Billion Dollar Broker

This past week industry power-house InnerWorkings announced it reached $1 Billion in annual sales.  Their motto of “We make marketing happen” is one that should truly resonate with print providers, yet very few firms have been able to execute at this level.

The concept of a print management company (or if you prefer the old-fashioned moniker – print broker) succeeding to this extent was unheard of 20 years ago, and 13 years ago when the company was founded, most folks would have laughed you out of the room if you suggested that they could generate even 1/10 of their present annual sales.

For me, the InnerWorkings success says a lot about how print buying has changed in that time.  Over the past 15 years, while many print providers were struggling with the question of should we go digital or remain offset, this company was taking advantage of how corporate America was changing.  The buyer could care less (although they didn’t always say it) as to what kind of press you were using.  All they wanted was a competitive price and their print problems to go away.  InnerWorkings made it happen because their vision went beyond ink on paper and focused on managing the logistics of print, and it didn’t hurt that they also were able to make the industry’s over-capacity work for them. They’ve become the low cost producer for distributed enterprises who see print as a commodity.

Although I still think our DNA is one of a manufacturing industry, the success of InnerWorkings tells us how much the industry has changed from being purely manufacturing centric to becoming more customer centric.  Therein lies the kernel of truth of how to succeed in the 21st century of visual communications.  It’s more about providing solutions than it’s about being a manufacturer of print.

To Regulate or Not to Regulate

OK, I’ll admit at first I wasn’t too excited about this topic of Net Neutrality.  I liked things the way they were.  Limited regulations and free enterprise. Good things I thought, but then I started to do a bit of reading and talking to my son.   James grew up (professionally) during the dot com days of Silicon Valley and makes his living in that world. He is a proponent for net neutrality and was upset with the folks in Congress who “didn’t get it.”

I also started paying attention to my rising telecomm costs at my office and at home.  I also noted that there were more and more mergers in the world of telecommunications and less and less competitors.  Hmmm.

Although I’m not one for regulations, I think I concur with the FCC on this issue.  Utilities (or services which are utilized by the vast majority of our country — and dominated by a handful of companies) need to be regulated.  Otherwise, it’s my observation, that the smaller companies and folks who don’t have the deep pockets get forced out of the markets.  Talk to the young entrepreneurs in Silicon Valley, and you’ll see that they support net neutrality – because they want availability to the opportunities that a regulated system could provide.  The companies who are beginning to dominate the channels want to dictate the terms of access – and they speak about open markets and efficiencies.  But is this best for us?  Is this best for creating new markets and allowing the world of communications to grow?  Is this good for small business?

Congress is going to become involved in this and it behooves everyone in our industry – who utilize these pipelines of information every day – to contact their legislator and speak up.  I for one think that net neutrality is good for business.

Let’s Play Two

This past week, baseball lost another legend — Mr. Ernie Banks, a.k.a. Mr Cub.

He was in his prime in the 1950’s and into the early 60’s.  In those days, we didn’t have the 24/7 media connection we have today.  You followed your local heroes and occasionally read about the “other” stars in the newspaper and magazines.  Yet, for many of us kids growing up in those days, Ernie Banks was synonymous with the Chicago Cubs. Mickey Mantle was the Yankees.  Boog Powell was the Orioles and Stan the Man represented the Cardinals.  And of course for us Dodger fans, we had the Duke and an up and coming southpaw called Koufax.

Yup different days.  But the game is still played between the lines and every team has a chance in March. The smell of fresh cut grass; the crack of the fungo; and the snap of a catcher’s glove when the ball strikes hasn’t changed.  That’s what makes baseball such a great game.  So, let’s play two!

 

Vegas

I’m presently looking at the stark mountain range west of Las Vegas from the 32nd floor of a hotel.  102 miles to the west is Death Valley one of the most desolate areas of the world.  Below me is the Mecca of Sin, as some see it.   Others view it as Disneyland for adults.

It’s been about five years since I have been here, and it’s amazing the amount of changes which have occurred.  More hotels.  More entertainment.  More things to do.  Yet, what has not changed is the pace of Vegas.  The hype.  The energy.  And there’s been plenty of energy – and learning – at this year’s EFI Connect, which I’ve been fortunate to attend.

