No question that the COVID-19 has influenced all companies in the global printing industry, but Koenig & Bauer has, despite a lower order intake, a strong belief in the future. In this Conversation, Koenig & Bauer Sheetfed CEO, Ralf Sammeck, shares his views on where he sees his company in the future.
Ralf, thank you very much for the opportunity to visit you here in Attleborough. You’re the CEO of, it’s raining, we can hear that. You’re the CEO of Koenig & Bauer Sheetfed and we’re going to have this little conversation. I hope we will have a good time together. We could have met in Denmark last week.
Yes, that’s true.
You have a summer house there.
I have a summer house at Denmark, yes.
So how did you end up having a summer house in Denmark?
That’s a real long story but first of all Morten, I’m really happy that we have the opportunity today to talk.
Always, you’re welcome.
To make a long story short, I was visiting this house we bought, it’s a really tiny one in Denmark with my family when I was 10. And every summer we went there and one day, unfortunately the husband of the owner died and she said.
Did you say fortunately that he died?
No, no, no.
Fortunately for you.
Unfortunately of course and so she offered it to me, it was not so easy because as a German, you’re not allowed to buy a house in Denmark but with my relationship to Denmark, I was able to buy it.
Is being a CEO for one of the larger companies in the printing industry and we’re going to talk about all the nice things you’re doing here but do you think that it’s also kind of, that you need some time to have a place where it’s like quiet and closer to the nature and just relaxing and get your head off?
Actually yes because you know Denmark, it’s a lot of space and I spend a lot of time with my wife just walking down the beach. And, but if you would ask my team here, they would say, oh, he’s back from Denmark now he comes up with new ideas. Of course the head is always working.
Yeah but I’d say the reason why I’m asking is because though I’m managing a way smaller company, my head is always around my business, right? And I take that maybe it’s the same for you, right?
Yeah, same with me.
Yeah so even when you, for me I don’t know how you but for me, it’s also like sometimes even if you sleep, it’s like thinking of ideas or problems that you need to solve. Is that something that you also recognize?
Absolutely, my recommendation is have always a pen and a piece of paper next to your bed because sometimes we have really good ideas when you sleep and then you have to write it down.
That’s a good suggestion but the only thing problem I have is that often I go to bed so late that I fall asleep and then I still get the dreams and have them in the morning.
Okay, that is less important of course but so when you joined Koenig & Bauer in ’96?
No, in 2000.
In 2000, yeah.
Being a CEO of a company this size, what kind of challenges do you have in your daily work?
Yeah, I mean, what is a challenge? First of all, I don’t see it as a challenge. I really see it more like a, I see like a sport. I really like to compete and I really like to form a team who can be successful in our environment and our market. And this is actually what I enjoy most. And I have a great team here and all the products you have seen here today, this is the result of my team. So therefore of course I’m quite proud but it’s also a result of the customer relationship we have. And this is something, this is for me most important, also for my team, that we were very close to our customers, understand their business and how can we support them to be more successful.
And I mean to some extent when you are, I really like that you say that you bring also your team and your customers as part of your success. But I would say that sometimes it must be difficult because developing equipment like this one takes long time. The changes in the market right now are really rapid changes, right? I mean, I know that you spoke to my colleague address people just a moment ago, where you also talked about the COVID-19 situation. That came like out of the blue, right? So sometimes even though you have to have the best team and you have the customer relations, it must sometimes still be like, if not headaches, then at least some kind of challenges how to get through these periods of time.
Yeah, of course, if you have a crisis, like the Corona situation, it’s challenging but again, then we are back to sports then the question is how can you master this situation best possible? And what we did with our team was to find solutions for our customers that they still get the best possible support from us and therefore digitalization is key. So we were offering our customer community platform to them that we can support them to increase the productivity because interesting is our packaging customers and 60 to 70% of our customers are in the packaging arena. They had a lot or they have a lot of work and therefore it was very important that we can come up with ideas to support them even better that they can produce continuously. And therefore, we started with our new hotline idea that we not only have technicians, electricians, we have also application engineers available 24/7.
