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May 1, 2006 12:00 AM
Dallas lore holds that Padgett Printing was founded more than a
century ago on the corner of Main and Ervay, the very spot
currently occupied by Neiman Marcus’ flagship store. Others
challenge this claim. “Well,” says Don Padgett, a
co-owner and company director, “If it isn’t true, it
ought to be.”
But there’s no disputing the family-run company’s enduring legacy, or its remarkable recent achievements. We recently visited with Don and his cousin Winfield, (who is a co-owner as well as the company’s chairman) and David Torok, president and CEO. We learned more about Padgett Printing’s 103-year history as well as how the family-run business evolved from a struggling $8 million company in 1989 to a thriving operation with more than $29 million in annual revenues in 2005.
Grandfather Cyrus and his sons, Jay D. and Hal “I’ll
start,” volunteers Don Padgett. “As the sign out front
says, the company was founded in 1903. It was a little downtown
printing office with one hand-operated press. My grandfather,
Cyrus, ran it.”
By 1922 when Cyrus Padgett’s sons, Jay D. and Hal Winfield Padgett joined the firm, it had grown large enough to relocate several times. The company moved to Harry Hines Blvd., a business park near downtown Dallas, in 1948.
“It was a trade shop with a high level of craftsmanship,” says Don. “[My uncle] Hal usually handled sales and public relations. My dad [Jay D.] was interested in mechanics. He would be very happy when a press broke down and he could crawl under it and fix it.”
In 1950 and 1951, Don, a Notre Dame graduate, worked at the
company during school vacations. After earning a business degree
from Notre Dame, he joined the Navy. “Winfield is some 13
years my junior, but we’re both destroyer guys, fighting Navy
men,” says Don.
Win served in Vietnam, and qualified for the Combat Action Ribbon. During the Korean War, Don served as Supply Officer on the USS Maddox and was awarded the Combat Action Ribbon as well as area ribbons for service in Korea and the Far East.
Following his military service, Don returned to the company where he briefly worked in sales prior to going to law school. After earning his law degree from Southern Methodist University, Don served as Padgett’s corporate secretary while also practicing business law with two Dallas law firms. “I was strictly here part-time,” he explains.
The offset era begins
For the first 70 years of its existence, Padgett was a letterpress operation. From its roots as a trade shop, the company eventually branched out into publication work. In the 1950s and 1960s, many large corporations were moving their headquarters to Dallas, prompting the printer to do more advertising work.
Winfield a Princeton graduate, served as a communications and deck officer aboard two U.S. Navy destroyers in the Pacific prior to joining the company. When Win joined the company in 1972, the shift to offset was under way.
“We still had two Miehle verticals in 1972,” recalls Winfield. “We also had a couple of Heidelberg platen presses, some Merganthaler Linotypes and a Vandercook proof press. These machines supported our budding offset operation with two- and four-color 38-inch and 50-inch equipment.”
Dee Trizza, Padgett’s president, believed anyone who was selling printing should be thoroughly grounded in all aspects of the business. Winfield, like all of Padgett’s salespeople at the time, gained experience in every department. Winfield worked in the pressroom and bindery, drove a delivery truck and even was a receptionist before spending four years as an inside salesperson and about three in outside sales. “Nothing was handed to you in sales,” he says. “You had to develop your own accounts. That’s how I got involved in the community.” Winfield has served on the boards of many civic, charitable and creative groups, including The Greater Dallas Chamber, the Dallas Convention and Visitors Bureau, Dallas Advertising League, Art Institute of Dallas and Better Business Bureau of Metropolitan Dallas.
A Texas-sized challenge
In 1989, the Padgetts realized they needed a new strategic direction. “We needed a good operations guy,” says Winfield Padgett who was selling as well as managing the company then. “I realized I couldn’t provide that.”
The late Nolan Moore, then president of PIA Texas, suggested the company contact David Torok. Torok was then with Hurst Printing (Dallas), which was a wholly-owned subsidiary of Packaging Corp. of America in those days. Prior to joining Hurst in 1987, Torok spent 12 years with Western Publishing (Racine, WI) in a variety of operations and marketing positions.
In 1989, Torok was hired as president and CEO. His first
priority was to get the company on firmer financial footing.
“I did a quick reorganization,” says Torok. “The
company’s best sales person was also running manufacturing,
too. He was good at it and loved tinkering with the presses, but we
needed sales, so we had him concentrate on that full time.”
The move quickly paid off—one year later sales jumped from $8
million to $10 million. Torok’s second priority was pushing
Padgett into the computer age.
“The day I showed up there were two computers in the whole company,” he recalls. “The CFO had one and the other one was in a box. Just taking that second computer and giving it to the receptionist to type invoices and proposals was a major step.”
In 1990, Padgett installed EFI’s Logic management information system (MIS). “It allowed us to continue growing without adding office staff,” says Torok. “We eliminated time consuming manual reporting—everything was manual then: estimates, cost sheets, all production statistics.”
‘Never in doubt’
As with any organizational change, things didn’t always go smoothly. “There were some difficulties,” concedes Don Padgett. “But while there was a [period of] adjustment, the decision [to hire Torok] was never in doubt.”
The Padgett cousins say it was clear from the outset that Torok was in charge—there would be no leaning on seniority or old family ties to circumvent his authority.
Torok spent hours in frank discussions with his management team during his first year on the job. “We probably met offsite every two weeks,” he says. “I did 90 percent of the talking, telling them the direction, the value proposition Padgett was going to have.”