The focus of the conference is product centric – similar to HP’s DScoop — but there was plenty of good solid information.  More importantly it was the opportunity for management teams to meet and network with others who are living the world of implementing management systems and digital workflow. Talking to someone face-to-face in a collaborative manner is still the best way to communicate and learn.

One of the most interesting points of the past two days, given EFI’s core business in MIS software, was a discussion I had with several folks regarding production standards, BHRs, and sales comp.  It seems I was having these same conversations over 30 years ago – and the importance of these issues have not paled.  Our tools have become much more sophisticated, and we have a lot more information and data, but the base issues still remain the same.  Do we REALLY understand what the data is telling us?  And HOW are we going to use it?  The more things change ……

Controlling Your Destiny

I was perusing the Wall Street Journal this morning while waiting for my desktop to finish waking up and read two articles that piqued my interest.  One dealt with how manufacturing is making a comeback in the U.S., and the second was an op-ed piece on the cost of textbooks.

As I always attempt to do, I looked to see how print fits into these discussions and found some nuggets worth exploring.

The manufacturing article dealt with the inevitable cycle of business – what was once a good idea has become old-news as time and competition change the playing field.  In regards to manufacturing, China no longer has the upper hand due to low wages as its labor costs have begun to increase.  On top of that there are a variety of issues including transportation time, and controlling the product which have opened the door for innovative U.S. manufacturers.  Manufacturers who embrace automation, efficiency and logistics control.  Although the print community has not been devastated by over-seas competition, the need to become more efficient and embrace automation is continuing to ripple throughout the industry.  And that’s a good thing.

The other article dealt with supply, demand and how publishers have been able to increase the price of books dramatically (did cost of printing go up during this period – I don’t think so).  As the article stated, since 1985 the price of consumer goods have doubled, but the price of a text book has gone up six-fold.  Which brings me to the need for print providers to start thinking of ways to control their destiny – which is a trend we are starting to see as firms move up stream in marketing and downstream into mail and fulfillment.  If you take it a step further, look at the model of the print management firms who have successfully helped “manage” their clients print procurements.  Thus the print provider is much more than just a supplier and have carved out a profitable niche.

One last thought. The first article was focused on how “Made In America” is making a comeback.  So, let’s keep working to make sure that “Printed In America” continues to be a viable option!

Parting Shots From USPS Postmaster

It’s fascinating to see what people will say once they are no longer the point person in an organization.  Some will take the politically correct path, while others will voice what they wouldn’t have said prior to their leaving.  Case in point is Postmaster General (former) Pat Donahoe.  Check this article out from the Washington Post.

Mr. Donahoe has it right.  There are myopic forces at work – both labor and mailers.  And of course, we can’t forget Congress.  The article is good reading and Donahoe provides insights from a person who was trying to make the right changes.

The real question — and this is true of any major government service or organization — how can we modify it without upsetting a significant stakeholder(s).  So, does anyone have the guts to make long-term decisions and deal with significant short-term pain?  If you’re an observer, you’re saying yes, let’s make the right decision.  If you are the individual/stakeholder whose career will go down in flames or business will significantly be affected, you probably have a totally different perspective.  It’s the breakfast analogy.  The chicken is a participant/observer (eggs), but the hog (sausage/bacon) is committed/stakeholder.

So, what should be done with the USPS?   And are you a chicken, or are you a hog?

 

Happy New Year

Wow.  Another year has come and gone. It’s interesting, as many observe, the older we get the quicker the years pass by us.  Yet, there’s a lot to be said for looking forward to a new beginning as we did when we were children. Not a bad thing to keep in mind as we go into another “interesting” New Year.

What make it “interesting?”  There’s continued turmoil in the Middle East (when hasn’t there been?).  Our economy is doing well, yet there’s concern that Europe and Asia will cause a slow down since they’re not buying our products at the same levels.  The price of oil is down — but that’s a two edged sword, but I think most of us like sub $2.00 gasoline.  We continue to argue about “affordable” health care and the inequality of wages.  Ah, and the Republicans are taking over Congress — is that good news or bad news?

So, let’s let our inner child out and ignore all the bad and look for the good stuff — it is out there.  In comparison to previous generations — and much of the world — we live in a nation of wealth.  Housing is affordable, as is food.  We have the freedom to express our opinions in many different forms.  We can worship (or not) our Creator in all his/her wonderful aspects.  Education is affordable and available to anyone.  And I’m of the firm opinion, that you can be whomever you want to be.  Is it easier for some? Sure, but there are no laws stating that certain groups can NOT fulfill their desires.

