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On deck for Deluxe expansion

Posted: November 20, 2011 1:30 a.m.
Updated: November 20, 2011 1:30 a.m.

Michael A. Alvarez Jr., president of Deluxe Media Management, stands above the production floor recently in Valencia. His company provides third-party logistics and marketing services to the entertainment industry.

 

Drafted by the St. Louis Cardinals in 1986, Michael A. Alvarez Jr., of Santa Clarita, said he took his signing bonus and created a tax shelter to start a company. Over time, he made inroads into the studio entertainment market.

 Deluxe Media provides third-party logistics services and marketing solutions to the Hollywood entertainment and consumer-products industries.


Recognizing the potential for growth if he aligned his company with the right partner, Alvarez said  he took another gamble  in February 2002, when he sold the company that he’d built into a major service provider to the entertainment industry in film, video and digital media.

 Alvarez was only 35 years old, too young and too energetic to retire, he said.

“I sold because I believed we’d have greater opportunities,” Alvarez said.


Today, Alvarez, 45, is president of Valencia-based Deluxe Media Management, a division of Deluxe Entertainment Services Group Inc., a wholly owned subsidiary of MacAndrews & Forbes Holdings Inc.

“Being an entrepreneur is awesome, but when you get something going and start growing it, you need muscle and capital and a bigger customer list,” Alvarez said. “You need money to go to the next level.”

New horizon
A self-described workaholic, Alvarez said he originally started the company, Vision Entertainment, with friends.
“I started Vision Entertainment at 19 years old with a couple of close friends, the Russell family,” Alvarez said. “Today we’re still working together; still friends and we still enjoy our business.”


After selling the company in 2002 that he started 25 years ago, the privately held company changed its name to Deluxe Media Management in June 2003.

 By October 2003, Alvarez was made president, essentially of the company he created and then sold. Alvarez was asked to stay and help continue growing the business, he said.

“I believed the best partner I could have was Deluxe — they’re the biggest partner in this area of entertainment,” Alvarez said. “But I never imagined I’d be here this long.”

 Kevin Gold, senior director, account management, praised Alvarez’s role in leading the company.

“Mike has always been an innovative leader, finding ways to keep us not just relevant, but frontrunners, in a continuously changing industry,” Gold said. “That leadership is what sets us apart from the competition.”


In August 2011, Deluxe Media Management reportedly signed one of the largest industrial building leases in Vista Business Park, near the Valencia Commerce Center.

Growing locally
“We brought Hollywood to Santa Clarita so that Santa Clarita can do what it does best, and that’s service,” Alvarez said.

While Deluxe Media Management specializes in providing third-party logistics services and marketing solutions to the industry, the company also supports order-and-fulfillment and marketing services for non-entertainment companies.

The new 229,450-square-foot building that the company leased allowed the company to expand its fulfillment operations. The building also features nearly 12,500 square feet of office space.

With its headquarters in Valencia, the company has a combined total of 415,000 square feet of warehouse and order fulfillment space in other cities.

 “We expanded because of the growth of the business,” Alvarez said.


That growth also meant an increase in the number of employees retained by the company.

When the company was sold, Deluxe Media had 89 employees who stayed on after the sale. It has since grown to 238 employees, Alvarez said.

“We represent about 50 families and over 70 kids, a large percentage are from Santa Clarita,” he said.
“Working with Alvarez is like waking up every morning with two cans of Red Bull being injected directly into your veins,” said JoAnn Knob, vice president of logistics.

His passion and animation drive every employee to a level of ability to continuously go above and beyond the customer’s expectations, Knob said.

Fan of the SCV
Married and a father of three, Alvarez said he loves it when he goes out in the community and sees the employees he works with every day.

“I want Santa Clarita to know that we love our community, and this is a version of us giving back,” Alvarez said. “We’ve made an impact on the place we love so much.”

Also a youth baseball, basketball and football coach, Alvarez heaps praise on the local area and its people.

“We’re awesome,” he said. “We’ve got great service and people, our restaurants are the best and we have our own hospital.”

Strategic alliance
Describing the sale of his company to Deluxe Entertainment as a strategic opportunity, Alvarez said Deluxe Entertainment was able to provide his company with the edge it needed.

“And the merger gave them a one-stop operation for the film prints that were being sent out to movie shows,” he said.

Deluxe Entertainment was already providing film and print to the industry but Deluxe Media was able to receive their content, store it and distribute it for them.

The company’s Hollywood film laboratory, a continuously running operation since 1919, was once operated as part of the William Fox Studios.

The name Deluxe became known because of the “Color by Deluxe” trademark name, adopted when the lab helped filmmakers adjust the color and density of a picture in the laboratory timing department.

The purchase of Alvarez’s company gave Deluxe Entertainment a complete supply chain from manufacturing film or digital cinema prints to shipping and managing logistics of prints and trailers to theaters.

 Thousands of prints are packed, bar coded, and shipped with each print watermarked using Deluxe’s unique Forensic Coding Technology to aid in deterring piracy.

Expansion
Before selling his company, Alvarez said it only provided order and fulfillment services to domestic television groups within the studios. Selling the company gave his business access to the wider studio market.

“I began the company as a television marketing distributor for shows like ‘Silver Spoons,’” Alvarez said. “Today, we get to work with ‘Harry Potter,’ ‘Desperate Housewives’ and more.”

“His overall vision never gets mired in the daily operational minutiae,” said John Bevacqua,  who works in business development at the company. “Michael always embraces a chance to add new and different strategies for success to the business.”

It would have been very hard to penetrate those areas of the studios, Alvarez said. “Deluxe allowed us to have the muscle to walk in the door to the other divisions that we were not doing business with,” he said. Today, his company works with studios such as Fox, Sony and Paramount.

New Territory
Venturing into today’s technology, Paramount Pictures announced Oct. 11 that it teamed with Deluxe Entertainment Services Group to provide “For Your Consideration.”

 Producing and mailing scores of DVDs for screeners who don’t make it to a theater to select movie award contenders can be a costly endeavor.

For Your Consideration allows secure streaming of films by online screeners for the 2011-2012 awards season, making it the first major studio to stream its awards films online.

The studio will present its awards contenders, including “Rango,” “Super 8” and “Like Crazy” later this season. Screeners began receiving the films by mid-October.

“We are delighted Paramount chose Deluxe’s digital screener platform,” Alvarez said.

 “By continually expanding and customizing our services, we are able to best support the rapidly changing needs of our entertainment industry clients.”

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