And also we offer press support with a camera and to help the customer that they can fix the machine without a technician from us because as you can imagine, in some countries, we were not even able to travel. So therefore we had to come up with some idea, we call it press view support. And so these are all ideas and you’re right, difficult situations, you have to have fast and good ideas. And this is what I like on our job, that we always have to come up with some ideas to support the customer also in difficult situation.
Another way you also, I would say inspired me was from your live event when Drupa was postponed.
I mean, there’s been so many live events and so many virtual events that I think that sometimes there’s maybe some kind of information overflow but you used your customer experience center to have a daily broadcast in German and English to your audience. And I think that really also showed that you were really fast in also adapting the new technologies in your communication. So how has that in, I mean, do we need to have a customer experience center in the future? Could it be done by video? Do we need trade shows? Do we need to meet in person?
I think, yes.
I hope so.
But to be honest, the Corona situation has shifted certain things. For example, we did the, let’s call it Drupa or we call it Koenig & Bauer live. And we did all the presentations and we had huge response, more than 4,000 people were actively seeing our streams. And so that was a great success but we also were not able to wait til April next year because we had all these new machines and ideas and digitalization and everything. So we wanted to really show it to our customers and maybe future customers. So therefore we came up with the idea and it was quite successful, but yes, I think it will change a little bit. But of course also in this time, we do demos with the video technology. Customers are not always coming here so we can do live demos.
So it would be in a combination in the future you think?
I think it will be a combination.
And you are the, by the way, you’re the owner of the big offset manufacturers that have continued to commit to Drupa. So the 21, you will entire, you will own the show, right?
To be honest, I’m disappointed about the other companies because I mean, I’m in the industry for, I don’t know, maybe 100 years or so but I mean, I was a pressman one day and then an engineer then I went to university to become an engineer.
So you have this ink on your veins.
And I think this is important and if you see the Koenig & Bauer management team with Carlos sports of Amman and Histoff Merla. And I mean, we are all very much involved in our industry and there is one big, big show every four years. And this show I think, is so important for our industry. And I think it’s a huge mistake if you’re saving money on this end because I think we should show the industry what kind of technology we can offer, what is the development we are doing and to have also the one to one communication with our customers, it’s a show. And this is something I think is very important for our customers, is very important for our industry and therefore we are committed to Drupa.
I agree with you but the first time I heard about the cancellations from vendors like Bobst and Xerox, I was more under the impression that, of course it can’t be of course money or it can’t be environmental as Bobst came up with. But I was also thinking that, you just showed new equipment at your live event. I mean, of course you can show the same thing again but will customers then go to the trade shows and see things if it’s not like the new thing because I think you’re totally right, that when you go to Drupa, it’s because you want to see the new things.
Maybe we show something new, again.
That would be interesting to hear, can you tell anything now?
No but of course, we are always working on something. And yeah but I think it’s important for the industry. At least we’ll have to have this one show for the industry available, so we are supporting this.
So let’s hope they get rid of Corona before then.
I really hope so.
Yeah, because that is also as UN address vapor spoke about all companies in the industry have been influenced by this terrible pandemic, right?
And that is something that I think that everybody is now, I think that I heard a stock analysis person last week saying that now people are starting to buy stocks again. And that is typically your shares, that is typically a view on some kind of believe in the future, right? And I’m just thinking that maybe people, the first crisis where it’s like, oh, everything is just lockdown and everybody was scared, what is the future of the things? Do you also feel that? Yeah because you just announced some, was it Q2 numbers that you just recently released? Did you did just release some Q2 numbers?
Oh, yes, yes, yeah.
So do you see a development and a positive development already?
The Q2 was definitely much better than Q1, so yes. You see a good development and if I see our sheet-fed business, so if you compare with other players in our printing industry so there’s the VDMA organization who are always announcing the figures and order intake first five months was down by round 36%.
So if I compare this with order intake and on the sheet-fed side, it’s minus 12.9. So I of course would prefer to have more than last year but in this circumstances we are, I think we are doing quite well in comparison to other companies.
Are you a financially strong company to stand against.
