And, not surprising at all to watchers of fast-consolidating businesses, there have been a number of new entrants – most notably Broadridge Financial Solutions, which has long been a major supplier of digitally printed materials, and which offers size, strength and “one-stop-shopping” at annual meeting time, which is a plus for many already over-burdened corporate citizens.
Over the past two years we are glad to note, there has been a growing realization at many companies that they cut the quality – and also in some cases the quantity of their printed matter – much to their disadvantage:
Well-designed printed matter makes an immediate impact on recipients. If it is “inviting” it will prompt recipients to skim, and ideally to read deeper.
The growing length, complexity – and often the critical importance of corporate governance matters has also focused attention on better ways to get readers’ attention, win their support – and get their votes.
Good printed materials also send a strong message about the strength of company itself - and the value it places on its shareholders, and on communicating with them. Also, as one of our suppliers noted, the “push model” tends to get much more shareholder attention than a web-based “pull-model” – that requires recipients to go to one or more websites to take action – like casting one’s proxy votes. Recipients of “full-set hard-copies” of proxy materials are roughly twice as likely to cast their proxy votes than recipients of “Notices of Internet Availability”…although we still believe that over time – and IF companies design their materials, and their voting sites better, the two models will eventually equal out, and the web may actually win over a majority of voters – as it has already done at most high-tech companies.
In any event, there has been much more attention paid in recent years to design and layout considerations – both in printed and in web-based materials. And lately, there has been a modest return to the use of “glossy” materials, which had fallen out of favor - primarily because dropping them was such a quick and easy way to cut costs.
This brings us to another very important point: New technologies are driving change fast in both the print and the web worlds. Most important to note, they are helping to reduce costs – even while increasing quality – and the timeliness of info – for corporate issuers and for their shareowners. Please be sure to look at the article about Tangelo Software in this issue about ways to make the layout and presentation of important and time-sensitive financial documents cheaper, easier, more accurate, more available in multiple formats - and faster. Digital printing – and print-on-demand – can also generate huge money-savings for corporate issuers, as Tangelo points out.
We buy a fair amount of printing ourselves. And we also benchmark the price of printing on a regular basis for clients, usually in connection with RFPs for transfer agency and reorg contracts and sometimes in connection with annual and special meetings. In our 22 years as a publisher, we have seen our own printing costs go down in every single year we went out for bids.
So here’s a summary of our advice:
(1) Relationships are important, and having good relationships with your financial printer(s) WILL pay big dividends for you, and make life a lot easier. Also…changing printers is a challenging and potentially disruptive experience: It involves extra work and extra monitoring in year-one at best, and a fair degree of risk.
(2) But that’s no reason not to benchmark the market-price of printing, and the kinds of services that good printers can bring to the table on a fairly regular basis. If you already have good suppliers, more often than not, you’ll stay with them...and be a lot more comfortable for having done your homework. Best of all, your printers will likely respect you a lot more in the morning, and pay more attention to you thereafter.
(3) Be watchful if you let other suppliers - like a transfer agent, reorg agent, solicitor or mailing house buy printing for you: They are entitled to a reasonable markup, if they’ve done the legwork, provided storage and/or logistical support – but many times we’ve found these largely hidden surcharges to be way out of line with the value added.
(4) A well-designed RFP process, with a well-crafted RFP, will also help you make sure you are getting a truly good deal, and that there will be no ‘surprises’ in the form of unexpected extra charges and surcharges on your bills. Our very first issue had an outline that is still good, twenty-two years later!
(5) Most times, however, all it takes is a few phone calls (from people who understand the printing business, that is) rather than an elaborate RFP process to get a better break on printed matter: Regular readers may remember our real-life example of someone who’d been quoted $.13 an envelope – for over one million of them - who got down to $.06 after a few calls...only to find out from us that she could easily have paid as little as $.015 had she shopped a bit harder...and smarter. These days, however, as noted above, it’s not strictly a matter of pricing: It is also very wise to assess the kind of know-how – and hands on support – and genuine value-added that a really good financial printer can bring to your own printed materials.
(6) Always check your printing bills with care – for surcharges and ‘extras’ like making corrections, overtime charges, etc. – and for mathematical mistakes, which, tend not to be made in your favor.
(7) Maybe the best tip of all…pull a D&B report on any new printer you might consider using. Most printers these days barely scrape by on miniscule margins – And many of them have no printing plant at all, but simply ‘job-out’ the work to others. NOT a good recipe for a long-term relationship.