For the last 30 years, North Canton-based Buckeye Color Lab operated in a relatively unchanged industry. Since 1970, the Troup family has owned and operated the business as a color-processing lab for professional portrait and wedding photographers.
The lab grew out of Troup Studio, a photography studio founded in 1947 by Walter Troup. During its heyday, the studio shot the portraits of some 6,000 area high school seniors a year.
In 1970, Troup Studio expanded to offer color processing services. At the time, venturing into the processing arena was a logical way for the studio to control the quality of its end product. From there, it began offering processing services to other professional photographers.
In 1989, Buckeye Color Lab’s CEO Walter Troup (who retired in 1990) sold Troup Studio (which still operates under the Troup name) and began to concentrate solely on the color processing end of the business.
The company grew steadily, and now, with $9.5 million in annual sales, is among the 15 largest labs in the country, estimates President Steven Troup, son of Walter. Even over the last year, as most businesses fought to maintain business, Buckeye Color Lab grew nearly 3 percent over the previous year and now boasts 800 clients on nationwide.
Growth came from establishing long-lasting relationships with photo studios and by offering what was then an unprecedented one-day processing time on photo proofs at a time when the industry norm was three days.
“That brought us tremendous growth,” says Troup.
But in the late ’90s, Troup realized 3 percent annual growth was no longer acceptable in an industry that was rapidly consolidating and being forced to accept the emergence of digital photography.
“Our industry really didn’t evolve much until the last three to four years,” says Troup. “There were no big technological revolutions happening, so our growth came out of doing things better and faster than other labs.”
Today, the photography industry as a whole is adapting to the biggest change most lab and studio operators have seen in their lifetimes — the creation and growing acceptance of digital photography.
“It’s coming along very fast,” Troup says of the technological changes affecting his industry. “Today there are 6,000 labs in the business. They (industry analysts) expect in three to four years for there to be 60 labs left. We are trying to position to be one of those 60.”
Troup predicts he needs to grow about his business 10 percent per year to stay competitive.
“We see that as doable,” he says. “It’s going to be aggressive. We’re trying to line up programs to make sure that happens.”
The company’s growth plan, implemented about a year ago, is threefold. First, after years of research and conservative contemplation, the lab last year invested in half a million dollars worth of digital equipment.
Many of its clients thought it was late jumping on the digital bandwagon; most of Buckeye Color Lab’s competitors had invested more, earlier, to meet the immediate need of their photography studio customers, but never recouped their costs.
“Many labs invested more, but didn’t find the payback was there,” says Troup. “We waited a little longer than some of our competitors to go digital, and we found a way to do it at a cost-effective level. It certainly helped us to be able to survive long term.
Bob Hendrickson, the company’s vice president, focuses on the technology side of the business, and has to maintain the delicate balance between keeping up with new technology while not investing in technology that will soon be obsolete.
“All previous models had a life expectancy — now it keeps changing,” he says. “You have to be very focused on getting a return for that investment. Now we’re looking at life expectancy. We want to grow the company so we can absorb the overhead.
“Do you stay on a box that’s still working for you when your competition is buying a box that works 20 percent faster? It’s a delicate balance.”
Troup says he’s seen labs invest in new technology but never find a return on that investment.
“We’re now seeing some of the labs that put in digital a few years ago — when we said financially it doesn’t make sense — are struggling financially. We waited until a year ago. Our customers thought that we were missing the bandwagon here. We said, ‘We have to do this or we aren’t going to be here long-term for you.’ Fortunately, I think we proved them right.”
When Buckeye Color Lab invested in digital equipment, management retrained employees to work with that equipment instead of hiring a new staff of computer-literate artists.
“For many of them, it was new, and many had not worked on computers at all before,” Troup recalls. “That was one of our fears as management, that we didn’t want to displace people. Some had been with us 20 years.
“It went very well, although it was a nervous time for us because we didn’t want to be in a position to lose those people.”
Buckeye trained its optical artists in digital retouching, mainly with the use of Adobe Photoshop software.
“We opened it up to everyone and paid them while they learned. Forty people signed up. The ones who excelled in that were the people we brought over to digital. Most people had the skill of working on a print with a brush and liquid dye, so going into Adobe Photoshop was a new technique of doing the same thing.”
Today, 60 to 65 percent of retouching is done digitally. Eight percent of the files the company receives are digital — a number which is growing rapidly as more of its clients begin to use digital equipment.
New marketing efforts include developing customized marketing programs for photographers to use to help drive business into their studios and training studios on how to better market to customers. Buckeye also has hired a full-time marketing director, a rare position in the industry, and employs six people full time in customer service.
“As the consumer evolves and becomes more digital-friendly, the type of management within that studio will change,” Troup says. “We have to change how we operate with them. We’re looking at developing programs to become more of a service provider to studios than we’ve been in the past. Instead of just being the lab that processes the film, they want us to also handle some of their marketing efforts for them.”
The third part of the company’s aggressive growth plan consists of ways to build and maintain customer relationships on a nationwide level. Up until 1992, Buckeye built its business primarily through developing personal relationships with customers.
“It was all word of mouth,” Troup says of the company’s traditional marketing efforts. “And that’s part of the reason that our sales are still so strong within the state of Ohio.”
The bulk of Buckeye’s customers have traditionally come from within Ohio. Since the mid-’90s, however, it has been expanding its marketing efforts to a national level, primarily through trade shows and direct mailings, and now 40 percent of its customers are out of state.
Troup says the company participates in 12 to 14 trade shows a year and sends newsletters and direct mailings to customers and potential customers.
“Our whole business is built on relationships, so the photographer that sends film here will only send it when he feels comfortable with us as a company, and he has an individual person here that he knows,” says Troup.
He adds that photographers are very loyal customers.
“Photographers will not change labs. It’s very difficult for them to make a transition to a new lab, so once they make that jump, they stay, until you really give them a reason to leave. So our people work very closely with them to make sure that they’re happy at all times, satisfied with the work, and that we know what they expect of us,” he says.
Troup is also faced with the reality that many photographers are starting to print their own work, primarily through ink-jet printers, and that has become a threat to color labs.
“We need to look at what type of studio is going to be doing that and we need to look at ways that we can help the studio understand that we can do it as good or better.
“It’s no different than when color first became popular,” Troup says. “Studios have always printed their own black-and-white work, and when color became popular, they started doing their own color work and quickly found that they could do it. But when they stayed in the darkroom and did their own printing, they were no longer behind the camera, and that’s where they make their money.”
He expects many studios to try their hand at color processing, but then, like their predecessors a generation ago in the black-and-white arena, to come back when they realize it’s not cost-effective. How to reach: Buckeye Color Lab, (800) 433-1292
Connie Swenson ([email protected]) is editor of SBN Magazine.
