Three trends: if you want to grow - The Noel D'cunha Sunday Column

He was in Brazil for the Fifa World Cup finals. And he never works, his team members act on his guidelines. Kitagawa was in India early this month to inaugurate Toyo’s second plant in India at Dahej in Gujarat.

Kitagawa became the COO of Toyo in 2009. Toyo has also been one of the three top ink manufacturing companies in the world since 2009. 

“We have a three year planning concept, and there are three key pointers,” he tells me, when I asked what would be the mega-trends with which he hopes to steer your growth. Innovation. Global synergy. And Scrap and build.

I prod him and he summerised.

Innovation. Create a product and find areas we are not into.

Global synergy: Toyo is present in 20 countries. The most important thing is how to connect the skills of each country.

Scrap and build. We have a long history, many assets – visible and invisible. In order to continue our business, break something done and build it.

I pondered.

Innovation. What do you do when the rules of the game change? Most will do something different. That's the situation many manufacturers and printers are facing today. They are playing multiple roles that will help them define their futures. Most agree that this includes innovation in many different forms.

Chandra Mouli of Orient Color Art Printers in Sivakasi combines the flexo and offset technologies to create a hybrid, which enhances the value of the product. A print packaging firm in Vadodara uses his four-colour plus coater press to print on plastic using special inks manufactured by an Indian ink manufacturer. The client who came with the job needed it and he tweaked his operation. He did something different. He says he will continue to experiment with his packaging jobs.

Likewise, there are print equipment manufacturers developing or improving technologies that they claim would be totally new way of printing. Lombardi and Gidue are slugging it out in Italy to show a totally new way in flexo printing. Quadtech and Gallus combined to offer automated colour control and productivity benefits.

All this is in keeping with the evolving business needs of their clients.

Another way of defining innovation can be: exploiting new ideas which ultimately leads to the creation of a new service or product. IBM, for example, was primarily a hardware company; today only a quarter of its revenues come from hardware products, another quarter from software, and half from different types of services.

Global Synergy: For Toyo the effort to expand and further solidify its position are focused on global penetration especially in emerging markets.

While Toyo has presence in 20 countries, it’s acquisition of Arets was its strategy of targeting a broader audience. The company’s acquisition of Arets was for two reasons: one, the sales network and technology. Toyo does not have a market for UV in Europe and Africa, which Arets has and Arets has a UV technology that’s different from Toyo’s. “In our quest to become the best, we will combine the technologies to better serve the world,” says Kitagawa of Toyo Ink. The key aspect to future growth is the synergy between the two UV technologies, which would be developed into opportunities.

Scrap and build. What Kitagawa meant was “hard driving”. Its policy of scrap and build may seem wasteful, but it also means using new machinery and technology to make inks more economical. “A small saving per ton of ink, at very high volumes, would quickly justify the expense,” says Kitagawa.

I turn back to the key-note address by Ashish Hemrajani, founder and chief executive officer of BookMyShow, during Print Summit 2014. Hemrajani explained how he started his business, selling movie tickets through telephone and internet in 1999, at the height of the dotcom boom, to selling Bigtree to News Corp, to founding Bigtree Entertainment.  “We had to reassess our priorities,” said Hemrajani. Bookmyshow.com, a part of Bigtree Entertainment was built, around a software that allowed selling tickets for movies. “We built an ecosystem did not sit upon it,” he said.

The scrap and build policy means building new things by replacing older, less profitable ones including installations. However, getting the level of investment right will be essential for achieving sustainable growth in the years to come.