Cost-Saving Measures — Save a Buck, Save a Job

UNLESS YOU are willing to pay three easy installments of $99.95 to receive “Shortcuts to Easy Street,” a six-hour seminar with 100 hot tips on how to trim 30 percent from your cost structure, no one is likely to deliver money-saving ideas to your front door. Apparently, the printer down the street is hoping to outperform your company, and would consider any advice to be providing comfort to the enemy.

In fact, about a dozen companies contacted by this magazine responded to a request for money-saving ideas by saying, “We’ll take a pass this time around.” That’s a fairly strong indication of the economic climate surrounding the commercial printing industry today. Growth is slowing, according to PIA/GATF statistics, and those who have found an added edge are keeping it to themselves.

But take heart, we managed to locate a number of printers and related businesses to go on the record with their ideas for innovative ways to reduce costs without impacting either your workforce or menu of products and services. Here are some of their random thoughts to help you shave a few cents off that cost structure.

So take notes.

Perhaps your trash is the first place to look for money, so to speak. Brian Peck, general manager for AMF/Coughlin Printing in Watertown, NY, found that centralizing refuse and recyclables to one location was an effective way to cut down on overhead.

“We have four locations and a delivery vehicle that goes around to each location,” Peck explains. “Many times the vehicle was empty on the return trip, so we had garbage and recyclables sent to the main production facility and one garbage pickup instead of four. The garbage amounts at the other locations were light and the cost of pickup was much greater.”

AMF/Coughlin has also found renting part of its facility’s parking lot to neighboring businesses to be another way to generate profits during slow seasons. The renters insure the parking lot for liability and help with the cost of maintenance and snow plowing, according to Peck.

PRINTING IMPRESSIONS/RIT Printing Industry Hall of Famer Jim Hopkins, president and CEO of Columbus, OH-based Hopkins Printing, has found that some up-front investments have more than paid for themselves and have benefitted the workflow. A Kodak NexPress, he says, has been a bonus in more ways than one.

“We have one operator who runs the digital press, but we find that the press runs much slower than our offset presses,” he says. “Since the quality is set at the beginning of the job and remains consistent, our operator can then perform the bindery and finishing operations on the previous job. In order to do this, we had to purchase a smaller cutter and folder.

“Keeping these small jobs out of our regular bindery workflow has been very cost-effective. We can go from the digital press area straight to shipping for 85 percent of our workload coming off the NexPress. Less hands touching each job means more profit for us and lower prices for our customers.”

Saving Time and Labor

Also, Hopkins Printing has benefitted from the use of a baler and scrap removal system for its bindery. With vacuums at each folder, cutter and stitcher transporting paper leftovers to the baler, the company saves countless man hours that used to be spent pushing around Gaylord boxes.

“That scrap is then sold at a higher rate to the paper recycling companies because our machine has made it easier for them to haul away and process it,” Hopkins stresses. “The extra money goes straight to our bottom line, and we have a much cleaner shop as a result.”

Danny Bowman, vice president of manufacturing for Network Communications in Lawrence­ville, GA, offers a slew of quick-hit suggestions that can foster better relations with customers and reel in a couple more bucks for both parties. They include:

• Change your overnight policy for small packages to afternoon delivery next day or second day delivery.

• Negotiate with your vendors for 1 percent to 3 percent discounts for paying early.

• Reschedule your labor to match the volume of your work.

• Know what your cost per unit is for every department and let them manage to it.

• Never cover vacations with overtime.

• Manage your waste by total volume vs. total good product out.

• Offer customers discounts for managing to your production schedule.

Improving plant productivity is the name of the game, according to Hal Ettinger, president of RBE Co. in Lawrence, KS. “Unlike cuts in staffing and services to cut operational costs, improving plant productivity cuts operating costs by driving more profit to the bottom line, which accomplishes the same thing,” he remarks.

Ettinger offers five tips for bolstering productivity:

• Improve utilization of existing office and manufacturing space.

• Create dedicated material handling aisles. Materials, like automobiles, move more efficiently when traveling on dedicated “roads.”

• Remove unused equipment and paper stock. This frees up critical real estate that can be used more effectively.

• Improve lighting; productivity improves with increased lighting levels.

• Scrutinize future equipment installations. Are you compounding problems currently experienced in staging and WIP (work-in-process) areas? Will the press or bindery line have an ample operator, staging and WIP area?

Rather than achieve short-term results that provide instant gratification to your bottom line, Bill Munz, a sales representative for San Diego-based Rush Press, sees more consistency in the bottom line gains when companies focus on day-to-day activities that will provide consistent cost reductions for intermediate and longer-term results. To this end, he feels it is paramount that printers handle two pivotal areas: Build an effective workforce, and back the force with well-maintained production equipment.

“High employee turnover in a commercial printing plant is costly. Bringing in new employees, whether experienced or not, requires someone’s time and effort to provide a degree of training for that person,” Munz remarks. “Long-term employees have been integrated, trained, supported and are focused on achieving the daily operational goals.

“It is up to management to evaluate their ability to perform, and to communicate the company’s expectations with a written job description. Effective training and continuing support are crucial, as are the results the employee achieves,” he adds. “Appropriate compensation and scheduled performance reviews should be a given. The overall objective is to let each employee understand his or her future within the company.”

Put E-mail to Good Use

Jack Crowley, vice president of Penn Valley, CA-based Crowley Marketing, believes savings can also be found on the sales and marketing end. He feels it is vital for companies to engage in database marketing via e-mail.

“The key is to communicate with customers and prospects on a regular basis based on the product line and the needs of the customer,” Crowley says. “Be relevant with the information that you put in front of the customer and/or prospect.”

Lastly, Charles Smith, president of Smith Litho in Rockville, MD, feels the print community should take a page out of the book—fittingly enough—of the paper industry.

“If we don’t raise prices and do what the paper industry is trying to do, which is charge more money, we are just going to be committing hari-kari,” he contends. “We have to realize that we must charge sensible numbers. The predatory pricing that has been going on for the last five to six years has got to stop. As paper prices continue to escalate, the situation is only going to get worse.” PI