Mailing/Fulfillment Resources -- Posting Positive Results

Many printing companies are running profitable mailing and fulfillment operations as part of their evolution into full-service graphic communications solutions providers. The printers who are still evaluating whether these service offerings make sense for their organizations, however, may need a little guidance in making that all-important assessment, notes National Association of Printing Leadership (NAPL) associate consultant Clint Bolte, president of Clint Bolte & Associates and author of the NAPL book How Fulfillment Services Drive Print Volume.

"When done correctly, mailing and fulfillment can be a lucrative profit center for printers," Bolte advises. "However, these are areas where customers' tolerance for missteps is extremely low. Mailing and fulfillment has a definite learning curve that printers must respect when they're developing and implementing their programs."

As NAPL research has shown, a printing company that rushes headlong into a full-blown fulfillment program without the proper knowledge base and infrastructure runs a double risk. The offending company can lose not only fulfillment sales but also print sales, since a majority of a printer's fulfillment customers are print customers, as well. Therefore, printers should take the time to do their homework and call on a range of experts for input, including consultants specializing in mailing and/or fulfillment, software vendors, materials handling companies and trade associations.

Both fulfillment and mailing are client-driven, and customers' needs in these areas range from basic to complex. It's important, therefore, that printers not take on jobs they can't execute properly.

"Given the variation in the kinds of fulfillment and mailing services clients are seeking, a printer might be able to handle the first five or six jobs from a customer just fine," Bolte advises. "Then something pops up that it's not sure how to handle. When that happens, it's important not to bluff. Be extremely aware of the services you can reliably provide and those you cannot."

A printer considering venturing into fulfillment would be well-served by understanding the three basic types of fulfillment and the opportunities and challenges inherent in each, notes fulfillment and mailing expert Pete Basiliere, author of the new book, Diversifying With Mailing & Fulfillment Services: Unlocking Hidden Profit Potential. In the book, which provides a comprehensive guide to developing and implementing profitable mailing and fulfillment services, Basiliere defines the three main fulfillment types as follows:

* Finished goods storage involves printed and/or bound items that will be delivered to customers or to another supplier over time. This service often deals with items that are produced in large quantities that the client knows it will use eventually. Typically, to save money through more efficient printing, bindery and possibly manual assembly operations, the customer orders the items and agrees via a purchase order or contract to take and pay for the balance of the job over time. The storage offering may or may not include print management programs.

"A number of printers that provide this type of fulfillment offer programs that essentially reduce the customer's print buying process to either a 'catalog' ordering system or a combination of standard and custom printing," Basiliere notes. "For instance, some items, such as letterhead, may be printed and stored. Others, such as #10 mailing envelopes, are stored as blanks and imprinted on-demand."

A typical scenario in finished goods storage would be when a graphic communications company prints, folds and binds 250,000 operating manuals of a particular automobile model for an automobile manufacturer client. The client periodically orders as a many manuals as it needs, based on sales.

* Pick-and-pack services involve taking individual items or very small quantities of an item and sending them to the end user. Again, using an automobile manufacturer client as an example, Basiliere describes the following pick-and-pack scenario:

The automaker engages the printing company to store 250,000 "Welcome" packages targeted to buyers of one of its mid-range models. The packages, enough to support one year's sales, were printed and assembled by an overseas supplier, who ships them to the U.S. graphic communications company.

Each business day, the U.S. graphic communications company receives the names of 1,000 car buyers who must be mailed a package. It downloads the names, laser prints and applies 1,000 mailing addresses, and presents the boxes to the U.S. Postal Service.

A subset of pick-and-pack is kitting and assembly, which involves the assembly of packages for a customer. Continuing with the automaker example, the client asks the printer to assemble a package for its upscale model, only 25,000 of which are sold per year. The package includes a printed operating manual, including customized information such as the specific features of the particular vehicle purchases, and personalized with the names of the buyer and the dealer. Also included in the package may be promotional items.

In this scenario, some printers may print all of the collateral in-house, while others might outsource some or all of it. As a fulfillment provider, however, the printer is responsible for making sure the kit is complete, accurate and mailed on time.

Pre-packing some items helps speed the fulfillment process, but the degree to which a kit can be prepacked depends on the amount of customization and personalization required, Basiliere points out.

* Customer support and information management. This area of fulfillment often entails interaction with the customer and its customers. Customer support services range from the basic to the complex.

"Basic customer support might entail having the printing company call upscale auto buyers on behalf of the automaker to ensure the welcome package was received and to thank them for their business," he says. "In this scenario, if the auto buyer has a problem, the printer's call center system should be capable of transferring calls directly to the phone number of the general manager of the dealership that made the sale in question."

Information management services include database and document management (management of the printing company client's customers and product data, as well as documents used in marketing campaigns), lead tracking, response management and related offerings.

Many printers' initial foray into fulfillment services often is made in response to the needs of its existing customers. To help printers assess which area or areas of fulfillment would best appeal to its current customer base, Basiliere provides a comprehensive customer questionnaire in Diversifying With Mailing & Fulfillment Services designed to elicit information about the customer's current fulfillment needs, how it is currently meeting those needs, and the advantages/ disadvantages of their approach.

Designed to be used as part of a comprehensive information gathering process, the questionnaire provides insights that can be used as a basis for developing a customer-focused fulfillment program.

To order the NAPL Survey of Fulfillment Practices, Diversifying with Mailing & Fulfillment Services, or How Fulfillment Services Drive Print Volume, call (800) 642-6275, Option 4; e-mail orders@napl.org; or go online to NAPL's bookstore at www.napl.org/store/.

Added Benefits

Running a successful fulfillment program requires careful planning and diligent management, but the rewards, including increased profitability and customer loyalty, can be substantial, according to these findings from the NAPL Survey of Fulfillment Practices.

Has overall client profitability increased as a result of offering fulfillment services?

Yes: 61.9%

No: 14.3%

Not sure: 23.8%

Turnover percentage for clients purchasing both fulfillment and printing, and for clients purchasing printing only.

Fulfillment and printing: 5.7%

Printing only: 13.1%