Consumer Goods, Retail

Tattoo Transformation

Family-run companies with long-standing successful products prefer to stick to their traditions. Change can be difficult for them—unless the next generation brings an unusual degree of courage. Like at Edding.

09/2022

“Dare to be who you are” is a motto of Edding CEO Per Ledermann (center), shown here in his tattoo studio with Alexandru Bejenaru (tattoo artist, left) and Sebastian Gellwitzki (Brand Development Manager).Porsche Consulting/Marco Prosch

Board mem­bers should be role mod­els for their employees—meaning as authen­tic, flex­i­ble, and per­sua­sive as pos­si­ble. But does that mean they should imme­di­ate­ly get them­selves tat­tooed? CEO Per Led­er­mann, born in 1975, did exact­ly that with his own ink in the ser­vice of trans­for­ma­tion. His company’s new course was launched on his left upper arm.

But let’s start at the begin­ning. When the Edding com­pa­ny was found­ed in 1960 by two young entre­pre­neurs with the min­i­mum start­ing cap­i­tal of 500 Ger­man marks (about 260 euros), no one could have fore­seen that the name “Edding” would soon become syn­ony­mous in Ger­many and abroad with high-qual­i­ty felt-tip pens. It would sell around 100 mil­lion of them in its first ten years—today that fig­ure is approx­i­mate­ly 150 mil­lion annu­al­ly.

Family entrepreneur Per Ledermann surrounded by his permanent markers. Edding's product with its rich history and tradition is an international institution in the classic office supplies segment.Porsche Consulting/Marco Prosch

“Per­ma­nent mark­er” is the gener­ic term for these con­spic­u­ous­ly wide-tipped pens. They were orig­i­nal­ly used by pro­fes­sion­als at ware­hous­ing, logis­tics, and ship­ping firms to mark pack­ages quick­ly and clear­ly. Then they were dis­cov­ered by artists, drafters, mar­ket­ing agen­cies, and pri­vate indi­vid­u­als. And for decades they were a fix­ture at lec­tures, sem­i­nars, and work­shops for pur­pos­es such as writ­ing on flip charts. In short, they had a broad mar­ket with a secure demand.

From Basement to Bourse

A portrait of company co-founder Volker Detlef Ledermann, painted in tattoo style. In 2005, Per Ledermann followed in his father's footsteps. He is getting Edding into shape and transforming the company as it heads into the future.Porsche Consulting/Marco Prosch
Edding, a family-run company, was founded in a basement office in Hamburg in 1960 by school friends Carl-Wilhelm Edding and Volker Detlef Ledermann. In 1986, co-founder Edding retired and sold his shares. The transaction was financed by the company’s launch on the stock market, with the Ledermann family retaining the majority of shares. The ordinary shares are in family hands, with only non-voting preference shares on the market. In 2005, Per Ledermann succeeded his co-founder father, starting off as the board member in charge of finances for what had become an international enterprise headquartered in Ahrensburg, northeast of Hamburg. In 2021, Edding posted group sales of 148.6 million euros and employed around 700 people. The company’s brand names—Edding, Legamaster, and Playroom—stand for high-quality products and solutions for both private and professional needs. Made famous by its permanent markers, the portfolio includes pens and other writing utensils for use in homes, offices, and medical and industrial settings. It features products designed to put creative ideas into practice, including tattoo ink and nail polish. It now also offers innovative digital applications. Legamaster develops and distributes visual communication tools, from classic products like flip charts and whiteboards to electronic solutions such as interactive e-screens. The Playroom brand, which joined the Edding group in 2021, represents innovative concepts and services that promote a “new work” culture of innovation at companies and organizations.

The logis­tics sec­tor now needs far fewer Edding mark­ers. And the col­or­ful pre­sen­ta­tion cases of work­shop orga­niz­ers are an increas­ing­ly rare sight. Like almost every­where else, here too the future is dig­i­tal. The trend toward paper­less com­mu­ni­ca­tion could very well elim­i­nate the need for writ­ing uten­sils. In 2020, the mar­ket for office sup­plies already dropped by 25 per­cent. This down­ward tra­jec­to­ry is con­tin­u­ing, not least of all because com­pa­nies are for­go­ing paper and pen­cils for sus­tain­abil­i­ty rea­sons. This puts Edding AG, which went onto the stock mar­ket in 1986, in the midst of a major trans­for­ma­tion. It has to rein­vent itself and become more ver­sa­tile.

