Now that Perusa has taken over Merz & Krell, Senator wants to continue to position itself as a reliable partner for the promotional products industry. eppi magazine talked to the new CEO, Daniel Jeschonowski and Sales Director Ralf Uwe Schneider about “Made in Germany” production, realistic growth and the necessity to realign the cost structure.
Mr. Jeschonowski, Merz & Krell sold Senator to Perusa earlier this summer. Who is Perusa and what plans does Perusa have with Senator?
Daniel Jeschonowski: Perusa is a capital investment company that focuses on investments in medium-sized European companies. When it became evident that Merz wanted to acquire Senator, discussions got underway very quickly. Perusa offered a reasonable purchase price and made it clear that they are interested in the continuation of the company. Perusa has made a clear pledge to the location in Germany, to the production and customisation of writing instruments and cups in Groß-Bieberau. Of course, the aim is also to make profit, but Perusa is not a corporate raider: All of the saving measures that will ultimately be implemented to promote growth will be carried out in good measure. Senator will operate independently, whereby Perusa will apply its management competence.
Ralf Uwe Schneider: The sale was no big surprise to the staff or our customers. It was long since clear that Merz wants to limit itself down to the areas aesthetics and neurotoxins and prior to Senator the company also sold off other business areas such as Dental & Hygiene. It soon became clear to us: We needed to act. Due to diverse reasons many changes had not been tackled over the last years, so that a whole row of tasks had piled up. The new investor has taken over responsibility for these.
Senator has often been in the red over the past years. What conclusion did the analysis bring: What was the reason?
Ralf Uwe Schneider: We have been able to record significant growth in turnover since the summer of 2015 and offer a good portfolio of services. However, we haven’t managed the cost side well.
Daniel Jeschonowski: Over the last twelve months we have indeed done a lot of things right: The price reliability, quality of the delivery and product and the presence of our contact persons was very good all in all. So, we won’t do everything differently or radically change our product programme. It is more about revising the internal processes. In the past, the basic costs were much too high compared to the turnovers. From the very first day after the take-over, we set ourself the goal as a company to be capable of acting. That means that we have to adapt the cost structure to match the turnover. We want to grow of course, but we are aware of the market situation and we are realists – as a result of the ban on promotional products within the pharmaceutical industry alone, a significant share of the total turnover in the writing instrument sector fell away. One has to plan ahead reasonably. After all, I am responsible for the staff members.
Ralf Uwe Schneider: In the past, optimism prevailed over realism. Today, the opposite is the case.
According to a press release by Senator, a “leaning down of the job plan” is also part of the saving measures. What does that mean in concrete terms?
Daniel Jeschonowski: We will take on a leaner form in all areas and are currently negotiating with the Works Council in this connection. I can’t cite concrete figures, because we are taking a differentiated approach and are discussing different measures with the employees – this ranges from voluntary solutions through to early pensions. A very important issue is: We are not going to save ourselves into ruin. We are not questioning any customer relations and we are sticking to all of our activities, whether it be the refill production, assembly, injection moulding or the customising of cups and writing instruments. We want Senator to continue being a big player on the market.
You stressed that the location Groß- Bieberau with its machine park will remain intact: How do you intend to implement this trump more efficiently?
Daniel Jeschonowski: We will rely more heavily on the “made in Germany“ argument in our communication. Quality, reliability, speed, transparency, the complete monitoring of the production process are our advantages that we want to place more emphasis on. We have no reservations at all about producing parts for other suppliers in the writing instruments sector. We are open to offers here.
Ralf Uwe Schneider: Supplier colleagues and distributors are invited to come and view the machinery onsite. We want to become a tangible company again, after all we dispose of the entire value chain from eroding the anodes in the tool construction area through to UV printing.
In the past there were a lot of personnel changes at Senator, there has also been talk about service and delivery problems. How do you intend to win back the trust on the market?
