Heidelberg Stock Price

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Deleted member 16349

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Just looked at the Heidelberg stock price. Wow it has dropped a lot.

I used to follow it just for interest sake. It had dropped a lot before but seemed to have recovered a bit but now it is even lower.

I was following it since I knew the business of manufacturing presses was getting into trouble due to the shrinkage of the printing industry and due to the financial melt down. I have always felt that due to these kinds of pressures, a press manufacturer would be eager to develop new technology based on new science, which is my main interest. Something that could differentiate them from the competition and provide a competitive advantage that would not be so easy to copy in the short term. The short term environment that could mean the survival in the long term.

But no, the press manufacturers continue to want to suffer and ignore ideas from the outside. Stock prices tend to reflect the outside view of investors on the future health of companies. They don't see anything special it seems and have made their investment decision by walking away.

The best way to compete is by competitive destruction due to innovation and not survival due to attrition. Investors can see innovation potential even if industry insiders can not. Investors don't see much.
 
oh God, I was thinking about the price of their products....haha

they are only going one way without consideration...
 
oh God, I was thinking about the price of their products....haha

they are only going one way without consideration...

What I would like to see is more performance at a lower product price. That would be a sure sign of advancement in innovation and would also be a competitive advantage. Unfortunately it seems the press manufacturers have taken the high priced technology route which is mainly providing a band aid solution to existing problems in the process that have not been addressed due to a lack of effort.

It is understandable that suppliers would not want to replace expensive technology, developed at high cost with lower cost technology since it would appear to lower their profit but I think this is a false assessment of how the market would react.

It is important for a supplier to try to make their existing technologies obsolete in order to protect their future. One can improve a product by continually refining an existing concept but one can take this too far. Ignoring the need to advance thinking and fundamental knowledge can in the end be what causes the company to fail.
 
Erik: Reckon, there is no sign of such things happening...

No not yet but I have always been of the view that a major shift in thinking is possible. That has been the basis of my interest in printing.

Innovation in thinking and technology is a difficult thing for people to understand. Its very nature is about something people can not see until it happens. It is usually a surprise.

Often innovation is a result of someone taking advantage of a problem others didn't fully understand. The new understanding leads to practical steps that fixes that problem in a way that others didn't think was even possible. It is a surprise.

What I find disturbing is that in the printing industry there is little interest in even finding out what might be wrong and then what might be a better solution. The acceptance of existing knowledge as being valid inhibits innovation.
 
Did Kodak recover some of that drop?

No. the stock price has been hovering around 3.15 for awhile now. But at that price it has made an occasional jump of 50% to 5.00. So, if one was a rich speculator I suppose that money could be made on those bounces. I don't see anything that would cause the stock to go up and remain that way (the analyst consensus is sell).

best gordo
 
No. the stock price has been hovering around 3.15 for awhile now. But at that price it has made an occasional jump of 50% to 5.00. So, if one was a rich speculator I suppose that money could be made on those bounces. I don't see anything that would cause the stock to go up and remain that way (the analyst consensus is sell).

best gordo

Gordon,

Sad situation but it also shows that companies that are trying to be high tech businesses are not immune from market conditions. Also the need for obsolescence is even greater for them. The treadmill of innovation does not slow down.
 
Sad situation but it also shows that companies that are trying to be high tech businesses are not immune from market conditions. Also the need for obsolescence is even greater for them. The treadmill of innovation does not slow down.

