Domino Printing managing director, Nigel Bond
BACKGROUNDER: Nigel Bond joined Domino as a financial controller in 1987, then went on to direct the company’s UK sales and service organisation. He subsequently became president of US Operations, before being appointed group MD in 1997. Nigel was born in Cambridge UK and obtained a degree in physics from the University of Leicester before qualifying as a chartered accountant at Thomas McLintock.
Founded in 1978, Domino has a global reputation for the development and manufacture of coding, marking and printing technologies that satisfy the compliance and productivity requirements of manufacturers. Domino’s consistent year-on-year growth – both organic and through acquisition – is underpinned by an unrivalled commitment to product development, resulting in a portfolio that incorporates complete end to end coding solutions spanning primary, secondary and tertiary applications.
Innovative ink jet, laser, print & apply and thermal transfer overprinting technologies are deployed for the application of variable data, bar codes and unique traceability codes onto product and packaging, across many industrial sectors, including food, beverage, pharmaceutical and industrial products.
In 2008 the Domino Group (Domino Printing Sciences Plc) achieved a turnover of £253.4m million; it is listed in the FTSE 250 share index on the London Stock Exchange (share code DNO). The group employs 2,000 people worldwide and sells to more than 120 countries through a global network of 25 subsidiary offices and more than 200 distributors. Domino’s manufacturing facilities are situated in China, Germany, India, Sweden, UK and USA.
1. What are the most significant advances the company has made during your tenure as group managing director?The most significant change is a robust consistency in the company’s performance in the period since 1997. We have delivered consistent growth in sales, profits and cash generation over an extended period. In doing so we have elevated the reputation of the company in the opinion of customers, suppliers, shareholders and employees through a number of key foundation strategies.
At the heart of the company’s success has been a continual stream of new products and product enhancements, keeping the business in a leadership position. This has been backed up by the acquisition of a number of new businesses to expand our product portfolio, so that we now provide customers in our industry with a full range of products and solutions to their variable data printing needs.
Behind the products has been a huge effort by our staff to continue to build and enhance our reputation for excellent customer and technical service, a key attribute that has won us many contracts with the leading manufacturers in the industries that we serve.2. How has Domino coped with the global economic downturn? Like many companies, the global economic downturn has had a big impact on our business. The hardware that we sell is used by manufacturers to put variable information onto packaged products which means they usually purchase products from Domino out of their capital expenditure budgets. With many companies putting freezes or severe restrictions on capital expenditure to conserve their cash positions, new hardware sales have been significantly reduced over the past 12 months or so. The fluids, spares and services sales to the installed equipment base around the world has held up better, but with production output down and some de-stocking, even this part of our business has dropped during 2009.
I believe we detected the impending recession as quickly as anybody and responded faster than most. Yes, we did reduce our cost base, through a number of factory relocations back to our HQ in Bar Hill and other redundancies. In all we reduced our workforce by over 200 people in November 2008, 10 per cent of the group. I was totally committed that this would be a one-off reduction and re-alignment of cost to anticipated revenues.
The last thing the employees of Domino needed was a reduction programme in multiple parts. It was very sad to have to lose any staff, but it was best to deal with the situation once and once only so that everybody could get back to doing their usual excellent job without a fear about when the next wave of cuts was going to come. This is what we have done.
As a result we have protected our reputation for service and customer support and continued to deliver what our customers want, when they want it. We expect 2009 to be another successful year for the company. 3. Are you seeing any signs of a recovery in your marketplace; if so how is it manifesting itself?The period from November 2008–February 2009 was the lowest point. It seemed that just about everybody had stopped spending and everybody was squeezing stock out of the pipeline, all in an effort to conserve cash at a time when bank lending and finance facilities were restricted.
Since then we have seen a gentle upturn in business which is now at a consistent and stable level. Recovery would be too strong a word. In parts of our business, the local management is more optimistic about the near future; this would be true of our Asian businesses and one or two specific countries elsewhere.
In overall terms though, we don’t use the word ‘green’ and that other word associated with it, in the same sentence. I think it will be into 2010 at the earliest before we see business levels back to those of early 2008. I am pleased that we do appear to have levelled out and have greater stability, albeit not yet at past levels.
4. How important is it for Domino to continue to innovate and develop new generation products? Innovation and the development of new products is at the heart of what makes Domino a successful company. Both through our very active acquisition programme and through internal development, where we spend a healthy proportion of our revenues, we have a major focus on product leadership. Whilst our products may be only a small fraction of the cost manufacturers spend in building their production lines, they are essential to the operation of those lines and have the potential to add so much efficiency to the way a production line performs. Giving our customers the capabilities that they are looking for is what our development programmes are all about. Even in these more difficult economic times, our investment levels in innovation and development remain high. It is essential for Domino to come out of the recession with the product range to continue our journey of success. 5. How has Domino managed to stand apart from the American acquisitions that hoovered up most of the Cambridge ink jet cluster and remain a world leader?I’m not sure that I’m the right person to answer that – you need to ask the Americans. Clearly many Cambridge-based businesses have been acquired by the Americans, and others, for a multitude of different reasons.
