WidthWise 2011
description
Transcript of WidthWise 2011
Supporting the UK and Ireland wide-format market, our sponsors:
2011
An
Publication
ImageREPORTS
THE FOURTH ANNUAL SURVEY AND REPORT ON THE STATE OFTHE UK/IRISH WIDE-FORMAT PRINT SECTOR
04 �� STRATEGIC OVERVIEW Key findings of the 2011 Widthwise survey.
12 � STATE OF PLAY We look at how companies are performing and moving forward across threeturnover brackets: up to £500k, £500K-£2m, £2m+. Includes a case studyon a company in each bracket.
33 � SECRETS OF SUCCESSGrassroots LFP players provide their insights into performing well in today’smarket.
34 � SUPPLIERS’ VIEWPOINTSHow do the vendors see the marketplace and challenges for the future?
38 � SUSTAINABILITYWhy we need to be taking the issue more seriously.
42 � HOW GOOD IS YOUR COMPANY?Exploring the characteristics of enduring businesses.
46 � THE LAST WORD…goes to Paula Evans, at Manchester-based Transport Media whodiscusses what digital wide-format print has bought to the out-of-homeadvertising market.
Contents
thanks to our sponsors:
Hello and welcome to this, the fourth annualImage Reports Widthwise Report which, basedon data and comment collected from over200 UK and Ireland print companies involvedin wide-format print, is the most sector andregional specific publication of its type.
Via Widthwise survey feedback collated thisspring, face-to-face and telephoneinterviews, this 2011 Widthwise Report takes anitty-gritty look at the overall state of thelarge-format market and from the perspectiveof small (turnover up to £500,000), medium(up to £2m) and large (£2m+) printcompanies so that you can best judge yourlevels of success with like-sized competitionand plan for strategic development.
The Widthwise Survey data, provided bywide-format players of all shapes and sizes,has been compiled by graphic arts marketresearch and strategic consulting companyInfoTrends into a series of easy-to-digestgraphics that are presented in this reportalongside associated features by ImagesReports.
You can download a digital version of thisreport from the Image Reports website atwww.imagereportsmag.co.uk. If you haveany comments to make on the report there isan opportunity for you to do that online too.
Lesley SimpsonEditor, Image Reports [email protected]
WELCOME TO WIDTHWISE 2011
2011
Printed in Great Britain.No part of this publication may be reproduced, stored in a retrievalsystem or transmitted by any meanswithout the Publisher’s permission.The editorial content does not necessarily reflect the views of thePublisher. The Publisher accepts no responsibility for any errors contained within the publication.
St. John Patrick Publishers Ltd, 6 Laurence Pountney HillLondon, EC4Y OBLTel: 020 7923 8999Fax: 020 7923 [email protected]
Editor: LESLEY [email protected]
Publishing Director:CHRIS [email protected]
Design:TANIA KING
ver 200 companies involved in large-format
print from across England, Scotland, Wales
and Ireland responded to the 2011
Widthwise Survey which was carried out this spring.
This is the fourth consecutive year that Image Reports
has conducted the poll, which covers business, markets
and technology issues. During the last four-year period,
the large-format industry has been revolutionised by
technology and economic turmoil. Since that shake-out,
the pace of change hasn’t slowed but that change is
typically more incremental than transformational. The
2010 Widthwise report explored what wide-format
players needed to do to be at the leading competitive
edge, by looking at the need for diversification and the
growth of growth vertical markets. This 2011 survey/
report goes a step further and takes a more nitty-gritty
look at the state of a still unpredictable market from the
perspective of small (turnover up to £500,000), medium
(up to £2m) and large (£2m+) print companies so that
they can better judge their levels of success with like-
sized competition and develop their strategy accordingly
In terms of turnover, number of employees and
company location, the overall demographics of the 2011
survey sample was much the same as in 2010 – but
slightly more respondents this time around said wide-
format print accounts for 80 – 100% of their business
(23% opposed to 15% in 2010). Of those that said it is
not 100% of their business a whopping 71% expect to
see the ratio of such work to increase in the next two
years. And that’s because, as the survey makes clear,
there’s still good money in wide-format.
A quarter of all those polled said overall margins have
improved in 2010/11. Less encouragingly, 45% said they
had got tighter (the other 30% said no change). Of those
with turnovers of £2m+ only 15% saw margins increase in
the period while the figure jumped to 27% and 28%
respectively in the small and medium turnover segments.
So, are the smaller companies better positioned in terms of
flexibility and readier to try alternative, higher margin work?
Almost half of those polled (48%) said margins in wide-
format are better than in other parts of their print
business. This encouraging news was pretty consistent
whatever the size of turnover. Yet one in five large and
small companies reported that margins were not so
strong as in other parts of the business. Only a tenth of
those in the middle turnover bracket said that.
By far the biggest concern was the state of the general
economy, with 59.1% ranking that as their top worry
while 28% ranked price competition as their biggest
concern. Fewer than a fifth of respondents placed the
availability/cost of finance as the most serious challenge
they faced and foreign competition didn’t seem to
particularly worry respondents.
