This is a question that has come up several times over my career. To be honest, I’ve always disliked hearing that since I knew the publisher who asked it would be doubtful of my response. I think it’s reasonable to assume that most people are aware that printers profit off the paper they sell to their clients. The number varies by printer, as some see paper as a way to make extra money while others only want to cover their purchase and handling costs. Does it matter how much money a printer makes on the paper they offer you with? No, it shouldn’t; however, this is only true if their pricing are competitive and you are receiving value for your money. The huge AND is because I recently dealt with a magazine publisher who received a paper that was at least two grades below than what they had paid for. They were completely unaware of the situation until I brought it to their notice, and it had been going on for quite some time. Worse, they were overpaying by around $10.00/cwt (if they were receiving the grade they were paying for, which they weren’t).
As a result of the snafu, this publisher inquired about my opinions about purchasing their own paper. Again, I’ve been asked this question many times over my career, particularly during really weak markets when paper merchants are aggressively attempting to get rid of surplus inventory. Whether this issue was posed 20 years ago or is still being asked now, my response is the same:
The general answer is no, you should not if you are a small trade and special interest magazine publisher with 1-5 titles (and without knowing your individual circumstances). My support for this response is as follows:
A paper consumer has three possibilities for purchasing paper: a) through the printer, b) through a paper broker, or c) directly from the mill. Because most trade and special interest magazine publishers are too small to buy mill direct, I won’t go into the advantages and disadvantages of that alternative. Let’s have a look at the other two:
Paper provided by the printer
To begin with, there is only one apparent “con” to purchasing paper from your printer, and that is that you will almost always be paying a mark-up. The proportion varies, once again, from printer to printer. Now, this becomes a little more tricky since just because you’re paying a mark-up doesn’t imply you’re paying more for your paper. It’s the same with everything else; it all depends on what you’re comparing it to! Just don’t assume that just because there’s a mark-up, you’re overpaying. The bottom line on pricing is that to determine a fair price, you must compare the given price to something with similar specifications.
Let’s have a look at what you receive for the mark-up you pay on paper provided by your printer because, believe me, it’s well worth it in the end!
Administration is the first step. Administration is a pain, believe me. Remember that if you bring your own paper, you are responsible for ensuring that there is enough paper on the floor to finish your project. This necessitates collaboration among you, your printer, and your broker. It may appear easy enough, but time is something that most people do not have these days. It’s also crucial to keep track of your inventory so you don’t end up with too much paper on the floor, costing you money when it’s not in use. This becomes your printer’s concern when they supply your paper, and they know how to handle it well!
2) Adaptability. As a magazine publisher, you probably don’t make many substantial adjustments in page count or quantity at the last minute. Will your broker be ready and able to respond if you do? And, if they can, how much will it cost? This is, once again, a printer-supplied paper issue, not yours.
3) Reliability. Purchasing paper from your printer ensures that it is of high quality. Because high-quality, A-grade paper is widely accessible in a soft paper market, brokers are usually able to offer it. When a market tightens, however, brokers frequently have “seconds” or mill/printer rejected paper available to them. I recall a time when a publisher sent their own paper to our printing firm, and we discovered that it was the same paper that we had previously gotten directly from the mill and rejected due to quality concerns. The bottom line is that it didn’t work! The expense to the publisher for this one issue was significantly greater than the annual savings that would have been obtained if they had supplied us with their paper. We tried to help this client, but they quickly went back to using “printer supplied” paper.
4) Accessibility. Availability is usually not an issue when the market is weak. When the market tightens up rapidly, though, it might become one. I had another customer who insisted on bringing his or her own paper. There was a time when, for reasons I don’t recall, they were unable to deliver their paper to us on time. As a consequence, they were pleading with us to assist them and locate the document they needed. The issue was that we didn’t have any to give them. We were eventually able to locate the paper they need, but it arrived at a price that significantly outweighed the cumulative yearly savings they had anticipated by delivering their paper to us.
5) The Costs of Carrying. When you buy paper from a broker, you usually have 30 days to pay for it once it is delivered (although there are some brokers who will bill upon use rather than delivery). When using printer-supplied paper, you’ll usually have 30 days (or whatever your credit conditions are) after the magazine is delivered to pay your print cost, which includes paper. Obviously, if you’re not working with a broker that bills based on consumption rather than delivery, you’re tying up your cash too soon.
6) Fees for printer handling. Customers who bring their own paper are almost always charged a handling fee. This charge might range from $.75 per CWT to $2.00 per CWT. The proportion of your overall savings per CWT for buying through a broker, regardless of which end of this range you select, is considerable. Printers that wish to dissuade customers from bringing their own paper will be on the upper end of the range, while those who don’t mind will be on the lower end.
This brings up an additional point worth noting:
Some smaller printers just do not have the volume to buy paper in a cost-effective and efficient manner, thus they must buy it via brokers rather than mills directly. In the past, I worked for a printer that couldn’t ensure that my client’s paper would be constant in mill, brand, and quality unless they utilised a weight and grade of paper that they (the printer) specified. These printers (which aren’t generally magazine printers) don’t mind if their customers bring their own paper. It’s critical that you engage with a printer who can and will obtain you the paper you want rather than what they have on hand. Again, if you have to supply your own paper because your printer is unable to obtain what you want/need, you are working with the incorrect printer.