All dressed up with no place to go?

It’s been a rare, snowy day here in Middle Georgia.  To be more precise, it’s been a rare, icy, slippery day here in Middle GA. Couldn’t get to the printshop this morning and received no disappointment whatsoever when I contacted the team and asked if they thought we should call off work for today.

“There’s a half inch sheet of ice out my front door.” reported designer Todd.

“I’m at my girlfriend’s house and we’ve already built a fire.” from RH man Brian.

“I was all dressed and ready to go at 6:00 am when you texted that you weren’t coming.” from the first lady of sales, Sharon.

That one held me up. It brought to mind the lyrics of one of my favorite British Invasion songs, “I ain’t got you:”

I got a Maserati G.T.
With snakeskin upholstery.
I got a charge account at Goldblatt’s,
But I ain’t got you.

I got a closet full of clothes,
But no matter where it goes,
It keeps a ring in the nose,
But I ain’t got you.

I got a tavern and a liquor store.
I play the numbers, yeah, four forty-four.
I got a mojo, yeah, don’t you know,
I’m all dressed up with no place to go.

I got women to the right of me.
I got women to the left of me.
I got women all around me,
But I ain’t got you.
No, I ain’t got you.

For those of you who might be somewhat beyond the age where familiarity with the British Invasion is a given, the Yardbirds were the Rolling Stones that didn’t stay around.  They had three great guitarists.  Jimmy Page went on to lead Led Zeppelin. Jeff Beck produced one of the most amazing jazz fusion guitar albums of the 1970s (Wired). And then there was Clapton, the guitarist of the aforementioned number. Poor Richard doesn’t ascribe to the 1960’s graffiti asserting that “Clapton is God,” but it’s fair to assume that you have heard of him.

Ain’t got you . . .  sounds really familiar. The printshop behind the red awnings on Poplar (name carefully concealed to protect the sensitive interests of the franchise) has spent a great deal of time and energy over the past couple of years adding the latest whizbang capabilities. We can help customers with email communications.  We can send postcards with PURLS. We can help with social networking and Google Adwords. We can even develop simple CMS sites for small businesses.  All of that along with wonderful capabilities in digital and conventional print and you’d think that we’d find an interested customer or two. But in reality, we’re kind of stuck . . . all dressed up with no place to go.

Poor Richard has batted about the “marketing services provider” concept for a couple of years. This theory maintains that in order to survive, printing companies must diversify into other realms of communication and become marketing consultants to their customers.  I’m all for the first part of the assertion.  Conventional print is certainly waning at the moment and merging conventional print capabilities with the low cost potential of the internet only makes sense.   Marketing strategy is something completely different, though, especially in the altered reality of the Great Decession.

If you had asked me just a couple of years ago, I would have said that marketing strategy was the exclusive purview of the experts.  In those days, marketing was at least partially predictable . . . traditional efforts (advertising, PR, etc.)would yield predictable results. Now I’d say it’s anyone’s guess. Proven tactics may fail totally and a low cost video on YouTube can go viral. It’s unpredictable, but there’s plenty of stuff to try.

Our Gralpharaphics shop has experienced good business relationships with a couple of excellent agencies, and in balance, these folks have done a very good job for their customers.  One of our key agency accounts closed last year after trying very hard to bring their customers in line with the new realities of marketing.  They experienced difficulties because the new realities are damnably hard to define and their customers still expected the predictability of the old paradigm.

So where does that leave us? We can implement some pretty cool stuff, if we can find the customers willing to take the risk.  These folks are pretty hard to find in icebound Middle Georgia, though, so Poor Richard is humming the old British Invasion song

Couldn’t find a good Yardbirds video, but the audio tells the story  . . .

Got to end on an optimistic note, though. Here’s Janis . . .

The Capital Trap

(or why my printshop isn’t like a transformer)

It’s been a while, gentle readers, and I’m sure that many of you have given me up for dead. Well, to paraphrase Monty Python, we’re not quite dead yet. Nonetheless, the images of loading bodies onto the two-wheeled cart are ummmh . . . ominously relevant.

It’s been a very rough two years, and I’m still looking for the corner to turn.  This may be a recession in the rest of the U.S., but in our small market, it feels a lot like a depression. We are struggling with a bad combination of circumstances. We have fewer customers with less money and greater reluctance to spend it. This is coupled with a sea change in the way we communicate that has not at all favored our core business: print. And to state that our resources are limited would be a wild exaggeration. They are simply nonexistent.

I’ve read about the capital trap. Usually it refers to banks and the total contradiction of government demands to both lend more and raise capital reserves. This is prima facie lunacy. How can you do both? Like most small businesses, the printshop behind the red awnings has been slighted when it comes to government largesse; and the banks quit lending to us before the balance sheet deteriorated to the point that Poor Richard could actually understand the bankers’ reluctance.

