Magazines count the cost of survival

The sector has been hit by falling sales and rising paper costs, but Philip Chadwick finds printers are helping publishers find ways of cutting costs
Magazines are feeling the squeeze right now. With dwindling circulations and advertising at an all-time low, publishers are having to take tough decisions on titles' futures and there have been some high-profile casualties over the past few months. That trend is likely to continue as the market continues to struggle and the print industry is already feeling the knock-on effect.

A snapshot of the sector doesn't make for comfortable reading. One of the highest profile losses was men's glossy Arena, which was suspended in March. The title's circulation was falling and a sharp decline in advertising was one of the reasons for Bauer Media's decision to cease publication. Meanwhile, Dennis Publishing made the decision to shut men's lifestyle magazine Maxim in April. Circulation of the title had dipped by more than 40% and Dennis decided that the future of the brand was online.

In the same month, the free commuter magazine Sport ceased publication after its French parent company Sport Media & Strategy went into administration. St Ives printed 300,000 copies of the weekly title, although there are hopes that it could return in the future, with directors in the UK rethinking the business model and looking for
further investment.

With advertising down and sales on the wane, the situation looks bleak, but publishers and printers are collaborating to ensure that their magazines survive. And some sectors aren't as adversely affected as you might think - there are plenty of signs of life in contract publishing, for example.

Data evidence
The latest set of ABC figures confirm the anomalous activity of customer magazines. In the last six months of 2008, there was a 16% rise in customer publishing titles' circulations and these titles accounted for 12 of the top 20 magazines in terms of circulation. In contrast, consumer magazines experienced a 6.8% circulation drop in the period.

There are also some sectors in the consumer market that are performing better than others. Personal finance titles performed well, as did those in the hobbies sector. But the recession has bitten into reader numbers for men's magazines Nuts and Zoo, while issue circulation for the women's weeklies have dropped 2.6%.

Despite these conflicting fortunes, there were still two notable launches this year, both from the Condé Nast stable. Printed by St Ives Plymouth, monthly Wired and 334pp luxury biannual title Love both hit the newsstands last month. So, while there is no doubt that the recession has taken its hold on magazines, some sectors look like they are coping better than others.

"We see a whole cross-section of the market - we're not a bad barometer," explains Tony Jones, chief executive at Pensord, which prints more than 300 titles, predominately in the B2B sector. "Not all sectors are underperforming but, by our calculations, the titles we have been printing year-on-year are underperforming as a whole."

He adds that smaller publishers appear to be more vulnerable to market fluctuations. "It is almost certain that they do not have much of an asset base and the last thing a printer wants is to effectively become their bankers. As we approach the summer, it seems increasingly likely that there will be more casualties," says Jones.

Helping hand
Pensord is doing its hardest to help publishers so that they can keep hold of the titles they've got. It's all about saving money in areas such as the design or the paper grammage, according to Jones.

"These days, it appears there are fewer experienced print buyers, particularly in smaller publishing companies. Therefore, many of the communications we receive start with ‘Can you reduce your prices?'," says Jones. "Our responses are often far more detailed than just a yes or a no. Long before the recession started, we made a conscious decision to put in place a print buyers' health check service to make sure publishers are buying cost effectively and efficiently in all areas."

Polestar is another print firm that handles both production and mailing for a number of its magazine clients. The company feels that it is well placed to work with clients on areas where cost savings can be made.

"With recent changes to the postal tariff, we have seen a move towards a lighter grade of paper being used for subscription copies of magazines to help reduce mailing costs," explains Polestar UK print key account director Avril Jenkins. "We have worked with our customers to trial various weights and brands of paper to ensure we achieve the best results."

The importance of paper isn't lost on the publishers themselves. Emap manufacturing director Richard Hunt recently outlined how the company's Inform stable of B2B magazines had cut paper and production costs. Speaking at Publishing Expo, he said that optimum manufacturing efficiency was the way to overcome increasing paper prices.

Emap's solution has been to implement back-to-back printing across the portfolio of 13 weeklies and 12 monthlies plus supplements. This means that sections are printed in one run, with only one makeready, on the same stock.
"We're maximising print efficiencies, minimising grammages, minimising reel sizes, bulk purchasing, reducing
makereadies and plate changes with the environmental benefits of paper and ink reduction," said Hunt.

