Vendors With In-plants: We Know What You're Going Through
Ryan Kiley knows a few things about the struggles in-plant managers face. It’s not because his company, Ricoh, sells digital presses to them; it’s because he oversees Ricoh’s in-plant.
Occupying 30,000 sq. ft. in the company’s customer experience center in Boulder, Colo., the in-plant has access to “the most complete portfolio in the world” of Ricoh equipment, says Kiley, director of strategic production services. It employs 14 people and can produce up to 18 million impressions per day if called upon to do so.
So when it comes to familiar issues like justifying an in-plant, Kiley knows first hand how important it is.
“We have to be an indispensable business unit,” he declares, citing a mantra of in-plants everywhere. “We have the charge of defending the company’s brand.”
Ricoh is not the only digital equipment vendor with first-hand in-plant experience. Canon, Konica Minolta and Riso also have fully functioning in-plant operations. The four vendor-operated facilities are remarkably like their counterparts in the mainstream of the in-plant industry, with one notable exception: they sometimes double as customer demo sites for the digital presses and other equipment they run. Apart from that, they do pretty much what every other in-plant does to save money by keeping all or most of their parent organization’s printing in-house where it belongs.
“I pride our in-plant on being a convenient, knowledgeable, high-quality resource similar to what you would expect from an advertising agency,” says Mary Perrone-Rizzo, print-factory site manager for Canon Solutions America, in Melville, N.Y.
All four rely on a mix of creative, production and distribution services to cost-justify themselves to management and to secure whatever additional equipment and support they may need.
With the exception of the Canon in-plant, none is located at a corporate headquarters. In Konica Minolta’s case, the in-plant is part of a Windsor, Conn., customer care center that also houses tech support and parts. Woburn, Mass., is where the Riso in-plant shares a building with technical services, a warehouse and space for training Riso dealers.
Though most aren’t quite as formidable as the Ricoh operation, they’re impressively equipped in their own right with top-of-the-line digital printing systems from their respective parents. The Riso in-plant is unique among the four in being an all-inkjet operation. “We have zero toner on our floor,” says Kristina Donehew, marketing manager, “and that’s a rare beast.” All four have binding and finishing capabilities, and three operate wide-format printing systems as well.
It should come as no surprise that when vendors order printing from their in-plants, they ask for the same kinds of things that other parent organizations do. As Perrone-Rizzo describes it, Canon’s product mix consists of the staples of business printing: everything from bookmarks, books and business cards to table tents, signs and stretched canvas prints.
“Where do I start?” asks Mitzi Sansivero, manager of the Konica Minolta facility, ticking off business cards, letterhead, brochures, calendars, bound books and signage on the list of things that she and her staff of four routinely produce. Technical and sales training materials are in regular demand, as are the “big, huge packets” of onboarding information that the human resources department presents to new hires.
Riso’s Donehew says that about 70% of her monthly volume is marketing related, supporting dealers, the sales force and end users of Riso equipment. Kiley says the Ricoh facility’s workload falls into two categories: traditional in-plant projects, including transactional print and postcards as well as signage and graphics for trade shows and other promotional uses; and top-quality printed samples that Ricoh sales representatives present to customers.
Slow Period? What’s That?
Staying fully booked is never a challenge for these in-plants, even the two that don’t have right of first refusal on work procured by their parent companies.
When demand exceeds capacity, or when they’re faced with odd jobs that they don’t have the equipment to produce, the in-plants have varying degrees of permission to send the overflow to outside printers instead of leaving the task to corporate procurement. With its headquarters location, the Canon in-plant is the only one that also has jurisdiction over an enterprise fleet of MFDs (multifunction printing devices).
All but one of the facilities insource print jobs from customers other than the parent organization. In Konica Minolta’s case, the expansion of insourcing has been striking. According to Sansivero, work from external customers now accounts for 60% of everything the in-plant produces.
“In the last four years, we have increased the intake of these jobs tenfold,” she says, noting that all of it originates through word-of-mouth referrals.
These come from relationships with area businesses that she and Dawn Nye, manager of solutions and services marketing for Konica Minolta Business Solutions U.S.A., have cultivated with the help of the local chamber of commerce. Local artists and galleries engage the in-plant to print works of fine art on canvas. Schools in four nearby towns rely on it for student-parent handbooks and other kinds of education-related printing.
Konica Minolta’s in-plant is the exception when it comes to insourcing. Donehew says she will do it occasionally, but “more as a service than a profit center” on behalf of Riso customers who need help. The Canon in-plant also insources primarily as a courtesy to clients and associates. But at Ricoh, says Kiley, the answer is, “absolutely not.”
They’re all on common ground in providing services in addition to printing, mostly related to graphic design and prepress. For example, wearing its advertising agency hat, the Canon in-plant offers a menu of creative services including concepts, digital file preparation, logo design, page layout, photo retouching and variable data composition.
Justifying Equipment: Not Always Easy
While it might be imagined that an in-plant operated by a digital print equipment manufacturer enjoys the luxury of picking whatever it wants from the portfolio, this isn’t necessarily the case. All of the vendor in-plants have to cost-justify their requests for new devices, and the process, according to Kiley, can be “easy or very difficult.”
He has what he describes as a “not insignificant” capital expenditure budget. But, whenever Ricoh releases a new print engine that he’d like the in-plant to get, he must show that he will have sufficient volume for the device before he can earmark money for its installation.
Donehew says that if the Riso in-plant is facing a production crunch and needs an extra device to get through the overload, it will either have to make a cost-justifying case for what it wants or “tough it out” with the resources it has. Every 18 months or so, she’s able to selectively upgrade equipment and software to keep the shop’s capabilities fresh.
Vendor in-plants earn and keep the confidence of their parent organizations in the same way that mainstream in-plants do: first and foremost, by operating as cost efficiently as possible.
Sansivero says that when Konica Minolta personnel see what bidding work to outside printers will cost them, they return to the in-plant and say, “We’ll wait for you.” According to Donehew, when the Riso in-plant looked into the possibility of outsourcing some work a few years ago, it couldn’t find a model as economical as the in-house inkjet production routine it was already following.
What Works, Works
But, there’s more to the bond of trust than simply saving money. There’s also the underlying commitment on the part of the vendors to the practical value of the in-plant concept.
Canon has found, says Perrone-Rizzo, that “in-plants always have the company’s best interest [at the] forefront. Every staff member is expected to be a good steward of resources and a brand ambassador.”
According to Ricoh’s Kiley, the best way to cultivate two-way loyalty with the parent organization is to realize that for an in-plant, “there’s no such thing as an internal customer.” What in-plant personnel have in their associates within the enterprise are business partners, he says, all dedicated to serving the same end-using clientele.
That’s an outlook that in-plants everywhere should take to heart.
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Patrick Henry is the director of Liberty or Death Communications. He is also a former Senior Editor at NAPCO Media and long time industry veteran.