Brown Printing Company

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Brown Printing Company

2300 Brown Avenue
P.O. Box 1549
Waseca, Minnesota 56093-0517
U.S.A.
(507) 835-2410
Fax: (507) 835-0238
Web site: http://www.brownprinting.com

Wholly Owned Subsidiary of Bertelsmann/Gruner + Jahr,
Founded: 1957
Employees: 2,600
Sales: $396 million (1998 est.)
SICs: 2721 Periodicals; 2741 Miscellaneous Publishing

Brown Printing Company, headquartered in rural Minnesota, is a nationally recognized producer of business, trade, and consumer special interest publications. In-house services include conventional/digital pre-press, platemaking, bindery, distribution services (label/ink jet), and desktop publishing. The company is owned by Bertelsmann/Gruner + Jahr Company, the third largest communications conglomerate in the world, behind Disney and Time Warner.

Small-Town Entrepreneur to Regional Printer 1950s-70s

Wayne (Bumps) Brown established Brown Printing Company in his hometown of Waseca, Minnesota, a small community about 80 miles south of the Twin Cities. Waseca was the site of a number of prior Brown family entrepreneurial ventures. Wayne’s father, Donald Brown, was editor and owner of the Waseca Daily Journal. His mother, Bell Brown, owned the Corner Lunch. His grandfather Walter Brown was proprietor of Brown’s Dry Goods located in Waseca and Rochester, Minnesota.

In 1957, Wayne Brown sold his interest in the family newspaper, bought the commercial printing end of the business, and began producing catalogs and publications on flatbed letterpresses. Brown and his team of printing artisans increased the speed of production with a switch to a four-color, heatset, web offset printing later in the decade. In 1964, Brown Printing Company began construction on a new facility also located in Waseca.

In 1969, Bemis Company, Inc., a Minneapolis-based manufacturer of packaging products with $300 million in sales, purchased Brown Printing. Wayne Brown retained his position as company president of the wholly owned subsidiary. At the time of the sale Brown Printing’s annual sales were over $7 million.

While the existing facility was expanded numerous times, and an ink production division was added in 1972, Brown Printing remained a single-plant company until 1978. The company expanded outside of Waseca for the first time when it opened a second web offset printing plant in East Greenville, Pennsylvania.

The East Greenville Printing Plant served the regional magazines and news weeklies located in the mid-Atlantic states. To satisfy customer demand, another eastern subsidiary began operation the next year. The Franklin, Kentucky, rotogravure plant was among the most modern in the nation when it opened in 1979. The gravure facility gave Brown Printing the ability to reproduce the high quality pictures desired by the publication and long-run catalog markets.

Sale to International Concern Sets Tone for the 1980s and 1990s

In 1979, Bemis sold Brown Printing to a subsidiary of Hamburg, West Germany-based, Gruner & Jahr AG & Co., a publishing and printing firm. Bemis received $45 million for Brown Printing, which embodied the largest part of their graphics business line.

In 1986, Brown Printing’s parent company, Bertelsmann, became the second largest publisher of books in the United States thanks to the procurement of Doubleday & Co. The worldwide communications giant also owned American-based Bantam Books. Bertelsmann, which had annual sales of more than $3.8 billion in 1985, also gained sole ownership of RCA Corporation’s record business, the third largest among U.S. record makers, in 1986.

Brown Printing, notable in its own right, ranked 28th in the nation among printing companies, according to Printing Impressions magazine’s 1987 list of the 500 largest U.S. printing companies with estimated sales of $300 million. According to a January 1988 Minneapolis/St. Paul CityBusiness article, some of the largest specialty printers in the country were located in Minnesota: 15 Minnesota companies in all made the top 500 list.

Brown Printing expanded to the West Coast in 1987. The California operation included the Riverside County Publishing Company (Riverside) and First Western Graphics (San Leandro). With the addition, Brown Printing had proximity to major population centers on both coasts and in middle America. Two years later, Brown established a PrepSAT division which encompassed the electronic pre-press operations. State-of-the-art equipment furnished Brown with new methods to process customers’ images and words in preparation for printing.

The 1980s held challenges for many industries; the printing business was no exception. Increased competition and rapidly changing technology put pressure on even established printing companies. High-speed presses, according to a June 1989 Minneapolis/St. Paul CityBusiness article by Nora Leven, “crank out more pieces per hour than did the previous generation of presses.” Subsequently, the industry was capable of producing more product than the market demanded. The over-capacity led to falling prices. Brown Printing responded by improving operation efficiencies and retiring outdated equipment a step ahead of the competition, but the company’s growth slowed.

Brown Printing broadened its reach with the creation of the Alliance List Services Division in 1991 to serve high-volume customers. The purchase of CMP Printing Co., Thorofare, New Jersey—a subsidiary of New York-based CMP Publishing Co.—in 1993, added seven new titles, including Computer Reseller News and Electronic Buyers News, to Brown Printing’s cache of magazines: high-profile national publications, such as Time, Sports Illustrated, and People, were among those already printed at Brown’s East Greenville, Pennsylvania, plant.

