By Andy Rae, Senior Vice President of Equipment & Marketing, Heidelberg Americas Why do you buy capital equipment? Hopefully, your answer is to make as much profit as possible from that purchase. Many think profit potential is related to the price of the equipment, but that couldn’t be further from the truth! To justify a 25% price premium, you only need about 9% more output for the same cost per sheet —yes, 9%!  This is because finance and depreciation only account for 30% of your budgeted hourly rate (BHR). The rest of your BHR is linked to your fixed and variable costs. So, when looking to buy capital equipment, you should consider these key investment questions: Based on the price of the equipment and its real potential output, what is your cost per sheet going to be? Can you utilize this capacity? Heidelberg has conducted in-depth research using neutral data on press productivity based on real-life performance in the market. This research proves that paying a premium for equipment with proven productivity leads to a significantly lower cost per sheet. Why? Because the number of sheets that can be printed are enormously higher, and at times, more than double what can be produced on other equipment (and remember you only need 9% more!). The next task is to extrapolate this thinking across the entire business so that you minimize the cost per sheet, in each cost center. Then you need to align the capacity of each cost center; it’s useless buying a new press with an average output of 50 million sheets per year if you are not able to invoice the work because it’s sitting in the bindery (as additional work in progress)! In all,  it boils down to a combination of optimal business capacity, cost center capacity, process offerings (stitching, binding, laminating, etc.) and minimizing the cost per sheet of those offerings…oh, and keeping sales & admin costs low, while still offering great service (I didn’t say it was easy!). Once you have the lowest cost per sheet, you can still work on the niche markets or customers that are willing to pay more based on your excellent service and quality, giving you even more profit. Entrepreneurs with the lowest cost per sheet smile when they hear the competition say, “They will go bust offering those prices.” In reality, they know they are making more profit on that “low” price than their competitors would have made at a higher price… that couldn’t even win them the...

By Andy Rae, Senior Vice President of Equipment & Marketing, Heidelberg Americas Why do you buy capital equipment? Hopefully, your answer is to make as much profit as possible from that purchase. Many think profit potential is related to the price of the equipment, but that couldn’t be further from the truth! To justify a 25% price premium, you only need about 9% more output for the same cost per sheet —yes, 9%!  This is because finance and depreciation only account for 30% of your budgeted hourly rate (BHR). The rest of your BHR is linked to your fixed and variable costs. So, when looking to buy capital equipment, you should consider these key investment questions: Based on the price of the equipment and its real potential output, what is your cost per sheet going to be? Can you utilize this capacity? Heidelberg has conducted in-depth research using neutral data on press productivity based on real-life performance in the market. This research proves that paying a premium for equipment with proven productivity leads to a significantly lower cost per sheet. Why? Because the number of sheets that can be printed are enormously higher, and at times, more than double what can be produced on other equipment (and remember you only need 9% more!). The next task is to extrapolate this thinking across the entire business so that you minimize the cost per sheet, in each cost center. Then you need to align the capacity of each cost center; it’s useless buying a new press with an average output of 50 million sheets per year if you are not able to invoice the work because it’s sitting in the bindery (as additional work in progress)! In all,  it boils down to a combination of optimal business capacity, cost center capacity, process offerings (stitching, binding, laminating, etc.) and minimizing the cost per sheet of those offerings…oh, and keeping sales & admin costs low, while still offering great service (I didn’t say it was easy!). Once you have the lowest cost per sheet, you can still work on the niche markets or customers that are willing to pay more based on your excellent service and quality, giving you even more profit. Entrepreneurs with the lowest cost per sheet smile when they hear the competition say, “They will go bust offering those prices.” In reality, they know they are making more profit on that “low” price than their competitors would have made at a higher price… that couldn’t even win them the...

