Thankfully there have been considerably more ups than downs, not least because on his watch he has cemented the South Wales printer’s position as one of the UK’s largest sheetfed magazine houses.

That’s not to say everything is rosy. Pricing remains an issue in Jones’ markets, meaning that even though the company boasts one of the most modern press halls in Europe, maintaining a healthy margin remains a constant struggle.

But Jones isn’t afraid to fight the good fight, even if, depressingly, some people in the sector still consider ‘profit’ to be a dirty word. 

Darryl Danielli You operate in probably one of the most price-sensitive and competitive sectors; post recession is pricing in the market generally getting better?

Andrew Jones Well, you’ve still got silly buggers in the market – buyers can always buy in cheaper. Of course there are still lots of companies going bust, but then there is still lots of capacity, so you have to wonder where it will end.

If the magazine market is challenging though, does that mean that you’re looking to take on an increasing amount of commercial work?

We used to be about 50% magazines, but it’s probably nearer 40% nowadays, because you can’t do 100% magazines, the schedules just won’t allow it as everything is crammed into the last two weeks of the month. We’ve got three core product areas: magazines, contractual – like football programmes, for example – and one-offs like directories and reference books or journals.

Does that make it more challenging, trying to compete across multiple markets?

In the old days, we were focused on magazines and people didn’t see us as anything other than a magazine printer. But the truth of the matter is that, with the equipment we’ve got now, it’s so productive and the quality is so good that we can print commercial work. In fact we started off as a commercial printer.

So what’s the history?

We started 103 years ago as a jobbing printer. My father made a conscious decision to get into magazines in 1979, but we were still doing commercial work. Then in 1988 we set up SGC Printing and took the commercial work outside of the magazine business.

How come?

Basically because, all those years ago, the demands of magazine printing were completely different to those of commercial printing. Magazines were seen as a young man’s game, with young staff because the hours were longer, so I ran the commercial part of the business.

Even though you were still a young man?

True.

Who started the original business then?

My father’s mother’s father. My father joined the business after being off school for a year with glandular fever. The story goes that my grandfather said to him ‘you’d better get your arse down to this printing business I’ve got, because I know nothing about printing and I need to know what’s going on’ – or something like that anyway. He was planning to go back to school and then university afterwards, but he joined in 1955 and never left.

But he wasn’t running it from day one, surely?

No, he took it over in around 1963 or 64 – he would have been in his mid-20s then. I joined on 1 August 1979 and I was the 26th employee – we were tiny really. We didn’t turn over £1m until March 1984.

So did you join as an apprentice?

Well, I joined to work in every part of the business and then I went off to Watford Printing College to do a BSc in printing technology. I then came back to the business in the typesetting department, ran that for four or five years, then did a bit of sales, then I ran Pelican [S&G’s trade finishing arm]. And then in 1988 we set up SGC and I ran that as a separate business. We had a two-colour B2 and a couple of single-colour GTOs and we developed that into a business that turned over around £6m.

Was that your dad’s plan then, to get you to run each of the individual business units before he handed over the reins?

Well, I’m not sure it was exactly a plan...

So was it more that wherever there was a problem your dad sent you in to sort it out?

That’s probably closer to the truth. I remember it like it was yesterday; we had a board meeting in 1987 and the old man had decided that we couldn’t have commercial and magazines in the same place, because they had different requirements. So, basically he was looking to throw away all the commercial work and just focus on magazines, but I reminded him that we didn’t really know how much of our work was commercial because none of the accounts were computerised in those days, so if we wanted information it took weeks to get. So he said, ‘well done, you’ve talked yourself into a job – you can have all commercial work and we’ll take the magazines’. Don’t get me wrong, this wasn’t exactly an empire at this stage. I think I had six staff when we started SGC on 1 April 1988. 

But you grew that business to sales of £6m, and clearly the magazine side has grown too?

We did £1m in 1984 and in 2014 we turned over just under £24m. And during that time we also installed CTP, which significantly reduced our earning potential...

How do you mean?

I did some calculations a while ago. In 2001 we were 100% CTP, but in 2000 we were getting anywhere between £50 and £80 per plate. So I worked on the figures from 2014 when we were producing 22,000 B1 plates a month and charging £25 per plate. Then for every 16pp section the client was having to supply film and that was £5 per colour, so that was another £20 per page or £320 per 16pp. Then there were Cromalins, etc. So I worked out that based on the costs we had taken out we were saving our clients £18m on our current figures. Yes, we’ve lost 20 planners, but we’ve had to replace them with expensive machines that we replace every five years at least. I know it’s a bit tongue in cheek, but basically if we hadn’t have gone CTP or hadn’t passed on the savings then we would have double our current turnover now.

I know that you’re sort of joking, but isn’t that indicative of the industry being too keen to give value away?

