What should I ask about the outsourced work a print shop sends to other printers?
Ask which jobs the shop sends out, to whom, and what it keeps after paying the other printer. Find out whether customers know, how quality and deadlines are handled, and whether the partner relationships are written down or rest on the seller’s personal goodwill.
Outsourcing can be a smart way to offer more than the shop’s own presses can make, such as large formats, special finishes or binding. It also adds a layer a buyer should understand. Start with a list of what goes out, how often and to which partners, along with what the shop pays and what it charges.
Work out what the shop actually keeps on those jobs. Ask whether quotes are built from the partner’s price plus a standard markup, or negotiated each time. Also ask what happens when the partner is late or the quality is poor. The customer blames the shop, not the other printer.
Find out how the relationships work. Do partners give the shop trade pricing because of a personal tie to the owner? Is there any written agreement, or only a habit? Ask whether the partners would continue after a sale and whether they also serve competitors who could take the customers. Finally, ask whether customers know their work goes elsewhere, and whether any of it involves confidential files being passed to a third party.
Key takeaways
- List every outsourced job type, the partner used and the margin kept.
- Ask what happens when a partner is late or the quality fails.
- Find out whether partner pricing depends on the seller’s personal relationship.
- Check how customer files are protected when shared with other printers.
Related reading
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Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
- 03Business Development Bank of CanadaGovernmentHow to diversify your supply chain
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