In case you haven’t noticed, the printing business isn’t what it used to be. But before you begin to think this is another of those ‘print is dying’ articles, let’s clear the air, it’s not. The printing business is far from dead but it certainly has changed. The days of constant incremental growth and an influx of new clients have gone the way of the buggy whip. There is still success to be had in today’s printing business but the model for making money is contrarian to familiar practices. And, believe it or not, the latest breakthrough in production technology plays no role in it.
Peaks and valleys are part of the business cycle in any industry. There are times when customers buy and times when they don’t. Many products can be manufactured in advance, stockpiled and sold on demand. For example, if you were in the toothbrush business, you would know how many toothbrushes you could sell in a year and when the peaks and valleys were. You would equip, supply and staff your factory to manufacture evenly throughout the year. You would stockpile production during valleys so there was enough to sell during peaks. But you are in the printing business and printing is different. Printing is custom. Every print job is unique. You can’t produce printing in advance, stockpile it and sell it on demand because your clients have to have something for you to print before you produce it.
Printers, for hundreds of years, have followed a different model. This model is based on being prepared for anything that could come through the door and then waiting for it to happen. Like the toothbrush manufacturer, you know in general when your peaks and valleys are, but unlike the toothbrush manufacturer, you can’t produce in advance and stockpile. And, at the same time, you wouldn’t want to turn away a client at any time, peak or valley. So the classic model for printing is to staff and equip for the highest of peaks and have a lot of downtime where both machines and hands are idle while overhead adds up waiting for clients to need your services.
Simply stated, in today’s business environment, printing success doesn’t come through increased business or new clients. If you continue to follow a model built around downtime waiting to be filled, the money you earn during the peaks will disappear during the valleys. To make money in today’s printing business you need to do the opposite of what the industry has considered logical for centuries.
Success in today’s printing business comes from efficiency and partnerships. To make money printers need to staff and equip for the valleys, not the peaks. You need to take inventory of actual production and eliminate operations that are not being fully utilized. If you are not readily selling non-core services like prepress or bindery, why bother when you can turn to partners who do them as their core operation? Ultimately, if a printer can trim fringe operations and focus on core services so that 80 to 90 percent of capacity is consistently being used, that printer can make money in today’s business environment.
But what about offering full service or being capable of taking work when the plant is running at capacity? That’s where having a variety of partners close at hand comes into play. Outsourcing among printers is far from new. But to achieve success in today’s environment, it is critical. That is one of the keys behind the success of the major, multi-plant and conglomerate printers like Donnelly, Cenveo and Quad. They operate at valley levels and then shift work among their facilities according to capacity or capability. Printers of any size can do the same thing without mergers and acquisitions.
Like most business strategies relying on partners for out-of-scope and beyond-capacity work is not without its risks. Can the partner live up to your standards of quality? Will the partner provide great on-schedule, on-service at a price that can be marked-up? Can the partner be trusted in terms of confidentiality and non-compete? These concerns are real, complex and difficult to overcome, but, with the right insight, preparation and tools, they can certainly be mastered.
Aside from the obvious legal agreements, printers, wishing to leave the past behind and follow today’s path to success, need software specifically built for the job – software that is powered by a method created for custom-produced goods and services like direct mail, marketing materials, publications, packaging, digital and all things print. They need software that empowers them to establish crystal clear, bullet-proof specs for the work they are outsourcing to partners. They need a way to qualify, manage and score their partners objectively based on capability and output. They need to automate the time-consuming process of sourcing and awarding the work. They need to be able to track outsourced jobs with precision and know that, on each and every job they outsource to a partner, they will receive the best possible combination of quality, timeliness and price. Simply stated, they need to be able to guarantee quality and service while buying the project for less than they can afford to make the project.
There aren’t fifty different alternatives to meet these needs. Spreadsheets won’t do it. General procurement, enterprise resource planning, customer relationship management and production workflow software can’t do it. There is only one solution – eLynxx cloud software and the eLynxx exclusive sourcing method that’s so powerful it’s been awarded five United States Patents to date.
eLynxx Solutions knows the printing business, because it has been part of the business since 1975. Through 40 years of revolution in the printing industry, eLynxx Solutions has provided the experience, expertise, innovation and technology that has allowed printers and print buyers alike the opportunity to mutually profit from an ever-changing marketplace. Having processed over 3.2 million print projects valued at well over $9.1 billion dollars, there is no question that eLynxx Solutions has helped a lot of people. The only question is when can eLynxx Solutions start helping you make money in today’s printing business?