Binding Matters

BY T.J. TEDESCO

Different operating circumstances require different business strategies. For example, three trade binderies in three different states each have different plans and methods of doing business. Who's right? Maybe, they all are.

In today's rough and tumble graphic arts world, excellent performance is not optional. To successfully compete over the long haul, companies must consistently say what they do, and do what they say. Yesterday's recipe for success—service, quality and fair prices—is just the starting point. Carefully evaluating business factors, such as geographic location, customer attitudes toward outsourcing, management strengths and weaknesses, and company core competencies, is essential. Then, implementing the right game plan that capitalizes on real strategic advantages is where the rubber meets the road.

Bookbinding Specialist
Located in Woburn, MA, a Boston suburb, 45-year-old Seaboard Bindery specializes in three main postpress product lines: adhesive binding, mechanical binding and saddle stitching. Seaboard Bindery is a regional competitor that rarely reaches beyond the New England states, eastern New York, New Jersey and southeastern Canada.

Frank Shear, Seaboard's president, acknowledges readily that his company is a niche player serving the bookbinding needs of printers in the Northeast. Seaboard Bindery offers non-core services, such as folding, cutting, drilling and laminating, to support the company's bookbinding niche. The company will occasionally convert fold-only or laminate-only jobs, but this type of non-core business is not aggressively sought out.

In the Northeast, there are binding companies with broader product lines than Seaboard Bindery, but the market is large enough to accommodate both the specialists and the generalists. Shear believes that being first to market with new product offerings is a distinct competitive advantage. As proof, he cites these examples: Seaboard Bindery was the first New England bindery to use PUR glue—strong enough for difficult-to-bind products—and to license both Otabind and RepKover lay-flat adhesive binding methods, giving clients a lower-cost alternative to mechanical binding. These investments have given the company its adhesive binding "triple play."

Although perfect binding is still a core product for Seaboard Bindery, lay-flat and PUR adhesive binding methods now account for a large portion of the company's business.

In addition to adhesive binding, Seaboard's two other core processes are mechanical binding and saddle stitching. The company is committed to growing these markets and recently bought new collating equipment and an in-line, automatic-feed drilling unit to boost capacity.

Under One Roof
Half a continent away, in our nation's Heartland, lies rapidly growing, Des Moines, IA-based Finishbinders. Unlike Seaboard Bindery, Finishbinders doesn't compete in a large graphic arts community. Because of the vast distances between commercial centers, and the impracticality of shipping work-in-process too far, Finishbinders has chosen to offer an under-one-roof, buffet of services.

Founded in 1985 as Mark Binding Corp., Finishbinders has evolved from a cut/fold/stitch company to a very diverse postpress services provider. No matter what area printers need, it's likely that Finishbinders can get the job done in-house—whether it be perfect binding, mechanical binding, saddle stitching, remoistenable gluing, UV coating, diecutting, foil stamping, polybagging, etc. Most regional companies that claim they "do it all" frequently have old, semi-automatic or even handfed, equipment. But not Finishbinders. This three-shift operation offers the latest, full-size production equipment, from top-tier manufacturers.

Like Seaboard Bindery, Finishbinders is a regional player: Most of the company's customers come from within a 250-mile radius of the plant. Creative projects die if local designers and printers can't get them produced. Finishbinders is determined not to let that happen. The company wants to give Heartland-area designers the freedom to explore their creativity without sacrificing competitive turnaround times.

A Specialist's Specialist
Chicago-based Rickard Bindery, currently celebrating its 100th anniversary, has yet another business strategy. The company's core competencies include high-volume, technically challenging folding, gluing and saddle-stitching solutions. This singular focus, and proven ability to deliver, has given the company a loyal following from all over North America—and beyond. Last year, Rickard Bindery did business in more than 30 states, four countries and three continents.

As anyone familiar with the industry knows, being a national bindery is highly unusual and possible only when a company offers something very rare. According to President Jack Rickard, "Nearly every day, we field referral calls from almost anywhere, from people who have technically difficult or very large jobs. I guess we've built up a reputation for doing the impossible."

Rickard Bindery packs a powerful punch in its specialty areas. Half of its 80,000-square-foot building is dedicated to folding paper. The company boasts more than 65 folding machines and is capable of folding sheets as large as 80˝ or panels as small as 7⁄16˝. The company's five full-size saddle-stitching lines can stitch miniature products, oversized products (up to a 19˝ drop) and complicated products requiring up to 12 pockets. In addition, the company has 18 gluing machines.

Outsourcing is core to Rickard Bindery's management principle. Jack Rickard believes that outsourcing allows companies to develop core competencies without the distraction of trying to do everything in-house. Recognizing that American business has embraced outsourcing business models, Rickard is determined to practice what he preaches. For example, his company once had a fleet of trucks and an in-house accounting department. By eliminating these internal functions in favor of outsourcing, the company has reduced costs and now can better serve its customers' needs.

And speaking about trucking... Rickard claims that the cost of delivering pallets today—through outsourcing—is less than what it cost his firm to do it in-house 20 years ago. And, he says, "the service we offer is much better. If I need six trucks tomorrow morning, I can get them."

Playing the Dealt Hand
Since New England's print market is not growing as fast as the Midwest's, Seaboard Bindery has adopted a more cautious growth strategy than either Rickard Bindery or Finishbinders. According to a November 1999 Printing Industries of America (PIA) survey, growth in the East was second lowest in the country—only marginally ahead of the South. Even though 1999 was a boom year for many New England printing companies, the area still lost two stalwart trade binderies: One permanently shut its doors, and the other was acquired.