I don't see innovation as the panacea. Sometimes innovation is rewarded by market acceptance and business success. But I think that more often than not the market, like product developers, prefers staying with the tried and true.
Also, it is very difficult to be ground up innovative with a well established technology. (e.g. how to you innovate with a PC) It is much "easier" to come up with new product categories (iPad, iPod, etc.). And even then, the innovation can be quickly replicated by the competition, which quickly makes the innovation common place and therefore no longer an innovative differentiator.

best, gordo
 
I don't see innovation as the panacea. Sometimes innovation is rewarded by market acceptance and business success. But I think that more often than not the market, like product developers, prefers staying with the tried and true.
Also, it is very difficult to be ground up innovative with a well established technology. (e.g. how to you innovate with a PC) It is much "easier" to come up with new product categories (iPad, iPod, etc.). And even then, the innovation can be quickly replicated by the competition, which quickly makes the innovation common place and therefore no longer an innovative differentiator.

best, gordo

So you are basically saying that you would be surprised if innovation had an impact. That's the point. It is what you don't expect that can have an impact. It is not a sure thing but historically innovation has eventually changed the market.

Assuming things will happen or not happen or that some things are very difficult to do is just speculation.

Where would Kodak be if it stayed in film? Their effort to innovate may not eventually be successful but not taking a chance would have resulted in a sure thing. Failure.

Maybe innovation is not the right word because it might imply more than what I suggest. Maybe "Rethinking" what you are doing would fit better. It does not require breakthrough ideas but ideas that better fit the needs.

Ideas can be protected. Patents can be made for new concepts that give some protection. Trade secrets also work. There are some ways to delay the competition from doing exactly the same thing. The key may be to move faster than your competition with ideas that are thought out better. Speed and depth of thinking are critical. Both are not valued in the press manufacturing industry.

I don't think it is so easy to come up with new product categories. Just because Apple seemed to do it so easily does not mean that it was easy. It did take vision from a leader. Others are trying to copy but followers can get caught spending a lot of development money and find themselves always one step behind and the market punishes that. Being early with new ideas that impress buyers with new performance and capabilities builds brand status.

In the end the market decides what were the right moves. Certainly not me.
 
Erik, I understand what you mean...

Anyways, stock prices are probably a result of poor sales (degrowth) and continued losses of Heidelberg. My solution - reduce prices to the level where they would make more profits (from increased sales) in terms of value than they are doing now!

Maybe thats naive...or maybe thats right...?
 
The problem isn't innovation...
The main variables facing this industry are the same ones or very similar to the ones facing most other manufacturing industries in the West:
Excess capacity - There is no need to buy new machines when you are only getting 60% utilization out of what you have already.
Financial leverage - Printers bought equipment in the boom banking on increased sales. When sales plummeted they didn't have the reserve cash to keep the lights on. There is an insane amount of good used and near-new lightly used equipment out there.
Lending Freeeze - Manufacturers of any type are being dumped by banks left and right as they aren't interested in lending money to them. The ones who will have tightened credit lines so tight that manufacturers are constantly bumping against the limit just to pay vendors and stay operating.
Raw Material Price Rises - Many have not noticed or aware that ink vendors margins are getting razor thin these days. Paper production capacity keeps shrinking faster than demand. It's almost like the paper companies want to run many of their customers out of business.
Increased Regulation - Environmental regulations related to VOCs are forcing many printers to move out of locations they have been in for decades. The third-world doesn't put these (very reasonable and sound) constraints on industry.
The Internet and digitalization - This has leveled global competition and freed markets leading to mass upheaval. I know small businesses that were once reliable customers that now buy everything online and don't give a damn where its made and what the working conditions are. The internet and digitalization has further taken documents that were once printed. Look at the digital charting hospitals are now using. My first job was at a printer who primarily printed all of the forms and paperwork associated with hospitals. That work is gone and won't be back.
Third World Labor vs. First World Labor - I've heard crazy stories where a printer in India or China has have 6 guys working on a press for 12 hours a day 6 days a week for the same cost having an assistant press operator work for half a day in the US. I've heard this from vendors who have been abroad and seen this first hand.

The problem is that their customers don't have (perhaps enough) money to spend and/or the need for more equipment and/or can't get a loan. Why do you think Heidelberg is so focused on supply-chain and materials now? The number of printers in the USA has something like halved in the past decade. The customer base is drying up. Companies who specialize in vending to this industry will contract if the customer base contracts.
 