“Our products have always been about helping people express themselves—which also and crucially means the freedom of expression,” says Per Ledermann, CEO of Edding AG.Porsche Consulting/Marco Prosch

Its course began to change in 2016. That was when the man­age­ment team led by Per Led­er­mann, the son of the company’s co-founder, posed the ques­tion: “Do we dare to strike out on new paths?” Led­er­mann asked a young grad­u­ate stu­dent to con­duct inter­views in the indus­try. The stu­dent, who was research­ing dis­rup­tive tech­nolo­gies, was charged with deter­min­ing where and how com­pa­nies were using Edding mark­ers and what would be replac­ing them in the future. Her results quick­ly con­firmed the sense that felt-tip pens had hard­ly any future in stan­dard busi­ness or indus­tri­al set­tings. And gave her the mate­r­i­al for a doc­tor­al dis­ser­ta­tion with the work­ing title The cul­ture of inno­va­tion at Edding. She was right on tar­get. After earn­ing her PhD, the for­mer stu­dent intern was tapped by Led­er­mann to lead the newly formed depart­ment of cor­po­rate inno­va­tion man­age­ment.

The sec­ond-gen­er­a­tion CEO of Edding takes a clear-eyed view of the sit­u­a­tion: “We’re fac­ing enor­mous change. Mark­ers will hard­ly be need­ed any­more, aside from a few for design think­ing. We’ve also moved beyond sim­ply apply­ing color to sur­faces.” But Led­er­mann sees the inher­ent value in his company’s decades of expe­ri­ence. “Our prod­ucts have always been about help­ing peo­ple express themselves—which also and cru­cial­ly means the free­dom of expres­sion.” Com­mu­ni­ca­tion knows many chan­nels, includ­ing uncon­ven­tion­al ones. Which is how tat­toos entered the pic­ture in 2020 as an espe­cial­ly strik­ing inno­va­tion.

Burchardstraße 13 in the heart of Hamburg — Edding CEO Per Ledermann with his team in front of the tattoo studio: Alexandru Bejenaru (left), Laura von Schwerin, and Sebastian Gellwitzki (right).Porsche Consulting/Marco Prosch
In 2020, Edding opened its first tattoo studio: in the historic Chilehaus in Hamburg's Kontorhaus district (old town). Behind the modern foyer are three treatment rooms.Porsche Consulting/Marco Prosch
Per Ledermann is enthusiastic about the new business idea. As the first customer, he got his own first tattoo when the studio opened—the relief of a wildlife preserve in Namibia.Porsche Consulting/Marco Prosch
Tattoo artist Alexandru Bejenaru writes “Edding” in sweeping letters on Per Ledermann's right upper arm. A design. It's not out of the question that the CEO will soon be using it elsewhere...Porsche Consulting/Marco Prosch

As Led­er­mann recalls, “We had already devel­oped the idea back in 2009 when our man­age­ment com­mit­tee was meet­ing for strat­e­gy nights over pizza and beer, but we didn’t pur­sue it.” Per­haps the impromp­tu notion was ahead of its time. And Edding was prob­a­bly not ready for it. At any rate, the idea lay dor­mant for a good five years—until Led­er­mann took it up again fol­low­ing renewed men­tion by a friend and pro­ceed­ed to cause a sen­sa­tion at the com­pa­ny head­quar­ters in Ahrens­burg, north­east of Ham­burg. He pulled out all the stops, approv­ing a “seven-digit fig­ure” for the ini­tial bud­get, order­ing inks to be devel­oped in accor­dance with the lat­est E.U. guide­lines, hir­ing five tat­too artists in 2020, and open­ing the company’s first tat­too stu­dio in the his­tor­i­cal Chile­haus build­ing in Hamburg’s upscale city cen­ter. And he got his own first tat­too, a hereto­fore unusu­al action by Led­er­mann fam­i­ly mem­bers except for the director’s nephews. “If we’re enter­ing new ter­ri­to­ry, then I have to go there too,” says the CEO, who can now also imag­ine open­ing stu­dios in other large cities.

