The firm consolidated production for its four locations – Stockton on Tees, Sunderland, Durham and Newcastle – last October, moving all litho, large-format, digital and finishing work to Stockton, which was already the firm’s largest production facility. It also centralised the design work at the Newcastle site.

We’ve kept sales at all the sites – we didn’t want to lose the local contacts, says commercial director Stephen Jones. Newcastle has a different focus with more design and we’ve rebranded that branch with more of an agency feel.

Despite the shake-up expected in any major move, Jones was pleasantly surprised by the staff’s reaction. We thought it would be a nightmare, but it was much easier than we thought, he says. Stockton had always been the flagship production site and people were willing to travel to work there. The ones it would have been an issue for were in Newcastle, but they were the designers and stayed there.

Consolidating growth
Over the years, the group has grown through a mix of expansion and acquisition. Having outgrown its original high-street shop in Middlesbrough, which opened in 1993, the firm moved to an industrial estate in Stockton in April 2001. In 2003, the firm bought the AlphaGraphics Sunderland franchise, followed by the Newcastle franchise in 2005 and along the way also started to operate an inplant at Durham University. The plants all had production on site with a mix of small-format litho and digital across the group.

Historically we’ve acquired businesses and then run them separately, so we had replication of staff and machines, says Jones. We also had to have three sets of consolidated accounts and replication of maintenance contracts and paper and consumables accounts, so it was logical to look at the financial picture. The investigation into centralising operations began in early 2007.

We started by looking at our accounts, says Jones. Then we looked at centralising digital colour and it was a no-brainer. We had eight machines across four sites ranging from Xerox DocuColor 12s to DocuColor 6060s and they were all on different click charges and the colour and quality varied widely.

The firm needed to invest in additional digital colour capacity to take the heat off the 6060. Before talking to potential suppliers, the firm used its MIS to analyse its digital requirements and then took those to HP and Xerox, eventually deciding on a pair of iGen3s.

We went with Xerox in the end because it’s more of a push-button approach, says Jones. The problem with Indigos is that you need a skilled offset operator to run one. Also, we were familiar with the Xerox software and we had a workflow set-up that meant the iGen3s were almost plug and play.

One reason the company centralised production was to buy smarter, and it did that with one of the iGen3s, taking advantage of Xerox’s end of year to get a better price. It got what Xerox calls a ‘golden sheet’, having the kit up and running within three days of signing the order.

Digital print, especially wide-format, was identified as a driver of growth, so digital was put at the heart of the reshuffle. Digital has proved to be something of a virtuous circle. Having taken the plunge with the iGen3 buy Jones decided that two machines were necessary to meet the needs of on-demand work, but he also needed additional work to fill the spare digital colour capacity, which led him to cross-media (data, campaign management, workflow design and web) and an investment in XMPie.

Cross-media has proved to be a real boon, bringing in jobs that contribute to several of the seven profit centres the firm operates: cross-media; creative design; litho print; digital print; point-of-sale (wide-format digital); finishing; and despatch (pick and pack, mailing, warehousing and online ordering).

Cross-media has become a USP that helps the firm work at a higher level with clients and agencies, as well as providing a trade service to other printers, agencies and print management firms. In fact, for one cross-media deal with a digital printer in the Middle East, AGNE handles everything except printing, including hosting sites and developing campaigns, and supplying personalised PDFs to be run out locally.

MIS upgrade
Not a firm to do things by halves, AGNE also became the first AlphaGraphics franchise anywhere to switch from EFI’s PrintSmith to another MIS, a move Jones says was imperative.

Prior to the installation of its Prism MIS, managers had to travel to each location to be able to access the branch’s information. Once we realised we were outgrowing PrintSmith, we spoke to five suppliers about our wish list for the perfect system, he says. Critically, it needed to work remotely so we could run all the sites from a central database.

The new MIS cost more than £85,000 and took several months to get up and running. The firm is still implementing further modules, having prioritised management accounts and estimating and quoting, and deployed those first. The MIS and centralised production has reduced costs as well.

We can get a better price, he says. Prism allows us to forecast much better. We can forecast our stock usage, which enables us to do more proactive buying with the aim of a 10% saving in consumables costs.

Other infrastructure investment included an IT upgrade. The firm spent £30,000 on a broad area network linking the sites, faster networking in Stockton to deal with the increased data for digital printing and a new email server for the group.

For a firm that is so switched on to full-colour personalised digital print, it might seem odd that the litho department only has two-page two-colour machines with a mix of portrait and landscape formats and straight and perfecting presses.

We reviewed the print we were doing – the mix of formats, number of colours and sides, what it was costing and what we were outsourcing and from this worked out what kit and how many people we’d need to man it on one site, says Jones. It was easy; the company was built on two-colour stationery and one-colour NCR work, including one-back-one work – any four-colour work we run through twice.

A multi-colour B2 machine was considered but rejected. If we bought new kit, there would have been a need for a lot of training and finding new customers to fill them, he says. It would have been a risk and we were already taking a lot of risks. We were investing heavily in digital colour – so we prioritised that. The firm carried out a similar process with its finishing facilities, most of which were already in Stockton, and added a PitStop folder and creaser for digital work.

AGNE’s centralisation was about more than just the physical location of the kit, although that has helped to reduce heat, light and power use and to improve efficiency. The centralised management system was crucial to identify and implement greater efficiencies and focus on the bigger picture.

Taken as a whole, the physical and technological moves have put the firm in the right place to succeed. We’ll find out the full impact at the end of September, but already it’s improved our profitability, lowered our overheads and helped pricing, says Jones. If we’d stood still we’d have made a lot less money, and now we’re positioned to go more into cross-media.