The smartest thing a print buyer should learn is …

The smartest thing a print buyer can learn is … not to focus solely on price. Dig deeper than that.

How?

Change the game

Stop focusing on price only, and start focusing on “value.” Change the conversations you are having with your suppliers. Change the conversations you are having internally with your organization.

Figure out what “value” is for you

What holds value for you and your organization? Think about it.

If you think it’s important, then it holds value. Can you measure it? Bingo – that’s value. Track it. Demand it from your suppliers.  You are paying, don’t forget that! That’s powerful.

It could be time (read: your time). It could be quality. It could be speed to market. It could be some level of innovation. It could be the partnership itself. Sure, it will be about price at some point. It could be many things. The point is that price is only one component of the value that a print partner should bring to you.

And don’t forget, you need to sell it

Communicate to your suppliers, very clearly, that your mission is to extract maximum value; not necessarily minimum price. If they don’t respond, if they don’t hear you – lose them. Quickly. Go find someone who understands the conversation you want to have.

Your next challenge, of course, is to start selling “value” internally in your organization. In order for you to be able to shift the focus from being solely on price, you must be able to communicate the message of how much bigger the bucket of “value” is than the smaller, singular, bucket of “price.”  Price fits inside the bucket of value; it does not comprise the totality of the value.

Get some help from your print partners to articulate it. If they understand what your doing, they’ll be glad to do it.

Don’t lose control of your negotiation calendar

Controlling the calendar in any negotiation is always a challenge.  In a perfect world, your calendar constraints would always match your counterparts calendar constraints.  But sadly, this is almost never the case.  You need to work competing agendas toward your ultimate goal of a fairly negotiated deal where you get what you need, and your counterpart – soon to be partner – has what she needs.

In situations where you find yourself negotiating in an environment that is not a competitive RFP, it is even more important to control your calendar.  A competitive RFP is a comfortable environment for a print buyer, because you are usually controlling most of the variables.  However, when you’re not in the RFP environment – you are on your own buddy!  This is a much more volatile environment for a negotiator or buyer.  If you are not careful, things can spin out of control, and by the time you realize it – it’s already too late.  So, what to do?

Set ground rules early

The best way to control your negotiation calendar without having to resort to badgering is the one that is most often overlooked – setting ground rules early.

This seems pretty simple and self evident, right?  Well, it’s not.  I’ve seen many negotiations begin without first establishing a fundamental set of ground rules.  And so have you I’m sure.  In fact, I’ve done it myself!   (Sound of me smacking myself in back of head).

One reason for this is that early on, especially if we’re dealing with people who are relatively new to us, we are usually pre-occupied with “starting off on the right foot”.  We worry about setting that good first impression.  About signaling to the other side that we are fair minded and easy to deal with.

Setting that good first impression and establishing a good rapport is indeed important.  In fact, if you’re of the mind, you can dig up statistics that will show you that if you don’t establish that good rapport early on, your negotiation is much less likely to be successful. However, if your negotiation doesn’t have a set of ground rules to operate under, you will quickly see that nice rapport go away as the two sides gradually revert to reactionary bad behavior.  Bad behavior (with adults) is not usually the result of evil people, it’s simply the result of good people operating in an environment with no rules.  If your leash is too long, you will go to the end of the leash; and so will your counterpart.

Here are some simple and reasonable ground rules that you can agree to with your counterparts – at the beginning, in the very first meeting – that will make it easier to keep things moving along and prevent monkey business (on both sides, your bad behavior counts too):

1. Emails should be responded to within 1 bus. day.  Even if it’s just to say “hey, I got your email, I’m working on it”.
2. Contract redlines must be turned around in “x” business days. (insert a number for x that makes sense for your situation)
3. Action items from conference calls or meetings must be documented and circulated via email.
4. Action items from conference calls or meetings must be turned around in 2-3 business days.

It might seem silly, but adhering to a simple set of ground rules can save you a lot of grief.  Without a fundamental framework in place, both sides pretty much have carte blanch to start playing games when it suits them to do so.  Do yourself a favor, don’t let that happen.

Thoughts from #KodakRT11

Yesterday I had the good fortune of participating as a panelist at Kodaks “The Future of Book Publishing Roundtable 2011“, hosted by the NYPL in NYC.  Publishers Weekly’s Jim Malliot moderated.  PW and Kodak did a very nice job with the arrangements.  It was a very well organized and interesting day.

Thought leaders from all parts of the book value chain were there, so it was interesting to hear the different perspectives.  In attendance were representatives from traditional publishers, self publishers, litho printing companies, authors, and POD printing companies.

