Produced By INKISH.TV

This is Morten from INKISH TV and as my viewers and my audience hopefully already know, Over the Skype is an opportunity to talk to industry leaders from all over the world. We have been in the Far East, and we have been in Europe. We have been in the US. And today, for the very first time we are heading the course to South America to be more precise, Sao Paolo in Brazil. I would like to welcome Hamilton Costa as my guest today. Welcome to the show Hamilton.

Thank you very much Morten for the invitations. My prayers to be with you. Being with you is a kind of being with the Pope. Now, Pope says, “Urbi and not Orbi.” In this case, from Copenhagen to the world. That’s right.

Oh, I think that that is exaggerating a little bit, but I take the honor. I think it’s an honor to meet you because to be honest, I don’t know much about the printing industry in Brazil and South America. So before we talk a little bit about you, can you talk a little bit about how is the industry actually doing in that part of the world?

Well, we have ups and downs for sure, but if you’ll take specifically the Brazilian Printing Industry as the… We have the two biggest countries in this industry in Latin America, Brazil and Mexico. Secondly by Argentina, Colombia, Peru and Chile. I’d say the most, most important markets. Like many other places, you’ll see different things and see a mix of things.

The profile of the industry is like the profile in many other parts of the world was the middle and small companies are the predominant. Feel big, mid to big companies, international companies, too. So if you come here and take a hike, I can take you to very state-of-art technology companies. At the same time, you can find the other companies that are let’s say in the beginning of this curve of high technology. You know? So it’s a mix of things.

In case of Brazil, it’s a very large country, it’s a kind of a continent. So you can find out all kind of printing companies in each region. You can still find typography. You can still find old applications. On the other hand, you can find very, very up-to-date applications. It’s not going so well in the last two years because Brazil was in the recession. We are just start leaving the recession. Started recovering the economy when the corona had just came, so it’s a big problem. Okay. Another can’t solve. Let’s stop.

Yeah, yeah. But I think that if you just touch upon the coronavirus for a second, I think that right now it seems that South America in general is not so hard hit by the coronavirus as for example, the US and Europe right now. But you say that still everything is closed down for ensuring that the virus is not spreading right now. Is that the case?

Yes, that’s the case. No countries that I can speak all the time in Latin America, including a webinar, we’re going to do next Friday for all countries from Mexico to Argentina and talking to them. They are all closer to the same here in Sao Paolo, the same in Brazil. Not all parts of Brazil, but yes we’re doing the same thing. And in some point before the cure, at the beginning of the cure, not at the beginning of the cure for in descendant of the cure in Europe. So we’re still feeling all the increase of the disease here.

Yeah. What about… I don’t know much. I know a little bit, but I don’t know very much about the political situations in, for example, Brazil. But are your government also giving support and packages to two industries in your country like in the US and Europe or are printers left alone here?

Oh, for sure. They had to do that because in countries like ours, in countries like in Latin America, you’ll have many, many people, let’s say out of economies. So many, many people, there must be help and many, many people that used to live by the day. They go out every day to take some money so they don’t have any money. So they are rushing and doing the governmental programs in a way. They can try to reach these people.

I tell you, Brazil, they are distributing $120 per month for each one of this person. The problem is that five or six millions of this person or more than that, they didn’t have a bank account. So they have to register themself first to be found to be inside of the program. So it’s a bigger challenge but helping for companies too and et cetera.

Okay. Let’s say that for the most of the world, I think that everybody is of course hoping for both a cure and a vaccine. One of the cures is of course to make sure that the industries and businesses are getting some money so they can hopefully survive and thrive as well. I mean I can’t help thinking how unfair it is when you say that Brazil was almost in growth again and then you are hit by the corona. So it’s like a double jeopardy. Right?

Oh, for sure. In fact, we are recovering from a hard recession as I said and I think we’re reaching again the numbers of 2013, 2014 or more than that. Now we are going back to 2010 again. So it’s a hard hit.

Yeah. Well, we can’t do anything about that right now. But what we can do is that we can talk a little bit about the industry and we could talk a little bit about you. I’m a little curious because you have been in the printing industry for many years. You are an author, you are a consultant and you have a lot of things on your curriculum vitae. So Hamilton Costa, please let me know a little bit more about your doings and who you are.

Well, I was born in the side of a printing industry because my father had a printing company at that time. So now I start working. During college, I start working with him and for almost 20 years I work in the family company. After that we start working outside and managing print industry associations so like the Brazilian Printing Tech and the Go Industry Association, ABTG. I was the president. President of other associations.

