e-commerce: Does it make sense for In-Plant Printers?

Originally appeared in Innes Publishing's In-Plant Printer magazine
By Chuck Gehman, Chief Technology Officer, Printable.com

Corporate e-procurement has become a new hot topic in many companies. Has the discussion made it to your department yet? Have you heard IT or business staffers talking about things like Ariba or Commerce-One? These systems help companies get a handle on their purchasing activities when multiple locations and many staffers are buying products and services from many different vendors.

Basically, it’s about using Internet technologies to streamline and automate the purchasing process. These same concepts can help you to make it easier for your internal customers to do business with your operation. And it’s possible that someone upstairs in corporate is thinking about plugging your operation into the corporate e-procurement environment. So, it just might be time to start looking at some of the ways that you can use these new Internet applications to both make your life easier and to provide better service to your company in the process.

In the commercial print world, a controversy has been raging around e-commerce. Mostly, the arguments center on this new way of doing business being an evil process that turns printers into commodity providers, and removes their added value to their customers. The good news is these discussions don’t really apply to the world of the In-Plant.

The world of e-commerce and how it relates to corporate e-procurement can provide a lot of benefits for In-Plant printers. These benefits include better customer service, improved communication, fewer errors and faster turnaround on jobs. And another really important area to consider is purchasing paper and supplies online. This can be both a money saver and a way to more easily manage ordering and inventories.

Appropriate e-commerce business models

There are many different companies and almost as many business models in the e-commerce arena today. Some are appropriate for the In-Plant printer today.

Bulletin Board: Basically, a place on the Internet or your Intranet where your buyers can post RFQs and you can read them and respond. This is a very loose definition of e-commerce but one that could be valuable to an In-Plant printer; since basically, you get the ability to organize RFQs from your internal constituency and respond to them more efficiently.

Storefront: An e-commerce company provides you with a web site with e-commerce capabilities, and provides all the backend logic and processing. It makes your operation look like you have your own elaborate e-commerce system, but in fact you are using the e-commerce provider’s systems. These systems can help you implement a portfolio of jobs you’ve created for your internal customers, and let them order online. This could be as simple as business cards, letterhead or forms reorders or as complicated as variable printing jobs.

Digital Marketplace or Linked Exchange: Vendors come together in a system that provides easy buying and access to information about products and services. In addition to being the direction most corporate e-procurement is headed these days (this is where Commerce One and Ariba fit in), this model is very appropriate to an In-Plant printer by providing the ability to purchase paper and consumables online.

One or more of these business models could be appropriate for your operation. Refer to Table 1 for details on some of the companies providing e-commerce products and services to printers, and to Table 2 for more information about online paper and consumables vendors.


e-production

It could be said that the easy and fun part of printing is when it comes time to run the job on the printing press. And that’s where the printer’s money is made. But the process before the job goes on press, communicating with the buyer and collecting the files to be output, making sure you are producing what the customer is looking for, and that the job flows smoothly through the prepress department is the time consuming and error-prone part of the job. Then, after the actually printing process, you have the bindery and fulfillment issues to worry about.

The fact is, the internal customer (and possibly other vendors the customer works with, like designers and photographers) is actually a key part of the manufacturing process in our industry. The supply chain in the printing industry goes as far “upstream” as the designer working in their home studio, and as far “downstream” as the bindery, where the end product is finished for delivery to the “end user”.

Even the most efficient operation spends time on what could be considered unnecessary interaction with customers and suppliers, such as fixing problems, correcting misunderstandings, attempting to agree on color issues, “signing off” on approvals and making last minute changes.

This is where e-commerce (or really, the new buzzword “e-production”) holds the promise of bringing real benefits to printers. By integrating and automating both the workflow and the transactions that add unnecessary iterations to an already labor intensive process, your personnel are free to focus on the real manufacturing process of getting ink on paper.

If you can more easily provide status information, exchange previously paper documents and even content files, obtain approvals electronically, and generally improve interaction with your customers, everyone wins.

Some of these new services are providing useful production tools like job ticketing, job status, and even automated preflighting. Not to mention the fact that these systems can provide high-tech job estimating and job costing that can help your bottom line.

Purchasing Supplies and Paper online

One of the easiest ways to get started with e-commerce is to purchase supplies and paper online. There are now several substantial companies selling these products over the Internet. They include PrintNation.com, GraphicArtsSupplies.com and the behemoth, Xpedx.

Paper seems to be a “hot commodity” for e-commerce in our industry, with six of the nine companies listed in Table 2 focused on this segment of the marketplace (although Xpedx sells other products as well.) We’ll talk more about these companies in a later installment.

Of the other three companies, two are “click and mortar” companies (meaning they have both an online presence and a “traditional” distribution business.) Pitman and Graphic Arts Supplies have their own inventory and distribution, while PrintNation.com is an entirely online operation, with no distribution of their own (they use other companies, like Unisource, to do the heavy lifting.)

The entry of the “brick and mortar” companies, like Pitman and Xpedx, is a recent development in the e-commerce landscape and brings a lot of credibility to the concept. These companies have recognized the powerful capabilities the Internet provides, and are combining it with their vast inventory, distribution and financial capabilities to provide a truly comprehensive package.

One of the greatest benefits of ordering supplies and paper online is the ability of these systems to “remember” previous orders you have placed. Most people place similar orders with their distributors on a weekly or monthly basis. Even if you don’t have your own inventory system, these systems let you pull up your previous order, see how much you paid, make adjustments for the jobs you have planned, and “click”… you’ve placed the order without having to wade through a mountain of paperwork.

Existing Systems and Infrastructure

To really take advantage of these new applications, these services should be able to plug into our accounting and estimating systems and look at historical data from jobs that are complete. We’re going to want to upload our production data into these systems so we can use it to job cost and benchmark that data against prospective new jobs we’re going to bid on.

Beyond the accounting systems, we’ll need to have an interface to our workflow and scheduling systems that will allow us to integrate the production information we need. We need both content (i.e., production files) and context (the information about the jobs: accounting, personnel, scheduling, etc. which is sometimes referred to as “metadata”) in the systems to have them really benefit our manufacturing operations.

There are several industry initiatives that are focused on providing this interoperability. While they are all at least a few months away from providing any real benefits, it’s great to see companies cooperating to create standard interface methods that will make these new systems even more useful in the future. Some of these intiatives are CIP4 and JDF (www.cip4.org), PrintTalk (www.printtalk.com), printCafe’s PCX (www.printcafe.com), and PPML and PODI (www.podi.org). It would take me several paragraphs to explain what each of these are all about, so instead, I encourage you to check out their respective web sites if you are interested in this type of interoperability. If not, stay tuned because you are likely to hear much more about each of these in the coming year.

This is also where the Commerce One and Ariba systems can come into play. They can provide the interface between your printing-centric applications and the corporate e-procurement and accounting infrastructure.

Finally, don’t forget that these systems may require changes to your current IT infrastructure in order for you to take advantage of them. For example, do all your personnel have access to the corporate LAN and/or a robust Internet connection?

Summary

Just like a new piece of equipment you would buy for your shop, you need to do your homework and understand how these technologies will fit into your operation before you start spending money.

With the right solution and good implementation, the opportunity these new technologies and services present to the In-Plant printer mean better customer service and a more efficient operation. The result can only be happy customers and an even happier bottom line.