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Commentary & Analysis

Is the Sky Falling?

By John Giles January 10,

By WhatTheyThink Staff
Published: January 10, 2007

By John Giles January 10, 2006 -- Online print buying seems to be growing and small commercial and quick printers are worried their customers will find ordering from the online print companies easy, economical, and move their work. Some printers are throwing some type of e-commerce solution on the Web while others are wringing their hands, fearing all of their customers will order online. To them, the sky is falling. What is ironic is that most of the online services are those that the quick printing industry turned its back on in the past decade. The trend in the quick printing market has been to eliminate walk-in retail customers with commodity products. Quick printers have added outside sales people to cultivate business-to-business relationships. They have moved locations from retail to light industrial areas to get away from a retail presence. The move by quick printers away from the retail business has been successful, but the trend left a vacuum in the market for retail printing. Short run copies, business cards, business stationery and other retail products are still being purchased. Most printers get 60 to 80 percent of their business from less than 25 customers. Online print services and "big box stores" such as Staples and Office Max are filling that void left by quick printers. There are still successful printing niches available to printers if they focus on their business and quit trying to be all things to all people. Most printers are job shops that produce custom printing for local customers. Online print services typically offer commodity work that has been standardized for production efficiencies. Want a special paper? It isn't available. Want different specifications from those provided? Go somewhere else. Custom job shops can't compete with the specialty printers because they are organized to produce a wide variety of custom work with special services. Traditional quick and small commercial print companies should have nothing to fear from online services if they are focused on their current top customers' needs. The fact is that most printers get 60 to 80 percent of their business from less than 25 customers. The only difference between the gross sales of one printing company and another is the amount of printing purchased by the top 25 customers. The bigger the shop, the more printing a top 25 customer buys. The amount of work purchased by the rest of the customers is usually not that significant. Printers need to focus on their top 25 customers and make print buying easier for them. Printers need to realize that they are entering the retail print market if the attempt to compete with online print services. The retail market usually means a smaller average invoice total and more transactions. To compete, the printer will have to market heavily. VisaPrint, the premier online printing service, reported 33 percent of its revenue was spent on marketing and selling expenses. Most printers are lucky to get their monthly newsletter sent to customers on a regular basis. Attempting to carve out the budget needed to drive customers to their web sites would put most printing companies out of business. VisaPrint reported their average order was $31.30. Printers need to focus on their top 25 customers and make print buying easier for them. Printers may find their top customers need online print buying services. The online service wouldn't be for the general customer, but specific to the top customer's needs. While the initial investment may seem high, the increased business and savings from ordering efficiencies may allow the printer to quickly recoup the costs. Online ordering packages complete with shopping carts are available from third party vendors who specialize in printing services. A variety of vendors offer static ordering capabilities, online ordering packages, and variable data printing services. If the return on investment warrants the move, a printer can quickly add the service to satisfy a customer's need. Service can be the main difference between online services and the local printer. Service can be the main difference between online services and the local printer. Online services handle thousands of orders a day and strict procedures make it difficult to offer the service that a local printer can order. The local printer can build the relationship with the customer that the online service can't. Why would a customer leave a printer for an online service? Most leave because they don't have a relationship with someone in the company. They haven't been "serviced" and they aren't confident that their needs will be met. Dealing with a faceless entity on the Internet is just like working with the faceless entity. Who is easier to buy from and what is the price? Printers shouldn't be emulating the online printing suppliers. They should be talking to their customers and finding out the special needs they have. The printer then should provide the tools necessary to service the account. Internet purchasing is a tool that can be valuable to a customer. The printing company will have to find out if it is right for the customers they already have and not worry about a single $30 business card order.



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