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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.

History of Brown Printing Company


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
theWaseca 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, rotogravureplant 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 RCACorporation'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
toPrinting Impressionsmagazine's 1987 list of the 500 largest U.S. printing companies with estimated
sales of $300 million. According to a January 1988Minneapolis/St. Paul CityBusinessarticle, 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 1989Minneapolis/St. Paul CityBusinessarticle 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, includingComputer Reseller
NewsandElectronic Buyers News, to Brown Printing's cache of magazines: high-profile national
publications, such asTime,Sports Illustrated, andPeople, 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 1993CityBusinessarticle 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 DevonGroup, 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 1997Minneapolis/St.
Paul CityBusinessarticle by Jennifer Ehrlich, that Brown Printing "is probably trying to go for a more
conservative path now."
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 consolidationin 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 plateeliminating 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 printingwas 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.

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