Being 100% sure you are doing things the most efficient way is nearly impossible. There are always cheaper, better or more qualified options available. That’s why the printing business is not easy. It is competitive, sophisticated, heavy on investment, light on profit and dependent on obtaining an array of projects requiring management of overwhelming details.
As much as some might fantasize about dumping the printing business and trading it in for the simplicity of running an ice cream shop or small business, there are difficulties in these enterprises as well. The truth is that no matter what you do, the grass is always greener on the other side. There are always better options, simpler solutions, less difficulties, and better tricks to make money. So what universal ideas might be applied to your business, especially if your business has anything at all to do with the printing market?
One concept is called breaking the iron triangle. That is one technique that can be used to make money in spite of the gravity and threat of competition. We all agree that there are only three things we can sell – whether in the printing industry or operating an ice cream shop. Those three things are quality, service and price.
The axiom is that a business can not offer all three. As quality increases and service expands, price typically goes up because costs go up. If price is to drop, it stands to reason that quality or service must be sacrificed. No one expects to eat a prime steak in a fancy restaurant for a buck or two. But for a buck or two one might get a hot dog at a greasy spoon at a local hang-out near you.
The idea is that as quality and service increase so does price. Everyone knows this. Everyone accepts this. Even some companies market higher prices as a lead, since higher prices indicate improved quality and service. My spouse buys a $300 pocketbook (occasionally) because she knows that the quality is better than the one at Target that looks exactly the same but costs $29.
That’s why breaking the iron triangle is contrarian. This means increasing quality and service while dropping price. So the $29 pocketbook becomes the same or better than the one for $300.
So how can that be? It turns out that those with printing plants are busy about 70% of the time, because they need to have available downtime for when their big customers call and need immediate service. If their presses were running all of the time, and they did not have downtime available, they would not be able to service the big customers and would lose their business.
But when the big customers don’t call, the presses sit idle. Of course, this idle time is already paid by the big customers in higher fees on other projects for the quality and service expected. This unused downtime becomes a gold mine for the printer who can sell it at the last minute to another customer.
And that other customer can buy the downtime for pennies on the dollar. That gives this last minute customer a huge cost advantage without sacrificing quality or service. In fact the service is downright super. By having numerous printers the quick-turn-around customer is never without downtime available and improves profitability by paying significantly less.
As a broker, or as a printer who does outsourcing of overflow or of projects that cannot be produced in house, breaking the iron triangle solves a lot of problems including how to increase the bottom line.
Managing all this is a choice, not a requirement. Not everyone is interested in lower prices. But for those who are, eLynxx software has a special set of tools that allow for the breaking of the iron triangle and of large increases in profitability.
We offer our PrintGizmo and PrintLynxx software that right out of the box can level that insurmountable mountain of details. And with sterling customer service, you can rest assured we are always working to make your life easier. Find out how our software works and get a free no pressure demo by visiting us today. You can also call us at 717-709-0990 to find our more information today.