by Jack Rickard, Rickard Bindery
Wouldn’t you like to improve your company’s bottom line with high margin and frequently repeating print jobs? Would a new niche help differentiate your business? Have you ever considered small format “miniature” work? If you thought that miniature printing begins and ends with the pharmaceutical industry, think again.
The world of miniature printed products, commonly defined as anything with one final dimension 2 1/2″ or shorter, is both varied and profitable. Run lengths are usually short because so many individual pieces fit up fit on a sheet. Even if you’re a printer that prefers long press runs, take a closer look at the business of printing miniature products because the effect on your bottom line can be outstanding.
By the numbers
Although the number of impressions is usually small, miniature format printing is profitable because of healthy markups on finishing operations. Even if you outsource the postpress work, markup on outside services will make your effort worthwhile. As long as you have a reliable postpress supplier well versed in the nuances of converting miniature work, your small investment in press time should yield handsome profits.
Let’s look at an example. Assume you have a job that sells for $20/M finished pieces. If the printing portion of your job is $5/M and outside bindery services are $15/M, your total markup constitutes a 40 percent profit on your printing. How many printing jobs have these kinds of attractive economics?
Once people understand that miniature work frequently repeats, even those reluctant to embrace outsourcing become converts. After jobs are done once, coordinating with outside suppliers on repeat work becomes routine and remains profitable.
Less geographic boundaries
Most normal-sized printing work is geographically sensitive because it’s not economically practical to transport heavy paper long distances. On the other hand, miniature work weighs so little (normal weight ranges between three and seven pounds per thousand pieces) that you can transport work thousands of miles away as conveniently and for the same cost, as across-town deliveries. Therefore the location of you, your customer and your specialized postpress vendor isn’t critical. For example, we recently participated in a large job that was printed in the Orient, folded at our plant in the US and distributed throughout Taiwan. Large jobs such as this fit on so few skids that a profitable vendor relationship can be developed almost anywhere.
Although your postpress partners may be a thousand miles away, job turnaround times aren’t adversely affected. For instance, Rickard Bindery is located in Chicago and we routinely win miniature folding and stitching work from both coasts. Frequently, setup materials are overnighted and when the job arrives via truck, our machines are nearly ready to run. For miniature printed products, the world is truly a small place.
Layout and packing issues
Miniature product folding sequences and format are important because reader usability and bindery productivity is at stake. For example, there are two common ways to layout a 24-panel miniature piece: one column of 24-panels; or, three columns of 8-panels. The later is easier for consumers to read and runs faster in the bindery. While printers may not care which imposition is chosen, end-users, binderies and chief financial officers do.
There are several ways to pack miniature products. Common solutions include trays, rubber bands, cartons with chipboard dividers and bulk packing – commonly known as “popcorn-style.” While trays are slightly more expensive, they have an advantage because product easily can be loaded directly into the chute of inserting machines, saving a great deal of costly labor.
To buy or not to buy miniature postpress equipment
If your company is skilled in miniature folding and you have a proven need for more capacity, buy the equipment. However, if you are considering bringing miniature folding capabilities inhouse for the first time, beware of some caveats.
The skill set required for successful miniature folding is very different than for regular-sized work. Miniature folding setups are more involved and operators need highly specialized dexterity skills. Although many miniature products are produced on thin stock, proportionately they are thicker than normal-sized work. Folded miniature products with a lot of panels may be quite bulky relative to its size, which can cause significant problems for the uninitiated.
Miniature products usually need to be compatible with mechanical inserting. In these cases, folded products should lie flat so sucker-driven inserting and packaging machines can automatically feed them. Lying flat is also important to avoid “tenting” which negatively affects fill count for products being inserted along with the printed material. If a folded product tents after insertion into a container or bottle, it is likely to cause a short fill and be rejected. Sometimes glue must be used to keep very thick pieces closed but frequently there are more attractive methods of accomplishing this lay flat state. Some miniature folding and stitching companies have invested a lot of time developing non-glue lie-flat solutions.
There are substantial working capital considerations inherent in miniature format finishing. Assume you have a job that is 60 percent outsourced with a 20 percent markup. Twelve percent of the job will flow right to your bottom line just for communicating with your vendor. Since you have 30 days to pay, the time gap between your revenue inflow and cost outflow is quite small. In fact, cash flow is hindered by keeping work in-house because you pay for this work at the end of the week, in the form of pay checks – which is equivalent to a net loss of 25 days on your payables. Additionally, critical cash is tied up in very specialized hardware. Companies that outsource finishing require substantially less working capital to maintain their business.
The pharmaceutical segment of the miniature products industry requires substantial administrative and quality assurance programs that exceed normal commercial graphic arts practices. For example, companies processing pharmaceutical work need folders equipped with automatic blank sheet detectors. Additionally, “locked” work-in-process inventory capabilities for lot mix-up prevention is a prerequisite along with many other infrastructure requirements. Count verification procedures are extremely stringent.
Printing by its very nature involves distribution to the reader. Newspapers and mail have been the traditional primary channels for promotional printing. The piggyback nature of distribution for miniature products will broaden the base of your company’s markets. Onserts and instruction sheets into blister packs are rapidly growing segments of miniature printing. “Gaming” products, kids’ stickers, consumer product inserts and hang-tags are all hot. And as usual, pharmaceutical inserts – the backbone of the miniature products industry – continue to drive a lot of printers to the bank … to make deposits that are anything but small.
Jack Rickard, president of Rickard Bindery, Chicago, IL, is president of the Printing Industries of Illinois and Indiana and former president of the Binding Industries of America. Rickard Bindery is a company specializing in discovering solutions to challenging bindery jobs. For more information, call 800.747.1389 or visit www.rickardbindery.com.
Reprinted with permission.