Commercial Opportunities for Newspapers -- Know Your Strengths

By Erik Cagle

Senior Editor

When Bruce Ross took a tour of the construction site that will soon host the Kansas City Star's shiny new production facility, the newspaper's director of marketing services was stunned.

"It looks to me like an aircraft carrier," Ross said of the planned 424,000-square-foot building. "It's a sloping kind of wedge. It's all glass, it's green and it is beautiful."

The futuristic-looking piece of architecture will complement the massive revitalization era that is sweeping through this midwestern city, adding sizzle to a town known for its steaks. Voters have already approved a glass-enclosed sports arena that will take up residence across the street from the Star's USS Print Shop, which incidentally carries a price tag of $199 million.

But perhaps the real beauty lies in what will take place inside the Star's glass structure when the project is slated for completion in March of 2006: four 50˝ KBA Commander presses churning out the 271,000 daily/382,000 Sunday circulation newspaper. And with the added capacity, the Star plans on boldly venturing into the world of commercial printing a year from now.

"Our niche will be the coldset environment, with capability to produce a large quantity very quickly," notes Ross. "That opens the door for both local and regional printing. I think those opportunities will present themselves as we investigate what this world looks like, who our clients are, and do a needs assessment."

Filling Idle Time

Newspapers across the country have taken the attitude that, if the capacity is there and it fills press time nicely around the paper's schedule, then why not go after commercial work? Not everyone has the capacity, but when 25-year-old news press relics are finally put out to pasture, their newer, more efficient successors generally provide the opportunity to take on outside accounts.

Two factors enabled the 27,000 daily/weekend edition Wenatchee (WA) World to embark on the world of commercial jobs. One was the purchase of a new press in 1999. Two, the World is one of the few afternoon papers left in existence. On the latter front, notes Stephen Shroeder, production director, a majority of the paper's press crew works days, and there were openings to accommodate outside jobs.

"At the time we were rationalizing the purchase of the press, we felt it was likely that we could do a little more commercial work, but we didn't want to build the ROI around it," Shroeder says. "We wanted the ROI to be justified by the newspaper. After we had the press a couple of years, we investigated what kind of commercial work would make sense for us."

The World focuses on broadsheet and tabloid products, as well as flexi booklets. The company has stitching and trimming capabilities (at press time the World was about to acquire a used Muller Martini Bravo-T stitcher). Mailing services are provided, as well as design work, though Shroeder notes that most jobs arrive as PDFs.

The World's commercial customer base consists of other newspapers, as well as weekly, monthly and quarterly publications. And while the printer is located 150 miles from both Seattle and Spokane, some of its customers are more than 350 miles away.

The World does offer commercial clients a preprint package, a single sheet of 70-lb. stock that's printed full color, trimmed and inserted into the daily paper. "It's simple, easy and cost-effective for the customer," Shroeder remarks. "It's clearly an area where we can benefit our customers and probably need to look at it a little more."

Because the company uses a 10-hour shift six days a week, what marketing the World does is highly targeted. But too much trumpeting could push the paper into another shift, when it is content to stick with the 60-hour week.

"We want our commercial work to augment the newspaper, but not necessarily overshadow it," Shroeder adds. "It's a balance between keeping our commercial customers happy, turning around a product in a timely fashion for them, but at the same time not forgetting that the newspaper is why we have the press."

Shroeder's advice to newspapers considering commercial printing as a side offering: Stay away. "Seriously, we've been cautious not to bite off more than we can chew. We try to take on projects that fit our equipment and our location well. And sometimes, when products aren't a good fit, we have to say no even though we don't want to do that."

Philadelphia Newspapers (PNI), which publishes the Inquirer and Daily News, operates its nine 10-unit Goss Colorliner presses out of the Conshohocken, PA, facility, producing tabloids and broadsheets for various commercial accounts. According to John Shimkonis, commercial printing manager, PNI has been offering commercial work for the past decade.

The doors to the commercial printing world opened up wide for PNI when a local printer, which produced the Philadelphia City Paper and the Northeast Times, went out of business. PNI stepped up to the challenge, and those two publications proved to be the genesis. Shortly after, Shimkonis was brought on-board to serve existing accounts and to solicit new business.

The Northeast Times is now owned by PNI. And while PNI has exhibited at a few trade shows, most of the marketing comes via word of mouth and Shimkonis' soliciting efforts. Naturally, it helps to have one of the top 10 largest newspapers in the country.

