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Trade Binderies : The Laws of Justification

February 2010 By Erik Cagle
Senior Editor
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JACK RICKARD is a firm believer in the concept of printers farming out their binding/finishing work to trade houses that specialize in such jobs, as opposed to print shops installing massive amounts of binding and finishing gear. And, since Rickard is the owner of Rickard Bindery, a 110-year-old trade firm in Chicago that specializes in folding and saddlestitching, we need to take his advice with a grain of salt.

But is Rickard biased toward specialty shops only because it's in the best interest of his business for printers to outsource their binding and finishing work? Actually, Rickard is a huge fan of outsourcing, and he practices what he preaches within his own business.

"The 'bring it inside' mentality doesn't work financially, for one," he says. "You're better off farming out work that is not part of your core business. All printers should have bindery capabilities, to an extent.

"I tell printers to figure out what their slowest day of the year is in the bindery, and size the bindery so that it will take care of 80 percent of that slowest day," Rickard adds. "Farm everything else out. That accomplishes two things. One, you'll have a department that runs at 100 percent, which is a great way to run a graphic arts business. Two, you'll have a bunch of happy campers among the trade shops that you're doing business with, and you'll have the versatility to go anywhere."

OK to Outsource

Three examples during Rickard's tenure have reinforced his faith in the outsourcing mantra:

• At one time, Rickard Bindery employed a delivery truck driver. When the driver passed away, Rickard re-evaluated the merit of maintaining delivery services in-house. His expenses were $70,000 a year. "I asked myself, 'why in the hell am I in the truck driving business, especially since I don't know anything about keeping a truck?' " As a result, Rickard hired a third-party trucking firm, and his outlay shrunk to just $15,000.

• When the firm's bookkeeper retired, Rickard questioned the need for a full-time staff person since there weren't enough transactions to really justify the post. Now Rickard's accountant sends over a lower-level assistant to tend to the books once every other week, and he's now paying just a quarter of the former bookkeeper's $50,000 salary.

 

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