Despite the still shaky general economic situation, over
half of those polled (54%) said they plan to recruit in the
next two years, a figure that jumps to 64% for medium-
sized businesses. Print production comes top of the new
blood wish list, with 62% of those looking to recruit citing
this as a priority, followed by sales and marketing (36%),
design (30%) and finishing (26%). Only 7% flagged up the
need for more people to handle business development.
04
key findingsOverview and
WIDTHWISE 2011
71% of those for whom large-format is not 100% of theirbusiness expect to see the ratio of large-format workincrease in the next two years.
48% said margins in wide-format are better than in otherparts of their print business.
25% said overall margins have improved in 2010/11, while45% said they had deteriorated
51% ranked the general economy as their most majorconcern
54% plan to recruit in the next two years.
66% said entering new markets/offering new services was ahigh or very high priority
46% are making strategic change to win business from newapplications/niches
56% expect to buy a new large-format printer in the nexttwo years
44% will invest in design software in the next two years
59% think it is more important to offer ‘green’ solutions thanit was two years ago, while 18% think it’s not importantat all
10 BITES OF DATAO
WIDTHWISE 2011
basic demographics
Business
South-east England – 40%
Midlands – 17%South-west England – 10%
North-east England – 9%
North-west England – 9%
Ireland – 6%
Wales – 5%
Scotland – 4%
11-20 employees – 15%
21-50 employees – 9%
100 employees – 8%
51-100 employees – 4%
1-10 employees – 64%
Up to £500,000 – 52.6%
£500,000 - 2m – 27%
£2+ – 20.4%
Under 20% – 32%
80-100% – 23%20-40% – 20%
60-80% – 13%
40-60% – 12%
No – 45%
Yes – 25%
No change – 30%
Yes – 48%
No – 18%
About equal – 34%
5.2%
General s
tate
of the
economy
Availib
ility / cost
of finance
Amount o
f new
entrants
intoth
em
arket
Price
competiti
on
Fore
ign
competiti
on
Recru
iting
staff w
ithth
erig
ht skil
l sets
3.29%3.61%
4.62%
2.34%
3.09%
0
1
2
3
4
5
6
Yes – 54%
Not sure – 23%
No – 23%
Geographic Location
Number of Employees
Size by Total Turnover
% of turnover in wide format?
Have your overall marginsimproved in 2010/2011?
Do you plan to recruit in the next 2 years?
Are your wide-format margins betterthan other parts of your print business?
What are your major concerns for business in 2011/12 (rank 1 – 7, 7being most important) – Average rating, all respondents
05
The industry is clearly still adjusting to the seismic
changes wreaked by technology and recession. Almost
half (46%) of the respondents said they are having to
make strategic changes within their operation to win
business from new applications/niches – but this is
considerably less than the 70% who said the same thing
in 2010, suggesting that much strategic change has
already taken place.
A key strategic focus remains finding new markets and
offering new services: 66% of respondents said this was
a high or very high priority, with only 6% saying it wasn’t
a focus at all.
Unsurprisingly, almost three quarters (72.7%) of
companies are involved in poster printing, with exhibition
and display graphics (69.9%), general
banners/flags/signage (65.7%) following close behind.
But there are areas where the percentage of printers
involved is still relatively low: in textile printing for
garments (8.3%), packaging (14.8%), industrial speciality
(15.7%), textiles for home/interiors (17.7%) and
cardboard engineering (16.7%).
Perhaps that’s because there’s still enough perceived
growth in some of the mainstream markets. Over 22%
said exhibition and display graphics is the fastest
growing sector for their businesses, with almost 20%
saying the same about general banners/flags/signage.
With architects becoming more central to print
purchasing, it will be interesting to see how their
demands play out. In the 2010 Widthwise Report only 2%
of work was said to come from architects. This time
around it is nearer 8%.
Getting more involved with clients at an early stage in
graphics projects is certainly a growing trend. Almost half
(49%) of those surveyed now offer a creative design
service, and over a quarter (25.5%) have a total project
management capability.
To maintain the search for new business, especially
from new applications and niche markets, print
companies are involving creative teams earlier in
projects, but the survey clearly shows that the
restructuring/refocusing of sales and marketing teams is
by far the most urgent priority. Many companies were
also researching potential new markets and working more
closely with suppliers to identify new opportunities.
Textiles must certainly be one of those opportunities.
Only 6% of respondents said they own a textile printer
and a mere 8% said they intend to buy one anytime soon
even though 56% of respondents having said they intend
to buy a new large-format printer of some sort in the next
two years.
