American Printer's mission is to be the most reliable and authoritative source of information on integrating tomorrow's technology with today's management.

By Jill Roth, Special projects director

Jul 17, 2001 12:00 AM


         Subscribe in NewsGator Online   Subscribe in Bloglines

Out-of-the-box thinking is what it will take to weather the storm as the industry moves from an era dominated by paper to an era dominated by communications diversity. Strategic planning cannot be based on ink-on-paper alone. History will no longer be the touchstone for the future. Customers will drive changes that printers may find difficult to accommodate. For the unprepared, there will be no future in print.

There will always be printers. There will probably always be printers that only do but print. They will be so efficient at offset printing that customers will ask them to do nothing else, but will expect them to deliver jobs faster at lower costs. Internal efficiencies will allow a select few printing companies to remain true to their ink-on-paper roots.

OTHER ROADS TO TAKE

For the rest of the industry, there will be other roads to take. Those who do not adapt to and embrace the new ways of doing business will be lost. Those who start today to look at their businesses in different ways, and build a technology base to adapt to new business models, will survive and prosper.

Fundamentally, the industry faces a looming challenge. Value-added services often have been provided free of charge to support the pressroom operations. And the pressroom is where the profits are. But as the business model changes, printing itself does not provide profitability. All of those value-added services now offer the best opportunities to improve the bottom line. How will printers adapt?

How will your company react when customers demand turnaround times of 24 to 48 hours? Will your systems be able to support them? One print customer was heard complaining about the time it took to deliver a 200-run length job. Why does it take three weeks to produce this job, he wonders? It's being printed on a digital press. The files are press-ready when they are submitted.

The problem, as it turned out, revolved around the printer's scheduling practices. The procedures inherent in scheduling traditional offset work don't work for short-run, quick-turn digital work. The two are not the same, and printers that want to meet their customers' ultra-fast cycle times had best be looking at streamlined data flows and scheduling procedures, and revamped internal systems.

What will your company look like when you are asked to deliver four times the number of jobs in a day at 30 percent less cost? Are you prepared to survive in a world in which revenues will decrease 40 percent but the chance to increase profits fourfold exists?

Shorter runs are a reality of life. Product life cycles have dramatically decreased. Software revisions, on average, change every six months. The brochures that support these product life cycles, therefore, change in the same timeframes.

Not too long ago, the New York Times carried an article about the communications industry. It said that once a month, a new area code is created somewhere in the U.S. Tons of printed paper become obsolete because of an incorrect area code.

There also is a push toward shorter runs to reduce inventories and their associated waste. A run of 10,000 may be split for versioning or may be printed on demand. Instead of printing a brochure once a year, the marketing piece is produced quarterly — in shorter runs — but at the same per-piece price. Are your systems ready to handle this reality?

There are new competitors poised to take a piece of the short-run, personalized profit pie. As they grow, traditional printers may not be able to compete.

THE NEW COMPETITORS

Consider IKON Office Solutions. Known in some areas as a supplier of equipment, the innovative company actually fields the majority of its revenue from printing. It boasts 34 regional document production facilities, primarily in the U.S. and Canada. Most recently, it has capitalized on this geographic diversity by instituting a distribute-and-print network driven by Digital Express, an Internet-based system that allows customers to order online and store archived material.

For commercial printers outside of the IKON network, Digital Express can be incorporated into their business. This allows the independent printer to handle overflow or specialized services for the IKON network. (IKON, by the way, provides services to e-commerce ventures such as iPrint.)

Sir Speedy now offers a service that allows users to transfer large complex files over low-bandwidth lines. This makes a franchise quick printer more competitive with local commercial printers. And Sir Speedy is aggressively positioning itself to do more than down-and-dirty black-and-white work. “If you are not fully digital, from file acceptance to color output and distribution, your business is short-lived,” claims Dan Beck, company president.

If you think cycle times are too quick for you to handle, think about Mimeo.com, whose business model is based on service and added value, including next-day delivery at the point of need. This company plans to acquire traditional printing equipment to produce special covers and brochures, as well as handle metallic color and specialty items. Mimeo.com is one of the new competitors.

So is Lexinet in Grove, KS. More than 80 percent of the firm's business consists of personalized direct mail to support dealers or agent marketers for U.S. corporations. Although its antecedents are in the black-and-white world, the company has recently acquired a DocuColor 2060 to eliminate the need to preprint direct mail pieces.

There is no doubt that large quick-print franchises are expanding their global presence either by opening their own stores or by forming partnerships with foreign companies. And these same franchise and quick-printing chains have developed Web-based services, ranging from online document creation and design to distribute-and-print.

These are the new competitors. The Internet offers opportunities for companies to take market share from more traditional print vendors. While many traditional printers rage against job tracking via the Internet (“I don't want my customers looking at our scheduling process!”), PIP Printing offers online ordering and job tracking. Kinkos.com offers printing, binding and shipping to 40 markets and same-day delivery service in 61 cities across the U.S. using Federal Express. Can you compete?

Some savvy printers have understood the need to link themselves more closely to their customers, providing services that go far beyond print. Bowne, for example, is transforming itself into an “information empowerment” company using the Internet. In addition to its basic expertise in financial document printing, the firm now offers translation services, digital database management and Internet site development.

REDEFINING YOUR BUSINESS

What opportunities are out there for commercial printers to diversify? Consider this: A recent Forrester Research study predicts that marketers will send more than 200 billion e-mails by 2004, creating a $4.8 billion e-mail marketing industry. By 2003, the number of marketing e-mails will equal the volume of direct mail forwarded by the USPS. Is there an opportunity to help your customers become part of this direct “e-mail” boom? Would your clients be interested in print-based direct mail combined with direct e-mail?

Think different. Think about opportunities to move beyond the traditional. And be proactive. Find technologies that will meet your customers' unmet demands. Then intertwine your services into your customers'. Beef up your network and hire the best IT people you can find. IT will be the backbone upon which your company's future will be built. Your company shouldn't be high-maintenance for its customers; it should be a convenience store that delivers your clients' favorite products and services.