Arandell Corporation

Don Treis, CEO

It sure is hard to believe it’s already October 19 and we’re starting to think about the holidays!

Each year, as a way of embracing the holiday spirit and to show our gratitude, Arandell Corporation donates to the Make-a-Wish Foundation at year’s end. In the past, we have arbitrarily chosen the amount to be donated and this year we’re going to try to change things up. This year, YOU will be driving how much we donate. In fact, if you’re reading this blog post, you have already made an impact on the campaign.

For every unique hit that we receive on the Arandell Blog between today (October 19) and December 15, Arandell will donate $1 to the Make-a-Wish Foundation. We’ll be driving these hits by updating our blog posts even more frequently than we normally do. And not only do the blog posts appear here, they will also be linked on social media sites like Twitter, Facebook and LinkedIn.

Also, to thank you for visiting us and to prepare you for the year ahead, you can request a copy of our corporate calendar. Simply send an email to blogging@arandell.com with your name and mailing address and we’ll mail it directly to you.

Help us make this our most generous Make-a-Wish donation yet by visiting the blog from wherever you may be. The hits are based on IP address, so visit us from home, work or on the road. And don’t forget to forward the link to your friends and co-workers!

Our wish for you this holiday season is that the New Year brings you happiness, health and prosperity. On behalf of all of us at Arandell, we thank you for participating in this charitable giving campaign, and look forward to keeping you informed in the years ahead.

Blake Hutchison, Director of Purchasing

I recently read an article in Multichannel Merchant that detailed some ideas about how a cataloger can gain control of their paper spend for 2010 and how these ideas will always result in lower costs.  In reviewing these ideas, I found some of them to contain the truth, but not “the whole truth” as they say in court.  So I thought I would provide some perspective from a printer who supplies paper for many of our clients.

Idea #1:  Establish long term pricing now

Pricing levels have decreased some 20% YTD.  And while the buyers of paper have had the upper hand throughout the year, that will change in 2010.  The producers will be able to pass along some increases.

Printers have the upper hand when it comes to negotiating pricing caps.  When an end user is negotiating their prices with a mill (through a merchant), their only negotiating tool is their annual tonnage.  A printer has the ability to take the annual tonnage of all of their paper clients, combine them and use the whole as leverage with their mill partners, thereby increasing the paper buying power of their clients.  By being part of the whole, you can significantly limit your exposure to these increases.

Ideas #2 & #3:  Challenge your printer to reduce waste and use paper calculators

Paper waste is a natural part of the printing process. A printer is not only challenged on their waste factors by end users, but also by the industry as a whole.  The more they can reduce their waste factors, the better position they are in to reduce paper consumption costs.  A “paper calculator” is a very generic tool that some merchants have put together to try to challenge the printer on their waste and create an “in” with an end user. 

The printer knows their presses. They know the most efficient way produce a job on press.  They know what grades, basis weights, finishes and specific brands of paper perform the best on their presses.  They work everyday on ways to reduce paper waste factors.  Yes, it is important to consider waste.  But to use a very generic calculator to come up with tonnage numbers that really have no basis in reality is a good way to create contention. Trust me; the printer is doing their very best on your behalf.

Ideas #4 & #5:  Reduce your cover and text weights

Always a good thing to consider when looking for ways to reduce paper costs.  But BE CAREFUL.  It might not always be the best idea.  The USPS has just announced new “droop test” regulations that have a lot of end users scrambling to HIGHER basis weights in order for their pieces to pass the test.   

You also might want to consider how your printed piece will look.  As you decrease your basis weight, you are sacrificing opacity and creating “show through”.  Your printer should have plenty of printed samples of what downgrading in basis weight will look like.

Idea #6:  Ship rail

Remember the idea of combining purchases to leverage paper prices?  The same can be done with shipping costs.  The more paper you are ordering as a whole will dictate whether or not you are able to ship rail.  An end-user who prints three or four times annually only gets to combine those tons in a shipment.  But a printer who may have three or four other paper clients printing right around the same time can combine those tons and get them to ship rail.  A printer has the ability to forecast, well in advance, and is in a much better position to work with mills to achieve maximum transit cost savings.

Some other ideas not mentioned in the article:

• For those end users who purchase their own paper: pay close attention to your consumption reports. The leftover inventory that is listed on your report is REAL MONEY and should be utilized as quickly as possible. Make sure you work with your printer to find a home for it as quickly as possible.
• If an opportunity to use it isn’t readily available, work with your printer to get rid of the paper. They might have an opportunity to use it on another printing for another client and might buy it from you.
• Do you know what the storage and handling charges are at your printer? If not, you should. The storage and handling of paper is a real cost to a printer. If they aren’t supplying the paper, they are going to need to charge for those services.
• In many cases, if the printer is able to supply the paper, they will waive those charges.

Questions? Please feel free to contact me any time at 800-558-8724, ext. 165 or BJHutchison@arandell.com.