Over half (55.1%) of the companies surveyed said they
own a solvent (inc. eco-solvent) printer and 27% of those
06
0%
10%
20%
30%
40%
50%
60%
70%
80%
Design
Pre-p
ress
/ file
manip
ulatio
n
Print p
roductio
n
Finish
ing
Sales /
marke
ting
Managm
ent
Busin
ess d
evelopm
ent
Administ
ratio
n
General IT
support
Intern
et / o
nline d
evelopm
ent
Other
30%
9%
62%
26%
36%
2%7% 6% 5%
15%
1%
% o
f re
spo
nd
an
ts
Where are you primarily looking torecruit? (tick all relevant)
0% 5% 10% 15% 20%
Exhibition and display graphics
Retail / POP / POS
General banners / flags / signage
Wall murals
Textile printing for home / interior décor
Fine art / photography
Textile printing for banner / flags
Floor graphics
Posters
Window graphics
Transport grphics
Industrial speciality (ceramics, metals etc)
Billboard / outdoor advertising
Cardboard engineering
Building hoardings / wraps
Other
Textile printing for garments
Packaging
19.4%
15.7%
14.4%
12.5%
11.1%
9.7%
9.3%
9.3%
8.8%
8.8%
7.9%
7.9%
6.9%
6.5%
6.5%
4.2%
3.2%
2.8%
High – 39%
Very high – 27%
Medium – 22%
Low – 6%
Not a focus at all – 6%
How high a priority is finding/entering new wide-format markets/offering new services?
Which market areas are you looking at becominginvolved in over the next 2 years?
Business
WIDTHWISE 2011
07
PostersExhibition and display graphics
General banners / flags / signageRetail / POP / POSWindow graphics
Fine art / photographyWall murals
Transport graphicsFloor graphics
Billboard / outdoor advertisingTextile printing for banner / flags
Building hoardings / wrapsCardboard engineering
Textile printing for home / interior décorIndustrial speciality (ceramics, metals etc)
PackagingTextile printing for garments
Other
0% 10% 20% 30% 40% 50% 60% 70% 80%
72.7%69.9%65.7%59.3%57.9%42.6%42.1%42.7%35.6%31.0%26.4%24.1%16.7%15.7%15.7%14.8%8.3%4.6%
Exhibition and display graphicsGeneral banners / flags / signage
Retail / POP / POSFine art / photography
PostersTransport graphics
Window graphicsWall murals
Building hoardings / wrapsBillboard / outdoor advertising
Cardboard engineeringTextile printing for home / interior décor
Industrial speciality (ceramics, metals etc)Floor graphics
PackagingTextile printing for banner / flags
OtherTextile printing for garments
0% 5% 10% 15% 20% 25%
22.2%19.9%13%12%10.6%9.7%8.8%7.4%6%4.6%4.6%3.7%3.2%2.8%1.9%1.9%1.9%1.4%
Direct from end client – 33.7%
Agency – 16.6%
Consumer – 13.6%
Print management – 9.7%
Architect – 7.9%
Other – 0.6%
Trade work (from another printer) – 17.8%
Where are you primarily looking to recruit?
Through which channels does your work come?
Up – 71%
Static – 25%
Down – 4%
If wide-format is not 100% of your business, do you expect to seethe ratio of wide-format to increase in the next 2 years?
0
20
40
60
80
100
Up to £500,000 £500,000 - £2m £2m+
% o
f re
spo
nd
an
ts
32%
20%
48%
40%
10%
50%
31%
22%
47%
About equal
No
Yes
Are your wide-format margins better than otherparts of your print business?
0% 10% 20% 30% 40% 50%
Creative design
Total project management
Variable data printing / versioning
Web-to-print
Website building / content creation
Database hosting / managing / cleansing
Other
49%
25.5%
9.4%
2.7%
2.7%
1.3%
4%
No – 54%Yes – 46%
0% 10% 20% 30% 40% 50% 60%
Restructure / refocus sales / marketing teams
Attend seminars / reasearch new markets
Work more closely with suppliers to identify / sell
Realign your branding / company name / website
Involve in-house creative team earlier in projects
Spend more time on applications R&D
Buy in databases (for maketing purposes)
Appoint a ‘new business tsar’ / business
Recruit people with specific new sector knowledge
Other
55.2%
54.5%
52.7%
46.7%
26.7%
25.8%
17.6%
16.5%
14%
2.1%
Which added-value services do you offer?
Are you having to make strategic changes withinyour business to win business from new
markets/applications?
What are you having to do to win business fromnew applications/market niches?
Which of these is the fastest growing for your business?
WIDTHWISE 2011
investing in a new large format printer expect to buy one
of these machines. But UV is where it’s at. Almost half
(48.2%) of those polled said they now own a UV curable
printer of some description. 49% of those investing in
new kit said they will buy a UV machine – 33% plumping
for a flatbed.
Latex printers are also enjoying a surge in demand. In a
relatively short time they have made a significant impact,
with 6.5% of surveyed companies owning a latex printer
and 15% of those planning printer investment over the
next two years having earmarked a latex unit.
Asked if they were expecting to invest more across
their businesses in 2011/12 than in 2010/11, 41% of
respondents said they were - pretty much on par with the
percentage that said they would be spending about the
same (only 17% said less). In terms of large-format
investment, 38% said they would be spending less that
£20,000 while 4% plan to pump in more that £25,000.