Poor Richard would like his business to become a Transformer. I’ve always been a little intrigued by these gadgets. The Transformers came along in my college days . . . I remember a slightly older friend’s 5 year old showing me the first one. “Now it’s a car, now it’s a monster machine!” he said as he pressed the button that released the monster.

“Now it’s a printshop, now it’s a monster communications machine!” Alas, were it only so.

The new “marketing services” that we’re all supposed to be so excited about providing did not gain traction in our little town. We’ve done a little, but the time requirements have been high and the return low. There are some product opportunities, but at this point we lack the capital resources to pursue them.

Our little shop is caught in it’s own version of a “capital trap.” When things were good, we invested in what we thought would be the capital equipment that would keep us growing in years to come.  Justification of the equipment was based on the ill-conceived (in hindsight)  notion that business would grow a little, or at least remain stable at mid-2000s levels. In our case, we still have the equipment, but the demand for the production has faded. We’re paying for the equipment, but it isn’t paying for itself.

In a different time, we would just sell the machinery, stomach a little loss and move on. Now, the only market for the machines we have purchased is overseas and the selling prices really don’t even justify the trouble required to move the equipment.  Unfortunately,  the notes on the machinery are not based upon present valuations, but upon the value of the machines before we warped into a parallel universe where printing equipment is worth little more than scrap metal. Naturally, the banks and leasing companies are reluctant to simply concede the devaluation of the machinery or the obligation. It’s kindof like real estate . . .

There is very little solace in the knowledge that we’re not alone in this predicament. Poor Richard has a friend, customer, and fellow small business owner in a completely different line of work that can describe the same scenario; and I suspect that every small business owner can tell some version of this or a similar tale.  Here’s the point:  we won’t be able to grow ourselves out of this depression until we can pay off some of the debt burden that we’re saddled with.

Somehow, the politicians (and the media) have the strange idea that small businesses are “reluctant” to invest and to hire new people. They think that all we need is the right “stimulus.” The latest platitudes and lip service from the pandering politicians of the Potomac comes in the form of a $30 billion fund to encourage regional banks to lend to creditworthy small businesses (see the Business Week article). Poor Richard wonders just who that would be. Wake up! It’s not reluctance that is the problem, it’s resources. I am very skeptical that the small business economy can be “transformed” by simply flipping a magical economic switch and not the least bit convinced that there is yet any understanding of the importance of the small business segment of the economy among those who ostensibly govern our nation.

Reluctance does come into play when it comes to taking on more debt, though. Most of us will never be as comfortable with debt as we may have been before the economic debacle. The good news is that the debt we currently have will one day be retired. The payments do eventually come to an end.  Somehow, some of us will manage to work ourselves out of this predicament; probably despite the feeble efforts of the politicians.  We’ll hold on  until we can find a little money to try the next best thing. And maybe that next best thing will work and we can make some money and then invest in new equipment and hire new employees.

Maybe we’ll even invest in new businesses . . . wonder how medical marijuana would grow in the basement of the old building on Poplar Street?

Life is still grand!

Treading Carefully

Poor Richard has  never strolled through a minefield, but he can imagine what it must be like.  It seems a good analogy for the experience of hanging on to a printing business these last 18 months. There have been days and weeks when explosions were occurring all around and it seemed the end was near. On other days, the sun was shining and everything appeared almost normal until the detonation 20 feet away and flying shrapnel brought reality into sharp focus. The last couple of weeks have been like that.

Macon, Georgia is no business Mecca. It is a sleepy southern town that has had better days and hopefully will have better days again. Macon has been a good place for a business like the printshop behind the red awnings on Poplar Street (name withheld to avoid the wrath of the franchise).  Over the last decade plus, we’ve enjoyed good customers, wonderful friends, and mostly amicable competition with the other printers in town.

For our company and for our competitors, business as usual ended abruptly in November of 2008. The stock market crashed, our customers contracted and folded, and sales plummeted.  Monthly newsletters went digital; nevermore to return. Businesses decided that they could do without printing. Our friendly bankers, once eager to finance new equipment purchases, now wouldn’t return phone calls. Yet we hung on and tried to do what we could, hoping and praying for better days.

An interview in the PrintCEO blog tells the sad story of the demise of Alonzo Printing, a midsized California operation that seemed to be doing everything right. The owner, Jim Duffy, describes the heady days of 2007 with new equipment investments, diversification into digital printing, and the difficulties of turning a marketing vision into reality.  Jim didn’t have to step on a mine.  His bank detonated it for him.

In our sleepy southern town, we were all holding on until just a couple of weeks ago. Sure, a couple of small printers have closed, but they were operating with 30 year old systems.  Two weeks ago, one of our better competitors announced that they were suspending their production operations and would continue as a print broker. Last week, a promising short run book printer literally disappear overnight.  The mines are exploding all around us.

