ONE YEAR AFTER BUYING Mitcham print and mailing house DP Direct, Nick Claxson says he has “no regrets”.

The business had been on the market for three years – with no takers and no great investment during that time – and perhaps had all the hallmarks of a business on a gradual decline, being left behind as others surged ahead. Staff numbers had fallen from around 70 five years ago to 35, working just a single shift plus overtime. Claxson didn’t see it like that. He knew about the business, having wedded the boss’s daughter. But he had his own IT business to run.

And this business, Comtec, has been doing very well indeed. Claxson, still only 30, started the business on leaving university and it has experienced 3,000% growth in the five years since. Turnover, at £4 million in the last financial year, should reach £7 million in this. The company runs data centres for major companies with a big emphasis on how to lower IT’s environmental footprint. Its own data centre, to offer outsourced IT services for smaller companies, opened last year in Reigate. It is a flagship for this approach. It has ultra clean hydrogen fuel cells to provide emergency electricity, operates with water-free urinals and stresses the value of carbon reducing IT solutions. This has won it recognition alongside other much larger and longer-established IT companies and Claxson himself was named Entrepreneur of the Year in the UK Technology Innovation & Growth Awards in March this year.

The success he has enjoyed in IT seems at odds with wanting to take on a business in the printing industry, albeit one in digital printing. But according to Claxson, the data-centric focus of DP Direct’s business has a lot in common with the IT business, not least that both businesses are talking to corporate procurement people.

Like any successful entrepreneur, Claxson sees the opportunities, not the down side. “DP Direct has a good reputation for high quality and for service. It handles some very complex work and doesn’t make mistakes,” he says. As for the opportunity: “It doesn’t do much contract work, and people call us because we have the capacity.” He has already turned some work away, partly because the price was not right and partly because the volume on offer would have unbalanced the business.

That capacity is housed in a 65,000sq ft factory in Mitcham. Inside its printing technology includes sheetfed Heidelberg Digimasters and most recently a Konica Minolta 1050, with a Delphax and older Océ on the continuous feed side and a KM 5500 for colour output. The mailing set-up is even larger, but even so there are still vast areas of factory waiting to be filled.

The company has been a traditional mailing operator, taking in pre-printed material to add to laser-printed letters and to fill envelopes. Samples of these personalised mailings and the letters that DP Direct formats and sorts for printing are displayed in the freshly decorated reception and office area.

Claxson has previously shied away from involvement as Comtec needed full attention. Now with the data centre open, the situation has changed. The IT background, he believes, can be applied to the sort of business that DP Direct is in and there are opportunities for expansion. Consequently, the deal was struck at a full price for the business. Alan Smith, who had founded the company, stays on as non-executive chairman. “I made sure that I sat down with every member of staff here and explained the vision for the business,” he adds.

Immediately Claxson brought in the green ethos that had applied to the IT business. There has been investment and gradually the building is being tidied up. In the longer term this space is to become a show-piece operation. On acquisition, it was clear that the company’s workhorse Heidelberg Digimasters had provided sterling service over the four years since installation but now needed to be complemented by a newer press. That choice eventually fell upon Konica Minolta, not least because of its ability to print on a wider range of stock (including recycled grades) than other printers, and also because it offered a lower energy consumption thanks to operating with a lower fusing temperature.

“We looked at Océ and Xerox at first, then at the Ricoh and Konica Minolta options, checking all the specifications against each other. I knew what I wanted and what the problems were,” he says. One requirement was around printing on recycled material. Because of the higher fusing temperature on the Digimasters, print on recycled papers has to dry out completely before lasering. As DP Direct positions itself in line with the environmental stance of Comtec, the company needed a machine able to print on recycled grades. The company is also working on ISO 14001 and on FSC certification. “We are going to become carbon neutral as well as FSC,” he explains. “We want to be green because it’s the right thing to do.”

The specifications on the various press choices pointed towards Konica Minolta, and distributor Danwood was called in to discuss the business. The result was the installation of the BizHub Pro 1050 and a c5500 colour machine.

This was the first step into colour for a company that had built its reputation in black and white and had been happy for it to remain that way. But customers wanted more and increasingly tenders were asking about colour and DP Direct would have to apologise that it couldn’t do that in house. No longer.

The colour printing proved easier to get to grips with than Claxson first thought and, thanks to attention paid to calibration, has proved a consistent performer. “The feedback we have had about colour quality has been good,” he says. Now the attention is turning to the software applications and how these can be harnessed to suit the business. DP Direct already has the data handling skills required of digital direct mail. And this is being enhanced by the data processing skills from Claxson’s IT business.

These skills are already being used to create websites for customers to interact with the printer. “These will not be websites open to the public, but for specific clients. Nor are we looking to do business cards. We want to be printing the longer runs, which is where the greater returns will be.”

The set-up that the business has is ideally suited to runs starting at 100,000, where previously DP Direct has over-printed on pre-printed reels or printed the letter to accompany an otherwise static mailing. For Claxson the opportunity to use the equipment it now has is far more interesting. “Instead of having to print at least 100,000 with an identical message, we think that we can print a short run of 4,000 to check the response rates: if these are good, then fine; but if not we can vary the offer or the message in order to maximise the response the client gets.”

It’s not all about the flexibility to cope with short runs. “Sometimes customers don’t understand our ability to do very long runs and what we have here,” he adds. As the marketing effort that will be behind DP Direct kicks in, that will change. The size of the building demands longer run work. It also demands contractual transactional or transpromo work which DP Direct is clearly working towards. The security systems with double door locks, cameras and so on are in place, and since the takeover the building itself is experiencing a gradual makeover. “We have never done a lot of contract work in the past, so we are adopting a wait and see approach,” he explains.

At the end of the process there will still be excess space over and above what the company immediately needs. “The plan now is to look over other companies. Given the size of the space we have here and the state of the market, we believe there will be companies, primarily digital, that can benefit by moving in here. We can take some of the burden from them and they can concentrate on running the technology part, which they know how to do,” he says.

“We might also think about investing in a B2 press, after all a business with this space can have a B1 press with reel sheeter. The right power and the right foundations are in place, so investment in litho is something that I’m quite open to.” Having a conventional offset press will also allow Claxson to offer a single source of print from under one roof working with white paper, rather than pre-printed jobs needing personalisation. “It’s sound business practice,” he says.

The intention is also to offer customers more services and so take more of their print requirements than just laser and mailing. “We are trying new ideas and becoming more aggressive in our approach,” Claxson admits. “We can talk to clients about doing more of their print. If we can get them into our workflows, we have captured them. We understand the issues around workflow because of our ICT background.”

Claxson’s track record is impressive. The growth of the IT business has earned glowing commendations about his management style and ability to be six months ahead of the trend in spotting the need to be green. His impact in transforming the fortunes of the polo club  suggests his management approach is effective. If print is going to upset that record, Claxson is showing no sign so far. “In five years I want this to be one of the largest production houses on this side of London. We have the technical skills; we have the capacity here. At the moment it’s operating on a single shift, so in five years I want this place to be buzzing. I don’t need it to be the biggest, I want to have the people here busy and I want to be dealing with technologies that keep us all interested; and the clients will be coming to discuss ideas they have for a mailing. That’s the bit that is interesting.”