Finishing & Screen Printing

“The trend is moving towards smaller volumes of partly personalized mail”

Thursday 16. April 2015 - Winkler+Duennebier (W+D) from Neuwied/Rhine celebrated its 100th anniversary in 2013. Its core business revolves around machines and systems that produce and process envelopes and mailing solutions. Machines that process hygiene products are its second mainstay. One seventh of its approximately 350 employees work in the areas of research, development and construction. The company has sites in the U.S.A., China, Malaysia and the United Kingdom. In this interview, Managing Director Frank Eichhorn explains what W+D's strategy is for asserting itself in a declining market overall.

Mr. Eichhorn, with Winkler + Dünnebier GmbH, you manage a company that is around 100 years old. Can you please introduce it briefly?
Frank Eichhorn: Of course. Our company has focused on envelopes since it was first founded in 1913. Our invention of a method of manufacturing them in a rotative manner was the reason it was founded. Before, there were only machines that you could place a sheet of paper in and then fold it in multiple stations. With rotative manufacturing, the process ranges from placement to transport and processing all the way to delivery of the finished envelope. We have perfected and accelerated this process and integrated more and more process steps into it over the years.
Where do you currently stand with it?
Eichhorn: Today, the entire envelope, including the window, gluing, the silicone strip and printing are all performed by one machine. Starting with either white or pre-printed paper that comes from the roll or is laid into the system as sheets, our machines manufacture up to 1,600 finished envelopes per minute. Speed is also important in our second field. We have been building machines for hygiene products like incontinence pads and paper handkerchiefs since the 1970s. These operate at speeds of 8,000 units per minute.
You state on your website that “W+D lives and loves envelopes.” Can you please explain this?
Eichhorn: Gaining attention is a problem in the area of digital communication. Advertisers have been proven to obtain much higher response rates with mailings sent out by traditional mail. In 2010, we acquired the former Buhrs ITM and its expertise in the area of inserting – here, I am referring to the insertion of the contents into an envelope. Since then, we are the only company in the world that offers complete mailing solutions from a single source: envelope manufacturing including customized printing and inserting. Even the postage can be printed onto the mailpiece. At the last drupa, we introduced a machine that cuts out the envelope, prints on it and then folds it around the mailpiece all starting with a white roll of paper. The mailpiece and envelope can then be completely personalized.
Is the market accepting these types of high end solutions?
Eichhorn: Yes. The demand for our products comes primarily from niche markets. Although the total volume of mailings is declining, we firmly believe that the envelope has a future. Particularly in the area of direct mail, mailings are becoming much more complex and more intelligent. The better availability and analysis of customer data allows for individual customers to be addressed with advertising in a much more targeted manner. There is a higher degree of individualization.
And therefore also the share of digital printing processes in your systems?
Eichhorn: Exactly. The trend is moving towards smaller, individualized or often even personalized runs. This can be a special photograph, a personal approach of specific target audiences or an excerpt from a map that shows the route from the customer’s house to the company that is doing the advertising’s nearest site. This information is extracted from a database, then printed onto the mailing on-the-fly and inserted into the respective envelope. This individualization is performed using digital printing. At the same time, we react by offering reduced set up times and easy adjustments to accommodate smaller runs and the shortage of trained operators. The demand for maximum speeds with mass mailings differs from the demand for easy operation and set up. Digital printing is coming from two sides. On the one hand, in the form of economical printing of smaller runs for specially selected customer groups. On the other hand, as complete individualization of a mailing’s contents.
How are the prospects looking for being able to continue to grow internationally with these types of solutions?
Eichhorn: Due to the fact that W+D has been present in nearly all countries for quite some time, we see limited international growth potential. Many of the emerging markets are skipping analog developments, especially in the mailing market. We are taking different routes to achieve diversification.
What routes?
Eichhorn: Not all of our customers are able to purchase new machines or interested in doing so, especially because our machines last such a long time. We react to this by offering comprehensive service. We remain our customers’ partner throughout the entire lifecycle of our machines and upgrade, overhaul and repair our systems with extremely short reaction times. We can also manufacture replacement parts very flexibly and quickly, deliver them to anywhere in the world and install them. Furthermore, we offer overhauled used machines through our subsidiary POEM, which we occasionally upgrade to meet today’s requirements by integrating modern modules. This is only possible because the technological foundation of our machines is so strong, even after 20 years of use. We also offer training courses and educational programs to ensure that customers are able to leverage the full potential of our systems.
Is the market accepting your offerings?
Eichhorn: Our service generates a significant share of our sales, so we are apparently meeting our customers’ needs. By engaging in partner like relationships, we are able to minimize breakdowns and get the highest output out of every machine. Our customers realize this. We recognized early on that we can’t change the market, but rather must adapt to new developments. Our customers are broadening their presence and this in turn means that their demands change with respect to both systems and service.
You mentioned that the mailing market is basically shrinking. Do you expect to see a turnaround?
Eichhorn: The level of new systems will remain stable. The service business and tissue market, on the other hand, can definitely grow.
Can your expertise in processing inhomogeneous materials be put to use in other areas as well?
Eichhorn: We are already doing this by supplying modules to system builders in the securities sector. There are definitely other areas of application in which our drive technology and our know-how in the area of cutting, gluing, and other process steps included in our portfolio could be of interest. So far, however, we have concentrated on developing our service business, building new machines, and upgrading existing systems. We can definitely imagine exploring other markets at some point in the future.
Your history was impacted by the entry of a financial investor, an IPO, and being integrated into a group. What is the current situation?
Eichhorn: We are a GmbH again that is fully owned by the Körber Group. That suits us just fine. Körber is an internationally active technology group with over EUR 2 billion in sales that engages in lively exchanges on technological solutions. We are identifying more and more synergy effects. This will ultimately pay off, particularly for our customers.