10 Ways to Financially Improve Your Printing Organization

Financial performance is a major concern of all organizations, whether you’re a commercial, packaging, digital, large format, or in-plant printing operation. Here are 10 ways you can improve the financial performance of your organization.

1. Improve Administrative Processes
Implement lean principles in your administrative areas to eliminate unnecessary and redundant non-value-added activities, steps, and handoffs in your sales, estimating, order entry, purchasing, invoicing, and accounting workflow.  Put a team together to define the steps required to get jobs through your administrative processes and design a more efficient "Lean" workflow.

2. Implement Industry Best Practices
Best practices are proven methods in which printing organizations have achieved top performance and serve as goals for other companies that are striving for excellence. Why reinvent the wheel? Improve your financial performance by adapting these accepted best practices to your specific needs.

3. Speed Up Throughput And Delivery
Write up orders accurately and effectively, and then use the quickest means available to produce and deliver products to customers. Unnecessary delays can add days or weeks to customer payments. You must pay out considerable costs in paper, wages, and other expenses to produce orders, so you want to get reimbursed as soon as possible.

4. Leverage Technology
The proper use of technology will improve the synergy of your organization and help it run more efficiently and effectively. An integrated management information system (MIS) like Avanti, EFI Monarch, EPMS, ePace, Radius, or Printers Software is a critical tool for managing and operating a financially sound printing organization. A typical MIS incudes estimating, order entry, inventory management, shop floor data collection, scheduling, job costing, and accounting. Implementing an ecommerce solution can eliminate time and costs associated with processing orders, speed your order to cash cycle, minimize inventory, and enhance relationships among customers and suppliers.

5. Keep A Tight Control On Inventory
Paper accounts for approximately 1/3 of your costs, so less cash tied up in inventory generally means better cash flow. While some suppliers offer deeper discounts on volume purchases, if inventory sits on the floor too long, it ties up money that could be put to better use elsewhere. Implement Just-in-time (JIT) inventory practices to reduce in-process inventory. You should not have items sitting in your inventory if it can be replenished before a job goes to press.

6. Review and Reduce Expenses
Take a hard look at all of your expenses. Consider ways to decrease operating costs, but be careful not to cut costs that could impede performance or profits. Reduce production expenses by scheduling better, reconfiguring work shifts, improving job planning, and eliminating spoilage. If you haven't already done so, implement Lean Office and Lean Manufacturing principles.

7. Know Your True Costs
Having a clear understanding of your costs is essential for producing accurate estimates, pricing orders, measuring job costs and profitability, and generating accurate accounting reports. Good job costing and shop floor data collection software can help to make sure that all of your labor and material costs are fully accounted for and absorbed in your estimating cost rates and pricing.

8. Invoice Customers Promptly
A customer cannot pay an invoice until they received it, so the faster you get the invoice to the customer, the faster you’ll get paid. When possible, send an invoice within 1 to 2 days after the order has shipped. A best practice is to establish the invoice amount when the order arrives and as the customer requests changes. The only exception is billable overs and shipping charges. Many companies are expediting the invoicing process by sending PDF invoices to customers using email.

9. Measure Your Performance
If you don’t measure it, you can’t improve it. If you don’t measure it, you can’t manage it. Time after time studies have found a strong correlation between a company's financial performance and effective goal setting. There are various tools for measuring performance including Performance Benchmarks, Key Performance Indicators (KPI’s), Balance Score Cards (BSC), and dashboards. Metrics can assess the health of your organization’s financial, production, cost, quality, and customer service performance.

10. Utilize Your Employees  Better
The need to effectively leverage the skills of employees is critical to improving your financial performance. You may have some people that have evolved into the wrong position over time. Or employees that are overloaded with work while others do not have enough to keep them busy. Take a close look at the skill set and workloads of your staff. Make sure employees are in the position that is best leveraging their capabilities.

If you're interested in learning how Profectus Printing Industry Business Consultants can improve your organization, contact Profectus for a FREE phone consultation at 1-888-868-8662. Or visit our website: www.profectus.com



Cost Rates Advisor Budgeted Hourly Rates Software

Printing Business Seminar: Calculating Budgeted Hourly Cost Rates

By: Craig L Press,
The Printing Industries of Wisconsin (PIW), &
The Institute for Graphics and Imaging (IGI)

November 11, 2009
9:00 am - 3:00 pm


In today's economy it is essential to know your true costs so you are more competitive on the desirable work and avoid the less lucrative work. This workshop will teach you how to develop and calculate hourly cost rates of your production equipment and employees. You will learn how to distribute 100 percent of your expenses among your cost centers so that your costs are fully absorbed in your estimates, actual costs, and pricing. All participants will receive forms and a spreadsheet that can be used to develop your own hourly cost rates.