"Our biggest strength is customer service and the fact that we are the biggest newspaper in the area," Shimkonis says. "Our success comes from combining our expertise and the group of professionals we have here in all aspects of the business, from delivery to warehousing, to prepress, editorial and sales.

The Fayetteville (NC) Observer has proven that it's never too late to start offering a new service. In 1994, the Observer (70,000 daily/80,000 weekend)—the oldest continuously published newspaper in the state of North Carolina—spun off Target Printing and Distribution.

Wide Range of Offerings

Target goes beyond its name, offering everything from design work, database management, fulfillment, mailing, printing and distribution, according to John Jenkins, Target production director. The printer performs a lot of work for the government, primarily books (flexi, case-bound and stitched). Among its publication customers are alternative weekly publications, such as Creative Loafing, affectionately dubbed the Village Voice of the south.

Target also performs a measure of single-sheet work, while 20 percent of its jobs are TV books. One-time jobs account for another 10 percent, but the lion's share (60 percent) is accounted for by other publications.

A KBA Colora, installed in 1999, offers the versatility needed by Target. "We bought it to be a newspaper press, but we also knew we wanted to diversify and grow our commercial printing business," Jenkins says. "We designed the press more like a commercial press. For example, I can run 192 tab pages in full color on a single pass. It comes back to high color capacity, high page counts. I can run extremely large broadsheets with full color. Our newspaper runs up to 48 pages a day and it's about 80 percent color."

Observer/Target offers a print and delivery program for its customers: a single sheet printed and inserted into its newspaper. Minimum counts are a bit high for the smaller advertisers, but Target will print, store and fulfill the product over a six-month period.

As in the case of Wenatchee's Shroeder, Jenkins prefers to market one-to-one and avoid big promotions that could overburden the printer. He also likes the notion that 90 percent of sales are from outside the area, as jobs are sold to clients in Rhode Island, Georgia, Mississippi and Florida, among other states.

Jenkins believes it is imperative for newspaper printers to stick with their core strengths as they venture into the commercial world. "You have to clearly understand what you can and cannot do in order to survive in this business. And you have to be innovative by doing things other people aren't doing.

"It's very different from the newspaper business," he adds. "If you try to run it like the newspaper business, it generally doesn't work very well. You need to have people focused on that product, know what they can do and know what they do best."

For Gazette Communications, which publishes the Cedar Rapids (IA) Gazette, an opportunity to print a local newspaper opened the doors to the commercial community. In this case, it was the Daily Iowan, the University of Iowa's daily student paper.

The Iowan, which is pressed behind the Gazette daily, provides the opportunity to work with the college publication closely, as student staffs tend to have high turnover from year to year, according to Peg Schmitz, vice president and general manager of print operations.

Now, Gazette Communications' biggest customer is King Features Syndicate. It churns out Sunday comics for 135 newspapers with about 40-plus versions, to the tune of three million impressions a week. The funny pages are distributed to locales from Montana to Atlantic City, NJ, and numerous points in between.

Catalogs Making Orders

Another large customer chunk for Gazette Communications is catalog publishers. One such product is training materials for high school and collegiate sports coaches.

In addition to working with the college staff of the Iowan, other services include mailing, shipping coordination, special labeling and trimming, and some folding. Its graphics staff is available for assistance on the front end of the workflow.

Gazette Communications employs a Goss Universal 70 shaftless press with 11 four-color towers and four in-line folders.

In addition to staying with work that speaks to the company's core competencies, Schmitz feels it is vital to leverage advertising connections when possible. Producing a daily newspaper (70,000 daily/78,000 weekend) provides credibility, reliability and a community connection, she feels.

Schmitz also offers a bit of advice that perhaps is lost on some non-newspaper members of the general commercial printing community: tracking costs. She encourages newspapers to have a firm grasp on their production costs. Their accounting process should be firmly established.

"At first we took the attitude of, 'Ah, we'll just add this on to another shift,' so we never really understood the cost of the process," Schmitz remarks. "So when we bid on jobs, we were kind of shooting in the dark sometimes.

"Go out and get affiliated with commercial printing organizations, because the margin that a newspaper has is much different than the margins that a commercial printer accepts. A lot of newspapers fall into commercial opportunities but, if they really want to grow, they'll need to understand the margins maintained for competitiveness."

Sound familiar?

Meanwhile, back at the Kansas City Star, Ross is on a mission to hire someone who can spearhead the commercial initiative, a candidate with the knowledge and know-how to make the paper successful on the commercial level.

"We have a tremendous amount to learn," Ross says of the commercial side. "But we've been in the printing business for 125 years, so we know how that works."