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Jun 1, 1999 12:00 AM
Pundits declare there are no quick printers. Industry observers proclaim quick printers are really just copy shops. Experts announce quick printers are simply another flavor of commercial printers. Quick printers even assert that they are business printers, imagers, document producers or even marketing consultants. So what happened to the steady, dependable, easily identifiable quick printer? Like everything else in our industry, this segment has become blurred.
After talking to quick printers from across the country, regardless of what they might call themselves in public, it is clear that this segment is distinctive and different from the rest of the graphic arts industry. "The quick printer segment exists," asserts Lou Laurent of Laurent Associates in a recent study conducted by the Graphic Arts Marketing Information Service of Printing Industries of America (GAMIS/PIA). "It can be defined and differentiated. More important, it is continuing to satisfy a significant part of the print communications needs of major North American corporations."
Because of the misunderstanding about this market segment, GAMIS undertook this study in late 1998 in the hopes of developing a clear view of the quick printing market. In the final analysis, the study defined a quick print business model that exists today. This, then, is the profile of the quick printer business in 1999 as determined by GAMIS.
There are around 24,800 firms that can be said to provide offset printing, network publishing, convenience copying and post-printing services. These are the types of services that "quick" printers offer, but they have other distinct characteristics.
Quick printers may have up to 20 employees, multiple locations and revenues exceeding $2 million. However, they typically operate from a single storefront location and have fewer than 10 full-time employees.
The average annual revenues of these companies fall between $600,000 and $800,000, but it must be pointed out that extremes abound. Actual sales figures per year can range from $150,000 to $32 million.
We tend to think of quick printers as relying on walk-in customers for the bulk of their business. And while this may have been true in the past, many of these firms are refocusing their resources on local corporate accounts. As part of their changing business strategy, they are proactively pursuing corporate business instead of waiting for the customer to walk through the door, says Laurent in the GAMIS study.
The array of quick printers who began in retail locations but have shifted to corporate clients is startling. Take Gordon Knowles of Perfect Image Printing (Charlotte, NC), for example. In 1981, when his shop opened, walk-in customers were responsible for the firm's huge success. "By 1991," says the printer, "we had outgrown our location and realized that all ou r retail business consisted of wedding invitations, $6 rubber stamps and $.10 copies. The business had reached a point at which we were spending an hour on a $10 job. It just wasn't worth our while anymore."
Today, Perfect Image is located in an industry park and boasts clients that come from the corporate world. In making the change, Knowles developed a marketing plan that involved hiring a full-time outside salesperson. "This, together with a new focus on printing rather than copying, resulted in our average order size being doubled," explains the printer. There is no doubt that quick printers are committing more resources to their corporate accounts. During the 1993-1998 period, quick printers' dependence on walk-in business decreased from 27 percent to 13 percent. When asked to project their future business direction, quick printers believe this is a continuing trend.
Another distinguishing characteristic of quick printers is their emphasis on "behind the counter" printing and finishing services. In addition to offset printing, these services often include high-volume copying, presentation graphics and network publishing (corporate manuals and documentation).
"Although quick printers are a distinct market segment," explains Laurent, "their products and services frequently overlap those provided by convenience copy centers and commercial printers. This functional overlap is one of the reasons why quick printers are sometimes hard to identify."
One of the ways to better understand the business differences among the three segments is to view each one as being a location on the print production chain. At one end is the copy center. At the other is the high-end commercial printer. Depending upon the level of services that a firm provides, it can move up the print chain or remain where it is.
"The chain depicts increasingly complex businesses, with greater value-added offerings and more intense product and service commitments," observes the study. It reflects how quick printers see the evolution of their business during the 1998-2003 period.
The question remains whether technology and new customer demands will change the basic nature of the quick printer in the years to come. The GAMIS study revealed that, in fact, quick printers aren't necessarily quick. Their typical job turnaround is actually greater than 24 hours. While their response is usually faster than commercial printers, they generally do not provide the on-demand printing services common among convenience copy centers.
As we move toward the 2003 timeframe, improved response by quick printers will be a more critical issue, according to the GAMIS study. "Quick printers will fall under more pressure to compete with the response times of convenience copy centers and will be offering a greater range of color printing services during the next few years."
