Build bigger profits following the three Ps
In the second of three articles, Matthew Parker, Founding Director of Profitable Printing Relationships, describes how following the people-planet-profit principle is the route to sustainable success.
What happens to companies that don’t evolve?
Do you remember Blockbuster, Polaroid, Toys “R” Us and Pan Am? All major brands with one thing in common: they failed to change with the times and went bust. Many other companies made the same mistake of failing to evolve.
Many printing companies are also slow to change. As an industry, we are very good at creating new technologies and developing more products for customers. But many companies are less good at adapting to a changeable buying environment.
Currently, there is a major emphasis in moving to a more sustainable production and procurement environment. In my last article, I introduced the concept of the triple bottom line and the three Ps (or 3Ps): people, planet, and profit. Adopting this approach can be a very effective way to adapt to the changing demands of brands and buyers.
The 3Ps approach is far more than just a way to satisfy buyer demands. Adopting this culture brings solutions to many challenges threatening printing companies now.
Let’s have an in-depth look at how the 3Ps can help printing companies in practice.
At the centre of the people element of the 3Ps is creating the right company culture. Put simply, look after your staff and they will look after you. Naturally, we should all aim to look after our staff as well as possible and give them the right support. But there are also substantial benefits to the company itself.
Staff recruitment and retention has already become significantly more difficult over recent months. One of the big employment trends in 2021 was the “Big Quit” or “Great Resignation”. Recruitment will continue to be a challenge in the coming year. Being an employer that values staff gives you significant advantages. It is important to make people want to join your company. However, it is also vital that you live up to your promises so that employees stay. One of the key 2021 metrics has been staff retention: thinking about what staff want and going above and beyond that. This is unlikely to change any time soon.
Creating the right culture leads to employees who will want to help their company rather than just work there. This can lead to big advantages for an organisation. Team members can be motivated to suggest how to produce more efficiently, reduce waste and create new products. In addition, every motivated team member can make a big difference to sales.
Everybody should reduce their carbon footprint. Key to this is how we manufacture products. All printing companies should expect to become Scope 3 carbon neutral, as well as Scope 1 and 2, in the next few years. Brands will start to demand this and, in addition, legal requirements on carbon neutrality in the not-too-distant future are likely. Businesses should start planning for this now.
For the printing industry, the key elements of Scope 3 carbon neutrality include:
- Purchased goods and services – this covers everything from office pens to presses, raw materials and energy
- Waste disposal – this covers all waste and recycling collections as well as chemical disposal
- Use of sold products – this means that you have to measure the carbon impact of your products once they have left your premises. For instance, what is the carbon impact of a product that eventually goes to landfill? What can you do to create products with less carbon impact?
- Transportation and distribution (up- and downstream) – this covers all deliveries to your factory as well as the deliveries of your products to the customer.
In other words, you will need to make sure that your supply chain is carbon neutral. You will also need to measure the carbon life footprint of what you produce. There are already carbon measurement companies that are starting to work in this area. One that specialises in the printing industry is CarbonQuota.
In order to achieve this, it will be important to focus on:
- Energy reduction and increasing renewable energy
- Higher-value and longer-life products
- The circular economy, where products are reusable where possible.
A good example of improving the lifecycle of products and joining the circular economy is the humble roller banner. Stands can be sourced from reused parts or recycled materials. The banner itself should be printed on a recyclable material with environmentally friendly inks. And companies should offer a service where they take back stands and either produce a new banner for the customer or simply reuse the stand for another customer. None of this is hard to achieve: it just requires a new way of thinking.
Naturally, a printing company concerned with the planet needs to be working towards supply chain transparency. This means you should know what is happening upstream in the supply chain and be able to communicate this knowledge both internally and externally. Your suppliers should be open about their social and ethical policies (such as what they are doing about avoiding modern slavery), the raw materials they use in production, where they come from and their labour practices.
These changes require funding. However, much of what has been covered in the people and planet sections above will actually improve the profit margins of a business.
Reducing labour costs through efficiency gains, energy costs and waste all make a big difference to the bottom line. The right people policy will reduce recruitment and training costs, improve productivity, and increase sales. These benefits should outweigh the cost of the policy many times over. The right planet policy will not simply result in significant cost reductions from energy and waste. A move to reusable materials can result in lower output costs. For instance, using reclaimed roller banner stands is likely to be more cost-effective than purchasing new ones and importantly reduces overall consumption of finite resources. There are also potentially more opportunities for trade-in for equipment that can be reused or where parts can be reclaimed. Again, the costs involved in the right planet policy are potentially much smaller than the resulting savings.
What should you do with the extra profits you make? Remember, the 3Ps approach is about the world, not just your company. Consider putting a proportion of profits into:
- Charity – this will also improve your profile and attract customers to whom this matters
- Research – create new processes and products that make you a market leader
- Staff – reward your employees, both monetarily and in benefits, for their part in your success and ensure that they realise that they and their community benefit from your success
- Apprenticeships – develop the right staff for the future.
Is this realistic for smaller companies?
Many people may feel that this is only a strategy for large organisations. However, companies of all sizes should consider adopting a 3Ps approach. Small organisations have more to gain because they work more closely with a smaller team of employees. They can be quicker in putting the 3Ps into practice, and company engagement with the 3Ps strategy will be much easier. Their chances of success are therefore higher. In addition, there are many sources of valuable advice. One of these is Future Fit Business.
Three action points to start implementing a 3Ps strategy
- Create a 3Ps working group. Successful implementation means the ideas should not just come from you. Ask for volunteers from all areas of the company. This means that the action plan you come up with will be realistic, and it increases the chance of buy-in from the whole company.
- Consider networking with like-minded businesses from other sectors including your key customers. It will provide an opportunity to learn what has worked and what hasn’t. This will result in you gaining new ideas and strategies
- Look out for my next and final article in this series. I’ll be sharing specific action points to help you implement a 3Ps strategy.
It is time to evolve!
The 3Ps approach has never been more relevant. Organisations that ignore this approach risk losing business and potentially failing. You don’t want to be the next Blockbusters or Toys “R” Us.
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