The printing industry has a plethora of businesses that have done just that. We installed our first eight-colour press in 1995, we didn’t go to the market and say ‘look we can do it in almost half the time, so we’re going to resubmit our prices accordingly and hack the market to pieces’. Instead we were still submitting prices based on a four-colour press, but as soon as other people got their hands on the technology the prices started to get hacked to pieces and it’s always been the same. It’s madness – we live and work in an industry that is highly capital intensive, and all we ever do is give the value away. 

But why is that?

The truth of the matter is that in print, all too often profit is seen as a dirty word. And if you’re seen to be making money then customers will come to you asking for lower prices. That’s a generalisation I know, and we’re lucky that the majority of our clients appreciate that we need to make a profit to reinvest in the business, but across the industry I think that attitude is the exception rather than the rule.

Do you think that sort of attitude is unique to print?

Does it happen in other industries? I don’t know. I feel that the UK market place is only concerned with price. I sometimes worry that too many buyers see the cost of everything and the value of nothing. Even though we’ve had a massive reduction in the number of printers, because of the developments of technology the capacity has actually increased. I mean, who would have dreamed that I would be looking to put £30m through this plant with four long perfectors and a straight press? Years ago that just wouldn’t have been possible. 

But that’s not just the fault of the buyers, is it?

No, it’s a combination of factors. The problem is that you can always buy it cheaper, so even if a printer charging obscenely low prices does go bust, as far as their clients are concerned that’s the benchmark for prices and, trust me, they will always be able to find some bugger to do the work for the same price – even if they know the original supplier went bust charging it. It’s not helped by the fact that a printer takes a long time to die, because it has assets, and when it’s in its death throes it can do a lot of damage to the market. That said, it’s probably no harder today than it was before. As an industry we know we produce a fantastic product – but it has always revolved around price. 

Back to you though, when did you take on the whole business?

2000. Up until then I had been looking after the magazine side of things – I moved to there from SGC around 1995 and ran it with Tony Jones [who later led an MBO at rival magazine printer Pensord]. We then became joint chief executives, which was never going to work because somebody has to be in charge. At that time the old man became chairman. 

Was that your dad’s idea, to give you some support in the role?

Well no, because I was meant to be running production and he was supposed to be running sales and marketing, but he kept interfering with production, because we were doing things wrong, apparently. So for whatever reason he left and took on Pensord. I then took sole charge in 2000.

So in a funny way, even if it wasn’t the plan, in effect your dad got you running every part of the business at different times, so you had all the experience you needed when you became chief executive?

Well yes, but it still took a bloody long time.

But he wasn’t involved in the day-to-day running of the business after you took sole charge?

No, he stopped being involved day-to-day from 2000 onwards.

So you were pretty much left to get on with it?

Yes, but of course he would still come in and interfere [laughs]. My old man was my best mate, my mentor and my father – it doesn’t get much better than that. We spent lots of time talking about the business even after he stepped back.

It must have been incredibly tough losing him in 2004, not just on a personal level, but also on a professional level – you lost your sounding board.

I had a very difficult year after he died. I was particularly vulnerable for a while, but over time I developed those sounding boards within the business – different people for different things. 

But do you think because you’ve worked in all aspects of the business you have a better understanding of the challenges your team faces?

I don’t know if I could really have a better understanding than the staff or their managers. But I think I can be more objective, the managers are sometimes stuck in the swamp and forget that they’re there to drain the bloody thing. Because I’m not involved in the day-to-day production side of things like I was 10 years ago, I’m able to be more questioning rather than just making my own assumptions. 

But has it also made you a royal pain in the arse to the team because you know every part of the business?

I hope so [laughs]. I think it’s fair to say there are times when I can be a little bit overzealous when we’re discussing things.

But it’s personal; it’s a family business so that’s understandable.

True, but we try to run it corporately. This isn’t a lifestyle business, my old man never ran it that way, I’ll never run it that way. We don’t rip the money out of the business, we pay performance-related bonuses and we reinvest. I make no bones about it, we’ve had a few good years lately, but then you have to remember that in our world a good year is making between £500,000 to £1m.

What are the ambitions for the business?

In the short term it’s to get to sales of £30m, and we’re well on the way to that. 

And longer term, even bigger? Or is £30m your sustainable target?

Well that’s the challenge, especially when pricing is where it is and the markets we’re in. I don’t think £30m is sustainable, we would need to grow. It can be quite debilitating to think that the only way to increase profitability is to bolt on sales. I was watching a B&Q advert the other week, where they were talking about all of their prices coming down, just selling on price, and now they’ve announced that they’re closing a lot of stores because their profits are falling. It doesn’t take a genius to figure out that that there might be a correlation with the fact that their model is sell, sell, sell, cheap, cheap, cheap. We’ve got that mentality in our industry too. 

