These days, production is everybody's business, for better or worse. The CFO is worried about the unit cost and the inventory turn; the sales people are concerned about shorter runs and speed to market; the art departments are often doing work that was farmed out or fell to production staff five years ago; and freelance designers all need to learn the same way to a bulletproof PDF.

What are the latest developments in book manufacturing, and how can they add extra value to the publishing process right now? PW interviewed the leading printers, component printers and paper suppliers in the book manufacturing world and found some innovative programs, new technology—including a few recent developments in the print-on-demand and shorter-run market—and some interesting ideas on ways the publishing industry can save time and reduce costs.

Publishers sneeze, and the book manufacturers get a cold. That's how close the relationship between these two sectors of the book publishing world is and, in the past two years, there's been a lot of colds going around. The problems were exacerbated by the fact that 2000 was the best year for the entire printing industry in 30 years. With a lot of school adoptions boosting educational sales, and the Harry Potter halo effect spreading work all around the trade world, printers described 2000 as the best year ever. (Production staff at the publishers, however, often found it a nightmare to get press time.) "It was a wonderful year, a collision of all good things—many good adoptions and some new Bible versions, topped off by Harry Potter," explains Ed Lane, president, book solutions, for R.R. Donnelley. "It was phenomenal," says Dave Liess, president and CEO of Coral Graphics.

Last year, sadly, was a very different story, as publishers took stock of inflated inventories and held back on placing new orders. As Charles W. Nason, president of Worzalla, observes, "You could hear the switch go from on to off. It was devastating." Other printers concurred, with comments ranging from the polite ("it was a weak year") to the blunt ("it was crummy"). Some closed plants, others did controlled layoffs, and everyone tried to manage through.

What's going on now? It depends on who you talk to, and what sector of the market they're in. For many, this year is a copy of last year—and that's not good. Some printers with both feet in the trade world are more optimistic. Michael Gallagher, president and CEO of Offset Paperbacks and Berryville Graphics, says he was encouraged by Barnes & Noble's announcement this summer about store expansion. Others, like Courier Corp., are getting a big boost from the religion market, even though trade sales continue to be weak. Jerry Allee, president, book services group, Quebecor World, had been more optimistic at midyear, but now is seeing some erosion in consumer trade—not so much for big first printings, but in the area of midlist and reprints. The educational market, especially at the college level, will continue to be strong, Allee predicts. On the paper side, 2002 started out with a whimper for Glatfelter, and Mark Pitts, corporate director, printing and converting papers, said he anticipates that the second half of the year will probably be "a little better, but not tremendously so."

The economy aside (and that's a big aside), the most change in the past 10 years for the book manufacturing world has come from consolidation in the publishing industry, especially in the educational world. As a result, book manufacturers have had to work out a new paradigm. It started with pricing. Stephen Snyder, executive director of the Book Manufacturing Institute, a trade association, explains that as the number of giant houses increased, the consequence was that "the pricing was for the whole house, and printers had to work within a new structure." For smaller companies that derived much of their success from relationship selling, it's been a difficult transition, Snyder says. Large or small, everyone feels the change. "As publishers consolidated, they become more savvy about the overall costs and savings. They say 'show me the savings,' " says Jerry Allee of Quebecor World. "Take two big publishers, put them together and, after all is said and done, you end up with 70% of the business" you had before, notes Charles Nason of Worzalla. Still, Bill Long, v-p sales and manufacturing for Maple-Vail, points out: "The price pressure has forced book manufacturers to do things better and smarter."

Another consequence of consolidation is that more of the business now falls under long-term contracts, with agreements on volume and pricing. At Offset Paperback, 80% of the business is under long-term contract; at Banta Book Group, it's 40% of the business. Many see that as a plus. "It helps printers manage their capital and plan their expenditures," says Ron Musil, president of the Banta Book Group. Mark Pitts, at Glatfelter, also views these arrangements as a win-win solution. "It means we can invest in the customer strategy," he says. But a few disagreed, saying there's no point in entering into lower-profit business arrangements for longer than you have to.

Given the pressures on their margins, many book manufacturers started looking internally for improvements. Quebecor World instituted a series of programs to boost productivity, including a highly successful and rigorous Allstar training program for its customer service reps that won an award from Workforce magazine. R.R. Donnelley is niching its plants to specific markets. Maple-Vail is focused on improved sequencing and reducing make-ready times in all manufacturing areas to tighten up the production chain. Often, the improvements come from state-of-the art technology, like the new Timson 48A installed at Malloy, the Michigan printer that was the first in the U.S. to install this gold standard of the shorter-run business, or a Man Roland zero make-ready press recently installed at Berryville Graphics.