I went to work with one of the biggest book manufacturer in Brazil, named Melhoramentos. Melhoramentos, we’ve made a deal and we were part of the Quebecor. At the end of ’90s, Quebecor was the biggest printing company in the world at that time. So being in Quebecor, I went to be a country manager in Mexico for two years. We’ve developed a huge big plant there.

After working some years in Quebecor, I decide that I’ve had managed all kinds of printing companies of all size. So I decided to start in the consultancy side and doing that for more than 50 years and worked especially all over Latin America. Working with other associations like the best NPES in United States today, APTech. With the NPES, I’ve been their Latin American director for about 15 years and helping companies to grow, helping companies in business development, helping many suppliers in their especially business development and mainly in the digital printing side.

Well, the other day, one guy came here and say, “Hamilton, what do you do?” I said to him, “Do we have time?”

I can imagine that.

I write books. I write articles and things like that. You know that very well.

Yeah. When you talk about your history and you have… I bought a log about that. The proofs that you’re talking about or not the proofs, but your CV is that you have actually, as you said, born into the printing industry by your father’s printing company, and I take that with all due respect with your age and your experience, I think that that printing company must have been considerably different from the printing companies that you visit today, right?

Oh, for sure. For sure. For sure. Because of technology, because the way that we have approach the customers and because the times are completely different, especially today.

Yeah.

So that’s one of the things that we most hardly try to talk and change the companies about that.

The reason that I’m asking is because, I mean, when you’re then from growing up and becoming a part of these big printing companies, as you spoke about and you set up plants in Mexico and all the things that you just spoke about. I was just curious because I mean, even if you look at technology from just 10 years ago till today, things are still developing at a rapid pace. And I was just wondering, how do you get your information to be up to speed on all these changes that goes on in the market so you can give correct advice as a consultant?

Well, being a consultant, we belong… Being an international consultant that’s why I have to live outside of Brazil as I have been in touch with the organizations like NPES and APTech for sure. We’re very close to all the, let’s say, the man club of international consultants, too. I used to meet all of them in all the trade shows or events like that and being invited by the most important suppliers in the industry. So [crosstalk 00:11:19].

Yeah. So that means also that if you… Let’s say that a certain vendor is preparing some new technology, then they would often invite you and some of the old man’s club to come and get a little insight in the doings, and so you also get a deeper understanding of the technology before it’s actually brought to market?

That’s right. That’s right. What they called as market analyst. That’s right.

Yeah, yeah.

That’s a term that’s not well used here in Latin America. The people make a confusion for market analysts and journalist. So they invite here much more journalist than the market analyst, but it’s different outside as you know in Europe, United States and in Asia. So they respect a lot the market analyst exactly to be opinion former or opinion that someone can hear. So it’s usually for them to invite us to participate in their new releases, their luncheons, et cetera.

In this week actually, yeah, I think it’s today or tomorrow we’re releasing a new episode of Print Sample TV with Pat McGrew. She happened to… As I told you or showed you that happened to mention, I think it’s maybe your latest book. What is that about?

Well, it’s named Printing: The Industry In Transformation. In fact, it’s a collection of many articles that are being written to the magazine of the Print Industry Association in Brazil. I collected them, I put in a certain order, I fill up the holes inside of them and updated them. So at the end, you will see a scenario exactly showing the transformation of the industry starting from those that only print something from some original Bean and today and going further to be much more a service and a solution company including printing to the market.

So I talk about this transformation. I have a master degree in management and I have teach many times. So I used to use this approach to the way that companies have to transform and become up to date with technology saying that internet must be part of their process.

100%, right?

Right. But for most of things, do not. You know? And things like that. And how to develop the company in a way to be in touch and not only with the new technologies, with the new approach and the new mindset you must have to this industry and their markets.

Yeah. When you compiled these articles, I guess the articles was written over some time and then you filled in the gaps as you said. Was it a surprise for yourself to see how the transformation process also came through your articles?

Well, what I’ve been heard since I launched the book for people that hadn’t the articles before. But because with the book I put in every article, I put the date that I wrote and some of them here, “I couldn’t believe you could see that in 2013, 2014. It’s absolutely updated. How could you say that at that time?” Because that was happening right at that time. So it’s not so hard for doing that in updating in this way, but for sure it’s a complete different industry of many years ago than it is today.

Yeah. So predicting the future, you can put that on your business card as well, right?

Well, you need the people to make their forecasts. Foresees and predictions is part of our job. You know?

Mm-hmm (affirmative).

Sometimes we do it very well. Sometimes we do not do it very well because like the black swans of coronavirus and now it’s a confusion. Someone will say black swans. The other will say gray hippo. Have you seen that?

No, I haven’t seen that. No.

