Nov. 23, 2009— In our continuing series exploring the minds of the movers and shakers of our industry, this week Felipe Mellado, chief marketing officer of Sun Chemical Corp., agreed to answer our questions.

PN: Tell me a little about your company, the segment of the market it serves, and who you consider to be your “core” users.

FM: Sun Chemical, a member of the DIC group, is the world’s largest producer of printing inks and pigments and a leading provider of materials to packaging, publication, coatings, plastics, cosmetics and other industrial markets including electronic materials, functional and specialty coatings, brand protection and product authentication technologies.

Sun Chemical has more than 10,000 employees supporting customers around the world. With a network of more than 250 locations in 56 countries, Sun Chemical employees work everyday to meet the needs of customers by improving performance on the essentials of business, such as reliable, on-time delivery and consistent product quality. Sun Chemical tailors solutions to unique market needs and brings new ideas and the latest technology to market.

Sun Chemical’s unparalleled global presence allows for the delivery of local service and support that is customized to the geographic markets it serves. Recognized as a leading source of innovation, Sun Chemical has 10 research and development centers that are focused on creating solutions that improve productivity, create new revenue opportunities for our customers, and contribute to a more sustainable, environmentally-friendly future.

In addition to its leadership in inks, coatings and pigments, Sun Chemical introduces new solutions that enable marketers to better manage their brand colors, protect product integrity through improvements in packaging, and introduce security features that defend against counterfeiting. Sun Chemical also creates innovations for digital printing applications, including inkjet printing systems for narrow web and corrugated printing as well as inkjet inks specifically formulated for LED curing.

PN: How did you get involved with the company? What is your background?

FM: Most of my professional career has been in the ink industry, which I joined in 1979 as a research chemist in the research and development center of Coates in the UK. I joined Sun Chemical in 1988, when they bought Prisma, an Spanish ink company partially owned by Coates.

I am a chemist by education, but through the years I have occupied multiple positions in R&D, operations, general management and marketing. I hold a master’s degree of business administration by the IESE Business School in Madrid, Spain.

PN: What do you consider your greatest achievement in this market to be?

FM: Hard to say after so much time in the industry, however, I feel fortunate to have been one of the leading people in the growth and consolidation of Sun Chemical Europe as the industry leader.

PN: If there was anything you could change, either about your career in regards to the print industry, your company, or the market as a whole, what would it be and why?

FM: Being conscious of how much value we deliver, as a company or as an industry. Can you imagine life without color?

PN: What do you consider the greatest challenge to be for the industry right now? Why?

FM: From an industry standpoint, the instability in the raw material market combined with the global economic downturn are the biggest challenges the ink industry is facing right now.

Although crude oil prices have lowered significantly since last year’s peak in July, the pace of reductions in our raw materials has been significantly impacted by the high levels of older and more costly feedstocks and raw materials in our supply chain. The rapid decline in demand, starting in the fourth quarter of last year, eclipsed many of our pigments, intermediates and resin suppliers’ abilities to respond. True year-over-year improvement in average prices will not be achieved until all of the inventory effects completely work their way through our suppliers’ systems.

Overall what we are seeing are raw materials suppliers actively shuttering plants, rationalizing product lines and taking the steps that companies must take in extraordinarily difficult times, but steps that could lead to interruptions or tightening supply despite the overall weakness of the global markets.

At Sun Chemical, we continue to work on closely controlling our costs with our supply chain partners, to improve our internal operations, and to develop new performance, quality, and value oriented products that help customers grow their business. We will continue to invest in those areas that provide our customers with innovative products and services allowing them to be more competitive and present the best value propositions in the market.

PN: What do you consider the greatest asset to be for the industry right now? Why?

FM: As I asked earlier, can you imagine life without color? Inks are an integral part of any final printed piece, whether as a publication or a packaging product. Those products can’t be the same without printed information or decoration. Our customers are constantly expanding the scope of their activities, expanding into new applications and new markets, and Sun Chemical is in an excellent position to work with them to ensure success in these ventures. We maintain a leading edge position in the products we offer, and evolve quickly to respond to any challenge in a printing operation or technology. This is a great asset.

PN: In your opinion, what have been the biggest changes to the way we communicate with one another in the past few years? How would you recommend this industry take advantage of that?

FM: Clearly, blogs and social media sites such as Facebook and Twitter have considerably changed the way people and businesses can communicate with each other. While we should clearly embrace social media and use it effectively, nothing is more important than personal one-to-one communication with our customers. That is how Sun Chemical can continue to be a long-term trusted supplier—a company that truly works for its customers.

To be able to achieve this, our customers have to know we are here to help them with their problems. We’re optimistic that Sun Chemical’s investments in quality, service and innovation will help our customers succeed. By knowing our customers’ business and their individual needs through personal one-to-one communication, we can help them operate more efficiently without sacrificing quality or service to their customers.

PN: Looking ahead, what major innovations or technologies do you believe will shape the future of the industry? Why?

FM: It is no secret that the rapid evolution of new digital media and communications technologies is changing the printing industry dramatically. Print overall, however, continues to modestly grow in most parts of the world. Some emerging markets are still experiencing healthy growth in the printing industry.

Of course, we see customers adding new digital printing capabilities that allow them to respond to the emerging demand for variable data print, the increased use of color and shorter runs. They are adding new digital presses that use inkjet and electrophotographic technologies. Sun Chemical is a major supplier of complete inkjet systems, and we expect that to continue.

More common among our customers are efforts to increase the competitiveness of their offset operations, which still have robust and healthy futures. We’re working with our customers by creating new solutions that reduce waste and energy usage to help them drive those costs out of their businesses that don’t add significant value. We’re also helping customers shorten make-ready times, so they can take advantage of revenue opportunities for short run color and versioning.

Success for print businesses in the graphic arts marketplace of tomorrow means embracing change and introducing new products and services that capitalize on digital and printed electronics technologies, or support communications program that evolve in the online world.

PN: What is the biggest piece of advice would you give to printers and others involved in this industry?

FM: On a global basis, Sun Chemical invests a significant percentage of its sales per year in research and development. We view this investment, not in terms of what other companies in our industry spend, but in light of the need to contend successfully with all forms of technological change which impact our customers. We continually ask ourselves “what kind of investment do we make to ensure our customers are at the forefront in their industry” and “what does it take for us to be on the leading edge in the industry.” By analyzing market trends, we know what our customers will be looking for and need one or two years down the road.

Working for our customers in this way is a very wise investment for Sun Chemical. After all, our customers in these challenging times are depending on us for quality, service and innovation that will help them be more successful, and by doing so we believe more customers will choose Sun Chemical. Printers should know that the products we offer are designed to help them be more efficient and save operating costs.

PN: Is there anything else you would like to share?

FM: At Sun Chemical, we firmly believe in the printing industry. We invest in making sure we have the most advanced products, because we believe this industry has a great future despite having to accommodate to quick changes.