With technological change comes cultural change. Computer-to-plate technology, for example, has enabled printers to move work from one plant to another for maximum flexibility. As PDFs replaced PostScript files, the burden of blueprints has virtually switched over to the publisher side. Once that PDF is done, it's the job of the printer to vet the integrity of the file and render the job printable. (That's not as easy as it sounds: Donnelley, for example, finds that more than 50% of the PDFs it receives have some kind of error.) But eventually, proofs may disappear altogether as each side knows what it's delivering and what it will be getting.

Some printers are expanding or branching out into supplementary businesses. Courier has seen an increase in component publishing, as has Banta. Both firms find that their education clients want them to be a one-stop shop, handling everything from component design to bundling and shrinkwrapping. "To be solely a printer today is to miss many of the great linkages in the business," comments Ron Musil of Banta. Similarly, Phoenix Color, known for its cover work, does some printing and is adding distribution and fulfillment services for its smaller publishers in partnership with Books International, a fulfillment house in Dulles, Va. Fidlar Doubleday, a printing company that recently expanded into digital publishing, finds that its customers, primarily small presses, need additional assistance. "There's been a tremendous upset in the whole chain, from design to delivery," said Fidlar Doubleday general manager Tom Burkhardt; that presents opportunities the company is happy to fulfill.

What Do Publishers Want?

You could draw up a wish list for publishers, but, after price, the number-one item on the list is sure to be speed—and numbers two, three and four will probably be speed, too. Behind the need for speed is a complicated equation, factoring in shorter print runs driven by supply-chain management and the unwillingness of wholesalers and retailers to act as the publisher's warehouse. The change has been dramatic. At Banta's Midway plant in Menasha, Wis. (17 acres under one roof), for example, the average run length 15 years ago was 30,000—40,000 copies; for the second quarter of this year, the average run length was 7,000—8,000. At Coral Graphic Services, a whopping 60% of the business now comes from reprints. Offset Paperbacks notes that with anything but the month's top titles, the final print decision comes much closer to the actual production dates than it used to.

The book manufacturers have adapted, organizing themselves for speed. Several years ago, Jaguar Advanced Graphics consolidated three locations under one roof for maximum efficiency. Last spring, Phoenix Color received a reprint order for 48,000 covers for Little Altars Everywhere and delivered it to R.R. Donnelley in 12 hours. Offset Paperback recently set a plant record when it printed 1.8 million copies of multiple titles in 24 hours. All over the industry, printing records are being broken. At Inland Press in Menomenee Falls, Wis., president Jim Lacy said the company prides itself on an under-15-day turnaround from receipt of purchase order to books shipped out. In the next few years, Lacy says, he is determined to get it down to 10 days. Ironically, the aspect of book publication that hasn't speeded up considerably is the sales and marketing cycle. On a normal schedule, the sales people still need to present a book to the marketplace five to six months before the on-sale date. On an exceptional basis, with an instant book, everything goes much faster. Advances in electronic prepress are also supporting the need for speed. Many, like R.R. Donnelley, have added preflighting capabilities to their Web sites so publishers can test the integrity of a PDF before sending it, thus saving much time and money. Remote proofing or softproofing enables publishers to check text placement on reprints before going to press. Many printers have added a portal facility to their Web sites so customers can log on and check job status. (See sidebar, p. S14.)

Other parts of the book manufacturing world have responded to support the lower print runs and the need for speed. Two years ago, Glatfelter streamlined its discount schedule and lowered its minimum paper buy to 10,000 pounds; it also maintains some popular grades on the warehouse floor for 24-hour delivery. Permalin Products now keeps three million pounds of inventor on hand, including sheeting and trimming for any size.

Cracking the Ultra-Short Run Barrier

Everyone in the printing world wants to be Chuck Yeager, cracking the ultra-short-run ceiling. Some say it's still a year away; others say it's here, right now.

Within the past few months, both Quebecor World North America and R.R. Donnelley have announced shorter-run modules for trade paperbacks (News, Aug. 12). Quebecor World started running its digital book module at its Martinsburg, W.Va., plant in July. This allows publishers to produce runs of less than 1,000 copies economically, and the technology is also being used for bound galleys, promotional copies and bound manuscripts. Quebecor World says its customers are especially pleased with the true offset quality of the four-color laminated covers. "While the project is still in its early stages, the market has been receptive," said Allee. Donnelley's print solutions division is installing its Inventory Management Service (IMS) in its Harrison, Va., plant, with an integrated, digital in-line printing and binding module to produce smaller runs of backlist paperbacks.

