Alliance Creative Group (ACGX) Growth in Print & Packaging Industry Driven by Full-Spectrum Approach, Aesthetic Yet Practical DesignsSeptember 29th, 2014
Alliance Creative Group bundles together everything a client needs to handle their brand identity in print and packaging, with the kind of back-end supply chain management capabilities and brand development skills needed to execute an entire strategic marketing campaign, including fulfillment and the assembly of customized product kits. With a vertically integrated component architecture that allows the company to share resources and capabilities across its multiple business units, ACGX has incredibly dynamic reach.
Alliance Creative Group’s recent extension of a successful 12 year plus relationship with the biggest privately-held beauty company on earth, John Paul Mitchell Systems, stands as a testament to the company’s printing and packaging prowess. President of JPMS, Luke Jacobellis, even went so far as to say that ACGX, while a valuable business partner for over a decade now, nevertheless continues to seriously impress the world renown developer of some 100 award-winning styling and care products, which today does business in over 80 countries around the globe.
ACGX was tapped by JPMS to handle substantially all cartons, inserts and master shipping boxes for their PM SHINES™ translucent hydrating demi-permanent line of 27 intermixable hair colors. A project whose success owes a great deal to tight-knit cooperation directly with JPMS, as well as the decades of creative/design production experience brought to bear by ACGX’s creative team, which has a distinct mastery of balancing eye-popping aesthetics with practical packaging assembly requirements. It is this versatility and class that ACGX’s clients have come to know and love, since the company morphed from online marketing, to a full-spectrum brand identity management and print/packaging house in the 2000’s. The company currently has a staff of 23 full-time employees in their Schaumburg, Illinois HQ and maintains a sophisticated umbrella of independent contractors to boot.
Alliance Creative Group’s ability to handle order fulfillment, including complete packaging and kitting of products into attractive, yet cost-effective bundles, while also doing initial distribution and ongoing, on-demand replenishment, further distinguishes them from other players in the print and packaging space. According to Q4 2013 research by Hewlett-Packard (NYSE: HPQ), the domestic market opportunity for packaging is around $11B and while only 7% or so of that volume is digital, shorter product life cycles are increasing overall demand for digital (as opposed to traditional analog) printing by leaps and bounds. This trend, further enhanced by growing product versioning and environmental impact concerns on the part of clients, means the iron is red-hot for ACGX, given that they are a one-stop-shop solution provider, which has considerable expertise in digital print.
Market research by German print hardware specialists, Heidelberger Druckmaschinen AG (ETR:HDD), throws a bright light on an already well-established phenomena, that customers typically recognize their favorite products (and are made to feel at ease about their purchase) by the familiar/engaging packaging of the brand. Heidelberger’s analysis even indicates that some 80% of women recognize their favorite perfume not by the scent, but by the product’s packaging.
Ernst & Young put the global packaging market at around $500B last year with all sources included and further noted key market features, like brand success being driven primarily by eye-catching and colorful designs that grow awareness, as well as the emergence of the mass luxury category in cosmetics and other consumer goods. The E&Y report also indicated that managing the increasingly complex supply chain “balancing act,” was fundamental to the success of a given brand/product.
The ability to do it all is one of the most compelling advantages ACGX clients get access to and there is little wonder then at the company’s strong Q2 results this year, showing a 26% YoY jump, with gross profits up 51.6% over the same period. ACGX even set a new record this year, with over $6M in revenues for the front half of 2014. That strong growth story is further underscored by a recent initiative to form the “Alliance Tank” operational unit, which is tasked with developing shared resource utilization, as well as strategic M&A now that the company is logistically proven, with an unquestionably established track record of first-rate performance for their clients.
ACGX is looking to tack on additional infrastructure in the creative/design, packaging and supply chain management areas, but is also looking at PR & marketing operations, as well as tech and software developers. The optimal targets will have compatible sets of competencies that will further improve the company’s already dominant internal theme of synergistic verticals and ACGX is particularly interested in targets that have a proof-of-concept completed in the consumer products arena, especially if there is a natural dovetail with the company’s own extant portfolio.
Strong client retention capabilities and the capacity to handle all aspects of print/packaging requirements continues to drive business to ACGX’s door and with a management team overhaul to support their growing network of clients (many of whom have been with the company for over a decade), the company’s project management, strategic marketing and business consulting strengths are better than ever. COO and general counsel for ACGX, Paul Sorkin, even said in a recent interview with Small-Cap/Micro-Cap online Investment Newsletter service, QualityStocks, that the company looks to be on pace for $12M in revenues this year, with as much as $800k in net income. No doubt buoyed in part by the company’s entry into the ultra-hot marijuana sector, where they will provide the burgeoning product mix (everything from candles and edibles, to lights and supplements) with the same kind of first-class printing, packaging, marketing, and supply chain support services that brands like Paul Mitchell have come to trust with their bottom line.
More info on Alliance Creative Group is available at www.AllianceCreativeGroup.com
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