“It’s much easier for the large printers like Brown to buy an existing business than to try to take business away from the competitors,” said Kelvin Johnson, president of the St. Paul-based Printing Industry of Minnesota Inc., in a January 1993 CityBusiness article by Betsy Weinberger. Brown Printing’s total annual revenue exceeded $400 million. The company was the eighth largest catalog printer and fourth largest publications printer in the nation. As a whole, the U.S. commercial printing industry generated about $85 billion a year in sales.

Through affiliate company BGJ Enterprises, Inc., Brown Printing purchased Graftek Press, Inc., a subsidiary of Connecticut-based Devon Group, Inc., in July 1997. Graftek, which had annual sales of about $60 million, specialized in printing, binding, and fulfillment services to magazine, catalog, and commercial clients.

“The acquisition of Graftek and its subsidiaries fits perfectly with Brown Printing’s long-term strategy of further building upon its dominant position in the trade/business, consumer special interest magazine and catalog markets,” said Brown Printing President and CEO Dan L. Nitz in a July 1997 news release.

The 40-year-old company printed more than 280 magazine titles for publishers and more than 250 catalogs for direct marketers. Brown Printing had manufacturing facilities in seven U.S. locations and employed more than 3,800 people. In its Waseca facility alone, the company used over 400 rolls of paper a day. The rolls averaged about 1,800 pounds and were about 10 miles long. More than 95 percent of the five million pounds of ink used at the plant a year was produced by the company’s Ink Division.

Brown Printing added to its holdings a few months later with the acquisition of Tulsa, Oklahoma-based PennWell Printing Company. The trade and business publication printer had spun off PennWell Publishing Company in the early 1980s. Well-established, Brown Printing’s new acquisition printed more than 100 magazine titles for 70 different publishers. The 1997 purchases of PennWell Printing and Graftek Press boosted Brown Printing into the number one spot among U.S. trade and business publications printers.

While building on the trade and business publications aspects of the company, Brown Printing dropped out of the gravure printing with the sale of the Franklin Printing Plant in Kentucky. The division printed circulars for local and national retailers. The advertising business, which used electronic media as well as printed media to sell its message, was subject to more volatility than the business publications arena. Minnesota-based print industry consultant Gershom Wu speculated, in an October 1997 Minneapolis/St. Paul CityBusiness article by Jennifer Ehrlich, that Brown Printing “is probably trying to go for a more conservative path now.”

Company Perspectives:

Customer service, high-quality printing and state-of-the-art technology are taken very seriously at Brown Printing Company. Each day, highly skilled and dedicated employees strive to make our customers’ experience with Brown satisfactory in every way.

This strong commitment to quality, service and technology has truly benefited our customers over the years and has elevated Brown’s reputation as one of America’s most prominent full-service printers of magazines, catalogs and inserts.

As the printing and publishing industry continues evolving, you can always count on Brown to be there with innovative solutions and technology to meet today’s demands.

Looking Toward the Future

The $120 million sale of the Franklin Division to Boston-based Quebecor Printing USA, the second largest commercial printer in the United States, and a subsidiary of Montreal, Canada-based Quebecor Printing Inc., was representative of the direction the industry was heading. Just as Brown Printing facilitated growth by acquisition so did its even larger competitors. “As technological advances continue to fuel consolidation in the print industry nationwide, Quebecor has embarked on an aggressive acquisition strategy to beat out the competition by sheer size,” wrote Ehrlich. Quebecor Printing Inc. had 115 plants in Canada, the United States, Europe, Asia, and Latin America. Brown Printing had exited a facet of the printing business in which Quebecor held a dominant position.

Brown’s own parent company, Bertelsmann, advanced its U.S. holdings in 1998 with the acquisition of Random House and boosted its share of the U.S. book market from six to ten percent. The giant media company held book, magazine, broadcasting, digital pay-TV, and online service concerns. Brown Printing was able to supplement its own in-house offerings through its union with Bertelsmann/Gruner + Jahr: web site and CD-ROM development, as well as custom publishing services offered by various divisions of the parent company, complemented Brown’s core printing business line.

Brown Printing had long prided itself on its commitment to both customer service and leading edge technology. The company continued to uphold both those traditions in 1998. The Minnesota-based company, with an eye to changing customer demographics, opened a sales office in suburban Tampa in 1998 in order to better serve the rapidly-growing southeastern region. Ongoing equipment upgrades within Brown Printing’s facilities provided customers with the most up-to-date and widest variety of options available in the industry from formatting to binding.

Brown Printing was among the first, worldwide, to install computer-to-plate (CTP) technology, which allowed customers to move their materials through the entire printing process in digital form. Data could be transferred directly from computer to printing plate eliminating film and chemical waste as well as cutting turnaround time. Instead of waiting for films and proofs customers inspected the printing job on their own computer screens. The conversion from mechanical to electronic printing was viewed as the wave of the future, and Brown Printing was at the forefront.

The combination of market know-how and financial strength positioned Brown Printing well in terms of retaining existing customers and bringing on new ones in the future. The company headed toward the 21st century quite secure in its position as one of America’s leading producers of business, trade, and consumer special interest publications.