Apple Graphics -- Little Fish, Big Pond

By Erik Cagle

Old-fashioned hard work and forging genuine, lasting relationships with clients enabled Kevin Polley's Apple Graphics to carve a niche in the Southern California sheetfed market. And now, with a little help from some new friends, the Duarte, CA-based company (10 miles east of Pasadena) is playing the role of a large, full-service printer within the confines of its 25,000-square-foot facility.

Rarely has a half-size printer, with 50 employees and annual sales approaching $10 million, boasted the firepower that Apple Graphics possesses. Unlike smaller independents, Apple Graphics has enjoyed a wealth of resources ever since its 1999 acquisition by Houston print giant Consolidated Graphics (CGX). An influx of new equipment, highlighted by a new, state of the art six-color Heidelberg Speedmaster 74 press with coater, is opening up even more opportunities for the printer.

"CGX has people in place who worked out national agreements with paper mills, plate manufacturers, ink manufacturers and the like," Polley says. "Those agreements increase our bottom line due to the efficiencies of their purchasing power.

"That's just one example of what separates Apple Graphics from its local competition," he adds. "I have the purchasing power of a $700 million company and I'm competing against businesses that do $5 million to $10 million a year. They just can't compete on the product and service level that I can offer."

Apple for a Mouse

Still, Apple Graphics had made a name for itself prior to joining CGX. For nearly 25 years, Polley has enjoyed a solid working relationship with the Walt Disney Co. It started in 1979, with Apple Graphics providing printed envelopes to the entertainment giant, and grew by leaps and bounds after Disney closed its in-plant shop in 1986.

But Disney isn't the only major entertainment company doing business with Polley—20th Century Fox, MGM Studios & Casinos and Universal Studios also provide a large industry footprint for the printer. Watson Pharmaceuticals, Nestle and Princess Cruise Lines are also among Polley's clientele.

Despite the regal corporate stature, Kevin Polley is able to get eye-level with his customers; he fosters personal relationships built on respect, friendship and admiration.

"It's lunch every day, two dinners a week and a ball game on Saturday. My customers become my friends—the people I hang out with," Polley says. "Clients are part of our family run company."

Apple Graphics was born in the garage of the Polley home. His father, Patrick, gave him a Chandler hand letterpress when he was 12. The elder Polley, working for a large advertising agency at the time and frequently entertaining at home, allowed his son to print napkins for the guests.

An ink-drenched 1420 Rotoprint soon found its way into the Polley garage. Kevin needed three or four months to clean it up before producing stationery, note pads, letterhead and envelopes for the agency. That led to jobs such as producing ad reprints for a large toy manufacturer.

Father and son worked nights and weekends on print projects before Kevin took the reins as a junior in high school. Jobs kept rolling in, including ad reprints for a major airline (his brother, Patrick Jr., worked for the agency that represented the airline).

"I was making about $1,000 a week, a little more than my friends who worked at Pizza Hut were making," Polley says with a laugh.

In 1979, Polley rented a 700-square-foot commercial building, "a little incubator," the first of five facility locations prior to moving into the current Apple Graphics' home. Polley brought along his sister, Nancy, to work with him and, as plant manager, she played a pivotal role in the company's growth.

The company's name came from Patrick Polley, who once said, "If I wasn't printing in my garage, I'd be out on the street corner, selling apples." That saying was relayed to Kevin's grandfather, who was in charge of production for EMI/Capitol Records and worked directly with the Beatles. The Beatles' manager caught wind of it and suggested that the Polleys use the apple logo from the group's Apple Records.

Good fortune continued to smile on Polley when a friend of his father took the helm as print buyer for Disney. Polley made the most of his opportunities, and the company enjoyed incremental growth over the years.

"My goal was to be the best little printer for large corporations," he says. "I wanted to outclass and outperform the competition."

By the time the mid- to late-1990s rolled around, Polley understood that accomplishing this feat was growing increasingly difficult, as e-commerce and stiffer competition demanded capital improvements. "I saw the amount of money it would take to become a serious player," Polley notes, "and with my clientele, you have to be on the cutting edge. It was an investment I wasn't willing to make; I didn't want to jeopardize everything I'd worked for all of my life. It made the most sense to align myself with a company that did have the same beliefs and would invest in Apple Graphics, and would allow me to run the company the same way I always had."

