Introduction
Establishing the right way of managing printed communications is an important but complex subject for most organisations so it’s no wonder many do not achieve the right level of value from their supplier arrangements. This is especially relevant in 2019 when, despite the continued growth of digital marketing, many corporations are seeing little downturn in their spend on printed material. In fact, UK advertising expenditure grew 3.7% during 2017, the largest of any year since monitoring began in 1982 [source BPIF].

Looking back
Since the early 1990s print management has been the solution of choice for large organisations with many switching to a fully outsourced model. This helped remove fixed liabilities, control an ever-increasing cost base, and enjoy a savings-driven and variable cost model. The unprecedented growth throughout this period, coupled with many new players entering the market, created the industry we know today and whilst the branding gurus have moved away from the ‘print management’ label it’s still at the core of their propositions. This incredible success story now sees a few big players dominating a multi-billion global market and employees and offices in each corner of the world.

Over the same period, we saw the demise of many print manufacturers. Indeed since 2010 the number of printers in the UK market has dropped by 20% whilst the total UK sales in print has seen an overall increase from £13.5bn to £13.8bn [source BPIF]. Clearly the fact that corporates tended to appoint a managed service, rather than one lead by print manufacturers, has had a lasting effect. Looking back, many of the printers never stood a chance as their lack of investment (or over investment), poor added value and high cost base meant they had to switch their loyalties from the corporates to the print managers. Whilst this created a love-hate relationship, the more versatile printers have survived by evolving and streamlining their businesses to maintain growth and volume, albeit at much lower margins.

Software
Then software jumped on the train-of-change and the print managers, some printers and independent providers developed products to automate the print process whilst delivering performance and demonstrating savings metrics. Many of the early independent software providers continue to be a success today but the print management businesses still see success with their own platforms where they offer a people / software / supply chain solution that remains attractive to many corporate customers.

Looking forward
We all know the marketing landscape has changed but printed communications are still a critical part of all customer journeys. Anyone who says otherwise is missing an opportunity to engage with a medium with a proven and sustainable ROI. The industry is still dominated by the large print managers but (and it’s a big one) there are an increasing number of choices available for corporates to source their print in 2019.

Yes, a fully outsourced model is very attractive to some, especially for large and international corporations that are looking for long term collaborative relationships. This comes with an element of risk – a feeling of being trapped through all the knowledge and data being held externally and a service provision that is so entrenched, it’s a daunting thought to move to another solution. The same applies equally to relationships directly with printers, and this challenge means that many of these corporates just stick with their long-term providers to avoid any disruption to service. Of course when looking at global arrangements the print manager will win over the printers every day. With these deals being few and far between, the big players are fighting over the last remaining customers to outsource.

Choices
The choices are varied and truly depend on spend, product profile, buying processes and geographies. You could appoint a print manager or a print manufacturer to create an outsource-based solution. You could employ expert print teams, deploy specialist software and build a supply chain to produce the material. Or you could create a blend. Each have pros and cons so the strategy defining your decision needs to be discussed before you start appointing. The two main models are shown below.

Option one – Outsourcing to a print management business
This is a popular choice for larger corporations but there is increasing evidence that some of these arrangements lack true financial transparency – with hidden fees being commonplace in the industry. Furthermore corporations will lose the control and knowledge to a third party and this generates a feeling of being tied to the supplier. However where fresh controls are applied to develop a relationship, value can be released on an ongoing basis.

Pros
– Specialist expertise and ‘free’ software
– Financial and risk accountability
– Client and service focus with SLAs
– Controlled buying and management
– Leverage of volume spend
– Automated ordering for low value print
– Strong relationships with your supplier

Cons
– High costs and management fees
– Difficult to measure value and cost effectiveness
– Difficult to establish best fit from a wide range of offerings under the ‘print management’ banner
– Hidden fees and undeclared rebate

Option two – Create an internal print management team (in-house)
Many organisations have maintained or re-adopted this model with different levels of success. The challenges include a lack of innovation and limitations on resource as well as developing technical solutions and managing sophisticated procurement activities. However, the benefits of direct relationships with the printer include removing multiple layers of administration and unnecessary cost by accessing the knowledge directly.

Pros
– In-depth understanding of the business and requirements
– On site resource and focused print buying
– Complete visibility of costs with no hidden rebates
– Control and direct access to the supply base

Cons
– Lack of investment in systems e.g. MIS, DAM, online tools
– Staff skills gaps and experience
– Poor procurement disciplines
– Inconsistent quality control
– Lower levels of resource flexibility

About Harler

Harler is the consulting authority in the print and packaging industry. Our extensive network enables you to control your requirements through access to operational, commercial, procurement and transformational skills. Our thorough knowledge of operating models, ways of working, productivity, industry specifications, technology and process are deployed to help you optimise service, quality, cost and social responsibility.

You get our comprehensive expertise across print, packaging, creative services, digital, document management, office print, postage and promotional products.

To see how Harler can help you, please contact us on 020 7971 1225 or hello@harlergroup.com

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