Ironmark, Annapolis Junction, MD: A Decade of M&A Dominance Leads to New Plant, Equipment

Perhaps Jeff Ostenso has spent some time working with the Witness Protection Program. The CEO of Annapolis Junction, MD-based Ironmark has ushered his company through a comprehensive identity change in the past 10 years. Interestingly, perhaps the only folks who still recognize the former Frank Gumpert Printing are its customers, who couldn't care less about names, but know a great job when they see it.

Turn back the clock to 2004. Frank Gumpert Printing—which had existed for nearly 50 years—is a modest, $3.5 million commercial printer serving the Annapolis area. Ostenso, who had taken the company reins in 1992 after having done it all in a 12-man shop, soon realized that being the quick printer down the street just didn't jibe with the vision he had for his firm.

Ostenso wanted to grow Frank Gumpert Printing. He wanted to do it through acquisition, as well as organically. Not only did he want to acquire capabilities his own firm didn't possess, Ostenso wanted to bring aboard a savvy talent base to deliver—confidently and expertly—on said capabilities. He wanted to cross-sell to the customers of those acquired companies; not only would he bring new services to his own client base, Frank Gumpert Printing would serve the commercial needs of the newbie acquisitions.

"Anyone can add printing equipment; it's really the knowledge and talent to produce it effectively and deliver it at the right cost point that make a big difference," Ostenso says.

Ten years later, the newly-minted Ironmark has added six firms through acquisition, with a pending seventh conquest slated to be its biggest acquisition yet. The company has ballooned from $3 million in annual sales to right around the $22 million plateau. And last September, Ironmark moved into a new, 52,000-square-foot plant, christened no less with the addition of two presses: an eight-color , 40˝ Komori Lithrone sheetfed offset press with coater and an HP Indigo 7600 digital press.

A Walk Down M&A Lane

As this issue went to press, Ironmark was also putting the finishing touches on a deal to bring aboard a $14 million book manufacturer that will see several older presses replaced in favor of high-speed production inkjet equipment. In all, the deal will push Ironmark's sales to a lofty $35+ million.

Now, in addition to commercial sheetfed offset printing, Ironmark offers digital output with variable data, wide-format digital printing (including signage and displays), marketing (promotional products, corporate apparel, event promotions), creative (Web development) and logistics (Web-to-print storefronts, fulfillment and distribution). Every acquisition adds something new to the firm's product and service profile.

"A lot of the acquisitions have been driven by what our customers are telling us," notes Matt Marzullo, senior vice president of sales and marketing for Ironmark. "From a sales perspective, when we sit down and talk to a prospect that loves their printer, we can talk about services like wide-format output, creative and promotional products. We still have an opportunity to get a sale from that client and can convert them down the line to other products."

Here's a walk down the M&A road Ironmark took to becoming a force in the Washington, DC; Baltimore; and northern Virginia markets:

• Admiral Envelopes (2004) gave Ironmark a new audience for its digital printing. Sales moved to $5.5 million, and the addition of a key sales representative tacked on $1 million worth of business.
• Lex Print On-Demand (2007), another local firm, had a strong following in the DC/northern Virginia area. Ironmark provided digital and offset printing services to the company's client base.
• Junior Press (2008) brought aboard the Marzullo clan, a three-generation family of printers. This deal ballooned Ironmark to the $12 million plateau.
• Graphix Unlimited (2010) was a distributor of printed product outsourcing and brokering a large amount of print within the local market. Graphix Unlimited was bringing in $2.5 million a year at the time of the deal and Ironmark grew it to $5 million within three years of closing the transaction.

"Graphix Unlimited's whole business was warehouse distribution. They were print brokers, but did a lot in the healthcare field, as well as print management," Marzullo says. "Adding them to the mix got us into the warehouse/fulfillment side of the business, which was something we really weren't doing."

• Corporate Printing Solutions (2011), also known as CPS, marked the largest deal to date for soon-to-be Ironmark and brought aboard Scott Hargest, who now serves as president of the overall company. CPS brought graphic design proficiency and wide-format capabilities. At that point, the firm was renamed CPS Gumpert. Image Mark (2011), a small promotional products company, also joined the fold that year.

It is interesting to note that CPS and then-Frank Gumpert Printing were both vying for the chance to acquire Graphix Unlimited. It was around this time that Ostenso and Hargest began having conversations about a potential merger.

