Highlights included musical numbers and a recap of the previous year’s financial performance.
CJ and I attended the annual Pacific Office Automation (POA) annual sales meeting on January 13 and were amazed at the production that went into the meeting. The theme was On Broadway. The event was introduced by a chorus from Phantom of the Opera. In the chorus line were the senior executives of POA.
Songs from several other Broadway musicals, including The Lion King, were featured as well. The performers were polished and highly professional. This was no local theater group performance.
Kudos to Pacific Office Automation President Doug Pitassi and his team for pulling this off. The entertainment was beyond what was expected, and the audience loved it. The musical production numbers were followed by Pitassi and his leading executives who presented POA’s financial results for 2023.
Pacific Office Automation’s 2023 Performance
Pitassi had regional leaders of which four reported the performances of their respective areas. There were two other geographic locations in which Pitassi led the discussion. These regions represented newer acquisitions.
The overall production was a little more than three hours. We learned just how well POA is doing. Revenue was up, but overall profitability was down. Like last year Pitassi kept referring to the area where he felt not everyone performed well. Last year, it was IT, and this year, it was profitability.
Above: Doug Pitassi takes center stage at the Pacific Office Automation annual sales meeting.
The professionalism exhibited throughout the business portion of the meeting was excellent, and each vice president discussed their areas of responsibility. From production print to electric vehicle charging stations, the news was positive.
It is obvious that what Pitassi was addressing was the same challenge that all businesses faced in 2023. The struggle to return to normalcy (meaning revenue) in the post-pandemic period and the profitability challenge when the economy is experiencing inflation. Inherent costs increase far beyond the ability of most businesses to maintain a desired level of profitability.
In our own business, we were hit hard by inflation, with our annual Gala experiencing an increased cost of 28% over the same model we used in the prior years. We can only imagine what POA dealt with throughout the business year hampered by inflation.
The overall Pacific Office Automation model reflects a business built on expansion fueled by acquisitions. However, it is not just adding pieces but getting them to increase their market share once they are safely in the fold.
With regard to the newer acquisitions, it was clearly shown how they had done year over year. In most cases, there was marked improvement, but certainly not all. In the end, the message was repeated that the goal is revenue increases as well as a return to the same degree of profitability POA had been enjoying for many years.
Pitassi proudly called out production print as responsible for $44,000,000 (roughly 11% of revenue). He did not provide the actual numbers for all POA’s diversified businesses, such as electric vehicle chargers and mailroom equipment.
Pacific Office Automation’s 2024 Goal
As for 2024, Pitassi announced the goal was $500 million. He reiterated last year’s message about the target for increased clicks and stressed this was all doable. Pitassi has a way of setting overly ambitious goals, and employees, as well as analysts, accept them as doable.
Above: Doug Pitassi does an amazing job of hosting the event and keeping things on track.
The number most repeated as a target was $10 million for the total revenue of a branch. Bear in mind these were all exceedingly small businesses and increasing that number to hit this figure is no small feat.
The regional managers quoted that number often as well by stressing they made it or fell short. Whatever the result, they were all bullish that they would do it in 2024. It was not a bombast but a statement of belief in their company and its amazing ability to do it better every year.
We would like to give a tip of the cap to Pacific Office Automation founder and CEO Terry Newsom, who purchased the Apeco Portland Branch in 1976. Apeco filed for bankruptcy a year later. Newsom took the branch, which had an extremely poor product line except for a private label Sharp model and built an incredible business that easily is at $450 million and growing.
Carol and I were at a Toshiba dealer event in 1986, where Newsom was honored as the dealer of the year. In accepting the award, Terry spoke to his fellow dealers and simply said, “Take out your checkbooks and pay those people you have working for you.” He said pay them well, and you will never regret it. It is obviously a message he has believed in for 47 years.
Above: Frank and CJ were honored to be seated at Doug Pitassi’s table during the banquet.
We also want to thank Pacific Office Automation for the kind and courteous manner CJ and I were treated. It has been my experience that not all winners are so thoughtful and generous.