You can read another article on the event here on the Print CEO Blog.

Here are my key takeaways from the discussion:

The convergence of e-sales and POD technology are exerting pressure on both ends of the book supply chain

As e-book sales continue to increase, the waste and risk contained within litho runs for books will be tolerated less and less.  At the same time, POD technologies are and will be making advances.

Factor #1: e-sales are shrinking long runs for 1st printings.
Factor #2: POD technologies like high speed inkjet, and integration/automation with binding lines are continuing to evolve.

This will make the longer pre-paid “POD” book runs more viable as time goes on.  Because of the economics, publishers are printing shorter and more frequent litho runs, as a hedge against potential returns.  This decreases the cost effectiveness of the litho run, due to the add’l makeready, plate, and shipping costs.  All publishers freely admit that managing this process is a risky game.  In addition, it was noted that this process has become even harder of late due the level of instability in the market today.

With these two factors converging, we are approaching the day when long-run pre-paid POD will be possible, and will able to satisfy a significant amount of the short to medium run litho book runs.  We are not quite there yet though.

The pendulum of power is shifting back to the author

Authors have more choices than ever: traditional publisher vs. self published, e-book vs. p-book.

Today’s self publishing sites, like Lulu.com, are not really publishers, they are technology platforms.  They enable authors to reach people on the other side of the globe as cost effectively as possible, using a POD model where books are printed as close as possible to the delivery destination.  No book is printed before it is bought and paid for.  This minimizes waste and time in transit, and speeds up time to market.

Self published authors are killing it with e-books.  Many of them are doing it with no prior traditionally published titles under their belt.

Going the route of traditional publishing is not so necessary anymore.  Publishers serve a valuable function.  Without them, it would be harder to get really polished work out there.  No one debates this fact.  However, it has become obvious to so many authors that things like cover creation, editing, e-pub conversion, can all be outsourced – by the author – and taken care of just fine.

All of this extra work, is well, extra work.  It’s not easy.  But it’s totally doable.  And it buys authors much valued independence and a bigger piece of the profit pie.  This is something that I don’t think has really sunk in yet at many traditional publishing houses.

What about promotion, and the marketing machine that can be brought to bear by the traditional publisher?  That’s true, that is very important.  I don’t have that piece figured out.

But I do know that many authors have capitalized on blogs and presences on the web to promote themselves.  Melinda Roberts is a perfect example of this.  She has built a huge following in the Mom blogger community through multiple web sites.  Authors have been able to build and establish a following in this manner in advance of coming out with their books.  This has helped them sell more books; both e and p versions.

Lulu’s “place in the space” is becoming more significant

It was nice to see Lulu at the same table with some of the biggest publishing companies in the world today.  Especially when we are, when you think about it, not a publisher – we are a technology platform.  I think it speaks to the importance of Lulu’s “place in the space”.  Lulu is well positioned to empower a new breed of entrepreneurs through our Open Publishing Platform, and to bring more value to our authors through our global distribution footprint for books.

Pre-paid POD is after all what Lulu specializes in, and the shift to this model is being driven by the economic forces and technological innovations that are at play in today’s market.  The companies that continue to innovate and bring new ways to authors to make money and profit from their work will be the ones who succeed.

Will high speed inkjet bring more of the major litho players into the POD book market?

You bet.  Here’s why…

We first need to understand one thing, and that is that there is a barrier to entry for high speed inkjet, at least right now – price.  These devices are hugely expensive.  Companies looking to be early adopters are looking at several million USD easy.  It can go higher too depending on the finishing options.  Because of this, only the well heeled financially strong companies can afford this kind of capital expenditure.

So who are the companies who can afford this kind of cap. ex.?  The big ones.  They tend to be the more established mature businesses, and many of those have as their core area of expertise – litho.  Don’t get me wrong, there are stand alone digital print companies buying these devices, but they are the minority from what I’ve seen so far.  There just aren’t that many (“digital only” shops) that have the requisite page volumes to support such an investment and can therefore afford to be early adopters.

I believe that all of the major litho concerns understand that this is game changing stuff, and they are jumping in early if they can.  They are transitioning as much short run litho volume as possible to the new inkjet devices.  Only a company with huge volume ready and waiting can afford to be an early adopter.  And the major litho houses have copious amounts of direct mail, trans-promo, and book volume sitting there, locked and loaded.

As we all know, the trend with publishers is that run lengths are shrinking, not growing.  They want to print the shortest runs possible to mitigate waste and returns.  The major publishers are also the biggest customers of the major litho houses.  Therefore, it’s logical to assume that some of the major litho houses, not traditionally known as leaders in POD books, will get into this business as a way to protect their interests in these key revenue streams.  They have to.