The new busi­ness model was not entire­ly with­out detractors—as might be expect­ed when an estab­lished man­u­fac­tur­er shifts to pro­vid­ing a ser­vice. “The tat­too com­mu­ni­ty was skep­ti­cal at first, because a large com­pa­ny was mov­ing into its small-scale mar­ket.” The work­force at Edding also had some reser­va­tions. “Our long-stand­ing ensem­ble had been play­ing flaw­less­ly togeth­er for years and sud­den­ly had to deal with a dif­fer­ent kind of music,” remarks Led­er­mann. “That was a source of unease and critique—like a wild rock band crash­ing the con­cert of a phil­har­mon­ic orches­tra.”

Between Boardroom and Zebra Farm

“I feel like a cross between a naturalist and a family business leader,” says Per Ledermann, CEO of Edding AG.Porsche Consulting/Marco Prosch
Born in 1975, Per Ledermann joined the board of Edding as its CFO in 2005 and then became CEO of Edding AG in 2009. At the age of 15, the son of the company co-founder had played with the idea of running the family business one day. Based on an initial desire for academic work, he studied law before turning to business administration. His multitasking skills and ability to find creative solutions were evident early on. At age 20 he and his wife Anika welcomed their son Yannick and daughter Elisa. There was never any doubt that the couple would keep studying while parenting, and they now have four children. After Ledermann passed his first state law exam, the young family spent two years in the USA. There he earned master’s degrees in business administration and international management. The family then moved to the Middle East, where Ledermann worked as a strategy consultant before entering and taking over the company his father, Volker Detlef Ledermann, had co-founded. Ledermann inherited a great desire to travel and a strong connection to nature and animals from his parents. Africa plays a special role here. Susanne and Volker Detlef Ledermann fell in love with the continent’s beauty and worked to save Hartmann mountain zebras from extinction. A love for Africa is also evident on Per Ledermann’s left upper arm, where a tattoo shows a relief of the wildlife preserve that the family runs in Namibia.

But Per Led­er­mann, whom some of the older employ­ees had known since his child­hood as the son of the founder, appealed direct­ly to the peo­ple at the com­pa­ny. Small three- and four-mem­ber project teams were cre­at­ed and he joined them too. “I got per­son­al­ly involved in an effort to build the bridges we need­ed to pivot from a rather hier­ar­chi­cal orga­ni­za­tion to an agile one.”

Alyssa Cetin, quality control manager, writes test values on a glass pane. Edding product quality assurance takes place at headquarters.Porsche Consulting/Marco Prosch

Actu­al­ly imple­ment­ing the trans­for­ma­tion was of course not quite as sim­ple as it might sound. Led­er­mann is very open and self-crit­i­cal on this score. “Despite being on a num­ber of dif­fer­ent teams I real­ized I still wasn’t vis­i­ble enough. So I start­ing hold­ing one-on-one talks in order to learn from peo­ple. But also to do some con­vinc­ing.” The employ­ees could see how seri­ous their boss was about the trans­for­ma­tion. For his part, Led­er­mann real­ized that “we had bur­dened our­selves with too many areas of inno­va­tion. The gap between man­age­ment and the team was too big. Some­times I was hell-bent on get­ting my way. At other times I shied away from con­flict.”

Since 2015, nail polishes have also been part of Edding’s product range. The primary buyers are large drugstore chains.Porsche Consulting/Marco Prosch
As with its markers, Edding swears by the “permanent” factor for its nail polishes: “ultra-resistant with great color strength.”Porsche Consulting/Marco Prosch
Edding employee Laura von Schwerin at the tattoo studio in Hamburg, where she has just polished her nails in five luminous Edding colors for the photographer.Porsche Consulting/Marco Prosch

Good com­mu­ni­ca­tion can be an impor­tant part of mak­ing a trans­for­ma­tion work. One employ­ee launched a series of infor­mal evening get-togeth­ers over wine called the “Strat­e­gy Spir­its.” Gath­er­ings out­side the nor­mal rou­tine made it eas­i­er to chart a new course and ensure every­one was on board. Tat­too inks alone, of course, would not be enough for the com­pa­ny to sur­vive, let alone grow. But Edding has remained true to its col­ors, albeit in novel ways. Its port­fo­lio now even includes nail pol­ish, whose pri­ma­ry buy­ers are large drug­store chains.

