Surviving in Challenging Economic Condition

The worldwide economy is in a slowdown and there are significant signs of a recession especially in the U.S. market. The economist’s state that near term outlooks for our economy will have a negative impact on businesses and the consumer alike. CEOs and CFOs need more strategic and rational strategies with solid metrics to offer a positive return on investment and increased customer value. InfoTrends has indicated six critical strategies that graphic communications firms and print service providers do implement that will enable a thriving growth in these challenging economic conditions.

There are clear implications that the printing industry will face. According to InfoTrends and NAPL, the number of print service provider establishments is declining. From 1998 to 2006 the number of establishments declined by 6,901, which is an 18.3 percent decrease. Some of this is due to consolidations and mergers. Also the number of employees dropped by 170,000—a 22.4 percent decline. There is a single graphic arts segment which has shown an increase, digital printing.

Digital printing has grown 300 percent in establishments and 250 percent in employees. How did they achieve such growth? This has been accomplished by offering savvy graphic communications and developing a significant value-add portfolio of products and services. This is a strong strategic business strategy. These services offered are effective use of digital technology and a streamline unified workflow. This will allow benefits to the customers of reduced overhead, improved managed costs, and effective business communications with customers.

These six strategies, according to InfoTrends, are:

1. The use of Internet-enabled sourcing customer programs that serve small and large businesses. These programs cover digital asset management, Web-to-print collateral, promotional products, and support material management, distribution, and fulfillment.

2. Leveraging multi-channel communication programs with demonstrable return on investment;

3. Emphasizing online, automated ordering processes for print products in a B2B and B2C market;

4. Focusing on markets minimally unaffected by recession;

5. Emphasize “lean manufacturing” and automation;

6. Leverage the use of SaaS (software as a service) solutions.

Utilizing these six critical strategies will enable graphic arts providers to not only withstand these challenging times, but experience growth at the same time.

In these times businesses are looking for strategic partners that can help them reduce their costs and provide non-core processes such as printing, document management, warehousing, distribution, and fulfillment operations. Creating and establishing a Web-to-Print solution to manage these processes has been quite successful for print service providers.

There are benefits of this strategy reported. Print buyers have seen a 14.4 percent savings using a Web-to-Print solution. Other benefits reported from the InfoTrends study indicated reduced turnaround times, improved job tracking, reduced errors, and improved corporate brand management.

The “eEnablement” study also indicated that 60 percent of the respondents saw 54 percent margin improvements, with margin up over 7 percent. Also PSPs saw an 8 percent increase in print volume levels and an 8.1 percent in increased revenues. Twenty-five percent of PSPs achieved more than 10 percent revenue increases. These increases are directly related to the e-print offering. Another question that was asked was how an e-business solution has impacted your business. The results were positive. PSPs attracted new customers, and 90 percent of them were digital printers. Also, expanding the PSP’s geographic reach was a significant benefit.