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Industry Insight

The In-Plant Market, by the Numbers

No survey of the small/

By Patrick Henry
Published: May 7, 2009

No survey of the small/medium print market segment would be complete without a friendly nod to in-plants. These captive printing shops provide a richly mixed bag of services to the corporations, educational institutions, and federal, state, and local agencies they belong to. InfoTrends says there about 52,000 of them, and In-Plant Graphics puts the average head count at 18.2 full-time employees. In-plants use the same tools and manufacturing routines as commercial printers, but their operational concerns are different. For one thing, they have to juggle the often conflicting deadlines and production requirements of their internal customers. As departments of larger entities, they have to strive for their fair share of the general budget, and they sometimes have to justify their existence to overzealous accountants. They may even find themselves going head to head with the commercial sector when their parent organizations decide to outsource. Many turn this competitive table by insourcing—taking work from the outside world—to fill excess capacity. Gaining and keeping respect is the essence of the in-plant’s mission. Equipping to meet changing demands is the key to preserving status and assuring survival. In recent years, though, none of this has been easy: a February report on the in-plant industry by InfoTrends says that the number of in-plants declined by 2.5% from 2006 to 2007. But, the segment’s appetite for new equipment remains undiminished. According to the InfoTrends report, 86% of those surveyed offer digital color printing, and a nearly identical share offer high-speed digital printing in black and white. In both cases, the percentages were up significantly from those in an in-plant market survey published by InfoTrends in 2004—not surprising, given the heavy emphasis in many in-plants on reprographics and copying. The in-plant segment continues to rely strongly on offset litho as well, with about two-thirds of respondents to the 2009 survey saying that they currently offered the conventional process. But, this figure was about six percentage points below the number claiming to offer traditional offset in 2004. 2008 market statistics published by In-Plant Graphics show a similar decline between 2006 and 2008, but from a larger base: 78.4% of in-plants are said to have provided offset printing last year vs. 85% three years ago. Steve Adoniou, an analyst for InfoTrends, notes that purchasing intentions reflect the changing equipment mix. The current study, he says, reports that only 4% of those surveyed had budgeted for a 2009 investment in an offset press with a sheet size larger than 20". About 11% planned a 2009 investment in digital color. Nevertheless, we’d observe that 2009 probably is not the kind of year that yields the best insights into what in-plants and other printers actually will decide as they ponder the right mix of capabilities for better times ahead.

Patrick Henry, Executive Editor for WhatTheyThink.com is also the director of Liberty or Death Communications, a consultancy specializing in research, education, promotional, and editorial support services for the printing and publishing industries.

Patrick Henry is available for speaking engagements and consulting projects. To get more information contact us here.

Please offer your feedback to Patrick. He can be reached at patrick.henry@whattheythink.com.

 

Discussion

By Bob N on May 08, 2009

Good story, Pat. Note that the 2.5% decline in the number of in-plants observed by InfoTrends should be compared to the decline in the number of commercial printers during the same time period. Here's another synopsis of the InfoTrends report: http://tinyurl.com/ogu7kv

 

By Clint Bolte on May 08, 2009

Other interesting trends in the In-plant arena that suggest a level of sophistication and value to their parent corporations of which the General Commercial Print market may not be aware is that more In-plants are reporting to IT Departments rather than Admin Services. Considering the integrated digital workflows requirements this makes sense. However, there are three more strategic advantages for this organizational reallignment; (1) in-plants are more an integral partner in executing the print output segment of the enterprise content management strategies of the corporation, (2) IT Departments are assuming responsibility for implementation of the more sophisticated Managed Print Services contracts (In-plant staffs actually do much of this interpersonal work!), and finally (3) for the lower volume Trans Promo initiatives, primarily within higher ed, IT is driving the digital print engines located within the In-plant operation rather than investing in more lower utilized hardware in the IT domain. On balance a report on the statistics of hardware utilization within the In-plant arena belies the exciting organizational and responsibility changes within the more forward thinking In-plant printing operations.

 

By MichaelJ on May 11, 2009

Another interesting post. With the focus on commercial print, the inplant has been as overlooked as the quick printer. Thanks for righting the balance at least a bit. The way I think about it is that inplant is at the hub of managed print services. Managed print services at the enterprise level is in the same category as business process outsourcing on the global level. It all points to a growing networked print functionality that as it develops will bring to reality the ability for anyone to print anywhere in any quantity for any audience. I've been playing with a term being used by Pac Print in Australia, the printernet, to capture in one word, what this new capability might mean.

 

By Tom T on May 14, 2009

I'm chiming in here a little late but as a Director of a University in-plant and also a person with many years experience in the commercial market I have a somewhat balanced view from both sides. It is still very common for in-plants to be under the Administrative Services arm of an organization, definitely in the higher ed segment. Most in-plants also are zero-balanced self-supporting operations and recieve no money from the parent organization. They are self-funded through recharges to their departmental customers or sometimes such as in the case of a college campus they have cash sales to students and others. This usually puts an in-plant into a competitive market with commercial printers. For the most part in my experience in-plants provide the same services as a commercial printer and the work is both offset and digital, with digital color becoming more and more a requirement. If the in-plant does not have the capabilities to produce the work they often will outsource to a commercial printer, thus maintaining control of the job and also leverging "trade" type pricing. The real value that is often seen in the in-plant is that they are in business to support the mission of their parent organization be it public or private and I appreciate Mr. Henry's article giving recognition to this segment of the printing world.

 

By MichaelJ on May 20, 2009

Tom, Thank you for giving the granular description. It's consistent with what I saw at the New School back in the day. One problem I think I noticed is that inter department are "funny" money. That's they are not a signal on the best way to do business. Just a limited resource that admins want to control to increase their power. That is compounded by the normal lack of respect for printers in general. The blablaba in many acadamies is that admins and instructors create value and everything else is overhead paid. It's further compounded by the fact that the staff of inplants are typically composed of many people without college degrees. My sense is that if these cultural issues could be overcome, colleges would recognize ways to cut their overheads so it doesn't cost $100k to buy an BA for our kids at most of our schools.

 

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