Your relationship with your print suppliers should be strong and cohesive. After all, your printer may be your largest vendor in terms of dollars spent annually. Your printer is important to your business, and you should view it as your company’s business partner.
When deciding on a printer, price certainly is important. No direct marketer should pay a large premium for the privilege of dealing with a particular printing company. But there are other factors, such as service, lead times and technology, that should be taken into consideration. In this article, I’ll offer tips for maximizing your relationship with your printer.
Most direct marketers shop by price when obtaining printing bids, but there are other factors to consider as well. Naturally, we expect printers to be competitive, and most are generally within 5 percent of one another. Following are strategies for the next time you solicit printing bids:
• Be sure the printing companies from which you receive bids are experienced in printing the types of jobs you’ll require of them.
• Always get bids from at least three printers. It could be that all three proposals will come out about the same. If one bid is high, most likely you’ll discard it. If one bid is low, and the other two bids are considerably higher (and about the same) it could be that the printer that stands out is providing a low-ball quote to get the work, or it may not understand the specifications.
• Match your company’s culture to that of your printer. You must be comfortable with the people and company you’re dealing with frequently. Companies generally prefer doing business with companies they can identify with culturally. Also, consider the size of the printing company. The very large printing companies have tremendous capabilities and resources, but whether they’re structured to provide the level of service your company needs is the question. Sometimes bigger isn’t always better.
• Determine if you can work with a particular company, almost daily at times. How will you feel about the printer as a large creditor? Is this a company you can count on five years from now?
• Ask the printer’s rep what he or she thinks about your company as a customer. Your printer needs to know it can grow with your company. Show the printer you’re committed to it as a business partner long-term.
• Discuss customer turnover with the printer. Find out how long its top 10 customers have been printing with the company. It’s important to know what percentage of customer turnover the printer experiences annually. It’s even more important to know why customers take their business to other printers. Keep in mind it’s easy for a printer to offer you a low price. But a low price alone won’t retain you long-term. Price can’t be the glue that binds the relationship.
• Don’t go out for bids unless you’re willing to change printers. Printing companies are wise to this tactic. If they think you’re simply shopping the market to get a better price from your current printer, they won’t quote their best price to you. This can become a credibility issue. A printer needs to know you’re serious about switching companies for all the right reasons. I think most printers would understand if you stay with your current printer for a price difference of up to 5 percent. But if the differential is more than that, you must be willing to make the difficult decision to take your business somewhere else. It’s generally best not to change printing companies unless there have been issues other than price. If you like your current printer, most likely it will be price-competitive.
• Contract for one year at a time. Unless yours is a very large company, contracting for more than one year isn’t necessary. Too many things can change, and going out for bids no more than once a year is ideal. It’s a competitive business, and you want to remain current.
• Be sure you’re quoting the same amount of square inches of selling space. For example, if you’re a cataloger, catalog trim sizes will vary from one printer to another. Convert the physical dimensions and number of pages in your catalog to square inches to make it easier to compare prices. Also keep in mind that going to a slightly smaller trim size can save money without affecting your results. For example, a trim size of 8” x 10-1/8” will pull as well as a catalog measuring 8-3/8” x 10”, yet the slightly smaller trim size will cost less to mail.
• Always have the printer split the paper price from its cost to manufacture the your job. Have the printer tell you the hundred-weight price of the paper that it’s using to quote your job. This will help you identify differences from one printer to another. Some direct marketers like to buy their own paper, which is another reason to separate the manufacturing cost from the paper price. Although you can benefit from purchasing their own paper, there are drawbacks.
This is often a cash-flow problem since the paper will need to be paid for before your materials even go to press. What’s more, changing printers can result in butt rolls of paper left over, which can’t be used. Paper also can arrive damaged, and if you’ve purchased the paper directly, often you’re left to deal with the merchant or the paper mill, which can affect your press date. And if the printer has a problem on press as a result of the paper, it’s your responsibility, not the printer’s. This can result in press downtime at a rate of up to $1,000 per hour, which can become expensive.
• Be sure printers’ quotes are based on the same basis weight and paper grade.
• Be sure your comparison includes, for example, cover changes, make-ready costs and ink-jet addressing. Also include any costs the printer charges to get electronic files, locked or unlocked files. This is a real cost and must be part of your comparison today.
Following are a few points that may help strengthen your relationship with your printer:
• Don’t think of yourselves as separate entities. A direct marketer and printer should work together toward a common goal, for example, to serve your customers and prospects.
• Communicate clearly and frequently with your printer. Good communication is the key to a successful relationship. Let your printer know in advance what you’re thinking and why. The printer can’t always react in a timely fashion due to lead times for its work, but it can help you solve problems if you let it know what difficulty you’re having.
• Don’t jump from printer to printer from year to year. Printers know the companies that tend to jump around from one printer to another. You won’t get a printer’s best price by gaining this reputation. In fact, you’d most likely pay a premium because the printer knows there’s no loyalty factor. I don’t advocate or encourage companies to change printers frequently. Any relationship builds and improves over time. The longer you remain with a printer, the more likely it will get to know your specific needs, and the more loyal the relationship will become.
Cost increases are, unfortunately, a way of life. Following are some ways you can reduce your printing and mailing costs:
• Slightly reduce trim size if you’re a cataloger. Ask your printer for alternative trim sizes, which can reduce paper and postage costs, especially if your catalog exceeds the postal service’s Standard A piece rate minimum.
• Correctly prepare your disks going to the printer. Send disks to your printer with all necessary files.
• Reduce paper weight. Paper is sold by the pound. So if you use fewer pounds, you may save money.
• Leverage longer print runs. Use multiple covers and a re-mail strategy to maximize your economies of scale.
• Consider buying your own paper. Recently, I asked a printer about this and learned, for example, that 67 out of 72 of its catalog customers buy paper not from a paper mill but direct from the printer. Most small and medium-sized catalog companies are better off letting the printer purchase its own paper for the following reasons:
1. The printer has more leverage over price, since it purchases paper for many catalogs, for example, from the same mills.
2. Cash flow is better for you, the customer, if the printer buys paper. Most paper companies will expect payment before your job even goes to press.
3. If the paper is unusable (rare, but does happen), the printer is expected to deal with the paper mill, not you.
4. You eliminate the management time it takes to deal with the inventory of butt rolls, incoming shipments, etc. The process of managing the paper can be time-consuming.
5. If you ever do change printers, you won’t have to be concerned about transferring paper inventory from one printer to another.
Stephen R. Lett is president of Lett Direct, a catalog consulting firm specializing in circulation planning, forecasting and analysis. He can be reached at (302) 537-0375, or by e-mail via his Web site: http://www.lettdirect.com.
COMING SOON
“Build a Collaborative Relationship With Your Printer” is excerpted from Stephen R. Lett’s upcoming book on cataloging to be published later this year by Catalog Success magazine. Among other topics, this book will include valuable insights about printing, paper and production.
- Companies:
- Lett Direct Inc.