Small Publishers Co-op To Take On Rising Costs
They may call themselves a small co-op, but Integrated Media Consortium (IMC) is set to allow a handful of small, like-minded publishing companies the benefits that were once only available to larger conglomerates.
IMC is the brainchild of small-publishing industry veterans Bill Walker and Alan Douglas. The voluntary buying cooperative will give small to medium-sized ($3 million-$200 million in annual revenue) publishing companies the benefits of lower costs on printing, paper, shipping and general office expenses by consolidating volume purchasing.
Walker, who will serve as IMC’s president, sees the co-op as a natural extension for smaller publishers looking to stay competitive. "As the economy turns upward, smaller publishers need to stay competitive," he says. "And the co-op provides that opportunity."
The formal announcement of the co-op's formation will be made at the American Business Media Top Management meeting in Chicago on Monday, November 15.
Founding members of the co-op include Allured Publishing, Douglas Publications Inc., Edgell Communications, Farm Journal Media and National Trade Publications Inc. The companies are not charged an annual fee but hold unspecified shares in the co-op. Member companies will have regular board meetings, which Walker says will determine which suppliers make the best fit.
Walker expects to have 10 members by January and 23 by the end of 2005 and IMC will wait until a critical mass of 10 publishers joins the fray before any deals with vendors are struck. But co-op members can expect to save the most in areas they typically spend most. "Wherever they spend the most money, that's where they'll save," says Walker.
Allured Publishing CEO Janet Ludwig sees the unique opportunity the co-op brings to cut costs. "All small publishers are paying huge costs due to the limited quantities they deal in," she says. "Because of the combined buying potential, we saw this as an opportunity."
"When you're averaging $10 million in revenue, it's very hard to get the attention," adds National Trade Publications Inc. president Humphrey Tyler, who expects to save more than his investment, though he doesn't expect it to happen in the short term. He says that while co-ops are common in other industries, they are rare in the b-to-b sector. "We're banding together, trying to get the purchasing power."
Ludwig also says the potential for co-op members to share information with each other was equally attractive to the controlling of costs. "The ability to say 'Hey, what do you pay?' isn't a line-item in the budget, but it's there," he adds.
Douglas served as chair of the Small Publishers Committee, Publishing Services Committee and Ethics and Admissions Committee for American Business Media. Walker is the co-head of B2BWorks, an online media and marketing services company. He was formerly a vice president of marketing at American Business Media. Tyler is the chairman of ABM’s Smaller Publishers Advisory Committee.
"Alan had this idea 10 years ago," says Tyler. "But it took time to research and develop it the right way, and now two visionaries are making it happen."