Overseeing the financial wellbeing of your business is never more important than during a time of crisis. Printing businesses across the country are facing unprecedented financial challenges due to the economic fall-out of the COVID-19 pandemic. Careful management and follow-up of receivables, keeping customers and potential clients up to date about changes to your operations and policies, and working with regional and provincial industry associations to ensure consistent best practices, is now more important than ever. We have collected a few helpful comments and strategies from two industry leaders. Here, Bob Dale and Jamie Barbieri discuss how printing companies can protect themselves during a time when virtually every sector is facing serious economic strain.
Bob Dale is a Partner at Connecting for Results. This Toronto-based consulting firm focuses on mergers and acquisitions, management strategies and executive recruiting. Another printing industry veteran, Gordon Griffiths, is his partner.
“We’ve been talking with print leaders from across Canada and together they recognize the need to change, especially at this difficult time. There are a number of topics to discuss, resources and best practices to share, and the CPIA leadership is working with a number of stakeholders to help. The reality is that in today’s business climate, owners and managers need to focus on their businesses and don’t have much time. So, short messages with precise and important information shared through social media and industry publications like Graphic Arts Magazine, are more critical now than ever. Cash and credit are two crucial topics right now. Since lenders are tightening credit, here are some strategies to consider:
- Dispose of under-utilized fixed assets
- Dispose of under-utilized leased equipment
- Use newly-found space wisely, consolidate operations or even explore renting a portion of your plant
- Engage additional investors
- Investigate opportunities to merge
With regards to credit here are some important things to consider:
- There are fewer healthy accounts now. The forced closures of businesses have changed everything. Even previously healthy companies can become a credit risk. So update your credit file carefully.
- It’s totally fair to ask for a deposit on work ordered. This should at least cover the cost of materials, or be COD.
- Printers are not bankers. Many printers are being asked to wait 60, 90 or even 120 days for payment. Our suppliers are not extending these terms to us, and our employees can’t wait for their pay cheques. Cash (flow) is king.
- Suppliers are playing hardball – and so should we! If printers don’t pay on agreed terms, suppliers will cut us off. Normal terms are 30 days, and printers are entitled to interest if these terms aren’t met. Payment terms should be the same as print specs. We need to get serious about overdue accounts.”
Jamie Barbieri is President of the PDI Group, based in Kirkland, Quebec. Founded in 1970, the company is the largest independent sheetfed printer in the province and specializes in complete integrated print solutions – including pre-press, offset and digital printing, web-to-print, fulfillment, direct-mail and warehousing to clients across Canada and the U.S.
“The economic landscape of the printing industry has shown signs of improvement over the course of the last 10 years. That being said, the onset of the COVID-19 pandemic will definitely impact all printers in one way or another. Caution and vigilance have to be applied. As well, we must use sound decision-making in answering the demands that are currently being placed upon all of us. If we don’t do this, we risk losing the gains and progress we’ve been able to assemble over the years. As an industry, we need to take a hard look at how we will manage our terms, finances, and other conditions under which we conduct our businesses during this new reality. The pandemic affects us all – and it’s our duty to adapt and to protect ourselves going forward.”