Ultra Short Run Reprints: Is the Juice Worth the Squeeze?

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Ultra-Short-Run Reprints: Is the Juice Worth the Squeeze?

Mary Summerfield (U. Chicago), Rebecca Schrader (Columbia), Kenneth Sabol (Johns Hopkins), James Pelz (SUNY)

Mary Summerfield

- digital printing can reduce staff time spent managing production--how? (see report by Denise Nitterhouse, www.cddc.uchicago.edu/digital_prod_strategies.pdf)

- keeping print-ready PDFs in repository lets you print whenever and bargain better on price and speed

- for system to work well, need preset pricing, print runs, and order triggers, so don't have to be thinking about constantly

- many POD vendors becoming available--need to figure out who best to deal with

- CDDC = Chicago Digital Distribution Center

--- uses Edwards Brothers digital printing center (next to Chicago warehouse)

- CDDC process:

--- Press sets print run, price (often increased compared to conventionally printed book), discount

--- BiblioVault maintains files (www.bibliovault.org)

--- order exceeding inventory triggers digital printing

- median number of units sold for '05 and '06 digital titles for Chicago = 28

- CDDC can handle 10-unit print runs well (now accounts for about 20% of print runs)

- survey of 10 presses (CDDC clients)

--- how low book selling and still kept in print? 4 kept all in print; 4 had min of 25/yr to keep in print; 2 had 50/yr minimum

--- max sales to move into digital: if less than 100, go digital (3 presses)

--- digital printing sometimes used to test demand for first paperback printing

--- use to fill orders until full offset printing arrives

--- most tend to increase price for digital printing somewhat, but sensitive to going too expensive

--- discount usually short

Ken Sabol (Prod Mgr, Johns Hopkins)

- production considerations for digital: need standard trim size, best to have not too many halftones

- POD=book by book; Lightning Source LSI (good with text, but ht's still problematic); short run=50 or more, books shipped to warehouse (Integrated Book Technology IBT--supports more trim sizes, good halftones praised by authors)

- offset still better than digital printing, but if customers don't really care, then not a problem

- decision ot do POD or SRDP made at monthly reprint meetings

- production dept deals with reprints at J.H. UP, not marketing dept

- with IBT, books ordered from printer, delivered to warehouse, just as with offset

- IBT unit cost is less than LSI, but LSI avoids any stock costs

- LSI can now to hardcover binding, so cloth POD feasible, and higher margin bcse of higher cloth price

- with split run and no more cloth inventory, can fill cloth orders with LSI hardcover (sale of a few books will cover setup charges)

- POD usually used for monographs whose original print run has been sold (<$100 for setup)

- POD handled the same as other books in marketing and catalogs

- can raise price of POD titles to offset increased cost (up to 30% increase)

- order tracking/rprocessing is a challenge

--- stock in electronic warehouses (1=trad print books; 2=LSI POD titles; others for other companies

--- whse 1 checked first when order comes in; if none avail., chcks whse 2, if none there, order automatically goes to LSI

--- LSI sends report saying what orders have been shipped, and customers are billed

--- invoices go out within 3 days of order being placed

- POD doesn't avoid returns of books

--- return rates high on course adoptions--esp. when bookstore orders for full course enrolment, but students buying from Amazon

--- returns go to actual warehouse and ship out like regular, non-POD units at next orders

--- returns treated as 0 because not in regular inventory system; instead are allocated to cost of sales for the month

--- other costs of returns not (20 cents per return charge from warehouse)

- POD makes for lots of small transactions, so control of transaction costs is key

- electronic reports very important, to avoid keying time and errors; automation a big help

- 5 minutes to process weekly invoice, rather than 3 days of work-study work

- part 1 of invoice is list of each transaction: isbn, press number, costs

- part 2 of invoice is PDF of each separate transaction showing all details of transaction

- accounting mgr imports each invoice into presswide database

- summaries sent to client presses handled by JHUP

- POD = significant income for JHUP

- Gross Margin = 58% on offset, is 62%, but more inventory risk

- at JHUP, definitely get enough juice to justify the squeeze, but this is partly because they've worked hard to increase the efficiency of the juicer

Rebecca Schrader (Columbia)

- disagrees with investment of time in reprint process referred to in Nitterhouse (over $200)

- decision process not automated at Columbia yet, but cost of initiating reprint is probably under $100; no huge decision-making process; estimates for short-run done online; benefiting from having production in xml fro some years

- answer to juice/squeeze question not necessarily entirely economic

- Columbia has large active backlist; abo. 300 reprints of all types per year, of which about 45% are digital

- margin on ultrashort runs abo 60% (not POD--ultrashort=below 150 copies printed); same margin as JHUP on POD

- either increase price or lower discount on ultrashort runs, to make up margin

- inventory carrying cost for Columbia is relatively low, so POD not needed until less than 50 copies sales per year

- very little overhead for POD and ultrashort printing, so most of margin goes straight to bottom line

- availability of POD and ultrashort allows for more conservative initial printing decisions--start with offset run of only what you know you can sell, then fill in future orders with shorter and shorter digital runs

- non-economic decision factors

--- keeping important work in print

--- retaining rights for as long as possible

--- coping with differential demand, e.g., overseas market

--- serving client needs (when distribute for others--eg, have convinced European partners to do short run printing in the US for books distributed by Columbia)

James Pelz (SUNY)

- been reprinting with IBT since 1993

- about 95% new titles printed digitally, at under 100 or even under 700

- all reprints done digitally; avg 220 units per reprint, but 22 titles at less than 50 units

- POD at about $4.65 per unit (not including shipping, warehouse, etc.)

- if only have older application files, can be cheaper to scan hardcopy of old titles for POD reprinting

- halftones an issue not just for quality, but bcse more expensive to scan if more than 20 halftones

- corrections: not happening for scanned reprints; if lots of corrections, handle differently

- reprint decisions--see flowchart handout

- Question: we haven't been able to crack 50% or 40% margin on short runs/PODs--what is the formula for pricing?

--- Columbia doesn't have a formula; just think twice about prices that are less than 3x unit cost; good margin is probably mostly because of good pricing from vendors

--- at SUNY, have price-per-page chart

- question: is anyone doing POD or ultrashort for 2-4 color?

--- not at Hopkins

--- SUNY has done one 4-color (with IBT); 100 copies, at a sale price acceptable to individual buyers who were contacted and asked

--- color inserts: 6-8 cents/pg for reprinting inserts? Problem becomes one of collation expense rather than printing expense

- Question: when raise prices, is it hard to manage changes in databases?

--- have a person whose job it is to keep info up to date

- Question: xml workflow has lowered cost of reprints--how? Also, when doing covers, does expectation of future POD affect decisions on things like colors, inks to be used?

--- JHUP has PDF workflow, not xml yet

---LSI prints covers on digital xerox, which isn't so great, but lack of vibrancy doesn't seem to affect sales

--- maybe xml not as important a factor for Columbia as implied; xml workflow isn't 100%

- has anyone looked at initial P&L statements now in light of short run?

--- PPB costs are higher than would like to see them because of short runs

--- need to look at in total cost of sales context, bcse inventory write-down expense has gone down, and total mainly balances out; for under 1000 copies first printing, look at life-of-title (3 years) for P&L

- at Chicago, doing lots of digital printing, and find that technology for 4-color covers is better than interior text printing

--- can send application files (InDesign) to vendor, so get pretty good printing quality unless getting fancy with inks

--- CDDC does preflighting through BiblioVault and catches lots of little errors

- Re. question about pricing changes in databases: at CDDC they are using Quality Solutions Eloquence, which feeds changes out to all suppliers

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