An Insourcing Wake-up Call

Perhaps you thought it was finally safe to go back into the water—that the shop shutdowns of the past decade were simply a bad memory and any remaining danger existed only for a few poorly run printing departments.

But certainly not yours.

Over the years, in-plant managers have become the captains of some very tightly run ships. The formidable triad of high quality, low cost and great service has been our departmental defense, as well as our mantra.

Sadly, though, the continued closing of in-plant shops has brought home to all of us the stinging truth that even well run, successful departments, with highly competent managers, can still find themselves on the outside looking in.

I'm not suggesting that quality, economy and service are not as important as they ever were. These are all battlefields we have bled over and must preserve. But when the budget axe starts its downward swing, even these noble qualities may simply get lost in the fog of the budget wars.

I have become convinced that the in-plant's survival is not a three-legged but rather a four-legged stool. The fourth leg is simply the making of hard dollars for the bottom line.

Adopting an insourcing profit-making strategy for the in-plant can make all the difference in whether you survive or not. It has for my shop at the Grocers Supply Co. Insourcing has meant additional equipment and greater job security for our in-plant.

A Little History

No one really knows how long the Printing Services department at Grocers Supply has been in operation. The old-timers sometimes talk in hushed tones about something called a mimeograph machine. It's safe to say that it has been around for most of Grocers Supply's 81 years.

I began my employment at Grocers Supply as a press operator almost 17 years ago. I won't call it an epiphany but coming from my background in commercial printing I couldn't help but see the income potential the department had but was not utilizing.

After becoming the print shop supervisor, I started looking for ways to bring in additional outside income. I had inherited the usual suspects often found in a typical in-plant of that time: Two A.B.Dick 360's and our flagship printer, a 9810 with a swing-away T-head. In addition, we also had a 30-bin C.P. Bourg collator and an Itek 275 electrostatic platemaker. As you can see, I didn't have much to start with. Fortunately I did have a competent crew. So, like a phoenix rising from the ashes, we started our long journey into insourcing.

Initially, my crews were less than enthusiastic about the idea. "More work at the same pay? And this helps us how?" But I made it clear that this train was leaving the station, and you either got on board or you waved good-bye from the platform.

My own company was not initially over-supportive either. "We sell groceries here, not printing," was the prevailing attitude. There were always jokes and subtle put-downs. My immediate manager at the time was always quick to inform me of the impending mutiny of my crews. How disliked I was by them because of the direction I was taking the shop. These were hard pills to swallow. Fortunately, his boss at the time was behind me 100 percent. His support made all the difference in the world.

Be The Printer Of Choice

I began by focusing on becoming the printer of choice for our own retail customer base. This was the most natural starting point since we already had our foot in the door with them. Like all retail companies our customers were purchasing a lot of outside printing. So why couldn't they purchase their printing from us? I simply got our customer list and started dialing and setting up appointments.

The response was great, and the jobs started rolling in. Since most of my fixed operating costs were met by our internal service to the company we didn't have to nickel and dime our retail customers to pay for every light bulb and paper clip. This gave us an advantage.

Working for a commercial establishment, I didn't have any of the policy restrictions on whom we could do business with that some government and educational in-plants have to deal with. Though these can be obstacles, opportunities may exist for those in-plants to insource from other public, educational and nonprofit institutions.

Our own customer base has grown over the years to include not only the grocery industry but also oil and gas, staffing agencies, print brokers and software developers, to name a few.

Like any business, ours has had its ups and downs too. Still, in the past 13 years we have not failed to both meet our operating costs and give our parent company a significant return on its investment. We are not just a necessary evil; our department has long since joined the lofty ranks of a profit center. On average about 45 percent of our revenues come from commercial sales.

We recently completed the most significant upgrading of the in-plant's printing equipment in its history. To a very large degree these upgrades were done with the shop's insourcing role in mind.

Insourcing Leads To Upgrades

Early on we purchased a four-color Didde web press for printing point-of-purchase signs for our customers. In our recent round of up-grades we included an interposer to our Xerox 6180. We also added an additional DocuTech 6100 and a DocuColor 6060.

When our old two-color press gave up the ghost, we acquired a Ryobi 3302 for the expressed purpose of servicing our commercial work. Along the same line we also recently hired a full-time sales person to focus on new outside account development.

My advice to every in-plant manager is to seriously consider adopting a strategy for insourcing.

Start with what you have. But by all means start.

—By Rustin Myers