By Mark Bohan, Director, Prinect and CtP, Heidelberg USA The print industry is currently embracing change through the adoption of Industry 4.0, which is all about driving productivity while ensuring and verifying the quality of printed materials. Combining seamless integration with business decision making allows for achieving this kind of smart manufacturing facility. At the heart of this change, we need a business intelligence platform (also known as a fully integrated workflow) that evaluates and analyzes a company’s production as a linked process rather than individual activities. What we are seeing with the fourth industrial revolution is the use of cyber-physical systems. These systems and processes communicate with each other (both inside and outside company boundaries) to provide a smart production system throughout the entire value chain. This builds on individual systems using the Internet of Things (IoT) and the cloud to provide connectivity and integration. Big data can be collected, analyzed and acted upon so that systems can utilize simulations and models to adapt, reconfigure and carry out steps in the manufacturing process. To facilitate this change, a business intelligence platform removes the obstacles by integrating production processes and making them measurable from the initial customer inquiry through to delivery and invoicing. As a job passes through the stages of production, the software knows where it is, who is doing what to it, how close to schedule it is moving along, and what kinds of costs/time it is accumulating as it progresses. Now, your company has a continuous feed of real-time information that it can use to: Reduce touchpoints Drive productivity and uptime Optimize consistency and repeatability Reduce waste and inventory A true business intelligence platform will significantly impact the future strategy and profitability of your company. The discussions and value propositions are now centered on how to rewrite the business operation as a whole rather than focusing on individual manufacturing centers (such as estimating, prepress, press, digital and postpress). The platform now connects all parts of the manufacturing process. Consider a car manufacturing operation. Changes to the production process are never made based on individual employees. Instead, the impact of each change is analyzed to assure that it will not degrade productivity or lead to costly failures and potential recalls. The same philosophy should apply to print manufacturing environments where the use of materials, software and equipment must be measured throughout the entire production cycle. Print production is transforming. The smart factories of tomorrow are becoming the reality of today. Systems that leverage Industry 4.0 are available throughout the whole production cycle, offering significant improvements to the manufacturing process. This is redefining the marketplace and cost structure. Exploiting these systems allow reduced manufacturing costs and cycle times...

By Mark Bohan, Director, Prinect and CtP, Heidelberg USA The print industry is currently embracing change through the adoption of Industry 4.0, which is all about driving productivity while ensuring and verifying the quality of printed materials. Combining seamless integration with business decision making allows for achieving this kind of smart manufacturing facility. At the heart of this change, we need a business intelligence platform (also known as a fully integrated workflow) that evaluates and analyzes a company’s production as a linked process rather than individual activities. What we are seeing with the fourth industrial revolution is the use of cyber-physical systems. These systems and processes communicate with each other (both inside and outside company boundaries) to provide a smart production system throughout the entire value chain. This builds on individual systems using the Internet of Things (IoT) and the cloud to provide connectivity and integration. Big data can be collected, analyzed and acted upon so that systems can utilize simulations and models to adapt, reconfigure and carry out steps in the manufacturing process. To facilitate this change, a business intelligence platform removes the obstacles by integrating production processes and making them measurable from the initial customer inquiry through to delivery and invoicing. As a job passes through the stages of production, the software knows where it is, who is doing what to it, how close to schedule it is moving along, and what kinds of costs/time it is accumulating as it progresses. Now, your company has a continuous feed of real-time information that it can use to: Reduce touchpoints Drive productivity and uptime Optimize consistency and repeatability Reduce waste and inventory A true business intelligence platform will significantly impact the future strategy and profitability of your company. The discussions and value propositions are now centered on how to rewrite the business operation as a whole rather than focusing on individual manufacturing centers (such as estimating, prepress, press, digital and postpress). The platform now connects all parts of the manufacturing process. Consider a car manufacturing operation. Changes to the production process are never made based on individual employees. Instead, the impact of each change is analyzed to assure that it will not degrade productivity or lead to costly failures and potential recalls. The same philosophy should apply to print manufacturing environments where the use of materials, software and equipment must be measured throughout the entire production cycle. Print production is transforming. The smart factories of tomorrow are becoming the reality of today. Systems that leverage Industry 4.0 are available throughout the whole production cycle, offering significant improvements to the manufacturing process. This is redefining the marketplace and cost structure. Exploiting these systems allow reduced manufacturing costs and cycle times...