Don Landis, VP, Postal Affairs

The following was released from the Postmaster General this afternoon. Some great news for your Thursday afternoon!

For questions regarding this release or other postal issues, please contact Don Landis , Arandell VP of Postal Affairs or Susan Pinter, Director of Postal Affairs at 800-558-8724.

To Postal Service Customers:

Many of you have expressed concerns regarding mailing costs for 2010.  The tough economic climate has presented significant challenges to all of us and pessimistic speculation has suggested that postal prices could increase by as much as 10 percent.

As we begin a new fiscal year and as many of you, our business clients, are preparing your 2010 operating budgets, we want to end all speculation.

The Postal Service will not increase prices for market dominant products in calendar year 2010.

Simply stated, there will not be a price increase for market dominant products including First-Class Mail, Standard Mail, periodicals, and single-piece Parcel Post.  There will be no exigent price increase for these products.

This is the right decision at the right time for the right reason.  Promoting the value of mail and encouraging its continued use is essential for jobs, the economy, and the future of both the Postal Service and the mailing industry.

While increasing prices might have generated revenue for the Postal Service in the short term, the long term effect could drive additional mail out of the system.  We want mailers to continue to invest in mail to grow their business, communicate with valued customers, and maintain a strong presence in the marketplace.  Changes in pricing for our competitive products-Priority Mail, Express Mail, Parcel Select, and most international products-are under consideration.  We expect to announce a decision in November.

We are committed to working with customers to find ways to grow the mail through innovative incentives like the Summer Sale and contract pricing.  Mail is the most effective means of communication and advertising and we will continue to work together to increase the value of the mail.  Mail is a smart investment for the future.

John E. Potter

Blake Hutchison, Director of Purchasing

As a catalog printer, from time-to-time, Arandell will receive concerns from environmentalists about the products we produce and the materials used to produce them. (You can imagine, as the one charged with purchasing all o f our paper, I take an interest in these concerns because most of them revolve around paper!)  In a previous article I addressed the “greenness” of catalogs and direct mail pieces. As I continue to research the environmental impact of direct mail pieces I am finding helpful tools to calculate the positive and negative impact of direct mail.

A tool that I found most interesting was created by the paper suppler West Linn. The tool helps calculate the impact of using PCW (Post-Consumer Waste) paper. Click here to use the tool. This is a impressive calculator because users are given the opportunity to change multiple variables, such as PCW percentage and paper tonnage and basis weight on their paper grades.

At Arandell, we implement best practice green initiatives in both the office and manufacturing facilities. We are certified to produce catalogs on FSC (Forest Stewardship Council), SFI (Sustainable Forestry Initiative) and PEFC (Programme for the Endorsement of Forest Certification schemes) certified papers.

If you are interested in using “green” certified papers let us know! Along with aforementioned calculator we have various tools at Arandell that can help you calculate the positive environmental impact your paper choice will create.

Don Treis, CEO

As Americans prepare to carve pumpkins, Trick or Treat, join friends and family in a time of giving thanks and purchase presents for loved ones, the catalog and direct mail world awakens. We in the direct mail business understand the rush of excitement of preparing files for catalog layouts, fine tuning mail files, controlling order fulfillment and optimizing marketing strategies.  A direct mailer’s world is turned topsy-turvy this time of year to ensure we utilize every ounce of what the holiday season has to offer.

Arandell Corporation understands that catalogers and direct mailers are in the midst of an exciting, stress-filled and demanding season.  Earlier in the year, we were preparing for YOUR busy season. During the summer months we performed LEAN initiatives to ensure our equipment was prepared to produce top-quality materials. Early this autumn we met with our sales representatives and sales support to educate them on the latest industry technologies and trends. We are prepared to assist you in all of your catalog and direct mail needs, not limited to just printing and distributing mail.

Perhaps your catalog is not receiving the expected ROI. We can help you inspire solutions such as updating your mail lists or changing formats to better suit your target market. Perhaps you are receiving large returns on an item. Our prepress experts can evaluate the printed color quality to determine precise color matching.  Are you having difficulties understanding the effect your catalog and direct mail piece has on sales? Our data guru can work with your company to optimize your matchback program.

I would like to stress that we at Arandell Corporation can consult in best practice catalog solutions. We have been in the catalog business for decades, proudly working with leading companies to increase their profitability. Our job is to help your “busy season” complete successfully.  Give us a call while there is still time to enjoy the season!

Susan Pinter, Director of Postal Systems

Arandell Corporation has printed and mailed many retail and mail-order catalogs. Both have their own unique requirements based on their marketing objectives.  For instance, retail catalogs have particular in-home dates to meet and are planned in meticulous detail with in-store promotions. Our standard mail-order catalogs often have personalized order forms and inserts that need matchback information to correlate in-home dates and Internet traffic.

