I’ve been in the publishing business a bit more than 30 years. The first venture, a local monthly newspaper for Ottawa-area Realtors, went to press in April, 1988.
It certainly was radical for the time. No one in the local industry could have imagined an independent publication covering the specialized community. The original idea was feasible because of declining publishing costs with the advent of computerized desktop publishing, and my knowledge of both journalism and the real estate brokerage community. The process of working as a real estate agent and then associate broker for two years also provided me with one of the essential skills for any business start-up — some fundamental selling and business development skills.
These were helpful because my initial analysis of the original business idea revealed two big problems. In the first, I learned that nine out of 10 new publishers fail within the first year. And the second problem was I was flat broke — I had survived in the real estate industry, but certainly not saved enough money to go without income for a year.
The solution: Presell enough advertising at least to cover the hard printing and production costs, and the method I used was to set a 25 per cent notional discount for prepayment. (I really budgeted the job at the 25 per cent “discount” rate. I sold enough advertising to pay the printers and graphic designer, who wanted to be paid up front, before delivery.)
The net and gross pricing system continue to this day, although we don’t require most advertisers to prepay. However, the late charge premium for slower paying accounts more than offsets bad debt write-offs — so our bad debt write off column is a black, not red-line item!
About a year after starting the real estate publication, I attended a local construction trade show on an advertising trade out. Seeing the market, I had an inspiration one night at a Smiths Falls, Ontario hotel, which I visited once a month to review the then mechanical/film page proofs before printing. Could we start a similar publication for the construction industry? So I started Ottawa Construction News.
Fast forward to 2019, and how does the business look today? In many respects it is the same as it was at its start. We earn most of our revenue from advertising, and virtually all is focused a single industry — construction. But there are many changes as well.
Almost all of our revenue these days comes from online sources. And our geographical reach goes far beyond Ottawa, to several different regions within the US and Canada.
During the past several decades there have been many changes and crises, along with some amazingly rapid opportunities. And some of the most fundamental and powerful changes in the business occurred within weeks. Yet, as I look back on the changes, most of big and radical changes had some element of preparation and incremental change — and in this regard, there were more than a minor number of surprises.
Consider, for example, the switch from printed newspapers to digital magazines. First, I needed to learn how to produce a magazine rather than a newspaper, and that resulted from an off-the-plan opportunity to start the regional renovation publication, Ottawarenovates.com. (While I seized the opportunity to start a consumer-oriented publication, I coordinated a partnership and set up a new business with others who know about business-to-consumer publishing.)
Then we started publishing digital magazines especially for US markets where we couldn’t see a cost-payback in a conventional printed model, using print on demand services to provide us with a small number of copies for advertisers and individuals willing to pay for printed subscriptions.
The next stage: Switching our established (Canadian) newspapers to online magazines — and this took some further turns.
I thought the best place to make the switch initially would be the internal newsletter we had published for years for the local home builder’s association. It was a small job, and the sales numbers hardly justified its production costs — and the association needed to pay hefty fees for postage/distribution and production subsidies. But the association’s executive director insisted that we continue printing the publication in tabloid format, six times a year.
So the big change occurred for our other titles when I faced a serious cash crisis and realized I would not be able to meet our printer’s obligations. After talking with insolvency experts, I pulled the plug abruptly on printing the newspapers, switching to the online magazine format. None of the advertisers objected. I made the change in the middle of the summer, when the home builders’ association publication wouldn’t print.
There was one print job left — the association newspaper. I advised the printers we would have one small job to continue, and I would make reduced payments but enough to cover this work.
And so we continued the last print job for another eight months, until the association’s board of directors with amazing speed “retired” their former executive director and the new leader immediately asked us to stop printing the publication, ending a 28 year contract.
This was painful, but there is a sweet irony. In November, I decided to ask the association if it would be okay for us to produce the publication in digital/print-on-demand format for its most lucrative Christmas issue — and the association gave the go-ahead, generating several thousands of dollars in sales for the last and final print-to-digital conversion project.
What can we learn about these events and changes:
- A good start-up will often have much entrepreneurial vision and creativity, though these opportunities are based on experience and knowledge acquired beforehand;
- Much change is incremental and technologically focused, and the natural (and best) places to try out new things that might be radical are on new and as-yet-undeveloped markets;
- Radical and sudden change can be possible and necessary, and a good crisis will often provoke the change;
- There can be holdouts, or traditions that continue year-to-year (or decade-to-decade) because they make sense or because a key client or clients wants to do things the old way. So our pay-in-advance discount became a prompt-payment discount, alleviating credit risk, and we held on with a single print publication after converting everything to digital status because the client insisted, changing only when we could.