Apart from spending on new printing machines, design
software was the most commonly identified large-format
investment area with 44.6% saying they will be buying
such packages. Laminators (18.8%) and contour cutters
(16.1%) came in next. Only a tiny minority plan to buy
into VDP (0.9%) or W2P (1.8%) software, so there is still
plenty of potential there. Asked what they wanted their
suppliers to focus their R&D on, printers said reducing
machine running costs was the top priority.
On the issue of the environment the picture remains
confused. While a walloping 59% of those polled said
offering ‘green’ options is more important that it was two
years ago, a significant 18% thought it not important to
do so at all and 9% thought it less important that it was
two years ago!
A much bigger percentage of print companies in the
top turnover bracket of £2m+ (more likely to work with
the bigger, more environmentally savvy retail clients)
thought it increasingly important than their smaller
counterparts. 26% of those companies with a turnover of
less than £500,000 actually felt green issues were
unimportant. Customers seem equally confused: only 4%
of printers said that ‘most’ of their clients asked for
environmental accreditation, while 63% said the question
has not arisen.
On the evidence of this survey, the large-format
industry is still in transition. Yet given the shocks it has
experienced since 2007, the most striking aspect of the
results in the 2011 Widthwise survey is the industry’s
sheer, bloody-minded resilience. In the middle of great
economic uncertainty, most printers – small medium and
large – seem to be making the strategic adjustments,
planning the investments and exploring the valuable new
niches that will help them flourish in the long run.
08
technology
0% 10% 20% 30% 40% 50% 60%
Finishing - laminator
Finishing - straight line cutter
Finishing - contour cutter
Print-and-cut roll-fed printer
Textile printer
Dye sublimation (non textile)
UV curable roll-fed printer
UV curable hybrid printer
UV curable flatbed printer
Solvent printer (inc. eco-solvent)
Latex printer
Aqueous printer
57.4%
27.3%
29.6%
21.8%
6%
9.3%
9.7%
13%
25.5%
55.1%
6.5%
30.6%
What type of wide-format equipment do you own
Other
Screen
Litho press
Flexo
Digital press - inkjet
Digital printer - toner
0% 5% 10% 15% 20% 25% 30% 35%
1.9%
6.9%
3.7%
0.5%
12%
31.5%
Do you own other types of printer?
About the same – 42%
More – 41%
Less – 17%
Yes – 56%
Not sure – 26%
No – 18%
Are you expecting to invest more in 2011/12than in 2010/11?
Do you expect to invest in a new wide-formatprinter in the next 2 years?
WIDTHWISE 2011
09
Which type of printer do you expect to buy?What technologies did you primarily operate
when you first bought into inkjet WF?
Aqueous prin
ter
Late
x prin
ter
Solve
nt prin
ter (
inc. eco-so
lvent)
UV cura
ble flatb
ed prin
ter
UV cura
ble hyb
rid p
rinte
r
UV cura
ble roll-f
ed prin
ter
Dye su
blimatio
n (non te
xtile)
Texti
le prin
ter
9%
15%
27%
33%
9%7%
5%8%
0%
5%
10%
15%
20%
25%
30%
35%
Other
Software – VDP
Software – W2P
Software – design
Software – workflow / MIS
Finishing – straight line cutter
Finishing – laminator
Finishing – contour cutter
0% 10% 20% 30% 40% 50%
1.8%
0.9%
1.8%
44.6%
10.7%
5.4%
18.8%
16.1%
Do you expect to invest in any of the following forwide-format in the next 2 years?
Less than £20,000 – 38%
£20,000 - £75,000 – 35%
£75,000 - £150,000 – 16%
£150,000 - £250,000 – 7%
£250,000+ – 4%
Over 5 years ago – 61%
3-5 years ago – 17%
1-3 years ago – 17%
In the last year – 5%
Sign making – 24.5%
Other – 19%
Litho – 19%
Photo lab – 15%
Screen – 11.6%
Pre-press/repro – 10.9%
0 1 2 3 4 5
Machine / consumables reliability / consistency
Profiling / workflow
Cutting machine running costs
Cutting kit capital investment cost
Improving quality / speed
3.59
3.05
4.22
3.55
3.92
2.53 2.51
2.15
2.69
0.0
0.5
1.0
1.5
2.0
2.5
3.0
Problem
s with
machine re
liabilit
y
Problem
s with
consu
mables r
eliabilit
y
Kit sp
ec misl
eading
Workflow
In total, how much do you expect to invest in wide-formatprocess over the next 2 years?
When did your company buy its first inkjetwide-format printer?
What is the biggest technological issue you face?
Where would you like to see manufacturersputting their R&D
WIDTHWISE 2011
oes size matter? This is yet another issue
economists can’t quite agree on. The theory
is clear: as companies grow larger their
average total cost of production should decline and give
them the edge over smaller rivals. Yet diseconomies of
scale – larger overheads, wider distribution networks, lack
of flexibility – may blunt this edge. And with markets
volatile in a downturn, larger players can find it harder to
generate the volume they need to keep their average total
cost of production competitively low. The one industry
where size usually does equate to longevity is organised
crime but the mafia, which has its own particularly
effective way of maintaining its competitive edge and
dispensing with failed managers, is not that relevant a role
model for most large businesses.