Ralf Uwe Schneider: We are aware that some of our measures caused a lot of frowning on the market particularly in the first half of 2015. But a lot has happened since the summer of 2015. It is down to our entire team that the market views Senator as a reliable partner again. For example, the product launch of the plastic writing instrument, Liberty, was the best launch in 15 years. We know that we are on the right track.
Daniel Jeschonowski: Consequent, good work is called for. We don’t intend to experiment around or come up with surprises, instead we have to further improve our strengths. For example, we want to assert our claim as leaders on the technology front especially regarding customising methods. Ultimately it is about sending out signals to the market that we are a reliable partner. So our presence at the industry shows such as the PSI, where Senator will be represented with a stand measuring approx. 200 m², will remain unchanged.
Will you be sticking to the “extramoredinary” brand strategy that was recently communicated?
Daniel Jeschonowski: Definitely, because the “more” is a key element of our brand that we want to fill with life: a plus in speed, reliability, choice…
Ralf Uwe Schneider: The market has above all perceived the “more” colours. We still offer significantly more choice than our competitors in this area, albeit only for the products that are especially in demand as bestsellers or new introductions to the line-up. Other products on the other hand are only offered in the popular shades.
How important is the export? Will the Senator offices in the different countries remain intact?
Daniel Jeschonowski: We have an export share of 30% to 40% with a strong local footprint in Great Britain, France, the Benelux countries, Eastern Europe and Scandinavia, where we are perceived to be a very high value brand. We are sticking to the international alignment, so there won’t be any changes in our subsidiaries. I meet up every month with the managers, this makes the international coordination much more efficient. This allows us to make use of the synergies and print an international product catalogue, which is translated into the respective country language.
Are you contemplating focusing more strongly on the retail trade? Or will the promotional products business remain to be the key market?
Daniel Jeschonowski: We are continuing our retail activities with a clear emphasis on writing instruments, we will however continue to focus mainly on the promotional products market and our activities concentrate on the promotional product trade as our partners. We can’t fully exploit our strengths such as speed, “made in Germany” and quality as distinguishing features in the retail sector like we do on the promotional products market.
Is there any movement on the product lineup front?
Daniel Jeschonowski: At the end of the year we will expand our product lines by adding several novelties, i.e. with a new plastic and a new metal writing instrument, both of which are “made in Germany“, and offer good delivery options. These are novelties that we stand for. In the cup sector the production and the customising at the location in Groß-Bieberau is a key element of our value chain which we also place a focus on. We have planned cautious modifications here and will be able to present one to two new models. We will concentrate on the strongest models of the writing cases.
What priorities are you setting for the sales and marketing area?
Ralf Uwe Schneider: New customer acquisition, customer care, winning back old customers are all important areas, whereby especially in the field of winning back customers a lot has happened over the last twelve months. Customer care is still our bread and butter business, which is why we rely strongly on our field service. In the promotional products trade we are very well known as a company with a long history and we are close to the market. Overall, however the brand Senator has to strengthen the brand awareness among the young decision-makers in the industry and become more present in the sense of a push-andpull strategy.
Daniel Jeschonowski: Whereby this doesn’t change the fact that the promotional products trade will remain to be our exclusive business partner.
Why should promotional products distributors buy from Senator?
Ralf Uwe Schneider: We offer commercial advantages: Good products with attractive prices. To put it bluntly: “You can earn money with us”.
Daniel Jeschonowski: But it is the services that make it attractive to work together with us: Reliable deliveries, smooth dispatch processes, contact partners that are always available, graphic work or creating samples and the shop-in-shop offers. For example, we have re-edited more than 16,000 photographs for our new catalogue so that the colours are reproduced both in the print publications as well as on the monitors of the customers so that they look exactly like they do in real life. We don’t want to do everything differently, but we want to improve a lot.
// Dr. Mischa Delbrouck spoke with Daniel Jeschonowski and Ralf Uwe Schneider.