By Stan Najmr of Presstek December 8, 2003 -- As the printing industry struggles to rebound along with the healing economy, printers are faced with a landscape that has changed drastically. Historically, while the printing industry has trended downward with the rest of the economy in periods of recession, it has always returned to growth as the dollars begin to reflow into the marketplace. This time, though, as corporate budgets came under increased scrutiny, there were a wide range of non-print alternatives made possible by technology advances and the prevalence of the Internet, and buyers took advantage of those alternatives to get their messages out in the face of evaporating budgets. Many industry experts agree that much of the business volume which vanished from the marketplace during this latest downturn will never return in the same form, and that growth in our industry will not come from a return of the same types of work and relationships that have been the mainstay of the industry in the past. Business communications are moving rapidly toward shorter-run, more customized pieces with faster turnaround times. Marketing professionals are also cognizant of the value of—and demand for—multichannel communications that allow recipients to receive information in the form and via the medium that is most convenient at any given time. And the arbiters of quality have changed the ground rules, frequently opting for speed and convenience in lieu of high production values. To meet these needs, many print providers are rethinking the way their business is framed, turning to a blended offering that combines color digital printing, direct imaging offset (DI) and conventional offset, leveraging the capabilities of each to deliver more robust solutions that better address their customers’ business objectives. Meanwhile, copiers, both color, black & white, and a new category—color-enabled black & white devices dubbed by CAP Ventures as the universal copier/printer—have increased in quality and functionality, making it easier for office workers to produce printed and electronic communications internally. Using these “document portals,” documents can be scanned, stored, e-mailed, posted to a Web URL—even altered and personalized. Like the desktop publishing revolution of the 1980s, the current technology shift has placed power in the hands of the end user, and the office environment has entered the printing business with a vengeance! What in the past had to be produced in the pressroom now can be produced in the office. Print volumes can be easily adjusted and on-demand printing strategies are becoming the norm for many applications. The old argument that you have to print more to reduce the cost per piece just doesn’t play anymore. And despite initial fears, it is clear that the Internet has actually increased the volume of printing—but not the printing volumes on conventional presses. The reason for this is that many printers have failed to offer convenient alternatives to office printing. But those who were able to deliver double-digit growth through the most recent downturn—and they are out there—understood the transition that was underway. They were able to capitalize on these changing customer needs, taking advantage of technology to offer a flexible production configuration that allowed them to accept, produce and distribute quality printed work faster and more efficiently than ever before. When digital imaging offset (DI) first came to market, these presses were primarily installed in small print shops as a replacement for older duplicators. As the technology matured, and imaging, automation and workflow continued to improve, DI became an interesting business proposition for digital printers. Most digital print operations started with a marketing focus. Unlike traditional press operations, success in digital printing was driven by a clear understanding of the customer’s business objectives, and the ability to help those customers deliver the appropriate messages to targeted audiences. Owners of these digital systems began to specialize in the production of marketing campaigns and print programs—generating a deeper customer relationship and a predictable, recurring revenue stream rather than focusing on the production of large volumes of printed matter on a “bid-and-buy” basis. As demand for short-run printing continued to grow, these digital printers began to receive customer requests for longer runs as well, but the customers wanted to preserve all of the attributes of the digital data handling they had become accustomed to from these providers: 24-hour turnaround, high quality from a first generation image, flexibility and competitive prices. Digital printers could, of course, outsource higher volume work to a conventional printer, but they are increasingly deciding to leverage their relationships to increase customer share. As they analyzed their businesses, they also discovered that 80% of their most profitable work came from 20% of their best clients—those who enjoyed the ease of doing business with a digital print operation. As I visit customers in North America and Europe, I am always amazed at the business ingenuity they display. Among the successful operations I visit, I have seen an increasing trend in the pairing of direct imaging offset (DI) with black & white and color toner-based digital output devices, which I have come to understand is truly a match made in heaven. These operators are able to produce high-quality printed material in quantities from as little as one up to thousands. If quantities are under a specified break point, usually around 500, digital presses are put to use. For quantities higher than 500, the job is directed to the DI press. One example is innovative digital print operation in Switzerland, Peter Druck. A few years ago, the company installed a Xerox DocuColor 12 and a 46 Karat DI press. Peter Druck uses ICC profiles to calibrate all of its print devices and delivers these profiles to major design agencies in the area. This allows the company to offer excellent color fidelity with 24-hour turnaround, and to use the DocuColor and the 46 Karat interchangeably depending upon the requirements of the individual print run. As Peter Druck’s business began to grow, the company also realized that it could offer even better service—at a lower cost and with faster turnaround—if it could circumvent the proofing step. As clients became comfortable with the reliable color fidelity Peter Druck was able to deliver, they were offered special pricing if they decided to eliminate the proofing step. Today, none of Peter Druck’s clients ask for a proof. This is a significant change in business process. Variable Data Printing and the DI And for variable data work, enterprising digital print operations are leveraging the strengths of both digital presses and DI to deliver the exact piece desired by the customer, and at a cost and cycle time that meets the demands of today’s fast-paced world. Static materials are produced on the DI, with variable information overprinted using either color or black & white digital devices. In some cases, this may mean that one side of the piece is fully variable (produced on the toner-based device) with the other being static (produced on the DI press). In other cases, variable information can be overprinted selectively on the offset printed piece for a customized result. By leveraging the strengths of both technologies, overall quality is up, cost to produce is down, and cycle times can meet the needs of all but the most demanding customers. These successful print service providers have cracked the code. They clearly understand the cost dynamics associated with direct imaging offset and digital output devices. They are able to achieve a balance between the higher per-image costs of operating a toner-based digital output device and the longer-run efficiencies of a DI press. They use the right blend of tools to meet the customer’s needs, making the acquisition of print even more convenient and cost-effective than the option of migrating the work to office devices. Future Vision The integration of toner-based digital output with high-quality digital offset is a solution whose time has come. From desktop to sellable sheets, the process is totally digital. Chemicals, darkrooms, specialized proofing devices and the many manual steps of the conventional offset process are virtually eliminated. The goal of this new genre of printing solution is to increase the amount of revenue printers can gain from their customer base by expanding the range of work that can be cost-effectively produced and by making the entire process more convenient, timely and efficient. In the past, conventional printers either refused short run work, sent the customer to a competitor, or tried to sell higher quantities based on a lower cost per piece because short run work was not profitable—for them or for the customer. And many have steered clear of variable data work because of its perceived cost and complexity. But with short run, on-demand and variable data printing on the rise, and with traditional long-run work declining, printers are seeing new competitors emerge daily, new competition that utilizes digital printing, the Internet, and digital offset to offer quick turnaround, full automation and the ultimate in customer convenience. Much like the typesetting operations of the past who fell prey to the rise of desktop publishing, printers must adopt these new technologies and new ways of doing business, or run the risk of closing their doors forever. Learn from the lessons of the past or the future will overtake you. As the late Milton Berle said: "If opportunity doesn't knock, build a door." The blend of digital offset and digital toner-based production capabilities truly opens a new door to the opportunities of the future. Just ask those who are already taking advantage of it—and enjoying double-digit revenue growth as a result.