How shared know-how can cut costs

Jon Severs
Wednesday, February 15, 2012

WIth the help of an innovative tie-up with the local university this firm implemented a comprehensive and effective energy reduction scheme

The company

CFH Total Document Management is a transactional mail services company serving councils, financial institutions and general businesses, producing statements, billing, council tax bills, payment slips and the like. It also does a bit of business forms and DM work. Established in 1977, owner and managing director Dave Broadway has built up the company, which is based 15 miles south of Bristol, twice over the years. 

"In 1995, we were in every type of continuous stationery printing. We then sold off several of the divisions, and consolidated to become a print and mail company. Since then we have been growing back, mainly through transactional mail services. In 2008, we moved into hybrid mail with our DocMail product, which is probably the largest hybrid mail service in the UK currently," he relates.

The problem
CFH uses a lot of electricity and the stability of supply of that electricity is crucial to the productive running of the business. The company produces 350m critical document images per year and it mails 66m envelopes per year – if electricity suddenly became in any way irregular, the knock-on effect of stalled production would be massive. Unfortunately, irregularities in electricity supply may be on the horizon, according to Broadway.

"One of the big worries currently in the UK is that not enough investment has been made in electricity generation, so as plants go offline in the coming years we may see the supply is not as stable as it has been," he explains. "We have onsite generators, and these would keep us going for a few weeks, but we wanted to explore the options for generating our own power, for both economic and practical reasons."

Another concern was the amount of power the company was using. If possible, it wanted to reduce this as well, for the same reasons as generating its own power.

The method
Broadway realised that trying to run a business and acquire the expertise to generate his own electricity at the same time, as well as reduce electricity consumption, was impossible. So he approached the University of the West of England (UWE) for help.

"They informed us about the Knowledge Transfer Partnership (KTP), a system designed to encourage companies and universities to get together and share knowledge with the help of government funding," reveals Broadway.

The KTP is an effort by government to bring together higher education or research bodies with businesses to improve each party and share knowledge. In CFH’s case, it worked like this: the company and UWE made a joint application for funding. Once accepted, a post graduate student was employed full time to carry out the project, supported by a professor. The KTP lasted for two years and the student spent the majority of that time with the company. The government funded around 67% of the costs and the company put up the rest of the cash.

That’s not to say the company employed the university and left them to it, though. 

"We had our own engineering department involved as well, and they were providing a lot of the base knowledge," says Broadway. "The onsite student was also using the staff knowledge extensively and one of our key directors was involved in the project and held weekly meetings with the student."

The student looked at all areas of the business to see where energy savings could be made, while also assessing potential solutions for energy creation so the company would not have to rely on the national grid in the future.

The results
The two-year project has just finished and Broadway says the results have been fantastic. That said, he says the initial aim of discovering an energy generation solution had to be abandoned nine months in, giving way to energy reduction as the key aim.

"My initial key desire was electricity generation," he explains. "This has proved incredibly difficult to achieve. We found the equipment we needed to generate electricity independently was either not available in the size we wanted or was prohibitively expensive in terms of payback.

"We did get very close to putting in a gas combined heat and power (CHP) system. It looked perfect for us as we could run the whole site through our own electricity generated from gas and it would have been much more efficient than electricity from the grid. But the government removed its support for these schemes and that turned a two-year ROI into a 10-year ROI. We could not afford that type of payback."

CFH also looked at wind turbines and solar panels. The former was abandoned as after testing the site didn’t have the wind speeds or frequency required, and the latter had a worse return on investment than the CHP system, at 12 years.

"It surprises me when there is this drive for greener energy that it is incredibly difficult to put in practice. We had a very good look, worldwide, and there was no one producing the kind of kit we could use."

Fortunately, however, the company was able to really make headway in its aim of reducing its power use. For example, lighting energy was reduced by 70% through installing LED technology, a better use of air compressors minimised wasted energy and potential savings of 15% of total energy usage were made through investing in LED UV lamps for the drying process. A whole range of smaller improvements also contributed to the overall effect.

"The current savings would give us a cost saving of £100,000 per year and we are hoping that with more time we could double that," reveals Broadway.

The conclusion
While Broadway concedes that the project has not thrown up anything new, he believes that the knowledge the company has gained has improved the business significantly and that the lessons learnt could be of benefit to other print firms. Hence, in an act of quite remarkable openness at a time when any competitive advantage is generally hidden as far from view from rivals as possible, Broadway is publishing a White Paper that informs other companies of exactly what can be done. 

"We’re doing this because I am an environmentalist, I want to see a benefit for print as a whole, not just keep it to myself," he says.

CFH is now in discussions with UWE about another KTP.

"We don’t want to stop yet while we are getting such good gains from it." he explains. "The next KTP will be re-assessing power generation to see if we can find a way of making the gas CHP work. We also want to look at the building to see if we can make that more efficient as well."

He stresses, though, that KTPs do not have to just be about the environment and explains that this is an initiative all printers should be looking at.

"You have to find the right partner and put in a good proposal to get the grant," he explains. "But it’s worth exploring as it can deliver fantastic benefits, as it has done for us."

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