As economy worsens, publishers look overseas as a way to cut down on their production costs
As the U.S. economic situation continues to worsen and costs close in from all sides, publishing production directors are trying to figure out new ways to get expenditures down. Some are finding the attraction of sending work overseas at a much lower price to be extremely attractive.
Keith Hammerbeck, corporate director of media operations at Advanstar Communications, said his company has had XML transfer done in India for several years. The work previously was handled in-house by a couple of programmers using a process that was complicated and time-consuming.
When the system needed an upgrade, Hammerbeck said, Advanstar decided to have the work done overseas and has been pleased with the results. “We'd love to automate this, but that's easier said than done,” he said. “This allowed us to lower headcount and still get a quality product.”
One company that has been successful at facilitating subcontracting is Potion Ventures, which launched less than two years ago but already has a stable of titles that use its services. One of the main draws is the company's content management system, called OPUS, which allows U.S.-based publishers to be able to see where a file is at any given time and to make needed changes.
“This is the way editors have been working for forever,” said Reena Russell, CEO of New York-based Potion. “You can't change that need to tinker in the creative process.”
One thing that can be changed, however, is the proximity of the production staff to the editors. Potion's India-based employees' work shifts allow them to be available for part of the U.S. business day so they can respond to work requests within OPUS as they are made.
“The hope is to replicate that feeling of having someone a couple of desks over who can deal with your changes,” Russell said, “but instead, the people are thousands of miles away.” U.S.-based editors can mark up documents within OPUS and turn them back in for Potion staffers to handle.
Russell said the two critical things publishers are looking for from overseas contractors are consistency and timely turnaround.
Finding the right overseas vendor can take time. One production director, who asked not to be identified, said it took more than a year and several vendors before one was deemed good enough to actually run a test issue.
For digital and print consultant Martin Kelley, who has worked with a number of overseas contractors, the right vendor was one that provided quality work, a reasonable price and a good, consistent turnaround time. By outsourcing one job that normally was done in New York, Kelley was able to cut his turnaround from three weeks to one and reduce the New York team by four people.
“It's a sensitive subject,” James McQueen, VP-technology and development at Cadmus Communications, said of outsourcing. The printing company has been outsourcing production work to India for a decade. “These days, that's what we're talking about—people's jobs,” McQueen said. “If you have to retain your staff and outsource, you're not saving. The idea is to outsource and change head count. It's that simple.”
Cadmus, which is owned by Cenveo, owns two facilities in India that together employ around 700 people. The staff in India initially handled books and then heavily templated medical journals. In time, the company has moved to doing production for magazines overseas.
McQueen said Cadmus was approached by a U.S. publisher with about 30 titles that is considering outsourcing production overseas. “It's just getting bigger and bigger and will continue to grow as communication and technology issues get worked out,” he said.
Kelley said he's been working with many publishing and retail companies lately and that the outsourcing of all noncreative functions—such as research, photo editing and production—has been a major topic of conversation because of the potential cost savings. “As one VP of operations said during a recent meeting, it's not a question of can it be done anymore; it's simply a matter of us learning to let go,” he said. M