Don't be a flyaway paper buyer; we're in the middle of one of the publishing industry's cyclical paper crunches. So what you need is a short course in buying paper

Folio: The Magazine for Magazine Management, August, 1988 by Jeff Parnau

Don't be a flyaway paper buyer

How would you feel about flying with an airline captain who said the following:

"That gizmo? I don't know. I never used that. My job is just to fly this thing. I'm not a mechanic. I'm not sure how the engines work. I think they run on kerosene or something, but whatever it is, they have a lot of it when we land. The wings have something to do with keeping us from falling down. That part there, I believe it turns the whole thing left and right, but you can't see it from where I sit. Anyhow, my job is to get this thing from A to B on a schedule, and I'm damn good at that. When I push on these, we go fast, and when I pull them back, we stop flying, and if I pull them back real far, they stop the whole plane. I know one heck of a lot about navigation, though."

Well, what's wrong with that? As long as the guy knows how to fly the plane, why should he have to know how it works? Why clutter his mind with a knowledge of petroleum products, or the way the hydraulics drive the flaps? What you want up there in the cockpit is a person who can get you up and down, right?

But in reality, you could never fly with a captain like the one just described. The airlines insist that captains go to systems school. In addition to knowing how to fly a plane, they must demonstrate a knowledge of why an airplane flies. They must fully comprehend the medium of their profession: the airplane itself.

Not so in publishing. Lots of publishers and editors think like this:

"Paper? Oh, I don't know much about that stuff, but they got plenty of it whenever we go to press. Some of it is shiny, and some of it is real dull. It can be thick or thin. When we get done with writing, they convert the words into ink, and put them on the paper. They can even do it in color. But what the heck. I'm a publisher. My job is just to get the words and pictures in the right order. I know a heck of a lot about thermoconductivity, though."

On the other hand, there are a certain few publishers out there who actually understand their medium. They know enough about putting ink on paper to make intelligent decisions about the two. So when ink became expensive a few years ago (because of the oil embargo), they knew what it cost, if not where to get it. Paper is a dfferent story. Unlike ink, publishers can purchase, own, contract for and inventory their own paper.

Today, we're in the middle of one of the publishing industry's cyclical paper crises. The stuff is more expensive than it should be, and hard to come by in many cases. Because availability of paper may dictate who gets to print a job, the situation backs up like a clogged sewer. Publishers are forced to plan a project further in advance, and to negotiate a printing contract months before they would expect. Printers, in turn, pressure their customers to make long-term commitments, so that they can solidly plan for paper purchases.

And all of this has taken our unwary publisher off guard: "What? You don't have enough paper? It will cost what? You want a decision when? Why?"

Knowing how to stay ahead

As I have said in the past, and now say again, there's no time like right now to learn what you need to know about being sure you have enough paper. Pilots need airplanes to get from A to B. Publishers need paper. Printers need neither. (Printers have no end use for paper, you know. They just convert it into something else and sell it back to the publisher, who in turn sells it to yet someone else. The end user is the reader.)

Now that we've got the philosophy out of the way, how about a short course in buying paper. A real short course.

Lesson 1: Anyone can purchase paper. Think about this: There are thousands of paper salespersons who call on little $100,000 printers. They fight to sell a few thousand bucks worth of paper to instant printers, and even to offices.

Lesson 2: Some printers prefer to supply paper and others do not. Some of the general logic is this: A printer may want to supply stock to as many customers as possible because it enhances his position in the paper purchasing market. Second, not all publishers will supply their own paper, so a printer must maintain a purchasing position. Third: Some printers buy in huge volume and resell the stock at a fair market price to their clients, but make money because of volume purchasing. Fourth: A printer might prefer that as many customers as possible purchase their own stock. It reduces his exposure to a bad debt, reduces capital requirements, and allows for "lost" interest money to be applied to expansion. Fifth: There are countless other factors in this picture. Suffice it to say, some printers like to buy paper and some printers don't.

Lesson 3: Paper dependency can be good and bad. If your printer purchases all the paper, and the market gets tight, you may find it difficult to switch printers. On the other hand, if the market gets tight, your dependency may transform into availability: The printer will attempt to serve those customers who have relied on him in the past. The ugly part: It is conceivable that a printer would neglect the needs of uncontracted smaller publishers, and give priority treatment to large, contracted accounts.