With the upcoming changes to the USPS method of tracking mail, specifically transitioning to the Intelligent Mail barcode (IMB) system, the needs of our retail and mail-order clients will be adjusted. Click here to learn more about IMB. We have been surveying our customers to determine how they, or if they, plan to use the Full Service IMB option. As of today, only our retail customers have expressed a desire for Full Service IMB to be used for tracking purposes. Additionally, some retailers are toying with the idea of using the Full Service IMB in lieu of printing Point-of-Sale personalized customer barcodes on their direct mail pieces.

I am writing to learn the opinion and perspective of our standard mail-order catalogers. We have already heard several possibilities on how they might use the IMB services, but at this time have not heard of any immediate plans for mail-order catalogers. Our understanding is most catalogers are just looking at “What if?” scenarios.  

Some of the things we have heard being pondered:

• Using IMB in lieu of matchbacks
• Using IMB data for segmentations
• Of course, retail and standard mail-order catalogers are taking in cost considerations with the different IMB options.

It seems the possibilities center around being able to use the IMB for smaller segmentation of files. I would love to learn what you are planning! Do you believe that Full Service IMB will have a large ROI? What information are you most interested in collecting? If you are NOT considering the Full Service, why? Do you fully understand the file requirements to implement your desired IMB service? What possibilities are there for using the IMB in a standard mail-order world other than tracking?

Look forward to hearing from you!

Don Landis, VP, Postal Affairs

As 2009 approaches the end, it appears the USPS is seriously considering the earlier-proposed Winter Postage Sale. The USPS’s final decision should be announced in the upcoming weeks. Like the USPS Summer Sale, the proposed Winter Postage Sale will provide yet another incentive for catalogers and direct mailers to increase their mail volume. In my opinion, the Winter Postage Sale will be an improvement from the previous postage incentives offered.

Unlike previous postage incentives, the Winter Sale will have a less complicate formula to calculate qualifications and savings. (The proposal is to simply base qualifications and savings on  any mail volume increase over the same period last year for the months of January 2010 through March 2010.)  It will also offer the largest incentive (proposed 30% discount) for direct mailers that qualify.

Earlier this week Hamilton Davison, Executive Director of the American Catalog Mailers Association, posted an update on the USPS proposed Winter Postal Sale. Within the article he shares the impact that ACMA has had with the proposed incentive, deadlines and additional details on the postage rebate.

Don Landis, VP, Postal Affairs

First of all, I should clarify WHAT the droop test is. I can only imagine what you all thought of when you read the title of this post….

The droop test measures the flexibility of catalogs. If mail pieces are too flexible they will topple over as they travel through the USPS sorters and scanners. Implementing deflections standards, or droop standards, will greatly reduce the amount of direct mail pieces that fall off the machines. Recently, the USPS extended the deadline for the deflections standard implementation from September 8, 2009 to January 4, 2010.

How to test your catalog

Click here to see a brief three minute instructional video. Otherwise, read on! Read more…

Blake Hutchison, Director of Purchasing

I just received the following letter from Verso executive Michael Weinhold.

Click here to read the letter.

I find this letter to be extremely interesting.  I was expecting mills that were garnering large sums of money from the black liquor tax credit to announce increases by the end of the year (as per my earlier post), but Verso has just jumped the gun on everyone.  We aren’t sure at this point if it will stick.  I think a lot of it depends on what the other coated freesheet producers (NewPage, Sappi, Appleton Coated, West Linn, etc.) do in response to this.  Some of them have been taking money from the tax credits, but others haven’t. 

We will keep you posted.  Any questions, please feel free to contact your sales rep or myself directly.

***SEPTEMBER 2, 2009 UPDATE***

I also recieved the following letter from NewPage proclaiming their price increase. It appears this will be an industry trend….

NewPage increases prices for coated freesheet grades.

Gary Sierzchulski, VP, Arandell Data Services

One of the most critical factors that is often overlooked in regards to Address Quality is the ability to better understand and view your customers.  Here’s is what I mean.

Suppose you have customers John Smith at 125 Ferret Street and J Smith at 125 Ferret Avenue Apt 2.

The John Smith at Ferret Street has purchased 9 products from you over the years, but none in the past 12 months.  However since he’s been a customer of yours, he has purchased $1400 worth of your products.

The J Smith at Ferret Avenue Apt 2 has purchased a $65 item from you 5 months ago but nothing before or since then.

Based on their past buying history, you would treat these two customers (or should) very differently.  In fact, if you were doing a mailing to only customers who purchased over $100 from you within the past 6 months or who has spent over $1500 life to date neither one of them would receive your mailing and you and they would miss out on a great opportunity to connect.

However through the proper use of address integrity products and duplicate identification processes we have cleaned up their information and these two customers now become one. 

Bad news is you just lost a customer. 

Great news is that you identified one of your best customers. Now you can communicate with him in a whole different way and acknowledge the fact that he indeed is one of your best customers.

Read more…