Torok also spent a lot of time in the plant. “I would come in at 7:15 a.m. and spend time in every department,” he says. “I went to every scheduling meeting for the first year. We refocused our CSRs’ [outlook]. We said, ‘You are representing the customers at this meeting. If there’s something that will impact your customers, bring it up at this meeting so we can make good decisions.’”
CSRs also assumed some duties previously shouldered by salespeople. “We need to keep the salespeople out selling,” says Torok. “If they can make one more call a day, get one more estimate a week, they can sell one more job a month.”
Efficiency was equally important on the equipment side. “We knew that run sizes were getting smaller and demand for color was going up,” says Torok. “So all equipment purchased from the 1990s on was acquired with the goal of reducing makereadies and set up times to the bare minimum. If you could save 10 minutes on every makeready, that was more significant than running the press 2,000 sph faster.”
The company also wanted to ensure that it could meet creative customers’ requirements to print on a variety of stocks, including recycled and uncoated. In the 1990s, Padgett had the first eight-color press in the Southwest to offer waterless printing: an eight-color 40-inch Komori Lithrone equipped with Coatermatic coating system. Since then Padgett has added a Heidelberg eight-color SpeedMaster 102 perfector.
In 1998, Padgett installed its first digital press, an Agfa Chromapress. “It was a major decision,” Torok says. “We did some focus groups with our customers and realized there was a market for color digital printing, but if you’re going to make money with it, variable is where the value-added [opportunities are].”
Early on, Padgett created a brand name for its digital business (“Maestro”) and hired a dedicated database manager as well as marketing manager. Nonetheless, digital print took some time to catch on.
Kissing every frog in the digital pond
“We quickly realized if you build it, they don’t necessarily come,” says Torok. Finding the right salespeople was very difficult—we kissed every frog in the pond.”
Padgett’s quest for the best digital salespeople included offset veterans, digital print experts, production managers, former agency employees and people outside of the printing business with backgrounds in target markets. The most successful salesman joined the company after his original employer, an all-digital shop, went out of business. (The defunct company had previously farmed out its offset work to Padgett, so there was probably a certain comfort level for all concerned.)
Today, digital printing accounts for more than10 percent of Padgett’s business, a number it hopes will grow to 12 to 15 percent in the next few years.
In 2001, Padgett added two Kodak Digimaster 9110s, later adding a Kodak Digimaster 9150 and a Xerox 92C spot-color device. Padgett does a brisk business imprinting shells produced on its offset equipment, which includes a Harris M-110 web press for direct mail inline finishing, in addition to the previously mentioned 40-inch presses. Padgett eventually replaced the Chromapress with two Kodak Nexpresses, the first in 2004 and the second in 2005.
Padgett now has the capacity to mail more than 700,000 pieces per day. There’s a low barrier to entry,” says Torok. “But a good mailing supervisor and database manager are essential.” Mailing and fullfillment is a growing area: To expand these services, the company just acquired 15,000 additional sq. ft. across from its main plant.
Although Padgett has an impressive array of equipment, Torok says people are the company’s greatest strength. “Our value proposition for our customer’s is peace of mind and ease of doing business.”
The company’s in-house production, database and postal experts provide peace of mind. Customers also can count on a stable workforce—many of Padgett’s employees have been with the company for more than three decades.
Padgett’s customers know that a real person will answer their phone calls. In addition to a full-time receptionist (a.k.a “director of first impressions”), key employees have internal wireless phones, enabling them to take calls virtually anywhere in the plant.
Plenty of Padgetts
A couple of Cyrus Padgett’s great grandchildren are following in his footsteps: Don’s oldest son, David, joined the company in 1993 and was promoted to director of strategic planning a few months ago. Winfield’s daughter, Lauren, a recent college graduate, is working in the purchasing department.
While the Padgett Printing team is proud of its 103-year legacy, it is equally proud of its flexibility. The company continues to change and grow with the times while still retaining its family atmosphere.
“We have the right technology, suppliers, people and customers,” says Torok. “We’re very comfortable about our future and where the company is going. It’s a good time to be here. As we say in Texas, we’ll ride the horse as long as we can.”
The right team
Padgett Printing’s president and CEO, David Torok, says Padgett’s strong management and employee teamwork help him cope with what would otherwise be an impossible schedule. “I’ve got 100 things I want to do every day. I can’t do it all myself, so I depend on them. I count on everyone here for good ideas—it’s my job to make them happen. We have the right team. I don’t have to worry about what’s on the press at 2:00 p.m. That enables me to step back and think long term.”
In addition to Torok, Padgett’s management team includes Chip Chebuhar, vice president/sales manager; David Marsh, chief financial officer, and Rick Olsen, plant manager. Torok says eventually the team will include a chief information officer. “IT will [soon] have the greatest ability to provide all the solutions and services customers require.”
What’s the secret?
Today, Padgett Printing has 125 employees and annual revenues of more than $29 million. Its customers include retailers, financial service companies and agencies. How has it survived when so many other printing companies haven’t?
Don Padgett credits the management team’s unique combination of talent and personalities. “The stability and conservativeness of one person is counterbalanced by the aggressiveness of others.”
David Torok agrees: “It’s the right people. We have an outstanding sales force and we allow them to do their jobs. We also don’t bet the farm on debt structure.”
Winfield Padgett adds that the company has taken a progressive but realistic approach to new technology. “A lot of companies are enamored with metal, machinery and technology. We’ve never lost sight of the market, customers or financial structure.”
Katherine O'Brien is editor of AMERIAN PRINTER. Contact her at KOB@americanprinter.com.