Simplify, Simplify

The WSJ reported this past weekend that print advertising sales in magazines were down.  As was reported in the article, we are not seeing a reduced size of pie being spent on advertising,  we are seeing our slice get smaller.  This is problematic for many in our industry who are seeing continued downward pressure on pricing being driven down by online print providers and print management firms.

So, does that mean we need to stop being a printer, as many gurus suggest?  Let’s be honest with ourselves, many in our industry don’t have the genes to be Marketing Service Providers (whatever that means), and there are still a lot of clients who just want to deal with a printer.  Yet, to survive as a print provider and achieve respectable profits (9-12%), a company must develop a unique niche or continue to drive costs out of their operation.  Let’s talk about costs.

Firms have production equipment which make ready in minutes and runs at blazing speeds, but we still have a horse and buggy paperwork process.  Pre-manufacturing workflow (sales, estimating, order entry, production management) is an area which has cost reduction opportunities.  The least amount of touch points we have in our workflow, the higher the probability to reduce variable operating costs and speed up the process.  To quote Peter Drucker, “There is nothing so useless as doing efficiently that which should not be done at all.”

Yet, this is not a simple solution.  It requires extremely IT centric thinking and a different mindset regarding capital expenditures, along with re-thinking how we go about selling work.  The company who embarks on this journey will need to totally re-work the traditional sales/customer service model.  It has to look different.  More thoughts to come.

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