Aligning with Consolidated Graphics—at the time, one of about six major players in the acquisition market—was the best fit for Polley, who still wanted to remain at the helm of the company. He sought to maintain his autonomy without corporate meddling, yet wanted the protection offered by the print giant, which included capital improvements.

CGX Group Vice President Dennis Rampe, who was also once an independent print shop owner, can empathize with Polley's viewpoint. "Most of us started our businesses because we were entrepreneurs," he says. "As our businesses grew, we got more employees; we became more embroiled in human resource, legal and personnel issues; and meeting with accountants and meeting with suppliers to make sure we get the best price possible. What most of us found was that the entrepreneurial process stopped and we became more administrators.

"When I was selling Precision Litho (in 1996), like Kevin, I didn't have the capital to push the company to the next level. I stopped having fun because I was an administrator by force and really wanted to be an entrepreneur. After selling to CGX, I was able to offload those responsibilities to the resources at corporate—worrying about purchasing and human resource issues. It allowed me to get back to what I wanted to do, which was to build my own business. That made it more fun."

The fun for Polley came in the form of $750,000 worth of prepress equipment, including a CreoScitex Dolev platesetter and IRIS digital proofers for computer-to-plate production. The bindery area was next, the recipient of a new, high-speed Stahl folder, Muller Martini stitcher/trimmer, Heidelberg diecutting press and other assorted equipment. Soon, a 4,000-square-foot expansion will be added for the introduction of fulfillment capabilities.

According to Chris Colville, executive vice president and un-official transactions maven for CGX, his company's blueprint is finding those independent candidates which boast outstanding managerial skills, business acumen and honesty. Polley, like Rampe, merited the investment.

"We want our presidents to run the companies and be successful, and we'll help them however we can," Colville says. "And, in Kevin's case, it's been a series of investments as he deepens his sales relationships and as he creates opportunities. His Fortune 500 clients are all large, national companies that can benefit from the other capabilities we have in our other companies. Our job at Consolidated Graphics. . . is to make sure we facilitate Kevin Polley being able to do whatever he needs to do to be successful."

Winning Combination

CGX and Apple Graphics have proven to be mutual catalysts. Polley was contacted by an entertainment customer recently with a request for one million four-over-four 81⁄2x11˝ flyers that needed to be delivered to 460 locations on a Friday. One catch: the disk with the needed files would not be available to Polley until Wednesday at noon.

Polley mobilized and called three fellow CGX printers to see if they could accommodate the workload. He then went back to the customer with prices for web and sheetfed work, which was the genesis of a four-week program. "Not many companies have that kind of horsepower behind them," Polley notes.

When another printer told a client that a certain job could not be accomplished logistically, the customer turned to Polley and Apple Graphics. The objective: produce 600,000 four-over-four bill inserts to be shipped to facilities in California, Wisconsin and Virginia. The request was made on a Tuesday for a Friday delivery. Between Apple Graphics and sister plant McKay Press in Michigan, the printing and delivering was completed on time. In the process, Apple Graphics was able to save the client a considerable amount of money on shipping.

"This type of service comes from company president to company president efforts, not some big corporate infrastructure instructing managers how to utilize their plants," Rampe remarks. "Companies can increase their capacity while not having to buy a press in order to service our customers on a more timely basis. We're seeing more work being moved around within the Consolidated Graphics family."

With 65 companies in 25 states, CGX fills out the national customers' footprint, "by default," according to Colville, because of its acquisition program. "We focused on buying one company at a time, based on that company's strengths, not what we thought we needed from a geographic or capability standpoint to service national accounts."

CGX installed a Wide-Area Network (WAN) to facilitate the expedited transfer of files from client to company and from company to company. Through CGX presidents' meetings, member companies become educated on CGX's national capabilities, and success stories like Polley's aid the cause.

"We don't mandate inter-company sales," Colville notes. "We tell them to do what's necessary to service their customers, and make sure that they have these (options) in their toolbox. It's going to be more and more successful for us."