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Value-Added Services -- Banking on Binding

March 2003
by chris bauer

With the economy stubbornly refusing to shift back to the economically favorable gear of a few years ago, commercial printers continue to search for ways to make a buck. One opportunity many printers have found is to provide more ancillary services, including expanded finishing options.

According to recent data from the Printing Industries of America (PIA) and the Graphic Arts Marketing Information Service (GAMIS), the current competitive business climate has forced many operations to diversify and adopt new products and services to remain profitable. As such, respondents to the PIA/GAMIS survey reported that nearly $1 out of every $7 earned by these printers is created in the bindery/finishing department.

These figures are no surprise to commercial printers offering full bindery services.

"Value-added services and all ancillary additions to a basic printing project can represent a positive profit center for commercial printers," advises Lucia Panini, market research analyst and corporate public relations manager for Santa Clara, CA-based Citation Press. "However, cost consciousness on the part of end users also forces printers to curb their margins and to avoid hefty charges for additional services."

What counts, she says, is value and how it's communicated to and perceived by the customer.

"The bindery is, indeed, becoming a more significant profit center for commercial printers," adds Tom Tran, Citation's president and CEO. "This is true for those printers that look at costs plus a fixed markup (not time and material). Handling bindery work in-house means being able to control quality, turnaround times and direct costs. Not to mention being able to streamline production start-to-end, passing efficiencies and cost savings on to the customer."

Dave Stump, president of New Washington, OH-based Herald Printing, agrees. "The bindery has always been a profit center for Herald," Stump pronounces. "We have always had a full bindery operation. It's always been a strong portion of what we are. I look at every department as being a value-added profit center."

While Herald Printing offers a wide array of binding and finishing services, such as cutting, folding, drilling, saddle stitching and gluing, Stump points to one technique that is really in-demand with his customers.

"Spiral and Double-O wire binding are both popular right now," Stump notes. "That seems to be the binding method that customers now want for elite pieces."

Stump explains that clients like the look of spiral-bound books, and find them more practical than some other binding possibilities. "It's just a different look—it's not a saddle stitched look," Stump contends. "It makes it a unique piece that stands out when it comes in the mail and, when it lays on your desk, it is an eye-catcher."

It also helps that buyers get to pick from an infinite number of different colored wire, Stump asserts. "I don't know any one of our customers that has the same color; we seem to have every color under the sun—including PMS colors."

Panini confirms the current popularity of wire binding, while adding spot UV, satin UV, embossing, debossing, custom diecutting and foil stamping to the list of services that Citation Press provides. While these options are popular, they have to be used in the right circumstances.

"Fancy UV coatings, foil stamping and laminations, to name but a few of the more creative options, are kept for truly high-end pieces that are meant to last," Panini councils. "Rarely is this type of finishing adopted on short life-cycle marketing materials given out at trade shows."

Back east in Ohio, Stump sees similar trends from Herald Printing's customers. "Foil stamping, embossing and special diecuts are very popular now. Nobody wants just an 8.5x11˝, 6x9˝ or 5.52x8.5˝ book any more—they want something that is a little bit different."

Overall, print buyers are looking for finishing solutions that can leverage the use of technology, Panini explains, without impacting the bottom line. "With this in mind, they are also seeking ways of differentiating their printed materials by creatively taking advantage of what design software coupled with finishing technology can provide—step-cuts, a variety of diecuts, saddle stitching (also with inserts). The technology available allows you to translate artistic ingenuity into cleverly printed products.

"In order to make the variety of finishing options attractive to end users it is also important to present them as part of a comprehensive service provider offering," she continues.

"Citation Press functions as a consultant to its client base, be it designers or corporate marketing decision makers," Tran stresses. "The value of the finishing services has to be embedded in the overall vision that the printer has in engineering a project, taking into account the customer's marketing objective and budget constraints."

Regardless of the type of binding job, printers seem to agree that they need equipment which is easy to set up and makeready, as well as highly productive.

"I am looking for (binding equipment) that will give me a quick makeready and high speeds," advises Rob Hegwood, vice president of Commercial Communications Inc. (CCI), located in Hartland, WI. "Customers are requesting jobs to be turned around faster and faster. To go along with that fast makeready, I also need high productivity."

Finding the Right System

One example of a machine CCI relies on to meet these needs is its newest addition to the bindery—a Standard Horizon CABS 5000 perfect binding system.

Features of note include CCD cameras in each MG-60H gathering station (CCI has three MG-60H's for a total of 18 gathering pockets) to ensure correct loading and document integrity, and a weight checking system. Also, the color touchscreen console on the 15-clamp perfect binder is used for automated setup and to program jobs, which helps to increase the jobs run per day and allows for more flexible scheduling.

The SB-15 also employs a newly developed, three roller glue application system with side gluing that helps ensure a consistent product. But it was the cameras in each individual pocket that really impressed Hegwood. "With some of the other systems I looked at, you could retrofit a (camera) that would read it after it was a complete book block before it went into the binder, in which case then you would have a whole gathering line full of incorrectly collated books to clear out—and that is a waste of time. "

With ancillary services coming at a premium, one might think printers are lining up to bring new finishing equipment into their shops. Yet there is some hesitation when they are asked about taking on more overhead.

"We have bought some equipment to make (our operation) more efficient and cut our labor costs," notes Stump of Herald Printing. "It's a great time to buy because there are some great deals out there."

Hegwood adds that since interest rates are low and suppliers are hungry to move equipment, he agrees that it is a good time to shop for equipment—but only if you have the work to justify it.

"The economy is going to turn around, and we have been one of the lucky ones that have stayed busy," CCI's Hegwood says. "That can be attributed to how we have positioned ourselves. Part of it is the equipment we already installed—more automated gear—that helps to improve speeds and quality."

Long-term financial commitments are challenging in the present economic scenario, Panini, of Citation Press, admits. "Variable costs are a key element to be monitored by upper management and must be performance-driven. All investments need to be carefully evaluated in order to avoid overcapacity. The focus now is on maximizing the ROI on existing equipment and to work very efficiently at each touch point of a printing project.

"The key for print buyers is to select a printer that acts as a single-source service provider to guarantee quality and a smooth workflow that maximizes efficiencies," the marketing exec concludes.


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