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Specialties Bindery--A Cut Above

September 2000

A Tight Labor Market
Specialties Bindery is located in Maryland's Prince George's County, which has a current unemployment rate of only 2.9 percent. Finding qualified employees outside of Prince George's is even tougher. Anne Arundel, a neighboring county, is at 2.2 percent unemployment and Montgomery is at a mere 1.4 percent unemployment. Although the company would like to increase its labor force, Brenda Slacum isn't counting on it. "Realistically, our growth will come from investments in automation and better, in-line solutions," she says. "For example, we're in the process of upgrading some of our collating equipment, which should allow us to divert $300,000 of annualized labor to other areas."

Despite the tight job market, Specialties Bindery can boast that more than one third of its employees have been with the company for more than 15 years. This wealth of experience allows the finishing operation to apply industrial engineering principles to its core products, as well as to handwork and semi-automatic functions. This allows the company to successfully bid on labor-intensive projects that are outside of its traditional sweet spot.

This focus on automation and in-line solutions is not new. Years ago, Specialties Bindery installed the first fully automatic Bielomatik punching and double-loop wire binding line in the United States. Today, the company has three of these in-line systems, allowing production of up to 500,000 Wire-O books in as few as four days.

"At DRUPA 2000, we saw a lot of automation opportunities that could potentially benefit our customers," notes Slacum. "Our customers don't care if we have a manpower shortage. They need their jobs on time and done right. Better equipment and cross-training programs allow us to consistently meet critical schedules." The company boasts an on-time delivery percentage rate in the upper 90 percent range.

Core Competencies
With its reputation for high-volume mechanical binding solutions (Wire-O, spiral wire, plastic coil and GBC), it's easy to pigeonhole Specialties Bindery. However, the company offers additional high-volume services such as perfect binding, index tabbing, map folding, oversized collating, fulfillment and shrink wrapping.

"Our core competency is meeting schedules," says Lee. "We sell kept promises and a good night's sleep. Our overlapping machinery allows us to meet difficult deadlines, even when jobs are coming in from the Midwest." For example, most binderies are happy to have one fully automatic Bielomatik binding system. Specialties Bindery has three. Although most of its customers are from the East Coast, Midwestern printers are beginning to discover the benefits of working with a specialist. Because of fast service, Specialties Bindery currently does business in about half of the United States.

Occasionally, the company will buy highly specialized equipment to satisfy the needs of individual clients. For example, in late 1999 a customer approached Specialties Bindery with a unique, high-volume, frequently repeating job. Layflat adhesive binding was the first attempt, but failed because of a particularly difficult stock. Next, the customer chose Wire-O binding, but this proved problematic, as well. Specialties Bindery developed a process that accommodated the tough stock and produced nearly 1 million books over the first six-month period.

Every morning, all Specialties Bindery managers receive daily financial snapshots that include prior day bookings, billed revenue, fully burdened production costs and a daily P&L. This "early-warning" report is a competitive advantage because any developing problems can be detected and resolved before it's too late.

Future expansion may one day also take the company further away from its book binding roots, perhaps even to diecutting or UV coating. However, management insists that it won't sacrifice strategic position for growth. "Our core value is to make customers' lives easier," says Slacum. "Haphazard expansion will be avoided."

Of more immediate concern is expanding the company's fulfillment business. "We have the people and the space to offer very credible fulfillment services," adds Miller. Every month, Specialties Bindery fulfills a large government project, which requires a lot of square footage, machinery and personnel time, as well as the latest in digital scanning and mailing services technologies.

"We have the workforce and the know-how to turn fulfillment into a significant profit center—we just need to market it properly," she continues. A comprehensive and consistent pricing strategy is very important. Miller oversees the estimating department and knows that competitive pricing is necessary in today's tough marketplace.

Any pricing edge that Specialties Bindery enjoys is due to better in-line solutions and engineering efficiencies, not lower margins. "Our customers know we need profits to fuel future growth," Miller notes. "However, we won't price ourselves out of the marketplace."

When asked about unfinished business, Lee believes that his highest priority is to do a better job of letting Mid-Atlantic companies know that Specialties Bindery has been independent from Quebecor for more than three years. "We're well on our way back to being a $9 million company," he concludes. "and we're still in the process of getting rediscovered in our own backyard."


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