Where's the Money? Binding

In-house or outsource? That’s a particularly delicate question printers must ask themselves each day. For many commercial shops, the question never arises about prepress or printing; that equipment is solid bedrock in a shop’s key requirements. But postpress equipment is another matter. Printers need to have a well-thought-out financial and business model with a thorough grasp of their customer and potential customer’s needs especially relating to the bindery.

Do I purchase finishing equipment or outsource the work to a trade bindery? What are the costs involved? Do I lose control over my job? How many extra employees do I need to hire? Will I have enough work to keep the machine busy?

As the economy begins to percolate once again and jobs begin to re-emerge, printers need to take a hard look at their bindery department. Will it be an efficient revenue source or do they need to partner with a trade bindery already equipped with finishing equipment?

On one hand, Justin Goldstein, executive director of Binding Industries Association (a division of Printing Industries of America), suggests that commercial printers remain experts at printing and leave bindery specialization to trade binders.

“I would recommend to printers to not bring their bindery in-house,” said Goldstein, who admitted his bias toward independent binderies as chief promoter of this segment. “If a commercial printer does bring the bindery in-house, they are going to need to think about supplies, maintenance and training. If they don’t have a steady stream of business to keep the bindery operating it doesn’t make sense from a cost perspective. Plus, printers do not have a knowledge specialist to operate the equipment or produce finishing work.”

Goldstein said his organization counts 700 to 800 independent trade binderies and graphic finishers in the United States, a steady number over the past year. “We’re not seeing a lot of printers purchasing bindery equipment to bring in-house,” he said. “In fact, we’re getting calls from printers who are looking for specialized binderies to help them finish their work.”

But bindery manufacturers are continuing to produce equipment that is easy-to-use, economical and productive. “It makes perfect sense to outsource highly specialized and long-run jobs, but some printers are bringing basic finishing in-house as run-lengths drop and turnaround requirements become more extreme,” said Mark Hunt, director of marketing at Standard Finishing Systems. “Binding, saddle stitching and folding machines today are easy to operate and have intelligent automation that flattens the finishing learning curve, making it easier to produce a top-quality finish without the need for dedicated experts. There are certain advantages to outsourcing, but with sufficient volume a printer can justify the investment, grow ancillary finishing profits, and gain full control of their schedules.”

Many commercial printers agree with Hunt’s assessment and are not only maintaining control over their jobs but increasing their revenue. Last year, Ryan Printing, a Blauvelt, N.Y., general commercial printer, posted its best sales ever in its 18-year history. In March 2009, the 12-employee shop located in Rockland County installed its first digital printing press—an HP Indigo 5500 model. Designed for the production of marketing collateral, direct mail, photo merchandise products, books and manuals, the HP Indigo press 5500 supports an extended range of media—including recycled, FSC-certified and SFI-certified papers—and prints in resolutions up to 1,219 dots per inch (dpi). But what about finishing the digital jobs? Would Ryan need to install new equipment or outsource himself?