In addi­tion to cos­met­ics, Edding is con­tin­u­ing to tar­get its long-stand­ing clien­tele in other busi­ness­es and indus­tries. Now, how­ev­er, the prod­ucts it pro­vides for pro­fes­sion­al appli­ca­tions are dig­i­tal. The “Edding code” tech­nol­o­gy, for exam­ple, uses con­duc­tive dig­i­tal inks to detect forg­eries of doc­u­ments such as driver’s licens­es and to elec­tron­i­cal­ly ver­i­fy brand-name prod­ucts. In pro­duc­ing inno­va­tions of this type, the north Ger­man com­pa­ny has been work­ing close­ly togeth­er with start-ups, which it invites in dif­fer­ent com­bi­na­tions to dis­cus­sion ses­sions at its head­quar­ters.

New partnerships, more innovation: Edding invites start-ups to its Co-Creation Day at the company headquarters in Ahrensburg. The aim: to develop new, innovative business models and forge long-term partnerships.Porsche Consulting/Andreas Laible
Ertuğrul Durukan, co-founder of Smarta NureArt, consults with Lisa Guo from Edding's Creative & Home business unit.Porsche Consulting/Andreas Laible
Jan Ledermann, nephew of the CEO, in conversation with Jasper Kolb from the Berlin-based artist platform The Makery.Porsche Consulting/Andreas Laible
Dide Durukan from Smarta NureArt quickly adds the finishing touches to her competition presentation.Porsche Consulting/Andreas Laible
Johann Desjardins of ekoo.co in a workshop with Judith Forster and Piril Unutkan, both from Edding’s Office & Industry Supplies business unit.Porsche Consulting/Andreas Laible
Jasper Kolb, co-founder of the creative workshop platform themakery.de, documents the results of the creative brainstorming.Porsche Consulting/Andreas Laible

One of these young com­pa­nies is Pris­made, which invent­ed the dig­i­tal ink used at Edding. In 2018, Edding acquired a 50 per­cent share of it. To han­dle the devel­op­ment and inter­na­tion­al sales of inno­v­a­tive dig­i­tal tech­nolo­gies, Edding found­ed a busi­ness unit in Munich called Indus­tri­al Tech Solu­tions. Its port­fo­lio includes the Edding com­pact print­er, a small label­ing device—made in Germany—for indus­tri­al pro­duc­tion process­es. As Led­er­mann explains, “It’s essen­tial­ly a dig­i­tal and fully con­nect­ed 4.0 ver­sion of a clas­sic Edding prod­uct.” Which takes the spe­cial­ist in per­ma­nent mark­ers almost back to its roots. How­ev­er, that’s not the end of the trans­for­ma­tion for this world-famous maker of writ­ing instru­ments. Led­er­mann, who runs a nature reserve in Namib­ia with his fam­i­ly while on vaca­tion, is espe­cial­ly clear on this point: “In many respects we’re still right in the mid­dle of the process of change.”

One thing that def­i­nite­ly should not change, how­ev­er, is the company’s iden­ti­fi­ca­tion with its his­to­ry. When the inter­view is near­ly over, Led­er­mann, in keep­ing with his role as head of a fam­i­ly-run com­pa­ny, puls a black “edding no. 1” mark­er out of his pock­et. He twists off the cap with two fin­gers in light­ning speed, and writes the company’s name on a piece of paper. Although six decades old, the orig­i­nal prod­uct still works per­fect­ly. “Our very first mark­er was refill­able,” says the boss—who upholds the tra­di­tion of writ­ing the com­pa­ny name in small let­ters but attach­ing great impor­tance to sus­tain­abil­i­ty.

The first black marker—"Edding No. 1”—an original that is more than 60 years old. Even today, the Edding brand name is the international byword for a high-quality, refillable felt-tip pen.Porsche Consulting/Marco Prosch

Edding Branches Out—Five Questions about Its Transformation

1

When was it clear that Edding’s fiber-tip pens could no longer power the business model and the company would have to change?

