71 / 110
MAY 2016 •
PPB
• 69
nitely opportunities for people on both
sides of the fence,” says Craig Reese, senior
vice president/director at Jack Nadel
International. “From our perspective at
JNI, people don’t like change and when
two distributors join forces, it’s a chance to
entice good people to look around and
make sure they’re working for the best
company. The same holds true for suppli-
ers. It’s an opportunity to find great region-
al managers and to take advantage of the
inevitable issues that confound two compa-
nies joining forces.”
WHERE DO WE GO FROM HERE?
While Woody remains a skeptic about
a fully consolidated industry, he’s careful to
make a distinction about the industry’s
future. “For years we believed that the
health of the traditional distributor net-
work and the health of promotional prod-
ucts as an advertising medium are one and
the same. They are not. I’m very optimistic
about promotional products as an ad medi-
um. But will $20 billion worth of business
continue to go through the traditional
channel? Some will, but there will be some
leakage too.” He predicts fewer suppliers in
10 years because of the commoditization of
the products but strongly believes there will
always be room for large suppliers that
import, decorate and turn orders in 24
hours. “Those orders will always go
through the traditional channel. Large sup-
pliers that are warehousing products,
pulling them off a shelf and shipping in
two days will do fine because there’s no
other place for those orders to go.”
Graham is expecting a slightly different
scenario based on market demand. “I don’t
see an industry of five big players that sell
highly optimized, efficiently produced and
sourced products. I just don’t see it. I think
how bad it would be if, in 10 years, the
industry was ‘owned’ by 10 companies.
That would be a bad environment. But I
don’t see it happening because we have a
medium that is much in demand. End
clients are hoping for innovation and cre-
ativity—they don’t always get it but that’s
the fundamental hope in what we are sell-
ing. What’s new? What’s innovative? What
will blow my customers’ minds away? If
that’s the assumption, then the market will
always meet that demand.”
This article is intended to provide perspective
in relation to consolidation issues in the pro-
motional products industry. PPAI does not
endorse any particular pricing model or market
approach. PPAI is committed to ensuring that
competition within the industry is uninhibited
by any express or implied regulation of prices
or quantities of goods or services in the market
or through any PPAI publication provided for
the benefit of the promotional products indus-
try as a whole.
Tina Berres Filipski is editor of
PPB.