Printers' Suggestions For Coping With Recession

About a month ago I posted some comments on the Printowners listserv, a very active group of print shop owners who exchange hundreds of ideas and comments on almost a daily basis. For more about this list, you can visit www.PrintOwnersList.com.

Anyway, I shared with the members of the list one of the interesting findings extracted from another recently released survey published by NAQP, Quick Print Pulse, Winter 2009. This is a quarterly publication that attempts, as its name suggests, to take the pulse of the industry.

The current issue asked owners a series of questions about how they viewed the current recession, and then followed up by asking them about specific steps they were taking to cope with it. Owners were asked whether they were expecting increases or decreases in sales as compared to 2008, how prepared they were to terminate employees, and how pessimistic or optimistic they were about the economy.

One of the survey questions asked owners what changes they might make in their businesses in 2009. They were given seven possible choices, and they were asked to rank each choice as to how important that action might be, relative to their own business. The possible choices participants were given were:

• Increasing sales
• Decreasing cost of goods
• Decreasing payroll costs
• Decreasing overhead expenses
• Delay purchasing new equipment
• Purchasing a competitor
• Possibly selling their own business

In my post, I shared the results of this one question and noted that I was a bit surprised that a significant percentage of printers chose "increasing sales" rather than some of the other choices. (See the chart.) I commented that my emphasis would not be on increasing sales, but on some of the other options such as: 1) reducing cost of goods, 2) reducing labor costs, and 3) reducing overhead costs. A healthy discussion ensued, with some agreeing and others disagreeing.

I argued that every dollar of costs that you can reduce or eliminate transfers directly to the bottom line, while a much smaller portion of each additional sales dollar transfers to profits.

One interesting and encouraging thing that often occurs on Printowners is that a number of printers jumped into the discussion and offered up their own lists of steps they had taken or will be taking to cope with the recession. Following are just a few of the suggestions for reducing costs posted by three members of the Printowners list.

Bucks Digital Printing

Bob Herion, owner of Bucks Digital Printing in Newtown, PA, offered up a lengthy list of steps taken at his firm, almost all of which are directed at reducing costs. He provided readers with the following:

• Install scheduling thermostats adjusted to work schedules.
• Install ceiling fans in warehouse to help with heat and a/c.
• Stop owner 401k.
• Reduce property rent to just cover the mortgage (we own).
• No overtime.
• Cut office cleaning service from twice to once per week.
• Cut trash pick up from three times to twice per week.
• Require all employees to punch out for half-hour lunch.
• Cut out Xerox second shift service on one machine and Saturday service on all machines.
• Consolidate inventory; discontinued three box sizes.
• Research prices of custodial items; reduced costs 20%.
• Turn off all power burning units when not in operation, saving over $200 a month on our electric bill.
• Cut back from three drivers twice a day to two drivers once; second driver as needed.
• Ship at our cost when it makes sense not to send a driver.

Bob then added some items he implemented to stretch his dollars:

• Stretch all vendors to 45 days, while maintaining our discounts where issued.
• Pay with credit card to extend another 25 days and accumulate points (AMEX).
• All receivables into interest bearing accounts. This includes 30 day CDs.
• Try to maintain just-in-time inventories where practical

The Print Shoppe