Our little company is treading very carefully. Like Alonzo printing, we made new equipment purchases when times were better. Some of these have not played out well. Equipment vendors, banks and even the franchise, once seen as allies, now look more like the enemy. The path through the minefield is complicated and dangerous and there is no lack of diversions that could cause a misstep.

Poor Richard is convinced that one of these is the whole “marketing services” concept. In the PrintCEO interview, Jim Duffy makes the following comment:

We marketed Alonzo, and from a pure marketing perspective, it was just a dream. And yet, it was another issue of not having the right people to make it really come to life. Then we reached the point where we couldn’t hire the right people. That’s how you get caught in the spiral.

You do need to market yourself; you need to do it in a way that’s going to be meaningful for your clients.

The last sentence is telling. Printers are not viewed by our customers as “marketers.” That is the realm of advertising agencies. With due respect and apologies to our agency customers, printers are not “pie in the sky” folks. We don’t do well with concept. Coming up with concepts that work requires a lot of time and creativity that a short-staffed printing company doesn’t have.

Printing companies do a very good job with details, with implementation.  If “marketing service provider” means that we have to dream up the marketing concepts for our customers, we’re in trouble. If it means that we implement and measure marketing “campaigns” using the new tools that are available to us, then perhaps we can provide our customers with something that is of value, that is meaningful.

Poor Richard is not certain what it will take for some of us to make it out of the minefield, nor is he certain that the printshop on Poplar Street won’t be blown to smithereens during the debacle. I hold to the hope that there will be a need for companies like mine that “do stuff,” that are competent at producing and implementing.

There is a certain sense of desperation that naturally occurs when one strolls the path through a minefield. Traveling the path requires care, tenacity, and not a small bit of prayer. There is also the possibility that the trail will eventually lead to un-mined pastures that allow more flexibility to move around and maybe some better possibilities for small businesses like mine. Poor Richard is really looking forward to the other side of the minefield.

The Recurring Full Moon Phenomena

It’s been a while. I’ve been out of sorts with nothing good to say, so I’ve ignored the blog altogether. After a couple of good months at the end of 2009, Poor Richard fell back into panic mode as business disintegrated at the printshop behind the red awnings on Poplar Street. January 2010 was bleak. I had just begun a serious study of biblical eschatology when the last day of February rolled around and all of our customers woke up at the same time.

I’m thinking it’s the moon. I’ve written about this before (see Poor Richard’s post The Full Moon). Last time, I discussed the deleterious effects of  minute changes in the force of gravity on machines and those who operate them. This time, I’d like to consider the tidal effect on the minds of the folks who visit our Gralpharaphics “business center.” (The franchise, who shall nevermore be named in this blog, became disenchanted with printshops a year or two ago and decided that we would henceforth become “business centers.”)

The moon was full on February 28th and the orders came rolling in. All of the work that our customers had decided they didn’t need in January and the first 27 days of February, they now needed immediately on March 1st.  It’s not that the tight deadlines are all that unusual, but there were small oddities about several of the orders. Just for entertainment, Poor Richard is pleased to provide you with a few snippets from the past couple of days:

“I gave you my business card as a .jpg. What do you mean you can’t blow it up into a 24 x 36 poster?”

“My last printer closed down. I had been doing this business with him for a while and he wasn’t charging me much. I was hoping that you’d be less expensive.”

“No, the order for 10,000 rack cards went to another shop; but we need you to donate 1,000 posters. Is that a problem?”

“All of their salespeople quit. They decided not to do the mailout because there wouldn’t be anyone to respond to the leads.”

It’s not quite the Twilight Zone, but things are a little bizarre. I answered the phone at lunchtime on Friday. “Do you do raffle tickets?” queried the voice on the line.

“Yes, ma’am, we’ve been known to,” I responded.

“Well, how much do they cost?” said the voice. Even with the sure knowledge that I could not be seen through the telephone, Poor Richard made a conscious effort not to roll my eyes and began to launch into his memorized series of questions regarding quantity, size, paper, numbering, perforations, etc.; only to be interrupted in mid sentence:

“My baby’s in a pageant, and I just need some raffle tickets.”

What kind of person raffles off their baby in a pageant?

We delivered 5000 sets of a stapled document to a customer on Friday – 4 sheets, 2 sides, stapled. This morning they called and said that they had counted the order and were 25 sets short. Poor Richard found it peculiar that anyone would actually take the time to count 5000 sets of copies and also a little dubious that they were short. The job is simple and familiar. We send the file to the big black and white machine manufactured by the nearly palindromatic company that begins and ends with X. The quantity is specified in the print job. The machine prints and staples, the documents are boxed and delivered. The machine log indicates that 5005 copies were produced. Poor Richard is certain that the missing 30 copies were transported into a parallel universe.

About the poster sized business card . . .  we printed it. When we explained that it would not print clearly at 24 x 36, we were instructed to repeat it as many times as possible on a 24 x 36 board. We printed it 90 times with a pretty blue background on a nice piece of foamcore for the customer to put on an easel.

