Entrepreneur bet the company on digital processing and won
Every fall, thousands of Quebec students get their pictures taken for school ID cards, and they bring home samples of wallet-sized, and eight-by-tens to parents who can, and often do buy them. There's good chance that the pictures were taken by photographers from the Photo Art division of Universal Color Laboratory.
"Parents are very busy these days, and they don't always have the time or the money to have their kids professionally photographed," said Martin Wirtschafter the company's president. "Kids change so fast, especially when they are in elementary school, that many families buy the pictures each year."
Wirtschafter who has been in the professional photography business for most of his working life, took over the company five years ago, after his father André, the founder, passed away. At the time, Universal Color Laboratory was generating about 70 per cent of its revenues from doing film processing for major retailers such as Provigo. The Photo Art division was just a small part of the operation.
But with the advent of smaller, cheaper digital camera, Wirtschafter, a technology buff who graduated with a marketing degree from Concordia University, saw the writing on the wall for the film processing, and a big opportunity in the student market.
"I was an early investor in digital photography. The first cameras cost thousands of dollars, were terribly slow, and the quality wasn't that great," Wirtschafter said. "But each new generation of equipment that came out, was twice as good as the previous, and cost only half as much."
Wirtschafter quickly realized that digital photography was going to take off in a big way among consumers, and that film processing companies like his own were going to take a big hit.
So he decided to refocus on the student photography business. During the late 1990s Photo Art, like its major competitors, used traditional film cameras. But the process was expensive and time consuming.
"Film processing costs were enormous, and since you could not see the picture in advance, if the expression on the student's face wasn't right or they blinked, the photo was ruined," Wirtschafter said.
After exhaustive tests, Wirtschafter decided to computerize the entire Photo Art production process, spending $1.3 million for digital cameras, computers, CD-ROM burners, as well as color correction and processing software.
Photo Art photographers can now see their work immediately after taking the picture, and if they don't like the result, they can re-shoot, or do color corrections on-screen. At the end of the day, they just copy the pictures onto a CD and send it to the lab which prints the ID cards, photos, sample sheets and so on.
According to one customer, Photo Art's shift from film to digital photography has brought significant benefits.
"It's cheaper, faster, and there is less work for us in identifying students, because each photo in the database has the student's name on it," said Tony Colannino, principal of John F. Kennedy High School, which has been dealing with Photo Art for more than a decade. "The photographers come in, and in five or six hours they take pictures of all our 500 students."
But Photo Art's transformation into a digital house was not painless.
"There was a steep learning curve," Wirtschafter said. "We were breaking a lot of new ground, and much of the software we needed didn't even exist so we had to develop our own." Staff also needed to be re-trained, and customers had to be convinced that the changes would benefit them too.
But after a rough first year, the new digital processing began seeing wider acceptance, and sales grew steadily, between 15 and 20 per cent a year. Last year Universal Color Laboratory's 30 employees generated close to $4 million in revenues, with the Photo Art division accounting for close to 70 per cent.
According to Wirtschafter one of the biggest difficulties in the student photography business is the marketing aspect.
"The contracts are highly competitive, and if you win an order one year, the next year, the order comes up for grabs again," Wirtschafter said. "The other big challenge is finding the key decision maker within each school. Unlike companies, most schools don't have a single person that is in charge of all buying, and often the decision is handled by parent committees, and it's sometimes hard to figure out the right person to pitch to."
Wirtschafter's next big priority is keeping up Photo Art's growth rate. Unfortunately the low birth rate means the student population is relatively stagnant. According to Statistics Canada, there were 6.2 million children between the ages of five and 19, with just under quarter of which live in Quebec, where most of Photo Art's business is centered.
In recent months Wirtschafter has been signing up increasing numbers of agents outside the province, particularly in Ontario and the Maritimes, and has been studying the possibility of doing more photography of children's sports teams and other organizations.
With the exception of the grad pictures most of the school photography is done during the fall months. Asked if is enjoying the slow period Wirtschafter shook his head.
"Are you kidding? Now is the time we have to sell. If we don't sign contracts now, we won't be doing anything this fall."
Photo caption: Martin Wirtschafter has built Universal Colour Laboratories' Photo Art division into one of Quebec's largest student photography companies by using digital equipment that provides better functionality and competitive pricing.
o When Martin Wirtschafter took over Universal Color Laboratory
in 1998 he recognized immediately that its future as a film and
print processor was limited due to the advent of digital photography.
|© 2002 Peter Diekmeyer Communications Inc.|