Business

When used in close proximity the words "print management" are always likely to spark heated debate - just check out the endless series of comments that usually accompany any story about print managers (both positive and negative) on printweek.com. So if you had the temerity to bring together some of the industry's leading print management names and printers under one roof, you'd expect disagreements and potential fireworks.

But at last week’s debate on print procurement at Stationers’ Hall, in central London, somewhat surprisingly the participants were in broad agreement on a range of issues. In particular, there was unanimous agreement that the print management concept is rapidly changing and the old model of screwing down suppliers and simply passing on the savings to customers is no longer viable.

This assessment shouldn’t really come as a surprise. In last month’s print buyer survey by Webmart, the findings showed that price had become less of a key factor and other areas, such as reliability and service levels had equal, if not more, importance (PrintWeek, 19 September). At last week’s debate, the great and the good gathered to hear a similar message: print management is about adding value to a customer and giving them a solid service.

The debate boasted an esteemed panel comprising of Steve Vaughan, chief executive of Communisis; Simon Ward, chief executive for the commercial division at St Ives; James Mollard, Bespoke managing director; Simon Biltcliffe, managing director at Webmart; James Samuels, Claritum managing director; Matthew Parker, director at Print and Procurement; and Andrew Wilson, managing director at Unity Publishing.

Words of wisdom
The first big name panellist to speak, Communisis’ Steve Vaughan, set out the argument that print managers should all agree that they are in business to make money – it’s the criteria for being successful after all – but the way to go about generating profit is changing.

“If you are buying third-party print and marking it up then you are already dead,” explained Vaughan. “Mark-ups are not viable; these are getting smaller and smaller and your costs are going up.”

He added that the key for PM firms is to add some value for their customers. Rather than just being buyers, print managers need to sell their expertise and bring their in-depth knowledge to the table. “We have customers coming to us because they do not know how much they are spending on print,” said Vaughan. “We are providing them management information. If you have that then you can challenge the customer’s demands. That is a very powerful way to add value.”

Indeed it could be argued that knowledge is power. If a print manager has a detailed understanding of a customer’s organisation then it can give a powerful and informed perspective on how print is being spent and deployed. It’s a far cry from the “scratchcard approach” to print buying, as illustrated by Bespoke’s James Mollard.

“That’s about selling a price-sensitive product,” he said. “There are very few barriers to moving that sort of print work around and it makes it very difficult to exceed expectations.”

But the next step up – a “service delivery” model – allows print managers to go further and ensure that the product reaches its destination. Beyond that, print managers can go for a “business improvement” model. This, according to Mollard, is what companies should be aspiring to.

“It’s about selling customers a vision,” he said. “You need to challenge their aspirations and bring them new ideas. It’s about genuinely engaging with your customer. We have to move away from print managers being this great evil that has driven margin out of work. Print managers are an effect, not a cause.”

The environmental pitch
One area where value can be added is on the environmental front, according to Vaughan. “All of our customers have got environmental representatives on their main boards; it’s an alternative way of getting to the customer with a very powerful message. The environmental pitch is a major opportunity for the print industry. This is a key part of our proposition – we have to change the established behaviour. [Equally] we can provide a channel to market for small printers. The government absolutely loves that – it forms part of their sustainability message.”

Printers could, of course, employ the theory of adding value to help boost their businesses, but the perception from the panellists is that they need to do a bit of learning first. “When it’s working at a corporate level, the print manufacturing sector lacks sales skills leadership,” claimed Mollard.

Customer service is another area where improvements could be made at the manufacturer’s end, according to St Ives’ Simon Ward. “Printers appear to be rubbish at customer service and we don’t appear to be very good at dealing with other printers,” he said. “Customers need a value-added service. They don’t want a bog standard one. I would love to stand here and say ‘print managers are all bastards and don’t deliver value’. Unfortunately, I can’t say that because the truth is that there are some excellent print management businesses in the market. They offer value added services and are not just driving down the price.

“[However,] printers need to move up the food chain,” continued Ward. “To get to the next stage is not that easy. We really need to get up to that next level. As a manufacturer, it’s our collective responsibility to do this. We need to fight back and get off our backsides and do something about it. That’s what my business has done.”

Embracing technology
Ward went on to explain how technology plays a major part in St Ives’ provision of a value-added service – it’s an area that was echoed by others on the panel. “You need to be investing money in technology,” said Communisis’ Vaughan. “Lots of others are and they are ahead in the market. The technology will get you in the end.”

With that technology, Vaughan argued that print managers can provide the kind of information customers, and suppliers, really needs. “We give our supply chain a mountain of information; it’s a really powerful piece of competitive intelligence.”

Taking up Vaughan’s point, Claritum’s James Samuels explained that having a robust online model gives buyers and customers the detailed levels of information needed to add value. “There needs to be a change from the black arts to an online process,” he said. “Then you can have informed discussions and not just on price – it’s about the end-to-end process. Knowledgeable buyers should be driving the process.”

“The technology can empower you,” added Webmart’s Biltcliffe. “We’ve been working on our online estimating service since 2000. And on our website we put up all our supplier arrangements. It is all transparent and we don’t hide anything.”

From a manufacturer’s viewpoint, Ward admitted that St Ives has “pulled up its socks” in terms of customer service and it has “moved up the food chain”. The company has repositioned itself in the market to become both a manufacturer and a print management firm and this has meant that only around 2-3% of St Ives’ turnover is now derived from print management firms. That used to be 10-15%, but Ward said that this has decreased because “we now do things better”.

“The best way forward is to print less, accurately. Not reduce your price by 40%. That is a non-sustainable model,” argued Ward.

“It’s important to think about what the customer’s solutions are,” added Print and Procurement’s Matthew Parker. “I hope we can move away from the traditional model of print buying.”

To do this print managers will need a ready supply of skilled staff but, according to Unity Publishing’s Andrew Wilson, print management training is currently pretty “hit and miss”. “I intend to do something about training,” he said. “It needs to be more of a real profession with the qualifications that go with it. While the procurement systems must change, so must the people in them.”

All of those who made presentations at the debate echoed the wider industry argument that the old model of print management has to change and, in some quarters, the market is already changing, although there is still a long way to go.

Embracing technology, adding value, setting up transparent systems and improving training were all areas in which the panellists, broadly speaking, reached agreement, but while everyone in the hall may have been singing from the same hymn sheet, getting the message across to the wider industry may prove more difficult, especially in these times of economic uncertainty.

The challenge for everyone involved in the printing industry, from the buyers and print managers right through to the printers themselves, is hammering the message home that selling print on the cheap is not sustainable and will damage the whole sector, not just individual operators.