Yet in a market revolutionised by economic catastrophe
and rapidly evolving technology, wide-format printing
businesses with sales of £2m have held up pretty well. In
the 2008 Widthwise Survey, 22 of the respondents
revealed that they had turnovers of £2m or over. Today, 19
are recognisably the same business, one has gone into
liquidation and two have been acquired –Lauren Displays
by a creative agency and Multigraphics by the
multinational packaging group DS Smith. Given the
carnage that has transformed so many other sectors of the
printing industry over the same period, such endurance is
impressive.
That doesn’t mean large companies have had it easy. Far
from it. And the 2011 survey suggests they still face
significant challenges but it says something about their
performance that their biggest worry by far is probably the
outlook for the UK economy. Yet even though the
economic outlook is as unpredictable as the weather
forecast, some of the biggest printers have decided to
invest (as the Evolve Group has done), revitalise their
image (Gardners) and experiment with 3D print (the
Simpson group).
BUSINESS
In 2011, for the first time, the results of the Image Reports
Widthwise survey are broken down by size of business.
While the responses show a fair degree of consensus
across the industry, there are some important differences –
especially for larger companies.
For a start, more than two out of three companies with
sales of £2m or more generated 40% or less of their
business from wide-format print and only one in seven said
this sector accounted for 80% or more of their sales.
Servicing significant, demanding customers in the retail
industry, many large digital print groups strive to offer a
diverse a mix of services and products. That said, with 77%
of larger firms expecting wide-format to supply more of
their turnover, this option is clearly increasingly favoured by
their customers. With 49% of larger print companies
already having environmental accreditation – compared to
18% across the industry – sustainability is not a trend on
the horizon but a reality of business life.
If you accept, as a rule of thumb, that larger print
companies tend to serve larger customers, this might
explain why margins were under significantly more pressure
among the wide-format industry’s biggest players. Only
15% said their margins had improved in the past year –
compared to an industry norm of 25% – while 42% said
they had deteriorated. This suggests that some larger print
firms have been under pressure to sacrifice margins to
maintain volume. Fierce competition has probably taken its
toll too: this was the second greatest concern for large print
firms.
The pressure does not seem to have significantly dented
business confidence or distracted many managing
directors from investing in the future. More than six out of
ten larger firms plan to recruit in the next two years and
they are looking to hire in three particular areas: print
production (where 57.6% of respondents planned to
recruit), finishing (39.4%) and sales/marketing (39.4%). The
quest for new sales/marketing staff is reinforced by the fact
that 60% of larger firms say they will restructure or refocus
12
State of play:For companies with a turnover of £2m+
WIDTHWISE 2011
D
THE MAFIA, WHICH
HAS ITS OWN
PARTICULARLY EFFECTIVE
WAY OF MAINTAINING ITS
COMPETITIVE EDGE, IS
NOT THAT RELEVANT A
ROLE MODEL FOR MOST
LARGE BUSINESSES
“”
their sales/marketing teams to explore new
applications and new niche markets. Just over half
wanted to make strategic changes, with 53% hoping
to closer collaboration with suppliers would help
them explore new applications.
Traditionally, printers’ marketing campaigns have
resembled showbiz marriages: short-lived, entered
into more in hope than belief and doomed by
unrealistic expectations. But the bigger large-format
printers have recognised their need to spread the
word. Their websites are now usefully informative,
not the electronic husks of yore. Last November,
Gardners hired brand design agency Stills to
makeover its image, including its website. McKenzie
Clark engages with potential customers with a blog.
Meanwhile, the Simpsons Group has launched what
it calls an ‘Influence Academy” to inform potential
customers while Augustus Martin has launched a
range of customer-driven consultancy services from
store audits to market research.
In an industry driven by digital technology, the fact
that so few companies made adequate use of the
internet was baffling, if not plain weird. What firms
are doing now might not be radical or transformative
but it does signify a shift towards some kind of best
practice.
MARKET ANALYSIS
Wide-format may have been the fastest growing
sector of the printing industry for at least a decade
now but things aren’t what they used to be – and
probably never were as good as we now think they
were. Though business has stabilised, the
marketplace is still tough.
The list of applications the largest wide-format
firms serve will startle no one. The most popular are
exhibition and display graphics (62.8% of
respondents were in this sector); posters, retail
POP/POS (both 55.8%); banners/flags/signage
(53.8%) and window graphics (46.5%). Probably he
biggest surprise was that 34.9% were involved in
cardboard engineering – compared to 16.7% for the
industry as a whole. The responses suggested that
many larger printers had taken the strategic choice
to focus on fewer markets but offer a more complete
service within those sectors: four out of ten offered
WIDTHWISE 2011
Up to £500,000 £500,000 - 2m £2m+
%o
fre
spo
nd
an
ts No change
No
Yes
0%
20%
40%
60%
80%
100%
120
27% 28%42%
46% 45%
27% 28%
42%
15%
General s
tate
of the
economey
Availa
bility / cost
of finance
Amount o
f new
entrants
intoth
em
arket
Price
comparis
on
Fore
ign
competiti
on
Recru
iting
staff w
ithth
erig
ht skil
l sets
0
1
2
3
4
5
6
3.47 3.