Yeah, yeah absolutely. Yeah I mean, this is most important and this is something why we can do these kind of investments. And I’m very happy also my management colleagues. They see it in the same way so we will continue to invest in high amounts in R and D. So we will not cut certain things. We will continue to develop and we still have some ideas.
What about, because, I mean, as you mentioned, you have a high role to play in the packaging area. So is VLF and very large format offset press still on Koenig & Bauer radar as well?
Absolutely, it’s our core business, one of our core businesses I have to say and we will also further develop our machines. This is a very good market.
For you, I mean, some of your competitors they had to withdraw from your market, right?
It’s true but it’s also not so easy to compete against our company.
Against you, because you’re a sports person.
Because yeah, I think we have very good equipment and we have very loyal customers, what is always a good sign and we are always further developing our technology, what I think is also one of the reasons why we have this very high market share, around 70% market share in large format and this is also a stable market.
Yeah, so you see their replacement. They will, if they have 145, they will buy a new 145 because they have the binding equipment and they know the quality and this, so they have trust and belief in Koenig & Bauer as a company.
Absolutely and they are always packages with long run lengths. This will not change, I mean they will see real packages also in the future, I hope so.
Probably or they will be packed in an iPad, who knows?
Yeah, I doubt it but I think this is something we will continue to focus on and what is also important talking about packaging, we invested also in the last five years into post press.
Because after talking many, many years with our customers and they always told me, Ralf, we need an alternative, I said, one day I said, okay.
We went and saw them just before and that was one of the live sessions I followed with specific interest because it started so natural that Koenig & Bauer was such a market share in packaging. And I liked that you use the module design that you can have the magnetic plate.
Oh the rotary die-cutter.
Yeah the rotary die-cutter and also the way that you can eliminate the scrap from the dyes and it was just, I think that if you are in the Kellogg’s segment of the market or if you are doing a really large printing, I mean, it’s fantastic.
It’s a game changer.
It’s a game changer. Also because of the speed and the quality of it, right?
Yeah but also if you see what we did at Iberica, Koenig & Bauer Iberica, we invested a lot in new people. We have a great team there combined with our team in Radebeul, so now we have a brand new flatbed die-cutter, CutPRO. Our CutPRO 106, this was a dream I had.
On a pen and the paper next to your bed?
Yeah, yeah, exactly and I thought, okay, the market is looking for an alternative and now we invested in people, we had ideas. And now first time we showed the machine on our show and we are really on eye-level with the market leader, in my opinion. So the market will tell us, of course, yeah. But we are very proud to have this new capability for our customer flatbed die-cutter, rotary die-cutter and also gluing with Duran. Great success and we’re very happy about it.
I can’t help think of for now, I’ve been here. It’s been, I think it’s more than 10 years ago I was here, at that time it was KBA. And I can’t help thinking of how impressed when you get here, get so impressed that you sometimes forget all the, you have always have to think about business ideas and you have to think about how you can make return on investment because you get so amazed about the technology that you deliver, it’s so high level technology, everything you see here. Is that also something that’s also in your mindset, as you said you had engineering background, right? So is it driving also sometimes, way more than maybe we can rather than this a need or is it really balanced?
Yeah I mean, that’s a good question. I hope it’s balanced. But again the ideas, most of the ideas come from our customers. So then we try to find a solution for our customers and present it to them. And sometimes they like it sometimes not. And then we just, I think we are very engineer-driven company. It’s not only me.
I’d take you more than one engineer here, right?
So we have a very good team and they are very engineer-driven and therefore we always find, we are looking for good solutions for our customers. And I think that’s the reason, this is what is driving us.
That is maybe one thing but one thing I want to add to it and that is my final thing here is that I think that all the people that I have met here today is also driven by a tremendous passion for what do you do together.
And you know, if you work hard and we work hard here but you have to have also fun. And you have to have open communication, no fear or something. So we have really open doors. We all work together on eye level and you cannot imagine what kind of ideas we are creating here so it’s a lot of fun and I’m happy to hear this from you that you will see this also.
You feel it right away when you come here.
This is a very special spirit here at Koenig & Bauer.
So thank you very much for your time. I know you’re busy so thank you very much.
Thank you very much, all the best