Getting Forward to Normal: What Ketchup Packets, Yeast and Nonprofit Mail Pieces Have in Common
For months, we have hoped things would get back to normal post-COVID. Now we know that we won't come out unchanged. Rather, we have an opportunity to choose what we take with us and what we leave behind. This series will aim to highlight the normal that lies ahead.
During the pandemic, it seemed like every week there was a shortage of something you just assumed would always be available. There's even a Wikipedia page called "Shortages related to the COVID-19 pandemic," that includes not just the titular ketchup packets and yeast, but also video game consoles, computers, condoms, guns and ammo, exercise equipment, and jigsaw puzzles (all of which raises the question of what we did for a year once the kids went to bed). Each shortage was some part demand spikes, some part supply challenges and some part irrational compounding once people heard there was a shortage as if we needed our money out of George Bailey's building and loan now.
Now, fundraisers face yet another shortage: paper. Yes, paper. This is due to a few factors:
Increased cost of inputs. The Great Resignation that is hitting everywhere is also hitting paper mills, requiring pay increases and/or bonus to get and keep workers. Additionally, input costs continue to increase from 2% to 10% on raw materials, pulp, energy and oil.
Transportation shortages. Not only does the labor shortage extend to trucking, but the chip shortage that has made computers and gaming consoles harder to get has also made it difficult to get new trucks on the roads to replace those going out of service. This makes it challenging to get raw materials to plants and paper from plants to printers, meaning that the system doesn't have as much paper flowing through it.
Decreased supply. During the pandemic, logging slowed. Logging firms didn't push too hard to keep supply up given that they projected decreased demand. Paper mills did likewise, either shutting or converting to other work during the pandemic. This is on top of the paper sector closings and consolidations of late. Run rates at mills are up 90% due to capacity reductions. The paper market continues to face demand pressures and uncertainty.
Increased demand. Many for-profit companies who had come out of the mail during the pandemic are realizing digital outreach alone isn't pulling the same numbers they used to have. With some entire industries (e.g., travel, restaurants) seemingly coming back to mail all at once, more organizations are competing for less supply.
The long and the short of it is paper manufacturers and printers will be charging more to get paper because it costs them more to get the inputs to it if they can get the inputs.
Thus, there are three things we recommend all nonprofits do right now:
1. Begin explaining circumstances to your leadership
In normal times, if your per-piece costs went up, you could go to a competitor. Now that competitor will be charging the same increase — that's if they can get paper at all. Some printers are telling even long-time customers they can't do jobs because of the shortages.
This isn't the paper or printing industry getting greedy: these are real increases in costs, not efforts to increase margin. The more your leadership understands this, the less likely you are to experience delays.
2. Plan and order ahead
Instead of taking two to three days to secure paper, vendors are taking two to three weeks. With diminishing paper supplies, the best option is to plan and order well in advance. Planning also helps with contingencies; if a usual supplier has unexpected outages or delays, your vendors will need as much time as possible to respond. Thus, I'd recommend planning, ordering and even asking your printer to take delivery in advance. Your planning helps their planning, which helps you.
3. Know your vendors
Now is the time to check in on your vendors to make sure they have the right amount of panic (not the sky is falling, but also not "things will just work out on their own"). You want to make sure you have backup places in place so that if one facility is at capacity or lacks supplies, another stands ready to take its place. If your printers aren't ready, you aren't ready.
These shortages certainly aren't what we wanted to bring with us from the pandemic, but we made it through hand sanitizer shortages. We are making it through ketchup packet shortages and, together, we'll make it through the paper shortage. But planning and acting ahead is critical to make sure that it's some for-profit that doesn't have the paper it needs while your mail date is secure.
Nick Ellinger joined the Moore, where he works to increase the automation and customization of fundraising as chief brand officer, in January 2020. Before that, he was DonorVoice’s vice president of marketing strategy, working with organizations like Catholic Relief Services, Share our Strength | No Kid Hungry, and the U.S. Olympic and Paralympic Foundation to look at their fundraising with a different lens. He developed his direct fundraising muscle running Mothers Against Drunk Driving’s direct marketing program for a decade. He’s also the author of "The New Nonprofit" to challenge fundraising norms.