6
4.94
3
3.06
5.65
PostersExhibition and display graphics
General banners / flags / signageRetail / POP / POSWindow graphics
Fine art / photographyWall murals
Transport graphicsFloor graphics
Billboard / outdoor advertisingTextile printing for banner / flags
Building hoardings / wrapsCardboard engineering
Textile printing for home / interior décorIndustrial speciality (ceramics, metals etc)
PackagingTextile printing for garments
Other
0% 10% 20% 30% 40% 50% 60% 70% 80%
55.8%
62.8%
53.5%
55.8%
46.5%
18.6%
37.2%27.9%
41.9%
23.3%
25.6%
23.3%
34.9%
14%
14%
14%
2.3%
4.7%
Have your overall margins improved in 2010/2011?
What are your major concerns for business in2011/12 (rank 1-7, 7 being the most important).
Applications for larger firms(% of respondents involved in each sector)
13
total project management, 32% creative design and 16%
variable data printing/versioning. A small minority – 4% –
already offer Web-to-print services.
Despite the scale of these businesses, foreign
competition does not yet register as a significant worry.
That may change. It’s worth noting that Augustus Martin
has founded POP European Network, an alliance of the
largest POP firms in the major European markets. By
offering a standardised pan-European approach and
increased print power, Augustus Martin and its partners say
they can reduce the time to market. Given that so many
wide-format customers are multinational, you can certainly
see the logic. A similar rationale may be behind
Papergraphics’ acquisition of Dutch firm Quality Graphics
last November.
And then there is China. With a billion people, the world’s
second largest economy has an insatiable appetite for
signage. And the Chinese wide-format industry, which is
still relatively unsophisticated in terms of quality and
services, is full of young entrepreneurs who don’t have vast
experience in running a business. So Chinese wide-format
printers should be pretty busy keeping up with domestic
demand for a while yet. (As indeed will Indian companies as
wide-format grows exponentially there.) But the long-term
threat – it could be as soon as ten years from now – posed
by these emerging powers should spur British businesses
to make greater efforts to differentiate themselves.
Digital technology has simplified the media. The
impenetrable processes that used to frustrate, baffle and
constrain customers – and justify the printing industry’s
fees – have been bypassed. Customers now consume
media in a completely different way and, interacting
through digital channels, take a do-it-yourself approach to
the media that has created many new print markets. That
said, you only have to look at the history of the digital
transformation of print to see the dangers ahead.
Once choosing print begins to seem as simple as
downloading a track from iTunes, there is a danger that
customers will regard print as a commodity. The time to
educate the market is now – especially as many printers
now believe that many of the people who are responsible
for procuring print don’t necessarily understand what
they’re buying. This will be especially important as pre-
press companies, photographic houses and screen printers
all seek to diversify into a market that is relatively vibrant
and lucrative.
For larger printers, the imperative is to ensure their
customers realise the value – financial and strategic – of
their expertise. This need may explain why a third of larger
firms in this survey are looking to appoint a business
development manager and give their creative teams more
timely involvement in projects while 40% plan to realign
their brand/image/website.
Larger firms haven’t stopped looking for new markets –
though only 22.6% said it was a very high priority – but
some managing directors have clearly decided it’s more
important to look at the markets they are serve them well
and serve them a lot better.
TECHNOLOGICAL OUTLOOK
Companies with a turnover of £2m or more were slightly
bullish about investment than their smaller rivals: half said
they would spend more in 2011/2012 than in 2010/11 and
70% expected to invest in a wide-format printer in the
next two years.
They weren’t just eyeing up new printers: 36% expected
to buy design software, 23% in contour cutters for
finishing, 14% in laminators and software to handle
workflow or generate management information. One in 20
expected to invest in variable data printing software,
something no smaller companies were planning to do.
The length of this shopping list is reflected in the fact
that 19% planned to invest £250,000 or more in the next
to years, with another 14% expecting to invest between
£150,000-250,000. Maybe one of the enduring economies
of scale is the ability to spend more on the latest
technology than their smaller rivals. (That said, it is
striking that over one in four say they plan to invest less
than £20,000 in the next two years.)
If you look at what kind of printer larger firms expect to
invest in, that would certainly seem to be the case. Very
nearly two out of three say they will buy a UV printer of
14
WIDTHWISE 2011
PRINTERS’
MARKETING CAMPAIGNS
HAVE RESEMBLED
SHOWBIZ MARRIAGES:
SHORT-LIVED, ENTERED
INTO MORE IN HOPE THAN
BELIEF
“”
15
Big firms recruitment targets(% of respondents looking to recruit in each area)
WIDTHWISE 2011
some kind – and 46.7% are opting for a UV curable
flatbed printer. The other priorities are textile
printers, solvent printers (13.3%) and latex printers
(10.0%). The larger firms, who have the resource to
take a risk, have traditionally been early adopters of
technology – three out of four bought their first inkjet
machine five years ago or more – and they seem to
be plumping en masse for UV.
