Commercial printers can grow profits through automation and a wider product offering

By Frank de Afonseca, head of production print at Ricoh SA

Cutting headcount is one way to cut costs and improve profitability yet it often requires a simultaneous investment in automation tools and processes to maintain customer service levels. Yet commercial printers have investment in new automation tools low on their priority lists for the next 12 months as they instead look to new print engines.

With fewer people in their shops printers will have to use software and device automation tools to take up the slack and even improve processes and service delivery. They’ll need better workflow automation and Web-to-print systems and they’ll need slicker finishing tools as well.

But Web-to-print still suffers low adoption levels globally. Worse, it’s clear following drupa 2016 that new finishing and pre-press technologies are low on the list of printer priorities over the next 12 months.

Variable data services are widely offered, wide format too, in-house creative design, stock, storage and fulfilment as well, but the value-added services to complement digital marketing methods remain scant. e-Mail, SMS, and social media marketing with website build and analytics are generally poorly represented printer service offerings.

The very things that printers should be looking into, and being encouraged to look into by the partners, vendors, suppliers, and consultants, seem to be getting lacklustre mindshare. Commercial printers, for example, could be looking into multi-channel services, particularly in a country like South Africa where Internet penetration is comparatively high. In South Africa penetration is over 50%, well above the 26% average for Africa. In fact, vast swathes of South Africa have fibre networks and 3G and 4G network coverage, certainly all the major urban areas and branch locations of major businesses in the country.

Web-to-print is another service with major potential for customers and commercial printers alike. Customers can achieve their own marketing goals such as making a wider range of materials available to all pertinent portions of their operations, serving their employees quickly no matter their location, maintaining brand consistency, and many more. Printers on the other hand gain loyal customers and increase the share of their customers’ wallets. Yet few commercial printers offer substantial Web-to-print services.

In a related point, many commercial printers offer their customers too few options. They must embrace digital communications if they are to survive, let alone prosper, using the new devices, software, and technologies emerging at a rapid pace from the print industry. Integrated print applications will give them new ways to meet new and emerging customer demands.

Prior to its 2016 event, drupa surveyed 741 printers from around the world, across four sectors (publishing, commercial, functional, and packaging) and divulged 26 common applications. Interestingly, printers had implemented an average of 2,8 applications each indicating a lot of scope for new applications and the customer services they enable.

Interestingly for South Africa, drupa’s take on the matter is that print demand will increase in developing countries with rising urbanisation and prosperity in growing populations but that growth and demand will be tempered by the rise of digital communications.

Wide format is one area where printers worldwide are consistently launching value-added services for their customers but in almost all others there has been either little improvement or even reduction. Wide format’s popularity with commercial printers is likely due to the fact that the products they can manufacture are complementary to their existing lines to quickly and easily capture additional revenues from existing customers and attract a few new ones to boot. And while it may be low revenue it’s generally high profit.

drupa’s survey also notes that offering Web-to-print dropped in many regions around the world, even though it’s consistently proved to offer high returns. Multichannel cross media services may be another darling of the developed world but in developing regions its rollout is erratic.

Some of the applications that printers can investigate:

Short run batch book production

On-demand book production

Stationery applications

Multichannel marketing

Digitally printed corrugated applications

Digitally printed flexibles

Inkjet-based signage (including backlit)

Digitally-printed business cards, point of sale, posters

Vehicle graphics

Decals

Floor graphics

Package prototyping

While printers clearly have a range of options to look at in implementing new services for their customers it obviously pays to start with the simpler options to build expertise before delving into the higher investment, more complex offerings. Decals and posters obviously come easier to foundational level commercial printers while floor coatings, vehicle wraps, and package prototyping will probably be commercially feasible after some learning.

Commercial print markets are riding the see-saw of success and failure found in wider print markets impacted by global and local recession with the rampant consumer and business adoption of digital media. Trends demonstrate that commercial printers have already begun or soon will invest in new technologies for the future of their businesses. They just need to push their investment towards automation to ensure they can grow revenues and improve profitability in an industry characterised by widespread competition and external financial pressures.

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Ricoh is a global technology company specialising in office imaging equipment, production print solutions, document management systems and IT services. Headquartered in Tokyo, Ricoh Group operates in about 200 countries and regions. In the financial year ending March 2014, Ricoh Group had worldwide sales of 2,236 billion yen (approximately 21.7 billion USD).

The majority of the company’s revenue comes from products, solutions and services that improve the interaction between people and information. Ricoh also produces award-winning digital cameras and specialized industrial products. It is known for the quality of its technology, the exceptional standard of its customer service and sustainability initiatives.

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