July 13, 2010

Dear Valued IIMAK Customer,

I am writing to inform you that IIMAK will implement a price increase of 5% on black wax thermal transfer ribbons, effective August 1, 2010.

There has never been a price increase on wax products in the history of the thermal transfer ribbon (TTR) industry. In fact, over the past 12 years, pricing has been reduced by approximately 50% across the wax product lines. IIMAK has been very resourceful in providing this continuous long term value, and we have been supported over the years by equally resourceful suppliers.

Recently, this industry dynamic has changed. Several of the key raw material suppliers to the TTR industry have been economically forced to reevaluate their position. Most notably is the PET industry, which provides the critical base substrate of the ribbon. 

The fundamental problem for PET manufacturers is economics. Costs are increasing and demand is growing.  Therefore, PET manufacturers have implemented aggressive price increases. Even more concerning, some manufacturers have chosen to withdraw capacity from the TTR industry. These manufacturers are compelled to shift capacity to meet high demand for PET in other more profitable applications such as flat screen televisions.

PET is not alone in the TTR raw material concerns, but it is the most significant and the easiest to illustrate this industry wide issue for the TTR supply chain.

There continues to be a long term future for thermal transfer printing. Collectively, from print engine manufacturers, to systems integrators, to label manufacturers and converters, to TTR manufacturers, we deliver a very valuable solution for auto ID users worldwide.

All of us at IIMAK understand value, and we understand the pinch of a price increase. That said, we are committed to this industry and will continue to deliver unique products and services that help you achieve your business growth objectives. If you have any questions or concerns, please contact your IIMAK account manager at 888-464-4625.  Thank you for your business and we look forward to serving you in the future.

Sincerely,

Richard A. Marshall
Chairman & CEO