Become A Broker
Another reader posed a question about printing brokers. I myself broker printing, as well as write articles and do graphic design, so I think I can offer some helpful thoughts.
Most trade printers only sell what they produce on their own presses. Some have only web presses. Others have only sheetfed presses and/or digital or large-format inkjet presses. Even within the various categories, most printers have only a few, or a small number of, presses and therefore cannot provide all possible configurations and capabilities without outsourcing some part of the job.
For instance, most printers have saddle-stitching capabilities, but only larger printers and binderies usually have perfect-binding equipment. And very few printers have letterpress capabilities, while only select shops offer detailed embossing and die-cutting (particularly laser die-cutting) services.
There are a few exceptions. A few conglomerates (or consolidators, as they are called in the printing field) have bought up enough smaller plants to be able to move projects around (or share portions of projects among) their related print shops in order to offer all possible services to clients.
Basically, if you're a trade shop, the equipment you can afford to keep on the pressroom floor determines what kinds of jobs you can bid on (magazines, books, promotional materials, signage, die-cut invitations). You sell your "niche" services to multiple clients, or you primarily do this and then form "strategic partnerships" with vendors offering services you cannot provide. In this way you service those needs of your clients that fall outside your core competencies. (To me this looks like brokering.)
As a printing broker, however, you have access to any sheetfed or web print shop, paper vendor, embossing and die-cutting shop, letterpress, etc., with which you can develop a relationship.
You take their price, add your mark-up, and pass on the combined price to your client.
Some brokers actually buy (and pay for directly) the print services and then sell them directly to their clients. Other brokers have the print shops bill clients for the combined prices (costs plus commissions) and then bill the print shops for their commissions once the clients have paid the bills for the completed jobs.
Brokering depends on relationships: commitments kept to both the printer and the end client. In the best of all possible situations, the print shop appreciates the extra work brought in by the broker and sometimes is willing to offer "broker pricing" (slightly lower than what the printer would offer the client directly). This allows the broker to add a mark-up and still remain competitive. After all, when the print broker adds his/her commission, if the total exceeds the pricing offered by the client's other vendors, the client won't give the job to the broker.
The end-user, or client, in the best of all worlds will choose a print broker for the following reasons:
- The print broker has access to multiple vendors and can coordinate all aspects of a job, from printing to specialized finishing (like embossing) to distribution.
- The print broker often has developed specialized knowledge through years of work in the printing field and can offer advice on everything from paper choices to printing options. He/she can often make suggestions to help the client both save money and produce a stellar product.
- The print broker can step in as the client's agent and rectify any problems that may occur before, during, and after the printing process.
It all comes down to "added value," a business term very much in vogue at present. If a printing broker can consistently bring work to a number of printers in a way that the print shop can make more money with fewer headaches (logistical, financial), he/she is adding value for the printer. If the broker can help a client articulate his/her printing needs, find reliable print providers, and make sure the job goes smoothly from start to finish, then the broker is adding value for the client. In this case, the broker will get along well with printers and clients and will thrive financially.
How much does the broker add as a commission? Most won't tell you, except to say that if the total price is less than the competition's price, what does it matter? That said, the reality is that the commission percentage changes from job to job. A broker will add a larger commission for a very small job (to make it worth his/her while) or perhaps just have the client go directly to the small print shop (this creates goodwill and the perception of the broker as a knowledgeable resource). For a very large job, the commission might be minuscule: 1 to 3 percent (although 1 to 3 percent can be a healthy commission on a large job). Ultimately, the size of the commission is limited to an amount which, when added to the cost, does not raise the total price above the competing vendors' prices.
[Steven Waxman is a printing consultant. He teaches corporations how to save money buying printing, brokers printing services, and teaches prepress techniques. Steven has been in the printing industry for thirty-three years working as a writer, editor, print buyer, photographer, graphic designer, art director, and production manager.]