Valpak, a direct marketing company with a massive automated printing facility in St. Petersburg, is a great example of how to create a brighter economic future for a region, according to a national leader in advanced manufacturing.
The company has successfully combined technology and talent, and that’s a big part of what’s needed to compete in the global manufacturing industry, said Byron Clayton, CEO of Advanced Robotics for Manufacturing, a Pittsburgh-based public-private partnership that focuses on robotics and workforce innovation.
The big challenge that’s facing Tampa Bay and other regions is building a coordinated talent pipeline, said Clayton, who spoke Tuesday morning at Valpak at a breakfast hosted by executive search firm Winner Partners.
The event, which drew several dozen local education, government and business leaders, was designed to highlight the manufacturing sector in the Tampa Bay area.
“Not all regions can compete. I’ve worked in regions that really want to do a lot of manufacturing. They can have individual success stories, but as an industry driving the economic prosperity of the region, they don’t have a chance. They are too far behind,” Clayton said. “Here’s the good news. Tampa Bay is not one of those regions.”
Valpak, which has digital offerings in addition to the familiar blue envelopes stuffed with coupons that are mailed to 36 million homes across the United States every month, is a model for what works, according to Clayton.
A different way
Valpak launched 51 years ago in the Clearwater home of founder Terry Loebel. By 2002, the company had about 1,100 production workers and was printing coupons in two plants, one in Largo and one in North Carolina.
“We were using ’50s, ’60s and ’70s technology, and we were throwing a lot of people at the processes in order to get additional work through. We were growing at that time at a clip of about 9.5 to 10 percent. We needed to figure out a different way to do this,” said Shawn Delemeester, Valpak’s production director and one of a handful of people tasked with researching an improvement plan.
After two years of researching technology in a variety of industries, and a more than $200 million investment by then-owner Cox Media Group in Atlanta, Valpak built the current plant, a 470,000-square-foot structure in the Gateway area of north St. Petersburg that opened in early 2008. It’s the most automated printing facility in the world, Delemeester said. Using trolleys, conveyers and automated guided vehicles, what used to be a four-day production process now takes four hours.
See photos below of Valpak’s automation in action.
Automation cut the number and cost of mailing errors and worker injuries, Delemeester said. It also reduced what was a 1,200-person workforce to 500 people.
Valpak sold its North Carolina plant and the buyer retained the workforce there. Locally, workers spoke 17 different languages, so Valpak offered a program to provide free skills training that included English, reading comprehension and math. That allowed the workers to get in-depth technical training so they could operate the new equipment.
That’s a very different approach than 40 years ago, when Clayton first got involved with robotics. At that time, many companies simply fired their workers and relied on robots. Those companies don’t exist anymore, Clayton said.
“Technology cannot be successful unless you have a great workforce that is willing and able to make that technology successful. Valpak is a great example of that,” he said.
Fill the gap
Tampa Bay has many of the ingredients required to be a manufacturing stronghold, Clayton said.
There are about 3,000 local manufacturing companies in diversified sectors and solid industries. There are about 63,000 manufacturing employees, the largest port in Florida, a major airport and a growing population.
Tampa Bay is home base for 20 companies with more than $1 billion in annual revenue. More than 500 foreign companies have presence in the area.
But here, like most places, there’s a shortfall of people who have the technical skills required for job openings.
“You have people with talent who are not getting work. Figure out what talents these people have, and what’s needed on the other end, and then how to fill the gap,” Clayton said.
He urged a coordinated approach to skills training.
“There are people doing amazing things in different parts of the area. What we want to do is connect them together so there’s one talent pipeline,” he said.
Clayton said Tampa Bay has the opportunity to be the region that presents a complete package to the manufacturing sector.
“Companies follow talent. It will start a domino effect and you will have companies banging on the doors here,” he said.
Note: Valpak originally provided inaccurate information regarding the number of envelopes mailed monthly and the name of the Google partnership. This story has been updated to reflect the correct number and partnership name.
Deeper dive: What’s ahead for Valpak
While the Tuesday event focused on manufacturing, Valpak does more than print and mail coupons.
The company crosses print, web and mobile platforms. It offer online coupons at valpak.com, through a mobile app and through syndication partners. Valpak is a Google Premier Partner, which means it can help businesses drive more online traffic to make the most of their advertising dollars.
Valpak’s print operation also is adapting to a changing landscape, said Shawn Delemeester, production director.
One step is selective inserting. Instead of sending a generic envelope of coupons to everyone, Valpak has worked with some of its major mailers to target ads at specific customers, based on their addresses.
That allows Valpak to get information back when the recipient redeems a coupon. Valpak sells that data. “We’ve created a whole other business off to the side,” Delemeester said.
Valpak also has started doing custom mailings for major retailers. The coupons inside are specific to that retailer, and the envelopes don’t indicate the coupons have come from Valpak.
The company faces challenges such as getting to the end of life on its computer systems and equipment installed when the plant opened.
“Dealing with those things in the print industry is rough. It’s shrunk so much and we’re dealing with the aftermath of that,” Delemeester said.
Valpak was acquired by private equity firm Platinum Equity from Cox Media Group in 2017 for an undisclosed price.