Andel on Handling: Don't stop the presses!
By Tom Andel, Editor in Chief -- Modern Materials Handling, 12/1/2008
Congratulations. It's December. You've made it through another year of Modern Materials Handling—your job and the magazine. If you're in the newspaper publishing industry, you're twice as lucky, because that business has been hit twice as hard.
Even before the most recent turbulence on Wall Street, newspapers were struggling to stay relevant while online news sources continued to consume an ever larger slice of the media pie. Know what's really ironic? I've been reading about the newspaper world's struggles in The Wall Street Journal—the print version. Their most recent report doesn't promise a very pretty 2009 for publishers. It said Goldman Sachs has lowered its performance estimates. Now it expects revenues to decline 11%, down from its prior estimate of 7.5%.
So what are newspapers doing about it? According to WSJ, publishers like Media General are big into cost cutting. They're reducing their newspaper workforce and outsourcing many operations. But where WSJ seems to see doom and gloom for the print news medium, we at Modern see opportunity—not only for newspapers, but for the materials handling industry as well.
Sure, some publishers are outsourcing, but what if more started being the providers of outsourced services rather than the consumers? That could happen, as we learned while putting together our industry vertical report on publishing (page 39). New, larger publishing facilities are being built to put out several newspapers as media companies consolidate. With this trend comes automation. As you'll read in our report, there's more materials handling automation than ever, both in the pre-press and post-press operations. This automation brings efficiency and widens capacity. Cox Ohio Publishing is responsible for 13 papers serving Southwest Ohio. As Twyla Cummings, a professor at the Rochester Institute of Technology's School of Print Media told me, technology has given this one location the ability to become a satellite distribution point, not only for local papers, but for the WSJ itself. Gatehouse Media, based in Fairport, N.Y., puts out almost 500 newspapers in an effort to be “hyper-local.” Professor Cummings said they're looking to further consolidate for greater efficiency.
Many newspapers have gotten to the point where assets are underutilized—not just their presses, but distribution mechanisms and processes. At the same time, many local colleges have newspapers, but they don't have the capability to print and distribute them. That's opportunity. And what about using some of their extra space to store inventory for neighboring businesses?
Maybe by this time next year Modern's front page will have news of a materials handling services outbreak in the newspaper world. Keep the presses going!
Tom Andel | Modern Materials Handling
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