Editions   North America | Europe | Magazine


CAP Ventures Study Pegs Profitability of Heidelberg Quickmaster DI

Press release from the issuing company

January 21, 2002 - A recent study by CAP Ventures shows for a second time that users of Heidelberg's Quickmaster DI outperform the average printer in the marketplace. Quickmaster DI (QM DI) owners report, on average, a 45 percent gross profit margin, a lead of 15 percent over the 2001 PIA digital printing profit leaders and a 19 percent lead over the average of all PIA printers. The profitability of QM DI printers is three percent higher in 2001 than in 1999, although the economic climate is more challenging today. In interviews with key executives, the same survey also found that the profitability of the QM DI starts at just a few hundred sheets. "The typical run length crossover position [of conventional offset presses] with toner-based printing devices is 500-700 sheets," the CAPV report notes, "but the most reliable estimates of the actual break-even point [for the Quickmaster DI] appear to be 450-600 copies of 4/4 11x17" sheets and 350-500 copies of 4/0 11x17" sheets." Heidelberg QM DI Shop Profile The survey of 480 QM DI users indicates the ongoing popularity of the Quickmaster DI, founded on its profitability and flexibility. Small to mid-sized printers can leverage this advantage the most: The survey concludes that 90 percent of the DI users have revenues up to $5 million. This trend towards smaller and mid-sized shops corresponds with the average number of employees in a typical DI print shop -- 70 percent of all DI printers employ less than 20 people and 76 percent of them run 1.5 shifts or less, which indicates the entrepreneurial nature of DI printers. (See the above graph.) DI Advantages Many factors contribute to the profitability of machines using DI technology. Thirty-four percent of respondents claimed to have chosen the QM DI based on quality, another 26 percent favored the press for its cost per sheet. The digital concept -- from the RIP to the platemaking on press and automatic adjustment of ink fountains -- allows for extremely short turn-around times of less than 10 minutes -- a fact that attracted 20 percent of current DI users. Billet Graphics, Inc. reports in the study "Having the DI allowed us to accept a last-minute job and turn it around in a minimal amount of time. Our client was very impressed with the quick turnaround, quality and price." On average, a QM DI user completes three to six customer projects within one shift, which can translate into as many as 12 makereadies per shift. A spokesperson for Printing for Less.com stated, "Our success stories are daily. We complete up to 12 makereadies/runs per shift." Another general advantage of the offset process over toner-based printers is the ability to print on a wide variability of substrates so that a wide range of jobs can be covered -- which is extremely important if the QM DI is the only printing press in a shop. Digitalization on the rise In the 1999 study, the use of the Internet was sited as an initiative that would be implemented within 12 months. The 2001 study reveals that the majority of the respondents use the Internet as a medium of communication with their customers. Forty percent of the DI printers indicated that they have a Web site and 37 percent are using the Internet for electronic job submission. It is clear that the Internet has become part of the production workflow. Summary "The CAPV report is an important industry barometer and we're pleased with the success of our customers," said Niels M. Winther, president of Heidelberg USA. "The QM DI has proven to be a quality press, allowing printers to meet their customer's demands and enjoy solid profits." Based on CAPV research, the survey results show the extremely positive impact of the QM DI on profitability in producing short run process color work. The QM DI's quality, makeready time and flexibility at a reasonable cost per sheet are the main advantages for the existing user base. The results from the survey show that the DI technology "...yields higher profitability through process improvement for short runs in an environment asking for shorter turnaround times," says a CAPV spokesperson. # # # Project Objectives Heidelberg contracted with CAP Ventures to coordinate this market research study to quantify and identify profitability and product usage trends. CAP Ventures is a leading consulting firm specializing in on demand printing, document management, database publishing, and electronic document delivery. Among the identified project objectives: Examine overall company size and characteristics of DI owners Explore gross profit levels across a variety of typical, short-run color print jobs Methodology Heidelberg USA contracted with CAP Ventures to coordinate a market research study to quantify and identify profitability and product usage trends. The study was designed to identify characteristics of Heidelberg QM DI owners and to explore gross profit levels across a variety of typical, short-run color print jobs. Heidelberg provided a list of QMDI owners in the United States. CAP Ventures conducted preliminary market research regarding industry trends, developed a prototype survey instrument, and a discussion guide for use in executive interviews. Working with the Heidelberg team, a final survey guide was developed, as were sample job descriptions and prospective interview candidates. The Fax-back questionnaire consisted of 74 questions in four areas designed to determine: Respondent's business type and size Current and future service offerings Survey CAP Ventures solicited responses via a fax-back survey from 480 qualified QMDI owners. Each subject was mailed a survey packet containing survey questions, sample job descriptions and instructional material, including an early submission incentive and deadline. Once the early incentive deadline passed all non-respondents were contacted by telephone and allowed an additional seven days for response. Once this deadline passed CAP Ventures contacted each remaining non-respondent a final time. The profitability percentages were obtained by asking respondents to bid on two typical short-run quick-turn jobs. The first was a 4/0 sales sheet that contained one color and grayscale image. The second was a 4/4 brochure that had two colors and two grayscale images. Survey participants were asked to supply their typical bids for different quantities on each job.