And then there's print on demand, for which a wide range of definitions exist. "We've got to stop using the term 'print on demand,''' insists John Conley, v-p of digital services for Donnelley. "Print on demand should only be used when you go into a bookstore and ask for a title and they print you one copy."

In the world of print on demand, Lightning Source is by far the biggest player. Printing 12,000 titles a day, Lightning has more than 250,000 orderable titles, including e-books, and offers three different business models to customers: drop ship, distribution and short run. Edwards Brothers has several interesting digital publishing models going—one in the Roman & Littlefield warehouse, and the other in the University of Chicago warehouse. One publisher prints to the order quantity; the other prints to a minimum, currently 25, to cover the conversion costs. In both cases, says Edwards CEO John Edwards, this works well for books that can handle a higher price point.

In all these cases, publishers need to take a look at the overall costs, including the cost of unsold inventory. Says Edwards, "We're talking to our publishers about a change of equation—not thinking about printing as dollars divided by unit, but number of copies actually sold divided by what the publisher pays." Notes Ed Lane of R. R. Donnelley, "If I can get a publisher who rents out warehouse space to do the analysis, he'll see quickly that less inventory even at a higher unit price is worthwhile." Lightning's president and CEO, J. Kirby Best takes it another step: he wants publishers to assume print on demand as part of the new, overall cycle of a book and switch over to a POD model whenever sales dip below whatever benchmark the publisher establishes. "Publishers shouldn't get stuck on cost per unit, but look at return on invested capital—with print on demand, that return can be in double digits, compared to traditional printing," he maintains.

What Else Do Publishers Want?

Publishers want better color management tools. Here's a familiar scenario: a cover design arrives in the art director's e-mail; it is printed out on a color printer (which may or may not have a full supply of toner) and taken to a meeting. The editor and publisher and marketing director all fall in love with the colors on the printout, but later, they are surprised to find out these aren't the colors in the file. Why? First, because computers print in RGB colors and printing presses run on CMYK colors—cyan, magenta, yellow and black. Second, people do not all have the same number of rods and cones in their eyes, which explains why people see color differently. There aren't easy answers here, only an ascending scale of quality in color proofs, with prices to match. There's no substitute for a knowledgeable customer, note the cover printers.

What Do Book Manufacturers Want?

What they want most is "level-loading"—the happy situation where the workload is spread evenly throughout the year, and the presses are always busy. For printers in the educational and trade business, summer and early fall is an eight-ring circus, while January and February can be pretty bleak. This is why every printer on the planet hopes that the new Harry Potter will print in the first few months of the calendar year. But the printers know that level-loading is an impossible dream. As Dave Liess of Coral Graphics puts it, "I don't think there is a price we can come up with that will interest publishers in keeping our work level-loaded."

Beyond the impossible dream, some interesting possibilities—turf issues, you might say—are under discussion. For example, who should buy the paper? Traditionally, it's been the publishers, but Stephen Snyder of the Book Manufacturing Institute thinks everyone would better off if manufacturers bought and held the paper. "Why should publishers tie up millions of dollars in paper held in plants all across the country?" he wonders. "Sure, they'd pay a markup, but they'd only be spending money when they needed to. Paper is an integral part of the manufacturing process, and a publisher isn't a better publisher because he inventories paper."

Quebecor World's Jerry Allee offers an interesting variation: "Publishers could still buy the paper, but if printers could control the components—jackets, covers, and inserts—we could reduce costs and help improve speed to market." Quebecor World, says Allee, would be interested in getting into that business. Glatfelter, the dominant paper manufacturer, has another idea. "We'd like more visibility at the printers so we could set up an automatic fulfillment system," says Mark Pitts. "That would be a solution that would add value."

On the less theoretical side, all the manufacturers interviewed agreed with John Edwards: "We still spend too much time doing paperwork." Although EDI is working for publishers and their retail and wholesale customers, the road between printer and publisher is still papered over with faxes and hard copy POs and invoices. For the past two years, a group of printers and publishers have been meeting regularly to discuss the implementation of an open-source, Web-based software application, Tambora, that would replace paper transactions with electronic equivalents. The group includes Courier, McGraw-Hill, Pearson, Wiley, Phoenix Color and many others, all of whom are hopeful that Tambora presents another opportunity to save time and money. (For more information on Tambora, visit