By Kemal Carr, President, Madison Advisors

Businesses, large and small, have been impacted by the COVID-19 pandemic, and in some cases their entire business models have changed. Employees who now work remotely have proven they are still productive and many of them want to continue working from a home office. This has triggered some strategic thinking about what to do with currently owned or rented office space, particularly because letting much of it go can deliver positive results to the bottom line.

However, most businesses still retain “essential workers,” those who must work on premise. Among these essential workers are the people who manage and process outgoing mail, including correspondence, transactional billing and invoicing, regulatory compliance information and marketing materials. For large companies with in-house print and mail facilities, these essential workers can be dozens of employees working on millions of dollars’ worth of hardware and software equipment that must be replaced periodically with newer models supported by additional training.

For years before COVID-19 hit, many organizations in the financial services industry had moved their in-house printing and mailing operations to outside print service providers (PSPs), which have welcomed and accommodated their business by acquiring all the security measures and compliance certifications needed to meet clients’ established deadlines. Printing, after all, is not the core business of banks or financial services firms and with the push toward digital communications, the print and mail center may become increasingly under-utilized. The insurance industry has been slow to adopt this trend, but it, like every other industry, has experienced the shift to remote working and may start rethinking the wisdom of funding their in-house print shops and those essential employees who might work fewer shifts or days out of the month.

For PSPs, printing and mailing is their core business. Many work 24/7, their costs are spread out among all their clients and, to be competitive, they must work efficiently and take advantage of the best and newest equipment and processes. Some PSPs specialize in serving certain industries, so they keep abreast of the regulations and other particular requirements of their clients. Many provide a dashboard, allowing clients to track their jobs and request that certain mail pieces be diverted or pulled out of the pack. Because PSPs deal with high volumes of mail, they also understand USPS regulations and know how to get the best postage rates and discounts.

Another consideration in the value of outsourcing is disaster recovery. A hurricane, tornado, fire or flood can shut down any print and mail operation. Many PSPs have agreements with their counterparts in other geographic regions that can take on the work to ensure the mail gets out on time, or as close to it as possible.

Deciding to move an in-house mail operation to a third-party provider requires addressing some critical issues to ensure it is the right move. For example, you want to find a PSP that understands your business, including any governmental compliance regulations, down to the state level if you do business nationwide. Do they have the security required to protect sensitive customer information? Can they handle your volume and meet your deadlines? Do they offer service level agreements (SLAs) and do they have adequate backup agreements in case of disaster? All this, and possibly more depending on your company’s needs, must be taken into account before selecting where to outsource your work.

Outsourcing can turn capital expenditure into a more balance sheet friendly operational expense by eliminating the need to accommodate an in-house print and mail center, purchase and install equipment and hire and train competent people to manage it, while at the same time ensuring the work gets done appropriately and on time. The decision to outsource may not be simple or easy, but many organizations have realized positive results in the long run.