It may be the full moon, or  perhaps terrorists have injected hallucinogenic drugs into the water supply in Macon. Poor Richard isn’t sure, but he’s happy to be busy even if the orders are a little odd.

Isn’t life grand?

The View from My Window

The view from my window is sometimes entertaining and sometimes thought provoking. Here’s what I see when I look out from under the red awnings at the printshop on Poplar Street (brand name omitted to protect the delicate sensibilities of the franchise):

The Poplar Street Park Congregation

At Gralpharaphics, we call them the Poplar Park Congregation. Their membership ebbs and flows with the weather and the economy. Lately, it’s been growing. It’s not that Poor Richard really minds the congregation that much most of the time.  It’s a public park and they have a right to be there. And they’ve been there or somewhere else downtown for a long time. My dad, who has worked in downtown Macon for over 70 years, knows many of them by name. They are loud, profane, occasionally drunken, and mostly harmless to others; if not to themselves.

There is an occasional preacher. There are frequent arguments and brief fistfights. If an event is upcoming, the Macon Police Department will clear them out for a day or so.  When the event is over, they come back. My customers have learned to always park on our side of the street to avoid jeers, comments, and requests for money. The money is used to buy a beverages in brown paper sacks from the Poplar Mart, the foodstore on the other side of the street that sells beer by the bottle.

We’ve had occasional fun with the congregation. There was the time when beautiful wife was given plug-in air fresheners by a friend who works at a bath boutique in trendy North Macon (where the congregants dare not tread).  Thinking to improve the atmosphere at the printshop, beautiful wife plugged in one of her new acquisitions in the lobby of the printshop during a brief Saturday afternoon visit. What she didn’t know was that there was a reason the trendy boutique had decided to dispose of the air fresheners at a deep discount. It was the fragrance–“Aroma de French Bordello.”

None of the printshop crew had ever worked in a bordello and they found the perfumed aroma somewhat strong for their tastes. With burning eyes, they unplugged the air freshener and transferred it to an outlet in the middle of Poplar Street Park just as the congregation began to arrive for the day.  It made for an entertaining morning as we watched the members of the congregation try to identify the source of the noxious odor.  One of them finally noticed the plug-in on the column in the middle of the park, and on hands and knees stuck his nose directly above the source of the smell and began to sneeze. The air freshener was removed by one of his fellow congregants, pocketed presumably to take to a location where Aroma de French Bordello would be better appreciated.

Now to the thought provoking part. The Poplar Street Congregation is indicative of a problem that is not getting any better. Macon, our lovely city, didn’t fare too well in the press last week. Forbes magazine published a top 10 article and we made #7. We’re #7 in the list of the top 10 most impoverished metro areas in the nation. That’s not a statistic that does much for civic pride. For the purposes of this short blog entry, it’s not worthwhile to go into the details of the problem . . . high unemployment, low incomes, poor education, etc. Fill in the blanks or read the Forbes article.

The causes of the problem are tough to tackle. The symptoms are visible from my window – the Poplar Street Congregation is a segment of the population that doesn’t even fall into the ranks of the unemployed. They haven’t been employed and they’re not looking for work. Goodwill, the agency whose motto is “Building Lives, Families and Communities – One Job at a Time,” used to operate the store behind the congregants. It shut down three months ago.

It seems that the Macon of my lifetime has always been a town just on the edge of getting it together. There was a time in the 1960s and 70s when we were a music mecca for Soul musicians and Southern Rock bands. We have a great university (Mercer) in town, plus Wesleyan College and Macon State.  The cultural scene is really pretty amazing. As is the case in many small cities, real estate and development interests have been allowed to run unchecked, leaving areas of abandoned and decaying buildings in their wake. Before the Decession, Poor Richard was convinced that downtown was on the verge of a renaissance and that may yet be the case. There are still signs of life and a great organization (Newtown Macon) that is devoted to the restoration of the city center. But the view from my window is troublesome today.

It seems that because the causes of the problems are tough to tackle, we don’t try. It’s easier to argue, to blame political incompetence and the inability to make rational decisions on race, to pretend that North Macon is part of another city entirely, to put personal aggrandizement ahead of the best interests of the community. Or perhaps it’s easier to pretend that there are no problems, that it’s all a bed of roses. Poor Richard is  afraid that the smell is more like french bordello air freshener than roses.

The Forbes article indicates where we are as a community. It is a warning of where we might wind up. It’s time to get behind the positive efforts to change Macon’s  direction. The list is long:  improving public schools, keeping the museum district intact, developing the College Hill Corridor, consolidating the City and County governments, reducing the number and improving the quality of our city and county representatives. It’s not impossible, though. Poor Richard is an optimist –  I’m sure that there are many like me who don’t want any part of politics, but will be glad to pitch in and help if we can all work together.