"Scott had a graphic design team and wide-format in his business, but he was looking for manufacturing," Ostenso remarks. "I was looking for the graphic design component. It was a good fit. So, we brought the companies together and called it CPS Gumpert, with the goal to eventually move into one facility and do a rebrand."

The next three years were spent working on the rechristening and planning for new digs. All of the manufacturing was taking place in the old Gumpert plant in Annapolis, MD, while wide-format, creative services and warehouse distribution—pick, pack and fulfillment—were being handled at CPS' Hunt Valley, MD, location 40 miles away. It was, in the words of Marzullo, "Logistically, a bit of a nightmare, with trucks going back and forth every day."

Ostenso and Hargest were able to find the ideal facility, which was centrally located in the heart of their customers' territory. And, since the existing building tenant still had a year left on its lease, that gave CPS Gumpert time to blueprint the facility to maximize production workflow.

Since the companies did not move into the same space until roughly three years following the merger, the integration process wasn't quite as arduous as it is for businesses that rub elbows within weeks after combining forces. Also, Ostenso points out, every acquired company's previous owner is still with the Ironmark organization in some capacity, perhaps a tribute to Ironmark's forward-thinking philosophy.

"We were able to put our strategy together," Marzullo says. "Even though we had merged, we still operated differently in the two locations. Over time, we were able to identify where changes needed to be made and then acted on them before we moved.

"We worked hard, bringing key groups together from both locations to establish our new hierarchy and corporate culture. The hardest part of any acquisition is two cultures coming together. So, we got together and, based on what each company did well, developed overall best practices."

"We also had to meld different manufacturing processes into one location," Ostenso notes. "Many hours were spent planning and sharing information, with many suggestions for setting up facilities and maximizing workflows. A lot of nights and weekends went into making it happen."

What's in a Name?

The pending deal to acquire a book manufacturer will revert Ironmark back into a two-production-facility configuration, but the specialized product mix of the new plant won't make it as cumbersome as the previous merger.

As for the new moniker, it was selected from roughly 100 names. "When Jeff and I heard the name Ironmark, we looked at each other and nodded immediately," notes Scott Hargest, president. "Iron: strong, steel...the iron of the presses. And mark: we put ink on paper, we make a mark for our clients, we're involved in marketing. It's a great combination of two words that really describe who we are and what we do."

One of Ironmark's goals in moving to the new Annapolis Junction, MD, facility was ensuring that customer work would continue uninterrupted. On the Indigo press side, an existing 5500 was still operating at the old Annapolis plant, while an Indigo 7600 was outputting digital jobs at the new facility. Ostenso has been impressed with the 7600; it can churn out 6x9˝ postcards in a four-up configuration, and the speed upgrade has been a big bonus. It's been a huge boost to a shop that kicks out two million color copies per month.

The eight-color Komori LS press with coater was obtained from a New England shop that closed its doors. Ironmark sales reps were encountering job opportunities that would fit a 40˝ press format—work that Ironmark had previously been farming out to competitors. Now, with the addition of book manufacturing, it will also be a boon for perfecting jobs. The press' closed-loop color controls, fast makereadies and quick job-to-job changeovers are among the other perks, according to Ostenso.

The acquisition of the book printer has already set the wheels in motion for new gear in 2015. The newest member of the Ironmark family has three older 40˝ offset presses, and Ostenso is eyeing a pair of continuous-feed inkjet presses to help modernize its production.

Clearly, book manufacturing will play a huge role in 2015's fortunes for Ironmark, as well as the burgeoning growth of wide-format printing. Ostenso sees on-demand digital printing output becoming an even greater piece of the pie as customers gain a greater appreciation of just-in-time production. "We've already converted multiple clients to that mindset and plan to convert more going forward," he says.

Speaking of converting, perhaps Ostenso's positive outlook could rub off on the industry at large. He believes printers need to embrace the market changes that are taking place and to adjust their roles to ensure they will be a part of the future. Marzullo adds that he sees a lot of glum faces these days at industry association events. Perhaps it's an approach or a way of thinking that needs to be altered or slightly adjusted.

"Jeff and Scott are two owners who are very excited about opportunities in print and related value-added services," Marzullo notes. "We see a future in printing. When you take the lens, tilt it and look at the printing industry in a different way, success is out there waiting for you. The future is not at all bleak. Time and time again, we hear industry people who are downtrodden about our future. The truth is, we come to work excited every day." PI