Asked what they wanted from the suppliers, larger
firms weren’t that much from different from the
industry as a whole. They would like better
quality/speed, lower running costs and their biggest
problem remains machine reliability. In the past,
some larger firms have also complained that their
different suppliers – of substrates, ink and machines
– don’t collaborate or communicate effectively.
THE LAST WORD
The wide-format industry has seen so much change
in the last four years it’s easy to overlook the
industry equivalent of Sherlock Holmes’s dog that
didn’t bark in the night. There haven’t been many
acquisitions by larger print and packaging groups
seeking to diversify into this market in the UK. The
most notable deals are quite old now: St Ives
purchase of Service Graphics in 2006 and DS
Smith’s takeover of Multigraphics three years ago.
There has been plenty of consolidation and strategic
realignment among suppliers, but not that much
really among print companies.
In part, this may reflect the commercial print
industry’s own financial troubles as the economic
crisis wreaked havoc. But as the recovery gathers
momentum, and banks become more amenable to
financing such deals, some opportunistic or strategic
acquisitions would seem likely.
Wide-format is no longer a niche market. If you
needed any confirmation of that, consider two
decisions the St Ives group has made this year. At
the end of January, the group relocated its large-
format division, Service Graphics, to massive new
premises in Chessington. Six weeks later, the group
sold off its magazine business. Five years ago, the
idea that wide-format would be more important to a
group as large as St Ives than magazine printing
would have seemed absurd. There is no more
compelling proof of the seismic shift which wide-
format has triggered in the printing industry.
Design
Pre-p
ress
/ filem
anipula
tion
Print p
roductio
n
Finish
ing
Sales / m
arketin
g
Managm
ent
Busin
essdev
elopment
Administ
ratio
n
General IT
support
Intern
et /onlin
edev
elopment
Other0
10
20
30
40
50
60
18.2
%
18.2
%
57.6
%
39.4
%
39.4
%
0%
9.1%
6.1% 9.
1%
18.2
%
0%0% 10% 20% 30% 40% 50%
Textile printer
Dye sublimation (non textile)
UV curable roll-fed printer
UV curable hybrid printer
UV curable flatbed printer
Solvent printer (inc. eco-solvent)
Latex printer
Aqueous printer
13.3%
0%
10%
6.7%
46.7%
13.3%
10%
0%
0%1%
0%
20%
40%
60%
80%
100%7%
2%
12% 19%
14%
19%
19%
28%
29%
45%
12%
36%
56%
£250,000+
£150,000 - £250,000
£75,000 - £150,000
£20,000 - £75,000
Less tahn £20,000
Up to £500,000 £500,000 - £2m £2m+
Planned printer purchases(% of large companies expecting to buy)
In total, how much do you expect to invest in wide-format processover the next 2 years? (includes software and hardware)
16
WIDTHWISE 2011
State of play: Case Study
A showof strength
ow divested of its magazine print business,
St Ives Group is evolving into two distinct
parts: print and marketing services - the
latter still in its infancy and contributing just 2% to group
sales of £149m sales for the six months ending January
2011. Of the other 98% its large-format display
company Service Graphics (running under the division
heading Exhibitions and Events) accounted for the
smallest proportion of sales at 11% (Point of Sale 31%,
Books 28%,
Direct
Response and
Commercial
28%) but chief
executive
Patrick Martell
has made it
clear that he
anticipates “a
significant
increase in
activity within
this market”
and that
Service
Graphics,
which
relocated its
head office to
Chessington at
the start of this year, will benefit from the move and a
£4m investment strategy.
Service Graphics’ sales director Scott King says
growth is already being seen and is predicting the
company will turnover £38-£40m by the year end in July
2011. “We expect to see significant growth and to
become a bigger part of the St Ives Group as time
moves on, both in terms of turnover and profitability,” he
says. “That is largely due to the new site and the new
technologies we have recently acquired, but we are
seeing growth from all our sites in terms of turnover.”
Service Graphics has bases in Glasgow, Skelmersdale,
Nottingham, Kent and Salisbury but it’s the new 4,274m2
purpose-built factory in Chessington that is the focal
point. Primarily servicing the South of England and
London, the Chessington production supersite will
support the company’s other operations. It is where the
greatest efficiencies are being made and where Scott
believes it can woo customers to best effect.
“Customers come here and it’s immediately apparent
that we’re serious players and proactive in the market,”
enthuses King, “and we’re holding Open Days in June
for designers and creatives to see what we’re all about
etc. In the past Service Graphics was a bit of a sleeping
giant – it didn’t shout about what it did. A new
management team headed by Nick Cole was put in
place a couple of years ago and things began to change.
He rejuvenated us. He sits on the St Ives Executive
Board and that has helped. St Ives recognises that
large-format is a really strong growth sector and without
that we wouldn’t be in a new building and have made
the investment we have.”