I’d like to still be looking out of my downtown window in a couple of years, and I’d like to see a different scene. Instead of the Poplar Street congregation, I’d like to see shoppers and tourists enjoying the park with open stores and businesses behind them that employ people.  Instead of the Poplar Mart selling beer, there will be a new grocery store to serve all of the folks who are moving downtown. Grant’s Lounge will be open every night, featuring the best Indie bands, who all want to play in Macon. It could happen, couldn’t it?

Neither rain, nor snow, nor dead economy?

Poor Richard thought it was only printers that had it bad. It had been a while since I had visited our local BMEU (Bulk Mail Entry Unit). The printshop next to Grant’s Lounge (name withheld to protect the sensibilities of the franchise) had a mailing to go out Friday, and no one else was available, so I loaded up the Suburban and headed for the post office.

First, let me say that the people we work at the Macon BMEU are nice folks. Ken, the boss, helped me get started in mailing several years ago.  I called him looking for information and he actually came out to the shop and spent a couple of hours going through the regulations. Randy, Charlotte, Gary and John are always helpful and friendly.  They play by the rules and let us know when we screw up, but they have always been patient and very good to work with.

This part of the post office (the BMEU) used to bustle with activity.  On any given day, There would be several mailers there with at least one who had made a royal mess of a mailing job.  One of the folks mentioned above would be patiently explaining the rules, even if the customer was irate. There is a Merlin machine behind the counter that checks barcodes and machinability. In days past, this machine was generally running. Other postal folks were continually going in and out behind the counter doing the things that postal folks do.

Yesterday’s scene was quite different. Only Ken and Charlotte were there and there was no activity at all. The first words from Charlotte’s mouth were, “This is my last week. I’m taking early retirement.”

And apparently she’s not the only one. The USPS has offered its employees an early opt-out program in recognition of the changes in their business. And the mail business has changed indeed.  The official statement from USPS on the Voluntary Early Retirement (VER) program reads like this:

Automation and technological advances coupled with mail volume reductions has the Postal Service continuing to look for ways to voluntarily reduce its workforce while maintaining excellent customer service.

Source: Liteblue.usps.gov

Dear readers, I hope you don’t think it inappropriate for Poor Richard to read a bit between the lines and hazard some not so bold inferences.

First, the reduction in mail volume is easy to document.  First Class mail peaked in 2001 and (with one year’s exception) has been declining steadily ever since. In FY 2008, the USPS lost $2.8 billion (yep, billion) on it’s operations and total mail volume decreased by 4.5% from the previous fiscal year. It’s a no brainer . . . email continues to replace mail.

The recession has impacted direct mail in the same way that printing has been affected. Direct mail is an easy target for businesses cutting expense. Standard mail piece volume for FY09 was down almost 20% from the same time period in FY08. (Source USPS Financials).

Staunching the flow of red ink seems to be more important to USPS than excellent customer service, though. It seems obvious that USPS is moving toward a much less customer-friendly environment. Bulk mail facilities in smaller communities have already been shuttered with customers told to carry their mailings to centralized units in larger communities.

The postal service is also quickly heading towards enforced online entry of mailings for mail service providers. At this point, the online service (PostalOne) is kind of clunky and complicated. That’s no big surprise. The problem, though,  is that all of the customer-friendly postal employees are taking early retirement. There’s no one to explain the new systems.

Finally, transferring costs to the customer may be exacerbating the problem. Poor Richard thinks that it started with rubber bands. Only a year or so ago, the bulk mail offices actually supplied rubber bands to their mailers for use in packaging standard mail. When mailers were told that there would be no more free rubber bands, most of us just shrugged our shoulders and passed that little cost on to our customers. Since then, there have been a lot of incremental cost increases that we’ve had to pass along. For example, the USPS has added a move update requirement that has increased the cost of list processing. They’re also charging a small fortune for address corrected pieces that are returned to the mailer.

Postal rates and costs continue to increase while the perceived cost of electronic communication is low.  Even when the potential impact of mail can be very positive (high ROI), it is perceived as an expensive way to market.   Simply put, the cost to mail has gone up while the perceived value of mail compared to the alternatives has diminished.

This is not a winning scenario for the USPS . . . and it does explain the drastic changes at the Post Office.

So we have to ask the question. Is printed mail, especially direct mail, still a worthwhile endeavor? Is there a place in the new economy for the US Postal Service?

NEXT POST – Direct Mail and the Internet

Bailout, Please?

At first, I wasn’t even interested.  After all, bailout funds have something of a stigma about them, don’t they? What with AIG, the big car companies, and greedy bankers all clamoring for more, it’s just a little embarassing for a small businessperson to go out looking for the government dole. We’re supposed to be the proud and determined entrepreneurs that keep the country productive and innovative and 16 other patriotic sounding adjectives.

