Getting Graphic: Rivals Take Shots in Reprographics Skirmish
By JENNIFER BELLANTONIO
Irvine-based Consolidated Reprograph-ics’ acquisition by the owner of cross-town rival OCB Reprographics Inc. has stoked a fire that’s been burning for the past few years in the graphics industry.
OCB parent American Reprographics Co. of Glendale last month bought Consolidated from Troy, Mich.-based Lason Inc., which is undergoing bankruptcy reorganization.
The deal went through even though the Federal Trade Commission in San Francisco has been looking into claims by smaller players that the combination stands to stifle competition.
David Stickney, marketing director at American, said his company still is working with regulators in their probe of the deal.
“There wasn’t anything that was prohibitive to the sale so we moved ahead,” he said.
OCB and Consoli-dated will retain their respective names, and the management team at Consolidated will stay in place, as will workers, Stickney said.
Both companies do print blueprints, renderings and other documents for architects, engineers and construction companies.
They also offer digital color services, facilities management and sales of large format copiers and other supplies.
Consolidated’s president, Mark Sipes, called the deal a good one.
“Many of our clients knew we were experiencing financial problems for the past 16 months as a result of the misfortunes and ultimate bankruptcy of our former owner, Lason,” he said in a statement. “With American behind us, we can strengthen our infrastructure and add state-of-the-art technology to our production facilities.”
Consolidated plans to install six new digital imaging output machines and revamp its accounting system, among other things, Sipes said.
American now owns the top two reprographic businesses in Orange County, which count about 350 to 400 workers each and yearly sales in the $40 million range.
But smaller players are incensed at the deal. Zachary Dafaallah left OCB a few years ago to start his own company, Irvine-based Pacific Coast Reprographics, and has been battling OCB since. He said he’s set to meet with a federal regulator this week.
“They’re not done yet,” Dafaallah said. “It’s not a short-term thing, it’s long term. The regulators are not thinking just about Orange County,it’s nationwide.”
Federal Trade Commission officials in San Francisco declined to comment on the matter.
American has 51 independently run divisions across the country.
In OC, the company has been buying reprographic businesses for the past several years.
Earlier this year, American bought Irvine’s Universal Reprographics South Inc., which was folded into OCB.
In 1999, OCB acquired Fullerton Blueprint, which took on the OCB name.
Even so, when American buys a business it continues to “run that business from the customer counter forward as an independent business,” according to Stickney.
“The reason we do this is to foster competition in the marketplace,” he said. “That’s important to us because we certainly have markets where we have more than one American Reprographics division competing against each other.”
Three of those markets are in California, according to company officials.
But that hasn’t prevented more mudslinging.
Pacific Coast has been running sarcastic print advertisements in the Business Journal for the past three months aimed at American.
The newest ad features Dafaallah’s partner’s infant son. The ad is split in two: both sides feature the same photo of the baby.
But one image has a black mustache, eyebrows, a beard drawn on his face and a dot on his forehead.
The copy reads: “Why is ARC trying to convince you that CR & OCB are two different companies? Good family values teach us that siblings don’t fight each other! Siblings don’t take on each other! Parents don’t tell their children to lie!”
Dafaallah said the ad is a response to one that Consolidated ran in the Business Journal a week earlier.
The Consolidated copy reads in part: “Competition is just a nice word for fight like hell! Let us at ’em. When it comes to fight for your business the new CR is smack in the middle of the fray. We’re itching to take on any repro shop in Orange County.”
“We’re trying to let everybody know that (American) owns OCB, CR, Universal, Fullerton Blueprint and just about all the companies around here,” Dafaallah said. “That’s why we’re running those sarcastic ads. You have to have a sense of humor about it. I love it. When I see it, I laugh.”
But not everyone is amused.
Chuck Hayes, OCB president, said he believes the ad is racist because the way the child is marked up could be construed as a slight against Arabs or Indians.
“I’ve been doing this for 28 years,” he said. “This is the first time I’ve had to deal with something like this.”
OCB plans to eventually do some advertising of its own, but for now doesn’t want to “dirty up the papers, Hayes said.”
