Monday, June 14, 2010

Duluth worries as trade publishers continue to trim staff, outsource production services

Apparently out of ideas on how to grow their businesses to seek ways to trim costs, with production being the one of the usual targets. Last Questex announced it will be outsourcing production on 31 of its trade publications and moving positions off of its payroll and onto the payroll of the Superior Media Solutions (SMS.

The Duluth News Tribune reports that the move will result in 14 positions in Duluth being transferred to SMS, but no employees will lose their jobs the paper reports.

"After six months, they will either be given the ability to work from home or we will find office space for them in Duluth,” the News Tribune repored SMS CEO Bill Walker as saying. “They’re not leaving the area. They will continue to be gainfully employed in the Duluth area.”

This is the second time the paper has had to report on a locally based B2B outsourcing production. On April Fool's Day of this year Advanstar revealed that the company has signed a deal with India-based HCL Technologies to take over production duties at the B2B. That move resulted in the loss of around 100 U.S. positions.

"In this highly competitive media marketplace, we need to focus on the things that we do well, creating a valuable platform for our clients, while handling other functions through partnerships or outsourcing agreements that will provide the economies of scale we need to operate more efficiently," said Chief Executive Officer Joe Loggia at the time in justifying the move.

Questex was spun out of Advanstar five years ago and filed for Chapter 11 in October of last year. At the time of filing the company had liabilities of $321 million and had reported $144 in revenue in the prior year (2008).