"These changes significantly affect our competitive landscape," says Shear. "Seaboard Bindery is a 45-year-old company. We will forgo some growth to ensure our long-term health. Last year, Seaboard Bindery's management team was pleased with the company's carefully controlled, 15-percent growth rate."

By contrast, regional growth in 1999 and expectations for 2000 are rosiest in the Midwest, according to the PIA.

"Healthy growth is projected for our industry, and we are poised to fully participate," says Rickard. "Even if things change in our local markets, a lot of our work comes from all around the country. We're probably less dependent on our geographic location than some other binderies."

Mark Beard, Finishbinders' president, is unabashedly growth-oriented. "This year, we're going to add on to our building and continue installing the iron," he says. "Last year, we started our third shift and hired people for nearly all departments. When significant bindery jobs pass anywhere near Iowa, we emphatically believe we're the best choice."

Capabilities/Equipment
Although these three business leaders have staked out vastly different patches of postpress terrain, they agree on one thing: Buy the latest and greatest equipment.

Since unbelievably low unemployment rates make it nearly impossible to increase output through labor, growth must come from improved automation and management processes. Seaboard Bindery has three perfect binders, including a late-model Kolbus Ratiobinder. Last year, the company needed to expand its mechanical binding throughput and installed brand new Wire-O punching and binding equipment, a folding machine and a collator.

Like Seaboard Bindery, Rickard Bindery also purchases top-of-the-line new equipment, but there's one difference. Fast turnaround times on jobs with millions of pieces requires a lot of equipment redundancy. "We want to have multiple ways of running most jobs, so we can turnaround large volumes of work on a dime," reveals Vice President of Operations Kevin Rickard. "Among our recent purchases was a fifth saddle-stitching line, a tenth map-folding machine, an automatic shrink-wrapping line and a third plow-folding and gluing machine."

Not to be outdone by its peers, Finishbinders has gone on an equipment acquisition tear. Since 1998, the company has added, among other things, a Muller Martini StarPlus perfect binder; Steinemann UV coating machine; various foil stamping and diecutting presses; a pocket folding/ gluing machine; a Kugler punch; a semi-automatic Wire-O inserter; plastic spiral inserters; and an index tabbing machine.

"To fuel our under-one-roof claim, we've got to add hardware," says Beard. "Our decentralized management structure makes it all work."

Making it Happen
Beard acknowledges that some people may wonder how his company can do so much, so well.

"Before strategically moving into finishing, we decided to create little companies within our company by empowering team leaders and giving them ownership of their particular areas," Beard explains. "For example, proven team leaders are allowed to help select their crew and priorities. Our decentralized decision-making process allows team leaders to choose whom works overtime and assist with how maintenance is scheduled. People respond to challenges and appreciate cross-training opportunities. We're not structured where line workers do the same thing over and over. We're more like Volvo, where teams build cars and take ownership of their work. Under our roof, quality is a given."

Jack Rickard tries to develop better technology and processes that help his customers win more business. "We focus on unusual configurations and very large volumes. There are companies that specialize in commodity 81⁄2x11˝, two-fold and 11x17˝ three-fold projects, but we're not one of them," says Rickard. "Rickard Bindery wants to be thought of for cross-folds, gatefolds, multi-accordion folds, oversized folds, miniature folds and difficult saddle-stitching projects, regardless of geographic origin.

"During the 1970s, we bet the company on technical specialization and hired people who could perform well in such a niche," Rickard adds. "Our customers count on us to tackle tough jobs—because if we can do it, more than likely, they'll print it."

Shear points to management and customer service improvements. "We're trying to improve all aspects of our business, including estimating and customer service. We want to be able to handle most of the opportunities that come our way, whether they be large or small jobs."

Like Finishbinders, Seaboard Bindery sees itself as an under-one-roof supplier, but with a difference. According to Shear, "We can handle just about any bookbinding need, but we want to be inclusive when thinking about our customer base. It's important to take care of the on-demand digital printer, as well as the big printer. Under-one-roof isn't just equipment; it's how we operate and service all of our customers."

Adding New Services
Seaboard Bindery believes that it can get more out of the equipment on its floor without straying far from its bookbinding mission. Occasionally, however, the company does analyze new services. A few months ago, Seaboard Bindery bought a new collator, primarily to boost its mechanical binding productivity. This decision had the double benefit of helping "woo" on-demand printers that wouldn't have thought of Seaboard Bindery in the past. Diecutting is a frequently discussed area of expansion, but, so far, the company is happy to outsource these services.

Like Seaboard Bindery, Rickard Bindery has briefly considered entering other postpress markets, but has rejected them for failing the core competency test. Like trucking and accounting services, Jack Rickard believes his company gets better results from outsourcing other services than he would from doing them in-house. When customers have jobs that require additional outsourcing, Rickard Bindery always offers the choice of either handling it for them or letting them source it themselves. According to Rickard, "Some customers recognize the added comfort of letting someone else control the project, and others don't. Either way is fine with us."

Breaking from his peers, Beard puts it this way: "A few years ago, we recognized our need for diecutting and built our finishing department around it. We even hired our finishing department manager before we had a single piece of equipment. We're so committed to finishing that we changed the name of our company to Finishbinders to reflect our strategy."

If Shear, Beard and Rickard don't share attitudes toward one-stop shopping, they are all in agreement about what their companies sell: kept promises.

Shear puts it this way: "If we went out there telling instead of listening, we'd be like everyone else. Our customers know that we won't take on a job if we think we won't be able to make the deadline. Trust must be a given."

Beard adds: "Fifteen years of running a company has taught me that you get dozens of chances to do things right. You only get one chance to do them wrong. When we say we'll do something, we're sure we can."

Rickard's conclusion: "People think we take ideas and turn them into three-dimensional objects. What we really sell are reliability and a good night's sleep."