After 17 continuous months of recession, though,  things were getting kind of desperate.  Actually, Poor Richard didn’t realize that it had actually been 17 long months until he heard it on the radio.  They kept the first year a secret for a while, you know. Anyway, because the level of desperation is inversely proportional to the level of funds in the company bank account; when the desperation got high enough, I made the phone call.  After all, I rationalized,  if all this money they’re printing isn’t  going to be worth a plug nickel in the long run, shouldn’t AlphaGraphics get some to spend before everybody else figures it out?

So Poor Richard called Saxby Chambliss’ office in Macon and asked to speak with the Senator. A very nice young lady informed me that the Senator doesn’t really actually even ever stay here in Georgia, because it’s too far away from the center of things where all of the important stuff happens. She asked me why I was calling.

“I’m looking for some bailout money,” I responded, then decided to sweeten the pot. “Of course, I’ll be willing to sell up to 99% of the stock in my company, if that will help.”

“Oh, that would be most helpful!” she answered, “and exactly how many billions of dollars does your company need to stay afloat?”

Not wishing to be greedy, Poor Richard responded that a few million would actually do quite nicely. This didn’t sit well with the young lady in Senator Chambliss’ office, though.

“Only a few million?” came the huffy response, “I’m not sure that the treasury department is set up to administer bailouts in such small amounts. I’ll refer your inquiry to the Senator, but perhaps you should contact the Federal Department of Largesse and see if they have a block bailout program for smaller concerns like yours.”

She was kind enough to give me the toll free number for the Department of Largesse and then hung up the phone muttering something about the time wasted by common citizens who feel entitled to call Senators’ offices. Feeling bold, nonetheless, Poor Richard placed a call to the Department of Largesse and immediately became entangled in the voice mail system.

“To assure the highest levels of service, please state your name and input your 9 digit Federal Employer number,” droned a disembodied voice.

I complied.

“Your call may be monitored to assure high levels of service,” continued the voice, “and your phone may be tapped to assure that you are not speaking regularly with Osama bin Laden or other Al Qaeda operatives. If you wish to continue, please enter your SIC code and the amount of governmental largesse that you wish to request.”

Once again, I complied. Not wanting to be greedy, I punched in 7,500,000.  “This is really kind of easy,” I thought.

“Please be advised that if you are awarded funds by the Federal Department of Largesse, your salary and bonus package will be limited to a measly $500,000 annually.  In addition, you are warned not to openly redistribute government funds among executive employees in such a manner that the news media or the public might discover your abominably irresponsible and unpatriotic behavior. If you agree with these terms and conditions, please press “1” to continue.”

Having no difficulty with the conditions, Poor Richard pressed “1.”

A long pause ensued, followed by a click as my call was transferred. Poor Richard could hardly wait. “Now I’ll get to talk with one of the customer service reps and tell them where to mail my $7.5 million,” I thought.

The phone clicked once more and another computerized voice queried. “Our records indicate that the asset value of your business is less than $10 billion dollars. Is this correct? If ‘yes,’ please press ‘1’ now, otherwise hold for the next customer service representative.”

With all good intentions and still hoping for the best,  Poor Richard pressed “1.”

“We regret to inform you that your business has been deemed insignificant by the Federal Department of Largesse,” sounded yet another automated attendant. “The SIC code you entered indicates that your company is involved in the business of printing. Printing is not considered to be a relevant economic activity, nor is it eligible for funding under President Obama’s 21st Century Initiative for Green, Energy-Efficient, Barely Conceivable and Totally Impractical Projects.”

“Please press ‘1’ if you’d like to speak with a customer service representative,” the voice continued. “Our current hold time is estimated at 16 years, 3 months, 2 days, 5 hours, 16 minutes and 35 seconds. Calls will be served in the order that they are received. If you’d like to be considered for a consolation prize, please press ‘2’ now.”

Feeling despondent, Poor Richard pressed ‘2.’ “Please hold,” came the voice.

It took a minute before I realized that the background music playing while I waited was familiar. It was Ray Charles singing about Greenbacks . . . “just a little piece of paper, coated with chlorophyll.”  I confirmed my mailing address with the last automated attendant and was told to look for my consolation check in the mail. In closing,  Poor Richard received a firm promise that the Department of Governmental Largesse would always endeavor to reallocate the resources of this great nation from each according to their ability and to each according to their need.

$100 Bill

I’m still waiting for the check. You know, Lincoln ain’t gonna get it, Jackson neither.  Maybe they’ll send a fresh, crisp $100 bill with Poor Richard on the front.

Buttering the Bread on Both Sides

It’s happened again . . . same story, but a little different this time. In July 2007, Adobe, with indeterminate brilliance, decided that it would be advantageous to link the print dialogue in Acrobat directly to FedEx/Kinko’s (see Poor Richard’s post On Which Side is the Bread Buttered?). The rest of the industry screamed and threatened and Adobe backed down.