Yeah, yeah, yeah. That is United States. There is a person that wrote a book saying, the gray hippo in LA. He’s just trying to say that we knew that was going to happen, but we didn’t take care about that.

Yeah.

Black swan, something that comes up and nobody expected that. That’s it.

Yeah. You mentioned that you have a webinar on Friday. Is that also the one that the [Ryan Abowners 00:16:30] involved in?

Yeah. This is sponsored by CONLATINGRAF, the confederation of the print industry in Latin America. Okay? The idea is to have… I’ve been doing this kind of webinars in all these days seeing at home. People of Columbia, people of Peru and their print industry association, their affiliates in Columbia, Peru and other places, and they decide to do it all over Latin America in a way to try to put together all the printing just to the associations and their affiliates.

So it probably is about 200, 300, 400 people, and to talk exactly directly to the guy that’s in front of his company suffering a lot today, how to adapt himself, his company to this situation. And a little bit what a forecast or a foresee or some view of the new world, the new normal post COVID.

And just of curiosity, Brazil is the only country in Latin America that doesn’t speak Spanish natively.

Yeah.

So what language do you do with it?

Well, I have to do it in Spanish. So the majority-

Okay. So you speak Spanish. You speak Spanish.

Yeah, yeah.

Okay. Okay. I don’t know. Is there a big difference between Spanish and Portuguese or…?

They’re very close, but there is a trap on that because you will have many, many similar words with completely different meanings. Yeah.

Because I have listened to a lot of Brazilian jazz music when I was a little bit younger and yeah, I always liked the sound of the Portuguese because I think it sounds quite different from Spanish.

Oh, yeah. It’s more soft.

Yeah.

It’s more soft. It’s more close to French. More close to Italian, and let’s say the Spanish is a little bit more hard. The pronunciation is more hard than the Brazilian is more… The Portuguese is more soft.

Yeah. Okay.

It’s a beautiful language.

I like it, too, very much. So, that is great. I was just curious since you do the webinar whether you would do it in Spanish or in English because that would be kind of crazy if you did it in English. Right?

Sometimes I did it. Sometimes I did it, especially in international events like the [School of HP 00:19:04], then presentations and webinars and things like that. But I’m much more fluent in Spanish than in English. Yeah.

Okay. That webinar sounds like an interesting webinar first of all. And secondly, I think it’s great that the federations and organizations also get people together to share information and knowledge about basically everything. If you look at your own work and the way you do things, you said something that… I mean, do you have a good business and do you have a lot of work to do so you are not bored?

Well, let’s say these days, I’m doing a lot of things, many things. I’m really very, very busy, but not making money. Let’s say that because it’s much more-

I know the feeling.

Yeah. You know that, don’t you?

Yeah.

It is much more a kind of information. It’s much more kind of support. It’s much more a kind of exchanging ideas and exchanging information. I think that is now our role of doing that. Okay? Helping companies, helping persons, helping business people how to deal with this situation. For many of them that’s a very vital situation. So those companies have no cash. None of them are doing… It is a very hard time to them.

For those that still have some cash, how to plan, how to be prepared for the recovery, when we’ll have a recovery. So many, many questions, many doubts, and I think is in our role, try to help the most that we can and try to gather the best information we can to help these people to move forward. That’s right.

And our people in general… I mean you can’t stay negative all your life of course, but I mean do they see the light at the end of the tunnel? Is it darker? I mean because a lot of these interviews, I do Over the Skype, I ask a lot of people how they see the time after the coronavirus because I must say that I don’t think that things would go back to be exactly as it was before. I think a lot of things would change and maybe that would also change in how we’re using technology and the demand for maybe…

I spoke to a couple of CEOs in Europe about maybe even the change of the COVID-19 will create a bigger demand for digital devices just because people will maybe ask for smaller print drawings and maybe it’s a time for the mass customizations finally taking it to the masses basically. Is that something that you see as well in your perspective?

Well, for sure. I’ve been trying to explain a bit what the economist says about the possible cures of the economy. If we’re going to have a V cure, a U cure, a L cure or a W cure. You know? This will depend on each country. You have a whole picture of the world. But for each country, we have a different curve ahead and for each printing company we’ll also have a different curve ahead.

I’ve been heard some people from flexible packaging, they’re performing very well each time. Sometimes some lines have increased a lot. Because much more people are eating in their homes, they need to buy things in supermarket. So there are companies that are going to… They are already having that V curve. You know?

Mm-hmm (affirmative).

Much others probably is going to find a laggard, taken much more than a snail and some of them will not survive because of that. You know?

Yeah.

Because we’ll have to be in face with… start finishing that, we will face a recession, didn’t we? Okay?

Yeah, yeah.

