“When developed strategically as a secondary market, GPO work will fill a printer’s downtime to maximize production utilization, increasing it from a print industry average of 70% to full utilization of 90% to 95%,” she said. “Before GPO work, a printer can average 2.5% profitability on 70% production utilization. Add GPO work and the bottom line grows to about 14%. Given these impressive stats, it would seem every printer would want a flow of GPO revenue.”
As a respected source that awards about $350 million annually to the private sector, Snider said GPO is the perfect client for filling downtime. However, she added that some printers are reluctant to bid on federal work because they may have been misled by myths about working with the GPO.
Myth 1: “GPO is a difficult client.” Actually the opposite is true because the GPO has for decades been a model for efficient procurement. You will succeed as long as you know and follow government requirements for printing, packaging, shipping and invoicing. As with any government agency, or commercial account for that matter, there are specific documentation requirements, and attention must be paid to details. The best way to avoid problems is to partner with a firm that specializes in GPO work, has daily contact with the GPO, knows how to avoid pitfalls and helps printers win in the competitive GPO bidding environment.
Myth 2: “GPO jobs are too big or too small for my business.” Neither is true. GPO awards work for printers of all sizes. For those interested in the big job, there are printers now realizing significant revenue from the GPO by winning only a handful of single-award jobs during any given year. For example, a job for the Internal Revenue Service could be awarded for hundreds of thousands of dollars. One the other hand, the printer who prefers small jobs in the several thousand dollars per job range can find plenty of GPO work. The typical GPO job ranges from $2,000 to $5,000.
Myth 3: “GPO work is produced by low quality printers.” High or low quality is not the issue in GPO procurement. Because the GPO is the only vehicle through which federal government agencies buy their work from private sector printers, quality requirements vary widely. Some finished products must be museum quality while others should be professional marketing, commercial print or duplication quality. The printer must know its capabilities, not stretch what it can do. The printer must bid for the work on which it can do the best job and make a profit. For this reason, it is imperative to become registered as a GPO print supplier at the correct level so your firm is eligible to do as much printing as possible. Again, a GPO bid service will work with you to make sure you qualify for any or all of the five levels of GPO printing – functional to best. A printer can only submit bids for the levels of work for which it is qualified. This is the important first step in developing GPO as a secondary market.
Myth 4: “GPO work is awarded at prices below my paper cost.” This myth can be dispelled with some common sense. The printer must know how to competitively buy paper and other materials, operate effectively, be adequately capitalized and be realistic about what it can produce to get successful results and gain more GPO business. This is no different than bidding on non-government jobs. The complexities arise with the details, and that is where professional government print management experts can help the printer stay clear of problems. Help is available for specification interpretation, program review, in-depth pricing analysis, cutting through governmental red tape, preparation of submission packages, invoicing and prompt collections assistance, negotiation and legal consultation services and direct representation to the government.
“Printers who have not looked at working with the GPO should,” Snider emphasized. “Those who have looked but have not sought GPO work should look again. There is lucrative business at the GPO to be had, especially for the 30% of the time that the average printer has no work scheduled... meaning no income to offset expenses.”
The key to developing the GPO as a solid secondary market is to be willing to seek work that can be produced when nothing else is scheduled. “The printer must look beyond the myths of working with the GPO to the reality of increasing profits,” Snider concluded.
About e-LYNXX Corporation
e-LYNXX Corporation patented the technology integral to e-commerce. Endorsed by Educational & Institutional Cooperative Purchasing (E&I) and Printing Industries of America (PIA), e-LYNXX drives results through its three divisions. ● AVS Technology® licenses the patented* automated vendor selection procedure used in e-commerce and procurement systems. ● American Print Management provides web-based system, services and patented AVS Technology® to reduce substantially the procured costs of direct mail, marketing, publications, packaging, labels and other procured print. ● Government Print Management offers effective U.S. GPO bid services and strategies. www.e-
*U. S. Patent No. 6,397,197, Patent No. 7,451,106, post-Bilski Patent No. 7,788,143, and Continuing Application 12/855,423 (collectively, the AVS Technology®) – This thicket of patents covers all custom goods and services, not just print. To inquire about licensing, contact Anthony Hawks at 888-876-5432 or Michael Cannata at 905-773-2207.