Rod Fowler, managing director of Renz Masterbind says that in tough economic times it pays to be creative
In difficult economic times when sales are flat, many printers make the mistake of treading water in the hope they will somehow weather the storm until the economy picks up.
This can be a risky strategy, a better approach is to look for new ways to leverage more turnover and profit from your existing processes and customer base.
One approach is to add value to your print by offering more finishing options to your customers. Ring Wire Binding offers a practical finishing solution that can be easily automated. In fact Ring Wire Binding also known as double loop wire or Wire-o offers the most automated approach at relatively low volumes, making it quite cost effective even for the small printer.
There is a huge variety of cover solutions and ideas used in ring wire binding that allows the graphic designer to be quite innovative when designing document solutions for clients. In fact, of all the finishing systems around, ring wire offers the largest variety and most flexible range of cover options than any other automated finishing solution. It also offers great solutions for photo books and calendars.
German manufacturer, Renz is a world leader in ring wire equipment solutions. We are seeing a continued growth in the use of Ring Wire binding but there is a significant change in the way it is being implemented. Historically we have seen large finishing houses buying large automated solutions, but these days we are providing benchtop and semi-automatic solutions for the digital print-on-demand market or small to medium size printer doing shorter runs. Most customers are surprised to see how only relatively low volumes are needed to justify the investment in professional wire binding equipment.
A similar picture is playing out in the area of celloglazing. Many printers are spending thousands of dollars per month to outsource celloglazing, work when it can easily be brought in-house and be more profitable and cash flow positive immediately.
Money Saving Example
If a printer is spending $4000 per month outsourcing celloglazing and instead chooses to invest in equipment to do it in house, the total cash outlay per month would be around only $2,770 with equipment lease costs of $570.00 per month, and after allowing for film and labour costs for a solution to handle the equivalent production capacity. That is an immediate saving and cash flow benefit of $1,230.00 per month. These figures are from a real life customer example where the customer actually reduced his cash outlay for this process and could pay for the equipment in less than 20 months.
We encourage our customers to do a proper audit and cost analysis of their outsourced finishing (for example cello glazing or wire binding).
The results can be truly surprising with the capital investment paid off in a very short time.
The often hidden costs of delay can also be substantial. By not investing as per the example above this printer misses out on over $14,000 per year in extra profit. Another way to consider it is that it is also an extra $14,000.00 per year in cash flow they have to find.
Many people think investing in new equipment will be an extra burden to their cash flow but as you can see from this example the customer was already spending $4000 per month anyway and now is spending less. So investing in new equipment to finish in-house not only makes you more money, but actually frees up cash flow with limited risk with all the added advantages of controlling the job, and reducing extra freight costs and delays.
That is something worth considering in these challenging times.