Last week I spoke at TACUP (Texas Association of College and University Printers). Of course no printing show – regardless of whether its focus is on in-plant or commercial printing or if its draw is national or regional – can get away from the challenges in the industry. As a result, I had several one on one conversations about the future of in-plant printing. The most often asked question from both in-plants and their parent organizations is, “What is the long term prognosis of in-plant printing services?” Answering that question is not easy.
The printing industry is undergoing challenges impacting both commercial and in-plant printers. Over the last 2 years I have worked with in-plants that have remained in business and others that have been outsourced. One advantage of an in-plant is that it uses a business model that does not include profit and often has a lower cost structure because it may not pay rent or utilities, or charge tax. As a result, a well run in-plant with enough demand can save the parent organization between 10-30% on commercial printing costs.
But in-plants, like their commercial cousins, are struggling with the same two issues – cyclical and structural changes that are reducing the demand for printed products. The cyclical change is tied to the economy, while the structural changes are from technologies that are disruptive to the printing industry such as the Internet/ email, cell phones, and e-books, among others. While a portion of the demand will return as the economy returns, the effects of the structural change are more profound and the declines due to those changes may never rebound.
To answer honestly, “What is the long term prognosis of in-plant printing services,” you have to acknowledge the two different camps. On one side are the “naysayers” who say that in-plant printers offering printing services are not sustainable. On the other side are those who say in-plant printers, like their commercials cousins, are evolving and will survive as long as they are responsive to their customers changing needs. The most recent market research supports the later thinking and shows us that, while there are signs of declining numbers of in-plants, they will remain a vital source of print production.
In February 2009, InfoTrends released a study of the in-plant market titled “In-House Production Printing—Critical Trends for Corporations, Government, Education, and Non-Profits.” The report, based on responses from 376 in-plants, revealed that digital printing is quickly displacing offset in in-plants, Data Center Integration is growing and in-plant production is increasing.
In two assignments I worked on this year, I would say that this conclusion is spot on. In both very large in-plant assignments I have seen digital printing displacing offset and Data Center Integration become a motivating factor for keeping in-plants. I suspect that the original impetus behind the statement digital printing displacing offset was due to toner-based technologies. I think that is further supported by high speed inkjet presses.
The InfoTrends study also estimates the number of in-plants in the U.S. to be 52,078 and estimates there was a decline in the number of in-plants of around 2.5 percent from 2006 to 2007. The report supported the thinking that the success of in-plants will come from their ability to be responsive to their customers’ changing needs. When asked which new products and services they expected to show the greatest growth, they listed the following areas: internet based services (Web-to-print), variable data printing, cross media marketing and digital asset management.
Which one of the two camps do you fall into – in-plants are unsustainable or in-plants will survive?