Q&A with Edwards Brothers Malloy CEO John Edwards
The December Issue Book Business featured the re-launch of the Top 20 Book Manufacturers, a ranking that lists the largest book manufacturers in the U.S. and Canada by revenue. To accompany that ranking, we interviewed top printing executives to find out how the printing industry has changed and the issues they think publishers should be most mindful of in the future. Printing experts shared insights on digital printing, minimizing supply chain costs, and integrating publisher and printer systems. The Q&As we published in the December issue were just snapshots, but following you'll find the full-length interview with John Edwards, CEO of Edwards Brothers Malloy.
What important printing trends do you see on the horizon?
I've been in this business for almost 30 years now. When I started demand drove the printing business. We couldn't help people fast enough because the demand went up each year, and we focused on building more machines to handle all of the orders. Then around mid-2000 electronic readers became more popular, and there was a fundamental shift in the debate. The demand was no longer feeding the supply, the supply was feeding the demand.
A printer had to become a different kind of company, managing the shrinking or stable market. Inventory became a really important part of everyone's discussion. When people ask me "What do you do?" I no longer say, "I'm a printer." I say, "I'm a supply chain partner." It's more about making inventory tighter, responding quicker, and understanding distribution, which I never knew about 20 years ago, to be honest. I would say that from the printer side the industry has changed dramatically.
We're consolidating our warehouses now and being tighter on inventory and trying to be more responsive to demands as they come in. We have to be willing to change content quickly. It's a much more nimble, flexible environment.
How are you working with publishers differently now in light of this shift?
The trend that I'm seeing is that larger publishers are consolidating their vendors. As publishers consolidate, electronic integration becomes a more viable opportunity. That means a printer's system is integrated with the publishers so that orders become automated processes. No one needs to touch the order once it comes in. There is a ton of money there for both sides. It's an automatic replenishment model. A few publishers are doing this now but not very many.
Do you think that will be the norm in the future?
I think it has to be. If you quantify the transaction costs for typical print orders they are quite high. But in an automated scenario, where the printer manages new orders as they come in, suddenly that entire infrastructure that manages reprints is gone. If you have corrections it gets a little more complicated, so maybe start with the deep backlist stuff, which is basically what a POD program does.
How has the evolution and growth of digital book printing affected the industry?
We've been in digital printing since the mid-90s. Initially there were legitimate quality concerns but today it is hard to distinguish between offset, inkjet, and digital. There are subtle differences in the colors. Really it's about the cost savings though. You don't get savings initially, but you save on the backend. Say you have a title that is three or four years old and you use digital printing, you'll make up the money you spend with cut inventory costs and quicker turnarounds.
The publishing community lives and dies by the last reprint decision they make, and they're always wrong. They either print too many or not enough. I think you're going to see more hybrid models. You can start of with offset, and as sales level off you can switch to digital to meet the demand as it comes in. You minimize the damage of being wrong. It's a very different model because publishers are fixated on price point rather than the whole supply chain cost, and it's when you look at the whole supply chain costs that digital starts making sense.
What should publishers be thinking about as they plan their future printing strategies?
From my perspective, the focus should be on what does the customer want and how are you going to get it to them? You want to look for partners that can help you regardless of what the demand is. You have to look for publishers who can really help you manage the life of the title. That is what it is all about.
We want to play a role so that publishing doesn't have to worry about their distribution and inventory. They can rely on us for that. We want them to be able to focus on their business.