By: Gary Jones, Assistant VP EHS Affairs, Printing Industries of America; Kaitlin Mackey, EHS Associate, Printing Industries of America; Matthew Crownover, EHS Associate, Printing Industries of America On July 1, 2016, the U.S. Department of Labor (DOL) released its interim final rule, increasing the civil penalties for violations of its standards. The increase was required due to the passage of the two-year bipartisan budget President Obama signed on November 2, 2015. This is the first time in 25 years that OSHA has increased its penalties. Since 1990, OSHA has been one of only three federal agencies that were specifically exempt from a law that required federal agencies to raise their fines to keep pace with inflation. The bill allows OSHA to have a one-time adjustment this year to catch up from the last time the agency’s civil penalties were modified. In addition, the law allows the penalties to be increased each year.  OSHA’s New Penalties The required initial penalty “catch-up adjustment” was tied to the percentage difference between the October 2015 Consumer Price Index (CPI) and the October 1990 CPI. This inflation adjustment factor for this period worked out to be 78.16 percent. The new penalties will become effective on August 1, 2016, and the maximum penalties for workplace safety violations issued by OSHA will be as follows: Violation Type Existing Penalty New Penalty Other-Than-Serious $7,000 $12,471 Serious $7,000 $12,471 Failure-to-Abate $7,000 $12,471 Willful $70,000 $124,709 Repeat $70,000 $124,709 Violation of a posting requirement $7,000 $12,471 Violation of a reporting requirement $7,000 $12,471 Due to the new law, the rounding down to the nearest $1,000 has been eliminated. The new law eliminated the rounding rules so penalties are now rounded to the nearest dollar. New Penalties and Existing Inspections The interim final rule mentions how OSHA is going to apply the new penalty structure to inspections that began before August 1, 2016. The rule states that the adjustment will apply to any penalty assessed after August 1, 2016, “including those whose associated violation predated such increase.” The adjusted penalties apply to any citations issued after August 1, 2016 whose associated violations occurred after November 2, 2016. This means that any inspection that has not been closed on or before July 30, 2016 may be subject to the higher penalty amounts. OSHA could wait to issue a citation until after August 1, 2016 so they can use the new higher penalties. It is not clear if OSHA will intentionally delay issuing a citation. It remains to be seen how OSHA is going to address the penalties for these inspections. States With OSHA Approved Programs According to the rule, states that operate their own Occupational Safety and Health Plans must also...

By: Gary Jones, Assistant VP EHS Affairs, Printing Industries of America; Kaitlin Mackey, EHS Associate, Printing Industries of America; Matthew Crownover, EHS Associate, Printing Industries of America On July 1, 2016, the U.S. Department of Labor (DOL) released its interim final rule, increasing the civil penalties for violations of its standards. The increase was required due to the passage of the two-year bipartisan budget President Obama signed on November 2, 2015. This is the first time in 25 years that OSHA has increased its penalties. Since 1990, OSHA has been one of only three federal agencies that were specifically exempt from a law that required federal agencies to raise their fines to keep pace with inflation. The bill allows OSHA to have a one-time adjustment this year to catch up from the last time the agency’s civil penalties were modified. In addition, the law allows the penalties to be increased each year.  OSHA’s New Penalties The required initial penalty “catch-up adjustment” was tied to the percentage difference between the October 2015 Consumer Price Index (CPI) and the October 1990 CPI. This inflation adjustment factor for this period worked out to be 78.16 percent. The new penalties will become effective on August 1, 2016, and the maximum penalties for workplace safety violations issued by OSHA will be as follows: Violation Type Existing Penalty New Penalty Other-Than-Serious $7,000 $12,471 Serious $7,000 $12,471 Failure-to-Abate $7,000 $12,471 Willful $70,000 $124,709 Repeat $70,000 $124,709 Violation of a posting requirement $7,000 $12,471 Violation of a reporting requirement $7,000 $12,471 Due to the new law, the rounding down to the nearest $1,000 has been eliminated. The new law eliminated the rounding rules so penalties are now rounded to the nearest dollar. New Penalties and Existing Inspections The interim final rule mentions how OSHA is going to apply the new penalty structure to inspections that began before August 1, 2016. The rule states that the adjustment will apply to any penalty assessed after August 1, 2016, “including those whose associated violation predated such increase.” The adjusted penalties apply to any citations issued after August 1, 2016 whose associated violations occurred after November 2, 2016. This means that any inspection that has not been closed on or before July 30, 2016 may be subject to the higher penalty amounts. OSHA could wait to issue a citation until after August 1, 2016 so they can use the new higher penalties. It is not clear if OSHA will intentionally delay issuing a citation. It remains to be seen how OSHA is going to address the penalties for these inspections. States With OSHA Approved Programs According to the rule, states that operate their own Occupational Safety and Health Plans must also...