The recovery in many times is not going to be so fast. And being a recession, it goes exactly the way you said. So less jobs, less rents, increasing probably the utilization of digital printing and other solutions. A long time more to educate the customers and a way to use printed materials because they’re going much more deep to all digital applications. Certainly the printed materials is going to be used like a differential. That’s something different, something tangible that can bring something additionally to the brands but must be educated again in that way. So it’s going to make and must have an additional effort in their commercial approach, marketing approach to develop this kind of applications. You know?

Hm. So just to understand it correctly, you said… So the post COVID-19 and maybe the changes in the market, this may be not so much because of the immediate effect of the COVID-19 recovering, but more that it fuses the recession that you’re talking about. And that is the recession that would create a demand for change basically.

I think both things. The world is not going to be the same anyway. The economy is not going to be the same. But I start saying about the recession because I think this is going to be the fear of everyone.

Yeah.

The fear about their income, the fear about their employ. It’s going to have a job or not more a job. The same for the companies. The way the economy shrunk, they have to look for more alternatives and they’ll have increased competition. They’ll have much more equipment and *ideal wage.* So probably it will come to a more consolidation of companies in certain level inside of the print industry. I think this is the first fear. This is the first moment. The second moment is how to recovery. Some are printed materials in the mind of the brands and the minds of the consumer and that’s the second and fourth to recovery to our markets. You know?

Yeah. So the demand creation will happen. I mean we have to stimulate the demand for print ads. You’re saying this is not only for packaging, it’s not only for flexible, it’s also for commercial print. Because if we don’t do anything as an industry, we will end up, sorry to say, but we will end up that all the media and other channels might take over that supply, right?

Yeah. Printing industry is very big in many ways. So you have different fields inside the print industry. It takes different markets, different segments, different products. The less who will suffer will be the part of the packaging, part of the packaging. Flexible packaging is going to be okay. A carton board packs is going to be okay. Label is going to be okay. Functional printing is going to be okay. Industrial printing is going to be okay.

All the other applications inside why they’re calling my book the new printing industry that’s gather all these things together much more and growing much more in commercial side and promotional side, et cetera. So there’s the side that you’ll be probably much better than the other side. The other side must do a lot for keeping their part of the market and keeping their jobs. Okay?

You know, it’s of course sad to talk about these things because I know that both of us loves the industry, but you know, I see it also as an opportunity because I think that maybe since 2008, ’09, I think that maybe too many has been focusing on low price and/or commodity print and boring products. So maybe it’s a time to have more valuable products and higher value propositions. That might open up for a little bit more in the embellishment and digital finishing and in general to make better, nicer books of one so to speak. Right?

For sure. You must focus on that. But I’m sure that the first moment that people will compete much more are really to prices, et cetera. Again, they’ll be in that trap that some of them will not survive because of that. So if you are a looking ahead, you must look for things that can add value not only to the printed material but add value to the customer. That’s why I say that you must find solutions that you put down some process customs of the customer.

Yeah.

Right? Work around that. Then you add printing on that. You’ll have a good way ahead. So in our consultancy, we’re having side of a consultancy, a digital platform for web to print publications and things like that. We do not only try to sell the commodity things, but try to show the way how to add this digital platform to add new value to their offer to their clients where they are using it. So in a platform you can add augmented reality and other stuffs that you can increase the value of the printed materials when they’re selling something to the customer. You know?

Mm-hmm (affirmative).

I think that’s going to be the way. That’s what I call the transformation. As part of the transformation with the industry, how do we interact with the digital work and with printed materials?

Well, you have kickstarted the debate. You have kickstarted the value creation. And I think that your sayings here has been extremely informative for me and for my audience.

Thank you.

So Hamilton, time is running out because I think that we have to also understand that people don’t have too much time watching our film. So I just want to say thank you very much for taking time to talk to me all the way from Sao Paolo. And as you know, I hope that someday I will get the chance to see you. I have unfortunately only been in South America one time. That was in Peru.

Oh, okay.

But that was nice, too. But you were not there. So I hope I… Now I have maybe a reason or an excuse to go and visit you in Sao Paolo. That I would like. So a fine word for me is just a thank you very much for taking time to be here on Over the Skype. So thank you very much.

Thank you very much, Morten, for this opportunity, for this conversations. It’s been a pleasure to have you here, or they used to say to the small village of Sao Paolo of only 23 million people. So…

So one more or one less doesn’t really matter.

I’m following your work, INKISH TV, INKISH [Nails 00:31:10]. How about to bring it into Brazil, thinking of that? Okay?

Okay. If you know about any who could be interested in helping with that, I would be honored to do that. So thank you very much. Okay.

You’re welcome.

Yeah. Bye.

Thank you.

Bye.