Times have changed and priorities have shifted, according to Chris King, production director at PrintWeek's publisher Haymarket Media. "Previously, we concentrated on quality as number one, followed by the environment and costs. Now all our energies are focused on costs. In the past two years, we have conducted a bottom-up review of our supply chain," explains King.

There are plenty of areas in the production process that can be considered in such a review, paper choice being just the tip of the iceberg. "Changing trim sizes and schedules for maximum press utilisation has also been a successful way for our customers to reduce their production costs," says Polestar's Jenkins.

"We encourage our customers to carefully consider paginations to ensure the maximum number of pages on a sheet with minimum waste," explains Jones. "Ideally, for a sheetfed process, a job would be made up of 16pp sections. Other straightforward considerations include whether the title should be perfect bound or saddle stitched and could the magazine be a self-cover publication."

Cover savings
Cover changes can also help save the pennies. A high-gloss aqueous machine seal can replace a UV varnish; it may have 20% less gloss but it is an acceptable replacement plus it can reduce costs.

"Another example of potential cost saving is polywrapping and mailing," says Pensord's Jones. "Lower micron polyester
is more robust and generates more impressions per kilogram, which has a positive impact on both the environment
and cost."

Mailing can represent a significant chunk of savings, especially with several alternative postal operators. "We are also able to offer ‘downstream access' for publishers to further reduce their mailing costs and we have worked extensively with our B2B customers on this initiative," explains Polestar's Jenkins.

"There are far more postal options available now and it is possible to gain substantial savings from alternative providers to the Royal Mail," adds Jones. "However, as there are minimum restrictions to qualify, this may not benefit all publishers' mailings."

It all adds up to a pretty significant chunk of savings. Hay­market's King claims the publisher has saved in excess of £1m as a result of the firm's review. "If you look after the pennies, you are sure to save the pounds and there are a lot more savings in the pipeline," he explains. "A good production team can make the difference between magazine survival and closure."

But when the recession ends, will everything go back to how they were? Not necessarily, says King. "In my experience, if you make that many cost savings then around 75% of those changes will be permanent - you've taken the cost base down to a new level and you won't go back. That said, when the recession is over, I would like to upgrade the paper. In my opinion, 25% of those savings should be reinvested in improving the quality of the product."

The recession looks set to leave a different magazine market in its wake. Publishers have cut costs to keep many of their titles going, but how many of these measures will remain when things pick up remains to be seen.
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COST CUTTING: KEY AREAS

• Simply changing the day a magazine is printed on can save publishers money - for example, switching production to a Sunday or a Monday instead of a Tuesday. Also some publishers have found that by paying their printers upfront and early, they have been able to secure discounts

• Paginations need to be carefully considered to ensure the maximum number of pages on a sheet. The reduction in print runs can also result in a change in the way a job is done. A print run of 15,000 could be printed using web offset. If that run goes down to around 10,000 then it can go on a sheetfed press. The process changes as well as the specification of the magazines

• Press days on weekly and monthly titles can be consolidated. For example, Emap has switched to back-to-back printing; titles are printed in one run with only one makeready on the same stock

• Publishers are aiming to minimise the grammages on titles, as well as lowering the trim size

• Finishing can save the pennies. By switching from perfect-bound to saddlestitch, costs can be halved. Also, covers can be a factor. While people generally might not be able to tell the difference between a UV varnish and a gloss laminate, there is a difference in price. UV varnish can be replaced with a high-gloss aqueous machine seal; it may have 20% less gloss, but it is a cheaper and, for many, an acceptable replacement

• Lower micron poly is more robust and generates more impressions per kilogram - this benefits not only the bank balance, but also the environment

• Mailing costs can come down by looking at alternatives to Royal Mail. By shopping around for deals from the likes of DX, CitiPost, TNT and DHL, savings can be made. Also, by physically reducing the size of the magazine, savings can be made on Royal Mail's size-based pricing policy. For example, Haymarket Publishing switched Marketing to A4 from A3 to take advantage of this

• In pre-press, soft proofing can help publishers make further savings in paper and ink