Per Ledermann: The foundation was laid by a study we conducted back in 2012 with 25 leaders in the office product, writing tool, and retail sectors. Its aim was to analyze how the market would change by 2020. And its conclusion, which predicted the market would drop by a third, left us in shock. The reasons had to do not only with digitalization, which was making key applications obsolete, but also with commoditization, which meant ever more brand names were generating ever greater price pressures. That was what prompted us to start changing the company in major ways.

2

What were the first steps in Edding’s process of transformation?

Ledermann: A key part of the transformation process consisted of looking outside the company and asking what exactly was happening on the market. And then of evaluating how much risk was involved. That’s how we came across new opportunities. One of the crucial initial steps was to focus much more on our target group of end consumers. Our first new product—acrylic sprays—managed to achieve surprising success. They were about helping people unleash their creativity at home. In addition to the product itself, we wanted to inspire design in both retail and online contexts. Our message concentrated on the courage to try out new ideas. That’s something every one of us can do. At some point the strategy really took off. In the beginning we were expecting annual sales of 300,000 euros, but we’ve now reached a mid-level seven-digit figure. That really charged our attitude toward change. We’ve been building on that with the next projects—which are even more adventurous.

3

How did the employees respond to change?

Ledermann: To be honest, when the idea arose of adding new product areas to our traditional collection, it wasn’t met with total agreement. Everyone at the company was fully occupied with their own fields of work. We first had to form a special project team that wanted to work on developing new product innovations. At some point the products were born and became part of our creativity-focused portfolio. That ultimately evolved into a pattern. When you’re facing major processes of change you need encouragement, and our acrylic spray paints for artistic design have definitely done the job. They worked superbly, and gave us the confidence to keep going. In the meantime we’ve come up with many more innovative products, such as nail polish, acrylic markers, and tattoo inks. An essential part of transformation isn’t just the products themselves, but rather what happens with the people when a company sets off on a new course—the very fact that we’re daring to try out new things. It’s important, however, not to neglect our existing business. It continues to keep us afloat and also has to finance our new ideas.

4

What are you doing about sustainability—will we be seeing fully biodegradable markers?

Ledermann: Sustainability is always a huge priority for us. We’re constantly seeking ways to make our products more sustainable. Our markers have always been refillable. We also provide our business customers with return boxes so they can send back empty markers, which we then disassemble and recycle. As for broadening our horizons further, we have to expand the company’s expertise. The complex part is usually a matter of bringing the right products together, and especially of raising awareness for them. The challenge behind biodegradable markers lies in the different components and in the system itself, which has to be sealed—in contrast to ballpoint pens. Biodegradable materials generally have fibers that are permeable in some way. As soon as the solvent makes its way through the material, the pen dries out. However, a few years ago we began developing our first inks based on natural pigments. And as far as plastics go, we’ve reached the stage where we can work with ever more mixed plastics. There’s still a long road ahead before the pens are biodegradable, but we’re progressing step by step—I’ll probably still need to be patient for a few years.

5

To ask the “quo vadis” question, what course will Edding be taking in the future, and what innovations will we be seeing?

Ledermann: The big topic of the future has to do with collaboration and work. We’re already starting to take a more holistic view of how collaboration functions, and want to keep moving in this direction. If you look at visual communications over the past two years, it’s especially clear that the transformation has to go faster. We’ve just set up a conference center—what we call a Playroom—for a customer in Dubai, which uses digital technologies to show innovation processes spatially. Depending on what customers need, we look at which hardware and software can be helpful and equip the place accordingly. Lots of new ideas are arising in the collaboration and work field right now, also outside Edding. It’s our job to find the right partnerships and joint projects. Our goal at Edding is to provide customers with overall solutions from a single source. There are also a lot of cool innovations and ideas in the traditional creativity sector. One of our employees recently returned from a business trip to the Netherlands, where he had seen how you can design colorful things in water, like works of art. I don’t know whether we’d ever be able to do something like that. But it triggers a sort of “truffle pig” mentality in us, with a desire to put the next innovative product idea into motion.
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