At Domino we are determined not to be acquired because somebody sees an opportunity to buy a company that is under-performing for a bargain price. We have performed consistently and strongly for many years, our shareholders have been hugely supportive and the relationship has worked well. Our share price reflects that. I like to think that we run the business as well as anybody could.
As a result, our shareholders see no need to sell and potential buyers, assuming anybody has ever looked at acquiring us, don’t see the big opportunity many, especially Americans, look for – to take huge amounts of cost out of the company. We already run very efficiently. 6. Domino has stayed faithful to Cambridge as an administrative and innovation hub. How does a Cambridge presence benefit the business?Cambridge is a great city and a fantastic place to be. The obvious benefits are the wealth of technology companies and consultancies, the quality of the people here and the quality of life for our employees in the East of England. With its history and tradition, our overseas visitors are always impressed by the city and enjoy visiting the area.
Cambridge is still relatively small so a company like ours can build a good reputation as an employer because, given our size, we are well known, which would not be the case in London or Birmingham. That reputation means we attract good people and people with ideas. The support services and infrastructure in Cambridge are used to dealing with technology companies which helps and again, Domino is an attractive business for them to get involved with.
We have recently transferred a number of production lines from overseas back to Cambridge, which amongst other things, demonstrates our belief in the quality and competence of the people in the Cambridge area.
7. Has the profile of your export markets shifted over the years; ie are some of your traditionally strong territories being balanced out between East and West (the US and Asia) as you colour in more areas of the global map?The group now sells in almost every country of the world; I would struggle to name a country where we don’t have customers. We have representation globally either through our own offices or through distributor partners, many of whom have been with us since the early days. With all the acquisitions we have done recently we now have hundreds of distributors around the world.
In my time with Domino, there has been a definite shift East in our potential markets. Back in the early 1990’s, the Americas represented over 35 per cent of the turnover; today that is less than 25 per cent. Conversely Asia would have been about five per cent 20 years ago; this year it will be approaching 30 per cent. Over 25 per cent of our employees are either Chinese or Indian; these two countries now lead our volume league table. We have an expanding business in The Middle East and although still relatively small, a number of African countries are emerging as markets for our products. 8. Are there still new territories or markets that Domino can conquer?We are present in all territories, strong in many and market leader in some. So whilst there are no new territories to enter, we want to improve our market share and position wherever we can. We must always look to do better, serve our customers better and enhance our reputation and position.
China and Russia were relatively small markets 20 or so years ago; today they are large and major contributors to our growth. I’m sure in the future we will see other countries develop their manufacturing base and become an important market; that is why we have people regularly travelling in regions of the world that are not immediately recognisable as industrial centres today.
Domino wishes to be truly global, providing value to customers wherever they are. In terms of market sectors, we serve a huge variety: food, beverage, pharmaceuticals, cable and wire being some of the larger ones.
In a world where identification, assurance, security and traceability continue to become more important, more market sectors will have a need for our products and services. Our challenge is to identify them and work with the players in those markets to help them achieve their goals. So yes, there are many more markets in the future for us to conquer. 9. Domino has been pretty acquisitional itself when it has spotted an opportunity. Can we expect to see more acquisitions in the future?I’m sure Domino will continue to spend the cash it generates wisely on further technologies and opportunities to enhance the business. Things have been a bit quieter this year as we also take a breather, look after cash flow and make sure we take the opportunity to achieve the goals of recent acquisitions.
I’m sure things will return to the previous hectic pace in the future. That said, we set out on a very deliberate path a number of years ago to expand our portfolio, and at the end of 2008 we had been very successful in not only acquiring the technologies and products we wanted, but doing so by buying companies with the same ethics, values and high quality reputation in their field as we have in Domino. So the onset of recession coincided with the end of a particular phase in our acquisition programmes rather than being the cause of a period of fewer acquisitions.
10. What aspect of business, if any, keeps you awake at night?I suppose the answer to that is none; I sleep very well. I am able to do so because all around the world we have great people led by an excellent management working within a framework built out of a common vision for the business. Clearly not everything goes 100 per cent to plan every day, but as long as I know people are doing their best, have the skills to deal with issues as they arise and are committed to seeing the company grow and achieve its ambitions, then I can sleep peacefully.