The research states that even though faster job turnaround will be required, quick printers' use of non-offset printing technologies will not change appreciably. This trend probably is due to the use of more efficient production workflows, including presses with faster makeready and computer-to-plate/digital press capabilities. "The challenge for quick printers by 2003 will be to provide faster turnaround on jobs that include more spot and process color," states the GAMIS study.
The face of quick printing already has been altered. During the 1993-1998 period, the number of quick printers in North America decreased by four percent. Laurent states in the GAMIS study that this decline will gradually continue through 2003. Most of the firms disappearing from the market have fewer than five full-time employees.
"Driving much of the thinning quick printer ranks is competitive pressure, poor business management skills, demanding franchise organizations and continuing financial pressures," states Laurent. "The outcome will be fewer, but stronger businesses."
There are signs already that franchises are closing poorly performing stores to reposition their resources on locations with greater sales potential. The resources that franchises offer include business training, equipment evaluations and promotional programs.
The increased resources that franchises can provide to strengthen their organizations will create added strain on independent firms. Whether independent or franchise, quick printers all face the same market pressures. Survival will depend on building infrastructures that support best management practices.
The study anticipates that there will be an increase in the percentage of franchise firms in North America as we move into the next century. Supporting this trend, relates Laurent, are current data indicating that franchise firms generate about $200,000 more in annual revenues than independent firms. Independents average annual sales of $600,000; franchise firms average about $800,000.
It is entirely possible that the quick printing industry may take on different aspects in the coming years. Quick printers become trade service firms. They become commercial printers. They remain as quick printers or add new locations. "Whatever direction a quick printer takes in the coming years, there can be little doubt that these firms will continually change the range of products and services they offer," observes Laurent. The GAMIS study suggests the major changes will be to add prepress services, broaden print services and expand into post-printing services.
By 2003, the study projects that quick printers will double their use of process color and almost double the number of spot color jobs they produce. As a result, quick printers will be upgrading existing offset presses or purchasing multi-color presses during the coming three to four years.
The importance of non-offset devices will continue to expand during the 1999-2003 period. Color copiers, in particular, continue to provide better performance at lower copy costs. Combined with RIPs, color copiers are well suited for digital color proofing and the presentation graphics market. The GAMIS study opines that the result will be an approximate 36 percent increase in quick printers' use of color copiers by 2003.
In addition, expect to see quick printers join the ranks of firms offering digital wide format output. This type of technology provides "a business extension that is fully compatible with existing corporate and POP business," points out Laurent. "The entry costs are low and wide-format printers are not complex devices to operate."
While the use of color is growing, black-and-white, especially in networked printers handling high volumes, will continue to find its place in the sun. The GAMIS study estimates that the utilization of these devices will increase more than 200 percent by 2003.
"While quick printers build stronger digital network connections with their corporate accounts, revenues from network publishing services will increase significantly," asserts GAMIS. The research organization also projects that by 2003 spot color will routinely be included in these documents as newer printing engines incorporate higher speed imaging to meet market demands.
What types of customers are demanding "quick print" services? A typical customer mix includes corporate business, retail, manufacturing, health care, education and ad agencies.
The documents that are most often produced include product information data, specification sheets, newsletters, flyers and catalogs (both black-and-white and spot color).
Interestingly, many of the print buyers interviewed for the study had strong views on the types of products and services that quick printers should offer in the years to come. Less than 40 percent of respondents expected quick printers to develop internal creative and design services. Many of the buyers already have these capabilities in-house, especially retailers.
On the other hand, there appears to be widespread need for mailing/fulfillment and wide format printing services. Quick printers are already getting involved with kitting, fulfillment, mailing and other post-printing services--a trend that is expected to accelerate in the next few years.
Most corporate accounts are producing posters, trade show exhibits and other point-of-purchase products. They need fast turnaround and usually provide the prepared digital file to the output provider. Therefore, the quick printer essentially functions as an output service provider--producing the POP media and mounting or laminating the output.
In total, the biggest opportunities for quick printers from now until the year 2003 appear to be in post-processing services, wide format and network publishing services.
Although the lines continue to blur around the quick print market segment, and today's quick printer may be tomorrow's commercial printer, this is an entrepreneurial group destined to remain an active participant in the graphic arts.
For more information, please see the series of charts on pages 82 to 87 of the June 1999 American Printer.