlands switched from the guilder to the euro in 2001. This transition created an enormous demand for labels because the old guilder labels had to be replaced. Thanks to our great flexibility and competitive pricing, we were able to cater for a slice of that demand and thereby acquire an interesting market position. Most of the money we earned was always re-invested in the business. When big investments had to be made, for example in machinery, we could always fall back on our own resources.

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The crisis worked out well for us

Unlike many other businesses, we benefited from the crisis. Consumers had less to spend and started buying in smaller quantities. As a result, kilo packs made way for smaller packs, and suddenly more labels were needed. We could never have anticipated that things would move so quickly. In November 2008, we relocated to our new premises in Alkmaar and, in the same month, we had our best monthly turnover ever up to that point. We were even still producing labels with the obsolete machinery in our old premises which were already half empty. After that, growth continued without interruption.

 

They call, we deliver

For us, the most important thing is being able to deliver as soon as a customer calls. Suppose we get a frost tonight, and the farmers have to harvest the kale. It’s no good delivering the labels a week later. We are able to respond flexibly to customer demand by buying in bulk, keeping adequate stock and keeping our workforce motivated. We do that by being completely transparent: we show everyone what is happening here, what the revenues are, how much is being earned and where the costs lie. If you are working your socks off while your boss is driving an Audi but is still too tight to buy a new screwdriver, you soon get fed up. That’s why we make sure that our people can do their work well and get paid a decent wage for it. I am a director, but I don’t feel I’m too good for any job; if the corridor floor is dirty, I pick up the mop. And I expect others to do the same.

 

If one of us is against it, we don’t do it

Theo and I have been friends and companions for thirty years. We are different in character, but we have the same ideas. Every decision we ever made was made within one day. We have built up a splendid business with a lot of growth potential. But, partly with our age in mind, we started to realise that if one of us drops out, the other will be left with a huge problem. The one who remains would bear sole responsibility for the entire business operation and the family would have to be bought out. Apart from that, buyers don’t queue up to do business with companies that have one owner because of the reliance on that one owner-director. So we asked ABN AMRO to explore the options for a new future. Things moved very fast since then. As well as two other private equity companies, Edo and Renee from Mentha Capital sat down to talk with us. We immediately clicked with them at the personal level and we were very interested in what they had to say.

 

Strategic reconnaissance

Mentha doesn’t get involved in the operational business; they leave that to us. What does concern them is how we can continue to grow. To answer that, we made a strategic review of the market with Mentha. This showed that the market is not going to grow anymore in the Netherlands and small printing firms with a turnover of 3 or 4 million are going to have a hard time. These are mainly family businesses that find it difficult to handle procurement tenders and which have to deal with succession problems. The market will then develop in the direction of innovative technology and new products.

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Buy & build strategy

Together with Mentha, we outlined a buy & build strategy. The aim is to grow over the coming years into a company with a turnover of between 40 and 50 million. The first step has already been made: we recently acquired Etipro and Optimum Group has merged with Villa Etiketten. At a stroke that gives us a turnover of 25 million – double the turnover of 2013. In addition, Villa specialises in digital printing. We anticipate strong growth in the digital market but we weren’t involved with it ourselves at the time. However, we can also grow in breadth, towards other forms of printing and other systems such as wrap-around labels, booklets, foil printing and flexible packaging.

 

Everything is shipshape

Mentha came on board exactly a year ago and now everything is shipshape. That has given us peace and enabled us to focus on the future. Mentha knows about acquisitions and everything they involve: due diligence, for example, but also strengthening the organisation and making it more professional. That is ideal. Theo and I can now concentrate again on what we do best: serving our customers.

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