After the integration phase following the merger of manroland web systems and Goss International, Alexander Wassermann hands over the reins to the new managing director, Franz Kriechbaum. In an interview by VDMA Printing and Paper Technology, the two talk about the advantages of the merger for the international business of the newly formed manroland Goss Group, their plans for the packaging market and service, and fully networked Print 4.0 processes in web offset printing.
VDMA: Would you introduce us to the manroland Goss Group?
Alexander Wassermann: Gladly. Our roots go back to the year 1844. manroland got into turbulent waters at the beginning of this decade. After the insolvency in 2011, the Possehl Group from Lübeck joined the company. The merger with Goss International followed in August 2018. Together we are today the world market leader in web offset printing and employ around 1,000 people. In 2018, our combined turnover amounted to € 293 million.
VDMA: What do you expect from the merger with Goss?
Wassermann: The key driver is market consolidation as a result of declining print volumes in the web offset sector. For us, the merger is interesting primarily for two reasons: manroland is strongly represented in Europe. Goss, on the other hand, had focused its regional activities on the US market and largely withdrew from the European illustration and newspaper printing markets. However – and this leads to the second point – Goss has here and we still have a large installed base there. So we complement each other very well and can build together on a strong service business. We can now better serve manroland customers in the USA and Goss customers in Europe, both in the new installations and service business, which contributed two-thirds to our total sales in 2018. Here we have a solid basis, which is less volatile than the continuing downward trend in the new investment market.
VDMA: How did your customers and your shareholders react?
Franz Kriechbaum: We have a very positive feedback. Our customers prefer a healthy large company to competition between two troubled companies whose future is uncertain. And our shareholders give us as much freedom as possible. As a Hanseatic trust, Possehl does not interfere in our operational business. Behind Goss is a private equity firm that focuses on more intensive controlling. That was unusual at first, but creates welcome clarity.
VDMA: How is the web offset market developing?
Wassermann: As I said, business continues to decline. With the exception of Japan and some less developed regions, however, we are very well positioned with our portfolio. And I expect paper and cardboard to experience a renaissance due to the sustainability debate. After all, the basis is renewable raw materials that we have been using for a long time in functioning material cycles. In letterpress we can already feel the updraught. In this market we sell two to three new web offset presses a year. As a ‘last man standing’ in high-volume printing, we have a good starting position – and our order books are well filled until mid-2020. We are dimensioned so that we can deliver a new machine every three weeks.
VDMA: Are your high-end presses up to the trend towards shorter runs and rapidly changing print jobs?
Kriechbaum: I think that this is exactly where our consistent automation philosophy comes in. Major customers have an average of less than 200 copies of waste paper during job changes and run their presses at a constant 24/7 stop with an output of several tens of thousands of copies per hour. In letterpress printing, the plates on our large web offset presses are also changed every 20 minutes in 24/7 operation. This works fully automatically by robot. The problem of our customers are the personnel costs. In many regions, large publishers are forced by framework conditions to place more employees on their machines than is actually necessary. Independent print service providers who work fully automatically around the clock are at an advantage here. Of course, this places high demands on our service. We need to be available day and night and plan service intervals with customers to minimize downtime.
VDMA: What do you expect from your Varioman packaging printing machine?
Wassermann: Flexographic and gravure printing solutions have dominated packaging printing to date. With offset technology, we offer an alternative in which we have achieved a high degree of automation. The Varioman is the first of our machines to have a supplied printing unit, which we integrate into a truly industrial solution with our know-how in automation. Offset in packaging printing will remain a niche market, but we are convinced that this technology offers an interesting alternative where long runs and quality come together with many job changes. In addition, we have proven the high flexibility of the system in tests. It can print 10 to 300 micron thin papers and foils at up to 400 meters a minute. Of course, we are also considering whether this offers prospects in the cardboard and folding carton sector. Here, fully integrated solutions are conceivable that print from the reel with seven inking units and ensure the right formats inline with a rotary die cutter. Nor are these considerations. Now we are curious to see how the market will accept the Varioman, which is exactly between flexo and digital printing in terms of costs.
VDMA: What role does Print 4.0 play in your solutions?
Kriechbaum: We have created the term ‘Maintellisense’, which combines the areas of maintenance, intelligence and sensor technology and focuses on preventive machine maintenance as well as the networking of the machines to our tele-support center. Thanks to this connection, we have access to a broad data pool and can systematically use the information contained therein. The aim is to convert BigData into SmartData in order to avoid unplanned downtime costs. Our vision is for our machines to be able to diagnose themselves in five years and give their operators concrete recommendations in the event of imminent faults. Anyone concluding a service contract with us automatically receives the necessary material and technicians from us to carry out preventive, planned maintenance. We are very far advanced in networking and are in the process of advancing the use of Artificial Intelligence. There may also be opportunities to transfer our know-how in this area to other industries in the future.
VDMA: What about the compatibility of your networking solutions?
Wassermann: We rely on non-proprietary technology for our Pecom hardware and software solutions in order to offer our customers maximum flexibility.
VDMA: Where do you currently see growth potential for the manroland Goss Group?
Kriechbaum: Our customers use our systems, but they also use alternative suppliers for service and spare parts procurement. Some we don’t even see anymore, others completely rely on us. But on average it is barely 20%. If we increase this share to 30%, our sales in this area will rise from € 200 million to € 300 million. We can provide service – but we have to regain the trust of our customers and convince them that we can really help them in their daily business. We have been focused on the new installations business for too long. We see further potential in the automation and retrofit sectors. To raise it, we are strengthening our position through targeted acquisitions. With our solutions, we can almost always bring existing systems from manroland, Goss and other suppliers up to date with the latest technology. In the field of automation and networking, we employ engineers and IT specialists in a targeted manner. As soon as they understand how high the technological level in printing technology is, we usually no longer have to do any persuasive work. It’s harder to get their attention.
VDMA: Final question — How do you see manroland Goss in 2030?
Kriechbaum: I think we will continue to be the reliable supplier of web offset systems in 2030 that we are today. We will also have a name in the packaging industry and successfully occupy a niche with our flexible solutions. And last but not least, our innovative industry 4.0 solutions will set us apart from many me-too approaches by really delivering what the buzzword ‘predictive maintenance’ promises.