Ironically (or not), most of the best POD book manufacturers out there right now are not also litho houses.  These companies are specialists and they have a technology advantage.  They are technologists first, printers second.  They have more sophisticated and more refined work-flows. But, for the most part, they do not have the financial wherewithal advantage over the major litho players.  Capital can cure a lot of ills.

It will take some time, but I believe that more of the major litho players are going to get into POD books in a big way.  They will invest in the technology necessary to be competitive with the more experienced POD book manufacturers, and will attempt to leverage the pricing advantage that they will have while their new inkjet presses are still shiny and new.

Will this create downward pressure on the price of POD book production overall?  I don’t have a crystal ball, but one would think so.  Simple economics says that increased competition = lower price.  Only time will tell.

Start the New Year off right. Help Others.

I’m starting the new year out right this year.  By doing something for others.

I took the fam down to St. Andrews church this morning to volunteer with the Brown Bag Ministries program.  The BBM is a great program that relies on volunteer donations and support help to prepare and distribute lunches to the homeless and those in need every Saturday morning.

It still amazes me to know that there are so many people and families in need, even in Raleigh, right now, that rely on the food that the BBM provides.  It reminds me of how very fortunate I am.  There are so many people that literally don’t know where there next meal is coming from.  It’s actually very sad.  But it’s also uplifting to know that you can actually make a difference, even if it’s just for a small number of people.

We showed up with some cold cuts, and cookies, as did many people and families from around our area.  It was a small showing, but considering it was New Years Day and many were probably traveling, I guess it was ok.  It was probably better that there weren’t too many people there today because my sons got to do more “work”.

I wanted my boys to see that there really are many many people out there that are so much worse off than they are.  I think they got the message.  It was really cool to see them get into it and start helping out.  Loading up lunch bags, carting supplies back and forth, loading and unloading the truck, you know – work stuff.

My big guy, Myles (8 yrs. old) has been there before.  This was his third time.  He was showing my little guy Quinn (6 yrs. old) the ropes.  It was really nice to see this.  I could tell that they understood that they were part of something that was bigger than they were today.  Bigger and more important than Mario Kart, and Lego’s and such.

My wife really enjoyed today as well.  We will make ourselves regulars there for sure.  Doing more charitable and volunteer work is on our list for 2011.  It’s good for the soul.

High Speed Inkjet: How it will impact POD books

Kodak 5000XL Inkjet Press

The arrival of high speed inkjet presses is one of the most significant developments in the printing industry in the last 10 years.  Here’s where I think inkjet can and will have an impact on the digital POD (print on demand) book market:

• It will enable longer POD runs, cost effectively.
• It will bring the price of digital color down (over time).

Let’s dive into each of these points a bit:

White Paper: How to Execute an RFP for Print

This post is a white paper on best practices when planning and executing an RFP (Request for Proposal) for POD print procurement.  This is kind of a long dry read, but I think that if you are in the business of buying print, you might find it useful.

Due Diligence

You have to know who the players are that you plan on inviting to the RFP. Take some time to do the research on who the appropriate candidates are. Get down to a short list of players that you have a reasonable expectation can meet the need. No more than seven. Sources of possible candidates and information include at least the following:

• Current partnerships
• Industry connections you already have
• OEM manufacturers of printing and finishing equipment
• Paper companies
• Shipping companies
• Social networking sites like Linked In, Twitter
• Publishers and other print buyers

Stoking the Competitive Environment

This is one of the most important aspects of an RFP. In order for an RFP to get max. value, there needs to be a competitive environment to leverage. Printing companies, and mfg. companies in general, don’t give margin away for free. The only time they will do this is if they are forced to do so through the credible threat of a legitimate competitor. Here are some steps to stoke the competitive environment:

1) Float the rumor, in advance, that you will be launching an RFI (Request for Information) and/or an RFP (a more official Request for Proposal). Get this info out to all the players. Include just enough information to indicate that you are serious about the endeavor.

2) Include companies both big and small, so you can begin to see where size, resources, and flexibility matter.

3) In addition to notifying print companies of the impending RFP, notify OEM manufacturers and paper companies too. Ring up the sales people, they know all the players, and information tends to be currency to them.  They can help create the buzz.

4) Let the rumor simmer. Give it some time to make it’s way around the industry. Word will spread like wildfire. Let it work it’s way up and down the org. charts at the print vendors. This builds expectation for the RFP and gives the sales guys enough time to build a case for participating.