How the Supply Chain Is Affecting Book Printing in 2021 & 2022
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If you’ve been watching the news over the last few months, you’re likely aware of the upending effects supply chain issues have had on many businesses around the world. To briefly sum up the situation: the once-invisible system of manufacturing, transportation, and logistics consumers have grown accustomed to is currently being challenged by many pandemic-induced obstacles, including shipping delays and price increases on common goods.
Few industries have avoided the ongoing supply chain squeeze, and the book publishing industry is no exception. With transportation delays and a strain on paper supply becoming the norm, it’s clear that printers, publishers, and authors must recalibrate their expectations for the holiday season and beyond.
To get a clearer sense of what authors can expect when ordering books today (and moving forward), we spoke with someone who’s quite literally in the middle of it all.
Andrew Fennell is the VP of Finance and a board member at Friesens, Canada’s best and biggest book printer. Andrew is responsible for the accounting and administration departments at Friesens — which includes purchasing and procurement of raw materials for books, as well as printing equipment.
We asked Andrew about how this “perfect storm” of supply chain issues has affected Friesens, what they are doing to overcome these challenges, and what authors need to know about navigating these waters in the months ahead.
We’ve been hearing a lot about supply chain issues lately, including paper shortages. How has 2021 been different from other years at Friesens?
It is definitely different, and there are four things that I think fall under the category of “different.”
Certainly, we've been busier. The volume of incoming orders has been much larger than in previous years — our total book volume is up 14% compared to our last pre-pandemic year in 2019. Larger volume means more quote requests and orders, raw materials required, invoices, and more shipments of books. So, that's the good news story: we're growing. But it is a bit of a challenge simply because there's more to deal with, on top of the supply chain challenges we’re experiencing.
There's a long list of supply chain challenges, but foremost among them is that paper mills are operating at full capacity and have limited supply, which means they've limited how much [paper] printers can buy. People may have heard about other raw materials shortages, and that's been different for us this year.
The prices of raw materials have also increased substantially (and frequently) this year. Truly, not a week goes by that we don't hear from some of [our suppliers]. The price of paper has increased, but increases are spread across the board. It's also glue, ink, hardcover board, cover materials, and printing plates. You name it — any raw material that we buy has increased in price. And some of those have increased multiple times in the last few months.
The other big difference — one that's affected many people — is transportation issues. For us at Friesens, incoming shipments of the materials we use to make books are taking much longer to arrive.
It's a bit of a perfect storm of challenges on the supply side.
Why are you at Friesens so much busier this year than years past?
The increase is for a few reasons. I wouldn't call it panic buying from publishers — although in the last few weeks, it sort of feels like that. [The increase in busyness] is partly a function of the larger publishers anticipating that they wouldn’t be able to get books made, or have books shipped from overseas, in the quantities that they've been able to get in previous years.
Some of the larger publishers who would try to produce the majority of their books offshore have realized that's going to be challenging and expensive for them. And so they've on-shored a lot of their business, bringing it back to North America. Although that sounds like a good thing, it overwhelms the marketplace and the manufacturing sector for books because we just simply don't have the capacity.
You noted that paper mills are limiting how much book printers can buy. Is that normal?
No, it's very abnormal. It happened once about 20 years ago, before I started with Friesens. It's not unprecedented, but there's been 20 years of ability to simply pick up the phone, send an order in, and the mills would say, “Sure, when do you want it delivered?” Today, you get a certain amount allocated to you every month from each mill, and that's it. If you've got two truckloads of paper on the way from one mill, the answer is simply “no” if you want more. They don't have the capacity to produce more paper.
Where you could once get [paper] whenever you wanted, it's now a situation where you hope you can get what the mill has allocated to you. Every mill in North America is currently on allocation, and we know that's going to continue into Q1 of next year, at least.
How did we get into this current situation? Is it entirely pandemic-driven?
Prior to the pandemic, there was a massive wave of paper mill closures over the last 5 to 10 years. So there were already fewer options to service the supply side.
When the pandemic hit, I think the remaining mills were initially quite concerned that demand [for paper] would not return to them. They had been on a path of closing down machines and transitioning paper machines to packaging or tissue grades for many years, because the demand wasn't there. And that was probably true even 18 months ago — they felt that demand was going to slip further. But it didn't. Now the challenge has become that they can't keep up with the demand.
Demand for paper has remained healthy over the course of the pandemic (or increased, in the case of books) but the supply of paper has really put such a strain on the supply side.
Have book consumers started to notice these effects?
It takes a while to filter down, but I think come November or December, it'll probably affect the average consumer more than it has. Up until now, readers have been fairly unaffected because they were still able to get most of the books they wanted. The prediction is that November and December will begin to be more challenging for consumers. And I think they're going to feel that in the pocketbook, too, because I expect book prices to go up at the consumer level.
What do authors self-publishing their books need to know about the printing landscape moving forward? How can they continue to be successful?
The thing that comes to mind for me, because we're living it, is this question about lead times. We used to get paper faster and produce books in a shorter period of time, and it's just not the case [today]. And that's true of all our competitors, too. We're all in the same boat — what we used to be able to do in a matter of weeks can now take double or even triple that time. As the printing queue is now significantly larger, it means that the wait time is longer.
I’ll echo what we're telling our publishing customers: the sooner you know how many books you need, and the sooner you can schedule things, the better. You should be thinking far, far ahead in order to get your books by the point that you’ll actually need them.
With expectations recalibrated for potential shipping and production delays, authors will benefit from giving themselves ample lead time before launching their book or holding an event.
What’s one thing that you’ve learned from this challenging time that you’ll take with you going forward?
What has really been fortunate for us is that we have very good relationships with our suppliers. We've tried to maintain those relationships and form partnerships over time, and I think that's been to our benefit in difficult times.
That's something we need to continue to cultivate, and make sure that our relationships with suppliers are as strong as they can be. Because when we're trying to deal with shortages and price increases, you want to be dealing with people who are reasonable and who respect you, and there's a good mutual relationship. I think Friesens is in a good position that way.
How is Friesens preparing to navigate these challenges in the months ahead?
On the supply side, we don't expect it to let up. We expect the same challenges to continue into 2022. One of the things that we are trying to get better at is being a little more predictive. Our ability to forecast and predict, and buy accordingly, is the biggest challenge for us right now. I expect that'll be true for a good chunk of 2022.
The other thing I would say is we continue trying to be creative on the supply side and come up with alternatives where we can get what we need and maintain our costs, so that we can pass on cost savings, or at least maintain prices throughout the challenging conditions we’re all going through.
What are you most hopeful about in the next 6 to 12 months?
I’m hopeful about paper supply. I’m not sure how quickly we’ll be able to move on that as an industry, but there’s one mill that’s scheduled to open up in February in Arkansas. That will increase the capacity of the industry in one paper grade. I’m hopeful there will be some other options for us and the industry to alleviate some of the demands on the supply side. There’s some light there.