This time around, the culprit is Hewlett Packard (HP), who on January 27 introduced a new web-to-print site called MarketSplash (see HP’s press release).  As a standalone site, MarketSplash really doesn’t represent much in the way of an additional threat to brick and mortar printers (like us), who are already under so much pressure that one more straw on the camel’s back will hardly matter. The site will go head-to-head with VistaPrint, the web-to-print leader and compete very well. In fact, with some creative marketing from HP, MarketSplash could blow VistaPrint out of the water.

Being of a curious nature, Poor Richard had to explore.  MarketSplash, like VistaPrint, is template driven. And, like many/most of the online printing sites, business cards are free.  So Poor Richard decided to order some. I found a template that I liked, featuring Albert Einstein; and created a business card for a new company I had conceived only 30 seconds before, the Incomprehensible Services Company.  Poor Richard, needing a title, is now the Chief Conspirator of Incomprehensible Services.

I was actually impressed by the design template.  The default font sizes were a little small, but the design tools offered enough for customization of a rudimentary layout. Joe Consumer will be able to operate this design tool without getting himself into too much trouble.  I was also generally impressed by the quality of the layouts that were featured. A proof is approved online. The free cards are all double sided, with an advertisement for MarketSplash on the back.  Here’s a screenshot of the proof page . . . I hope HP doesn’t mind.  (If you do, let me know and I’ll zap the image.)

Marketsplash Proof Page for Incomprehensible Services Company

The quality of design can be attributed to another HP acquisition, a company called LogoWorks. Purchased by HP in 2007, LogoWorks offers inexpensive design work online.  Like MarketSplash, LogoWorks targets small businesses who are looking for a low cost alternative to ad agencies and freelance designers. Custom design from LogoWorks is also included as an option on the MarketSplash site.

After reading this far, you may be asking, “So, where’s the problem?”

There are a couple:

• First, even though HP is not the first to offer a web-to-print site with low prices, they are going into competition with part of their customer base. This is admittedly a weak argument because HP’s desktop color printers were among the first technological developments to erode a segment of conventional printers’ business. (Home offices and the smallest of businesses were the first to go to self-printed business cards and letterhead).
• Like Adobe, HP picked the wrong partner. They have teamed with Staples Office Supply for overnight delivery of product. While the geographic distribution of Staples’ centers certainly makes sense, the assumption that they will have the capability of quickly producing and delivering a quality product is open to question. To HP’s credit, they are open to “co-branding and licensing of the MarketSplash platform” to other retailers.  Poor Richard has no clue what this actually means.

Conventional printers may re-evaluate our purchasing decisions, especially when it comes to high end digital presses. HP has been the market leader with their Indigo line.  The quality and capabilities of these machines are impressive and many printers the size of our AlphaGraphics (including us) had planned to migrate to this machine as leases for our existing digital equipment run out. HP also has a strong presence in the wide format arena. But HP does not have the market share in our industry that Adobe Systems has. Also, unlike Adobe’s software, there are good alternatives to the HP products. HP’s decision falls squarely into the category of “calculated risk,” and the potential return may well outweigh the consequences from agitating bothersome printers like us.

Can brick and mortar printshops compete? The answer unfortunately is “yes” and “no.” If it’s a question of price, the answer is a definite maybe.  We won’t be giving away business cards, and we’re really not interested in selling 100 of anything for $39.95, but by the time you add freight some of the other items are not so cheap. The online printers convey the impression of low price, though, and it is sheer folly to say that the web printers have not eroded the low end of the customer base.

Repeat letterhead and envelope orders from small companies were profitable “bread and butter” business when our AlphaGraphics started. That business has virtually disappeared as correspondence has gone online and as a result of the VistaPrint – type alternatives. Freelance designers also once represented a good base of business for postcards and flyers. They began funneling these products to gang run printers a few years ago, similarly attracted by cheap pricing (See Poor Richard’s post Caveat Emptor). It is not just a little ironic that LogoWorks and MarketSplash actually represent direct competition to the freelance market segment, though the freelancers themselves may not realize it.

Especially in this economy, conventional printing companies are competing for a larger share of a rapidly shrinking pie. Many of us will not survive. Most of us are hanging on by our teeth and clawing with our fingernails. For those of us who will fight through these rapidly changing times, it will mean finding new ways of doing business, new products and services, and working harder and more closely with the customers we have left.  Local companies have the advantage of proximity, of reacting quickly to customer needs, and the ability to provide expertise to those who still value it.  Poor Richard thinks (hopes) that the ability to survive and eventually succeed again will still be based on that value proposition.

It will be another 6 or 7 days before Poor Richard receives the cards for his imaginary venture. They’ll be shipped by an unnamed ground transportation company. The order represented a $13.95 value, charges graciously waived by MarketSplash, and my cards will be printed on a medium matte paper. I’m anxious to see what that is, too. Be assured that another post will follow!