So, let the inner child out and let’s get past all the dung in the horse stall — because if we look hard enough, we will find the pony.

Making 2015 A Better Year

From all reports, 2014 has been a good year for many in our industry.  Many companies are busy and many buyers are realizing print has value and a solid ROI.

 

Yet, as many of our company owners and CEO’s have discovered, good is not great.  The market has shrunk dramatically from 2008 and other competing media (specifically digital ones) have changed the landscape of competition.  So, how does one continue to thrive and survive in 2015?

 

Regardless of the challenges to do so, sales growth is crucial to success.  Many companies continue to expand their offerings (mailing, fulfillment, wide format, specialty products, and even marketing services), but the smart ones don’t just add capabilities (build it and they will come), they also spend time in training their sales force on selling those new services – and when necessary, adding (or replacing) players to ensure that the investment has an ROI.

 

Firms have to look at what the print management firms are doing and why they’re successful.  It’s more than just ink on paper.  It’s the willingness to provide unique service levels and negotiated pricing.  Its finding partners who fill in the gaps (wide format; mailing; web portals) to ensure that today’s print buyer sees our company as sophisticated as the “big” boys.

 

We also need to find ways to become more efficient in our operations and have financial tools which can help us understand the cost dynamics of our operation.  We can no longer afford “cost” systems which are historical in nature and don’t reflect the dynamic variables which comprise printed products, and our pricing teams need to understand the nuances of contribution and plant utilization.

 

We can no longer just focus on us (print providers).  We need to monitor what other competing medias are doing and the affect they will have on print.  Doors will open and doors will close – we just need to be sure we’re on the right side.

What’s Taking Benny So Long?

I think most folks will agree that Benny Landa is one of the industry’s most interesting – and creative – individuals.  Yet, I wonder if his revolutionary press is truly going to be revolutionary, or just another interesting solution that really doesn’t find a home.  Does anyone remember Dahlgren working on a waterless solution for printing?  I remember seeing a test version in the 80’s that was going to change the industry, but it was years later that the waterless solution became reality with the “Toray” solution – and it never got traction.  Is Landa going to end up in the same ditch?

In today’s Printing Impressions (PIWorld.com), they notated a blog article published by Landa on Tuesday (12/9).  Check it out.

Doing The Right Thing, Or Doing It Right

President Obama went on TV last night to announce his Executive Order regarding Immigration, “sticking [his] finger in the eye of the recently elected Republican Congress,” to partially quote Senator Lamar Alexander (R., TN).  While I may not like anyone in the Executive Office bypassing the legislative process developed by our Founders, I have to give Mr. Obama kudos for taking a step that may not help the Democrats politically (or the Republicans if they’re not careful), but is best for this country.

We have ignored the approximately 11 Million illegals in this country and that is not right.  People will cloak themselves in the righteousness of “they broke the law, we can’t excuse them” to the “we are a country of immigrants, we can’t ignore them.”  AND I agree with both sides.  Yet the reality is that over the past 30+ years a system has been created which allows (quasi legally) illegal immigrants into this country.  Congress has been irresponsible in not dealing with this issue and Mr. Obama is going to force the issue – and for that I give him credit, even if I did not vote for him or think he’s a model President.

By issuing this Executive Order, the gauntlet has been thrown.  It’s time to recognize that we cannot continue to ignore what many consider a insignificant amount of our population (3.7%). Yet, especially in the southwest, these individuals comprise a major part of our service economy, and there is a significant portion of these individuals who have been raised here, and have no future because of the actions of their parents wanting a better life.  Can we continue to ignore these 11 Million?

Is this an easy answer? NO.  But what many in Congress fail to remember, is that we’re dealing with people — not just numbers.  We’re dealing with economics and jobs.  We’re dealing with a future generation which will be ostracized and detrimental to our wonderful fabric of inclusion and diversity.  We’re especially dealing with developing a system to stop the illegal immigration (creating a police state within our border states is not the solution) AND allow economic growth.  Not an easy task.

What I’m afraid is going to happen over the next few months is a ugly political spat will break out and the real issue will be ignored.  Do we do the right thing?  Or just continue to ignore the situation, as we tend to ignore our gardeners, construction workers, laborers, and farm workers?