Post Profits with Postpress Products

Preserve re-orders by enhancing document utility and functionality postpress.

Adding value to printed products after production takes many forms—from diecutting, laminating, punching and perfing to varnishes, crash imprinting, gluing and binding.

These varied processes, either singly or in combination, add more utility to forms for the end-user, and with that added utility comes efficiency in use and, likely, added profit for the distributor.

"Sales of value-added products are very healthy; we've seen the dollar value of our sales increase an average of 11 percent per year," said Joseph Lunkes, CEO of USAdocufinish.

The Plainfield, Illinois-based manufacturer, formed in 1986 as United Stencil & Affixing, now sells $9 million annually, all of it in value-added forms. "Forms that combine printed information with additional functional utility offer more value to the end-user," Lunkes said. In addition, the more a form can do, the less likely it is to move to an electronic form and result in lost printing business, he said.

Leon Bogner, president and general manager at Ace Forms, Pittsburg, Kan., concurred with his colleague's positive assessment, saying, "Here at Ace Forms, we have seen a big move toward value-added products," Bogner said. "Our postpress labor hours have been growing at a rate of 20 percent annually."

As with business forms in general, individual value-added processes have seen peaks and valleys over the years. Lunkes noted the decline of carton labeling stencils, calling it "analogous to the electronic industry's evolution beyond vacuum tubes."

In addition, integrated cards and labels, which may require diecutting, varnishing and affixing, are becoming "very standard products," Lunkes said, and are suffering price erosion as a result of their ubiquity.

Expanded Markets

At one time, "value-added" was synonymous with being unique, which is what the integrated products were when they first came out. "The good news is, there is more market acceptance of this product and expanded uses for integrated products," Lunkes said.

For instance, a card integrated into a letter might formerly have been used primarily for membership organizations in direct mailing campaigns or for insurance market applications. Such applications called for unique information to be printed on the card itself, including a name and ID number or, in the case of insurance cards, the employer name and group number, as well as the name of the insured. "Two years ago, we would not have printed integrated cards for use by a retailer," Lunkes said. "Now, it's very mainstream." The decreasing cost of the product has opened it up to applications in which the card may never be used or kept by the intended recipient.

These newer applications may distribute a non-personalized discount card in a mass mailing or via handouts at the mall or at a community event. The recipient may detach and use the card, or may simply throw the integrated form away. In contrast, integrated labels are heavily in demand for warehouse and fulfillment operations integral to the enterprise, Lunkes said. A wide variety of die cuts and varnishes may be required, depending on the specific application needs for durability, harsh environment use, tamper resistance, etc.

Window decals can also be integrated for use in direct mail membership solicitations, parking permits, construction permits, oil change reminders and other promotions. "There is a tremendous amount of growth in integrated labels, but margins are similar to cut-sheets," Lunkes noted.

This is due to end-users' familiarity with the product, although exceptions exist for special applications, which carry higher profits.

When used on medical forms, for instance, integrated labels may need to withstand chemicals or freezing, and there is also often a need for highly tamper-resistant products for blood tests or forensic evidence, for example. "It just depends on the specs from end-users and whether or not they need compliance with some standard or have a perception that the end-user has more liability if the product doesn't perform," Lunkes said. Bar codes may be added to forms to increase tracking ability and establish a chain of custody. USAdocufinish has also developed an integrated label for use on prescription bottles that will peel off easily when the prescription is finished, enabling an end-user to discard the bottle without the private patient information attached.

Distributors who court opportunities for products with multiple layers of value added may find that the technicalities of such sales provide a natural barrier to competition, Lunkes said. Fewer end-user vendors can translate into better margins for the distributor who successfully meets the customer's needs with value-added products, he said.

According to Lunkes, integrated magnets and cards have greater profit margins than basic integrated labels. In some instances, end-users want to migrate an existing integrated card product to a more professional-looking, easy-release card, which can offer an opportunity to distributors.

Bogner said that the folding of cut-sheets and unit sets, in various configurations, has been "a big item" for Ace Forms. The manufacturer handles orders for forms and work books with multiple plies—12 to 50 plies or more, he said. Off-line numbering, punching and perfing are in demand, while linking or gluing several unit set forms together has been of interest to some customers.

Parking Permits

Distributors can also benefit from value-added products by integrating the products themselves with a larger solution for the customer. Chris Sparks of five-year-old distributorship Inland Printing Services (IPS), Mission Viejo, Calif., offered one example.

IPS solicited business from a local college, which was having difficulty keeping up with requests for student parking passes. "Most colleges distribute parking permits using two methods—either mailing or physical distribution," Sparks said.

Mailing requires hand-matching of the parking permit numbers to a letter with student information. Physical distribution creates long lines while school staff manually record permit numbers in the student records. Both activities require additional processing by the campus police.

The integrated parking permit product developed by IPS and USAdocufinish is printed with UV inks to resist fading, is strong and flexible, and meets laser specifications, Sparks said. There are three basic designs: the hanging system for rearview mirror display, a reusable glue system for inside window use and bumper applications for outside use. The permits are integrated with a printed list of college parking rules and regulations.

IPS handles orders of 10,000 to 100,000 for manufacturing of the base product, variable imaging and mailing permits to students. Colleges can upload their databases to IPS' secure site, where permit numbers and student information is merged and imaged.

The distributor will also warehouse blank permits, number them and release them to a college for physical distribution as required.

Such complex systems are not a quick sale, Sparks cautioned; the first parking permit system IPS designed took a year and a half of testing and has just completed one permit cycle. But, offloading the entire process has proven enticing to every other college approached by the distributor, Sparks said. "Pricing is very competitive when compared to their existing systems," he noted, and the distributor takes on all of the logistical headaches.

The eight-employee distributorship has an in-house lettershop for custom printing, and focuses on small to medium-sized accounts in real estate, mortgage lending, education and automotive markets. IPS' sales this year will exceed $800,000, Sparks said.

Just as a slimmed-down workforce in offices and manufacturing plants across all industries is being asked to become increasingly versatile to enhance the profitability of the employer, so, too, have forms been increasingly asked to take on multiple functions. Distributors need to closely examine every form used by their customers, both in operations and marketing, to see if additional functionality could be added post-printing with different or better diecutting, perfing, variable imaging or laminating.

As Bogner noted, "Overall, value-added or specialty work has been good … but, we are always looking for more opportunities and challenges."

By Janet R. Gross