Postscript

Got the cards about five business days later.  They came Express Mail (USPS). The printing quality was good, but not exceptional. Digital color on an 80# Matte cover, with an advertisement for MarketSplash on the reverse side. The freebies presume that more profitable orders for other items will follow from satisfied customers who have received their wonderful free business cards. I’m sure that that is a valid assumption, but I wonder where the breakeven number falls.

Even with streamlined ordering, there is a real cost to print, cut, package and ship the stupid things.  I’d figure between $10 and $15/set in a really efficient production operation.  If one in four customers actually order another item, that’s $40-$60 in additional sales required before a margin is achieved.  A low volume business model must turn high volumes to make a profit. This is  a combination traditionally not compatible to a specialized and detailed business like printing.

Poor Richard confesses that this may be the business model for the times we’re in.  It’s not a model that will be conducive to the kind of business that good local printers have traditionally done. I regret that and I think that one day the customer’s we’ve lost may regret it too.

Reality Check

After a couple of days of deep thought followed by two Nu-Way hotdogs, I’ve concluded that it may be existentially suspect to dwell overmuch about natural disasters. Nonetheless, we had one here in Middle Georgia one week ago, when multiple tornadoes touched down. I do not intend to trivialize Macon’s disruptive episode, but it is worth mentioning that simultaneously, there were earthquakes in China, the aftermath of a hurricane in Burma, a volcano erupting somewhere in South America and an overturned chicken truck on I-16.

The world is pretty much a mess and we got to see it firsthand. Experiencing a natural disaster “in real life” is much different than the momentary sympathetic impulse we feel after seeing the story on network news. Even if the wreckage doesn’t affect us personally, it’s still very tangible and a little scary when it happens all around you.

The image above, filched from the website of The Macon Telegraph, shows the campus of Macon State College. (For more images, see Storm Photos on Macon.com. ). Nearly 90% of the trees on campus were destroyed. According to news reports, up to 40% of the forest canopy in Middle Georgia was destroyed or damaged. Not good.

Unlike Burma and China, the cleanup effort in Macon happened very quickly. Georgia Power, with lots of help from other Southern Company utilities, got power up and running almost everywhere within 3 days. Volunteers showed up with chainsaws. Streets were made passable. Stores opened back up. Even Macon State College was open for business again on Thursday, a short four days after the storm.

Human tenacity, especially in the face of disaster, is remarkable; but I wonder if God doesn’t see it somewhat like the efforts of ants repairing the after effects of Mikey’s bright red Converse hightops. It’s all very serious and real to us, but only a little piece of the plan to Him. Perhaps we should consider that perspective and wonder just exactly what it is that we should learn. Could it be that all of our activity, all of our “accomplishments,” and all that we take so seriously really doesn’t have that much significance in the grand scheme of things?

Time to rethink the priorities. Time for a reality check.

Oprah Spotting

As beautiful wife and I left one of our favorite lunchtime haunts on Cherry Street Thursday, we noticed a well-dressed young man hurrying down the street toward us. By my guess he was a professional, in coat and tie, with an expectant and excited shine in his eyes.

“What’s the rush?” I queried.

He smiled nervously and replied, “It’s Oprah. She’s going to eat at the NuWay. Have you seen her yet?”

It was more that a little crazy in Macon the end of the last week. Oprah Winfrey taped a show here and the presence of such an electrifying personality in our city had the immediate effect of shorting out the synapses of a large part of the population.

“Ma’am, all you have to do to approve the proof is reply to the email,” Brian was saying into his headset as we returned to the shop. “Just type ‘OK to Print’ and reply,” he continued to an obviously confused customer.

“The reply button,” he continued, “on the email. It’s the button that says ‘Reply.’ ” Brian’s perpetually patient good humor was flagging a little. “Yes, that will send an email back to me. I’m the one that sent the proof to you. We’ll print your project when we receive your approval.”

He listened patiently, rolling his eyes. “Yes, ma’am, you can print it out and sign it, but that will mean you’ll have to use the print button and the fax machine.”

I knew that there was a full scale disruption of the magnetic field in Middle Georgia when I caught a snippet of Sharon’s conversation later in the afternoon. Sharon, our salesperson, was answering questions from one of her customers. She’s not always as diplomatic as Brian and seethed a light expletive under her breath after she finished the call.

“What?” I asked.

“I can’t believe what she just asked me,” was the response. “She wanted to know how many envelopes were in a box of 500.”

The crew took off early and I was at the front counter when one of our favorite designers came in with a camera and a sly smile on her face.

“And what are you doing?” I asked of her.

“Ostensibly, I’m on a photo shoot,” she returned with a slightly deranged expression on her face. Then she whispered, “In actuality I’ve been Oprah spotting!”

Thanks for coming to Macon, Oprah! Now we know why California is so crazy!