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The problem isn't innovation...
The main variables facing this industry are the same ones or very similar to the ones facing most other manufacturing industries in the West:
Excess capacity - There is no need to buy new machines when you are only getting 60% utilization out of what you have already.
Financial leverage - Printers bought equipment in the boom banking on increased sales. When sales plummeted they didn't have the reserve cash to keep the lights on. There is an insane amount of good used and near-new lightly used equipment out there.
Lending Freeeze - Manufacturers of any type are being dumped by banks left and right as they aren't interested in lending money to them. The ones who will have tightened credit lines so tight that manufacturers are constantly bumping against the limit just to pay vendors and stay operating.
Raw Material Price Rises - Many have not noticed or aware that ink vendors margins are getting razor thin these days. Paper production capacity keeps shrinking faster than demand. It's almost like the paper companies want to run many of their customers out of business.
Increased Regulation - Environmental regulations related to VOCs are forcing many printers to move out of locations they have been in for decades. The third-world doesn't put these (very reasonable and sound) constraints on industry.
The Internet and digitalization - This has leveled global competition and freed markets leading to mass upheaval. I know small businesses that were once reliable customers that now buy everything online and don't give a damn where its made and what the working conditions are. The internet and digitalization has further taken documents that were once printed. Look at the digital charting hospitals are now using. My first job was at a printer who primarily printed all of the forms and paperwork associated with hospitals. That work is gone and won't be back.
Third World Labor vs. First World Labor - I've heard crazy stories where a printer in India or China has have 6 guys working on a press for 12 hours a day 6 days a week for the same cost having an assistant press operator work for half a day in the US. I've heard this from vendors who have been abroad and seen this first hand.

The problem is that their customers don't have (perhaps enough) money to spend and/or the need for more equipment and/or can't get a loan. Why do you think Heidelberg is so focused on supply-chain and materials now? The number of printers in the USA has something like halved in the past decade. The customer base is drying up. Companies who specialize in vending to this industry will contract if the customer base contracts.

Chevalier. What you say is quite true for the whole industry. But within the industry, to survive and even prosper, you need to do things better than the next guy.

Innovation is one suggested method. If you have others, that would be good. Excuses are not suggestions. If a printer or supplier should not innovate, what should they do? It is a tough situation for sure.
 
The Heidelberg salesman for our area visited today, 7/17/11, and said the entire Heidelberg West operation is being shut down.

Al Ferrari
 
I heard they were closing down the demo centers in New Jersey and Long Beach. Demos will be done out of Chicago and Atlanta.

They also went from something like 6 regions to 4 in the US.
 
Erik, I understand what you mean...

Anyways, stock prices are probably a result of poor sales (degrowth) and continued losses of Heidelberg. My solution - reduce prices to the level where they would make more profits (from increased sales) in terms of value than they are doing now!

Maybe thats naive...or maybe thats right...?

I agree that lower prices would help but I would want to see lower prices on lower cost technology that has higher performance. That requires innovation which they are not able to do in a significant way.

Trying to sell higher cost technology that does not fundamentally change the process is a recipe for failure IMO.

By the way, their stock price, which was about 2.5 Euro on one of my earlier posts is now about 2.14 and was recently as low as 2.03.

I am still hoping the pain will increase to the point where they will let me help with some innovation but it looks more like they will just slowly go down hill thinking that they know best and somehow the market will change.
 
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I heard they were closing down the demo centers in New Jersey and Long Beach. Demos will be done out of Chicago and Atlanta.

They also went from something like 6 regions to 4 in the US.

Al and Marko,

Like many businesses, we evaluated our costs and decided to close the office in California. We still have a number of Sales and Service employees who live on the West Coast and are there to support our customers. In fact, we are hiring additional salesman to support this region.

Tim Henschel | HEIDELBERG USA
Manager, Public Relations
Heidelberg - Follow Us
 

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