In terms of growth though, are you looking at any acquisitions at all?

We did look at one company that was in trouble, we ran a budget on it and even if we took it on it still looked like it would make a £200,000 loss in year one. So we didn’t move on it. I then got a call from a restructuring company asking me if I was interested and I explained that I had looked at it, but as far as I was concerned it was a basket case. He then said there were things he could do like a pre-pack, but, and I know this sounds bombastic, but with my reputation and standing then I didn’t really want to be associated with a pre-pack.

But there’s a difference between existing directors pre-packing or phoenixing a company or an external buyer coming in and acquiring a business in pre-pack.

Maybe, but regardless, someone else bought it. But there you are, some people are quite happy to do that, and that’s their choice, but it’s not for me. At the end of the day, in essence what you’re doing is buying a business and assets for ostensibly nothing, and writing the debt off and starting again. I appreciate that it might save some jobs at the firm in question, but in an industry with so much overcapacity you have to think about the broader impact on the sector.

You’ve had some tough years too though, haven’t you?

Absolutely, in 2009 and 2010 we made 25% of the staff redundant and that was an incredibly difficult time for everyone. That ran in parallel to a major investment in the pressroom too. We put an eight-colour XL 105 in during January 2008, we had four long perfectors at the time and after three months of running the XL, I sat down with the other directors and said ‘right, we’re going to take out the other three presses and replace them with two XLs’. There were gasps of horror, not just because these were £3m presses but because we were going from four presses to three. We ran three presses until March last year.

But the redundancies were as a result of reducing the number of presses, so needing less shifts, rather than a cost cutting then?

Well, we had to save money too, as we were forecasting that if things continued as they were, with profits ebbing away, then it wouldn’t have been too long before we would be making a loss. But we had a pile of money in the bank, so we decided to act early and I decided that despite being in a recession it was the right time to invest in the latest press technology. We knew we would come out of the recession at some point and by that time we would know how to get the best out of the technology. Since then we’ve reinvested in the latest technology again. But at the time I just explained to people that our bus had gotten out of control, we were just employing too many people and not producing enough work, so we had to trim it back otherwise at some point in the future everyone might have been out of a job.

That must have been tough?

It was because we so departmentalised we had to go through the process as fairly and evenly as possible, so in the end we interviewed 150 people, even though we only lost 50 jobs it was harrowing for the staff. We developed a matrix, agreed by our partnership forum, which is a staff workshop that meets six times a year to discuss the business, and they agreed the redundancy criteria and then we scored everyone against those metrics. It’s not something we took great pleasure in, but it was open and transparent. And if we hadn’t have done it then we might not be here today.

But since then you’ve probably increased headcount?

We’re still a much leaner business than we were, top to bottom. We went down to about 212, we’re up to around 220 now. 

In terms of investments, clearly you’ve invested heavily in the latest litho technology over the years, but is digital an area you’ve looked at?

It’s something we’ve looked at, but it’s not really something that we’re really geared up to do, partly due to our location, partly due to how much demand there would be from our customers. Never say never – I know some of our peers have, but I just don’t know if it’s right for us, right now. Also when I can makeready a 16pp section on a press in four and half minutes... Yes, you have the cost of plates, but we can run down to 300 or 400 copies.

On the subject of run lengths and paginations, digital channels must be having a big impact; how are your paginations holding up generally?

They’re increasing. Of course paginations dropped in the recession, due to the combination of reduced advertising spend and the ‘digital revolution’, but that’s turning around. I’ve been involved with publishing businesses and also, of course, I talk to a lot of publishers, and their biggest problem is monetising the web, not falling print paginations.

And in terms of the other ‘web’ have you seen much migration from web to sheetfed?

We’ve seen some. Not all of that is down to shrinking run lengths though, some is due to there being fewer players in the web market. And also, when the web guys get busy they want to run the jobs they want to run. It’s only when they’re less busy that they start dipping into our market, which is around the 12,000-copies mark, but that’s not really where they make their money. Whereas for us, we don’t make much on long runs, we prefer shorter runs. But that’s been the case ever since I can remember.

You mentioned earlier that S&G isn’t a lifestyle business, so what’s your exit strategy?

All I wanted to do was go into the printing business with my old man. We’ve got some strong management here, some of whom have another good 20 years in them. It takes a lot of effort to run a business of this size. Would the children want to run it? Would someone else want to run it? How much is it really worth if I did want to sell it one day, which certainly isn’t part of my plans. I’m fourth generation and I would like to carry that on, but I’m not worrying about it just yet.

Last question. Do you ever regret never having worked in a different business at any point to get a different experience?

No, I’ve loved my journey here. Of course there have been ups and downs, but there have been a lot more ups than downs. But we’ve got a good business, I don’t mean that arrogantly, but we do a bloody good job here. Yes, we still want to do better, and will always want to.