What Attendees Will Learn?
- What budgeted hourly rates (BHR's)
- How to develop BHR's for your equipment
- The components of budgeted hourly rates
- Where to get the information and numbers
- How to recover your overhead costs
- What to do when equipment is fully depreciated or paid for
- How to compensate for under-utilized equipment
- Calculating direct manufacturing and all-inclusive costs
- Example prepress, press, and finishing BHR's
- Software and publications available to help develop BHR's
- How to use BHRs for pricing and job costing
- What to do when your cost is more than your customers will pay


Who Should Attend?
Principles, managers, financial officers, estimators, cost accountants, billing personnel, department managers, or anyone wanting to improve estimating, pricing, and costing skills.


Click here to download the seminar brochure and registration information.
http://www.igi.org/events/IGI_CPress_CalcRates_F.pdf

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Printing Business Seminar: Maximizing the Performance of Employees

By: Craig L Press,

The Printing Industries of Wisconsin (PIW), &

The Institute for Graphics and Imaging (IGI)

November 11, 2009

9:00 am - 3:00 pm

Performance is essential for maximizing efficiency, productivity, cost effectiveness, and the utilization of resources. This session will teach you how to improve the overall performance of your organization by motivating your administration and production employees, selling change, overcoming resistance, setting performance goals, creating performance benchmarks and scorecards, pinpointing areas of improvement, measuring results, and creating incentive programs.

What Attendees Will Learn?

- Maximize the performance of your most valuable assets, your people

- Developing a performance oriented culture

- Integrating lean practices and principle

- Why "Change Is Good"

- 10 Ways to sell change

- Proven techniques to motivate employees

- Retaining your best employees

- Improving employee morale and engagement

- Evaluating employee performance

- Setting realistic goals for your employees

- Creating employee key performance metrics and scorecards

- Effectively collecting and presenting data

- Designing employee incentive programs

- Using technology to improve performance

Who Should Attend?

Principles, managers, financial officers, human resource managers, or anyone wanting to improve company performance by engaging, motivating, retaining, and maximizing the capabilities of employees.

Click here for additional information or to register:

http://www.igi.org/events/IGI_CPress_BuildingPerf_F.pdf

5 Ways to Reduce Administrative Costs in Your Printing Company With Lean Principles

Lean is a business operating philosophy designed to eliminate administrative wastes, increase efficiencies, reduce overhead costs, improve workflow, and enhance the ability to meet customer demands. Its objective is to reduce administrative costs which account for 32% of a printing company’s value added. Administrative costs include sales, estimating, customer services, order entry, purchasing, invoicing, accounting, and other activities that support production. Printing organizations have experienced up to a 30% reduction in administrative costs by implementing Lean Office principles.

1) Eliminate Unnecessary Documents
Stop producing copies of job tickets and reports that may not be needed or even read. Time and costs are wasted printing, photocopying, distributing, and storing these reports. This Lean office waste is known as “Overproduction”. Most MIS systems enable users to access these reports and information on their screen as needed. Take a hard look at your reports, meet with your employees to determine what’s really required, and educate employees on how to query the information on screen when they need it.

2) Improve Administrative Processes
Put a team together to define the steps required to get jobs through your administrative processes and document them using Post-It Notes or flowchart software such as Microsoft Visio. Then count the number of steps involved; identify the non-value-added activities, wastes, and redundant steps; and design a more efficient “Lean” workflow. This Lean principle is known as “Process Mapping” or “Value Stream Mapping”.

3) Design a Lean Office Layout
A poorly designed office layout will create wasted time and costs as salespeople, estimators, customer service reps, and other office employees move estimates requests, quotes, and orders between departments and desks. This often creates interruptions to others. This Lean office waste is known as “Motion” or “Transport”. Redesign your office layout to follow your workflow so there is less movement and shorter distances between handoffs in your administrative processes.

4) Implement 6S
Straighten and organize your office by implementing 6S.

1. Safety - Always put safety first

2. Sort - What is needed right now and what is not

3. Set-In-Order - Remove items from office areas that are not used

4. Shine - Designate a location for everything and label

5. Standardize – Standard how everyone does things

6. Sustain – Continually reinforce 6S

6S in the office can include organizing job files, folders, file cabinets, proofs, die lines, samples, an individual’s desk, and sales brochures. Implementing 6S will eliminate wasted time and costs by making it easier to find things, improving workflow, and impressing your customers.

5) Utilize Your Employees
Take a close look at the skill set and workloads of your administrative staff. Make sure employees are in the position that is best leveraging their capabilities. Are you over staffed in some areas? Is there a poor distribution of work? You may have some people that are overloaded with work while others do not have enough to keep them busy. This Lean office waste is known as “Underutilized People”. Also, it’s important to involve all employees in your lean initiative and value their input. Those who do the work best know where improvements can be made.