65 / 110
MAY 2016 •
PPB
• 63
INDUSTRY
CONSOLIDATION:
ARE WE
BETTER OFF?
I
T’S A WORD OFTEN WHISPERED behind a cupped
hand.
Consolidation
. To some, the term carries with it a
sense of fear, worry and concern. It’s not so much the
results of consolidation that worry people but the concern
about what happens in the midst of the acquisitions that
cause the consolidation. Will there be a loss of jobs? A lack
of clients? Fewer suppliers to choose from? And how will these
acquisitions transform the industry’s landscape this year and 10 years
from now?
Since 2012, there have been hundreds of acquisitions in the pro-
motional products industry involving dozens of companies. The bulk
of the larger-company activity appears to be on the supplier side of
the industry, but the distributor side has had its share as well. About
a month before this issue went to press, the behemoth supplier
Samsonite announced its acquisition of the luxury luggage brand
Tumi in a deal worth $1.8 billion. Samsonite is reportedly the largest
travel luggage company in the world and Tumi, founded in 1975, is a
leading global brand with net sales last year of $548 million. Four
days later, Florida-based distributor Superior Uniform Group, Inc.
announced it would acquire all assets of California-based distributor
BAMKO, Inc. in a cash and stock deal worth $15.8 million. In 2015,
BAMKO’s revenues were a reported $31.5 million.
The big may be getting bigger but small companies are still the
industry’s bread and butter with 96 percent of PPAI distributor
members and 76 percent of supplier members generating annual
sales of less than $1 million. Let’s take a closer look at what may
causing this activity and what it may mean to the marketplace.
By Tina Berres Filipski