At peak season, the print-on-demand industry runs hard. Huge demand equals huge volume but with reduced margins and big risks can follow. Here’s a story to illustrate the point.
Watch the video and you’ll discover a story of a business that failed to adapt to a massive change in the nature and pace of their business and the lessons to be learned from their error!
And you’ll find out why monitoring is of paramount importance, particularly at this incredibly busy time of year.
Transcripts
In peak season volume surges, two or three times, sites move to a three shift, seven day operations. We employ a large team of casuals. When that happens, there’s a real risk for your operating margin. And to illustrate this, I’d like to share a story. A few years back, a digital print company I knew was facing big financial challenges. They won a major print-on-demand contract and seemed ideal. They had to learn a whole range of new things, how to deal with surges, operating on the weekends, overnight shifts, and so on, and build a new quality culture. But they thought they could handle it because there’s a lot of parallels with their existing business. But they failed to invest in the necessary workflow and financial management systems to be able to manage things a lot more tightly than what they used to and really know what was going on. Their existing production and financial reporting systems ran to averages, which run a week long or a month long cycle. And they failed to realize that relying on those averages was a recipe for disaster. An average can hide a myriad of sins and things unraveled quickly. Far too late, they realized that their operating margin had been eroded. They weren’t controlling their labor productivity across their night shifts well enough. Their quality wasn’t good enough and their file rates were too high. And instead of being their salvation, this contract became a poison chelus. So what’s the lesson? When things are changing quickly and that your organization is growing fast, often that’s the time that it’s at maximum threat to your business and to your forward direction. What you really need to find is there’s both stars and problem children that are inside your product portfolio and having the capacity to know what’s going well and what’s not going so well is a fundamental competence. If that sounds interesting to you, please ring my bell, reach out. I’d love to talk with you more about it.