Since summer 2010 Service Graphics has installed the
UK’s first superwide Durst Rho 500R roll-to-roll UV
printer, a Rho Tex printer and an Inca £20. “It has been a
huge investment but one which has brought economic
efficiencies through higher speeds etc,” says King. “It
also means we’re in a stronger position to service
customers and offer a wider range of solutions – and
that is what it’s all about.
“We expect to see a strong performance in 2011 and
moving forward, but the market remains competitive and
in all fairness, we won’t see it get back to what it was –
it’s a changed marketplace. We’re seeing spend coming
back in exhibitions and events, and retail and interiors
are growing markets for us. Our new site and new
technology gives us an advantage because the ability to
supply the correct solution, whatever that might be, is
what its all about, regardless of which market it’s for.
“Service and quality have always been our mantra and
now that means expanding the solutions we offer,
though print remains key within that solution – and that
will remain the case.”
But the move to Chessington is about more than
production capability: “It has brought a culture change
and a new vision which will take us to the next level,”
says King. “We’re doing much more about cross-
fertlisation in the business. Clients want a ‘relationship’
but they are happy to talk to more than one person,
often because the large clients have more than one
N
Sales director Scott King expectsgrowth in turnover and profitability
17
WIDTHWISE 2011
person dealing with a job anyway, So it’s quite common
for the designer to be talking to a client as well as the
account handler etc.
“We’re investing a lot in multi-skilling staff. As a large
operation we have to be sure we have the correct
knowledge base among the staff to compete with
smaller companies where owner/managers are talking to
clients and have a good overall view of what can be
achieved. The aim is to get the whole staff to fully
understand the business we work in. The directors all
get their hands dirty and sell and manage accounts too.
A new MIS system being installed across the Service
Graphics family of sites will help provide the data
analysis of various KPIs which can then be passed on to
the staff. “Communication is crucial to success which is
why we started an internal blog last year,” says King.
“It’s important to have all the staff on your wavelength.
When we were looking at the move to Chessington we
realised we only had a small corridor in which we could
retain staff and that mattered to us. In the end we only
lost three out of 200 in the move which meant we had a
strong buy-in from the employees and we continually
update them on what’s happening in the company.”
King says suppliers have also bought into the Service
Graphics’ vision. “We’ve seen an upturn in the last 12
months so we’ve sat down with suppliers and said
‘Look, this is the journey we’re on’ and they seem happy
to come with us.
“I would argue that wide-format has been the fastest
growing part of print for the last 15 years. We have been
continually taking new products to market, largely within
our existing markets because we think there’s enough
growth there to do that. However, how we work with
suppliers has changed. We are true partners now, both
actively looking for new offerings to take to market.
We’re finding that suppliers more readily now come and
talk about R+D possibilities etc. And we have kit people
coming to ask where we think there are gaps in the
markets. There’s much more synergy between printers
and suppliers than in the past.
“For instance, we open up the sales team to suppliers.
I’ve sent salespeople away for two days at a time to
have a proper dialogue about what can be achieved with
various materials etc. I have eight customer service guys
off to a supplier for three days next week etc.
“At the end of the day it’s about being in a flexible
enough position to a service customers’ changing
demands and still make money”.
A view of the print production area at the new Service Graphics’Chessington site
he Greek philosopher Aristotle argued that the
middle ground was a good place to be. He might
have changed his mind if he had been born
2,400 years later and been running a wide-format printer with
a turnover of more than £500,000 but less than £2m.
Medium-sized businesses do not have the flexibility of
smaller, nimbler rivals. One of the downsides of growth is
that it tends to create structures and demarcations that
didn’t previously exist. If management isn’t vigilant, fixed
costs can creep up. Neither do medium-sized firms enjoy the
economies of scale – or easier access to finance – available
to big companies. And even though they generate more
revenue than smaller rivals, there is precious little margin for
error. Every major decision is critical for the business. These
factors may explain why, traditionally, medium-sized printing
companies have been hit hardest when the industry
experiences economic turmoil. Yet despite these
considerable challenges, four years after the credit crisis,
medium sized wide-format printers seem – from the findings
of the 2011 Image Reports Widthwise survey – to be in
reasonable shape and looking to the future with a degree of
cautious confidence.
STATE OF BUSINESS
Profit margins remain the surest indicator of a wide-format
printer’s health. And that yardstick suggests medium-sized
printers are not doing too badly: 28% said their margins had
improved, while another 28% said they had remained
constant. In this respect, they were performing very slightly
better than the industry as a whole.
This may partly be explained by the fact that half of the
medium-sized businesses said their margins in their wide-
format business were better than in the other parts of their
print business. This was slightly better than for smaller and
larger rivals. Only one in ten said their wide-format margins
were worse, compared an industry norm of 18%. From these
findings it seems entirely sensible that almost 71% of
respondents in this sector expect wide-format printing to
account for a larger slice of their business in the next two
years. The relative buoyancy of medium-sized firms may
have something to do with the fact that they already derive
more of their business from wide-format: 42% said it
accounted for more than 60% of their revenue.
The findings suggest a degree of optimism about the
future and this is reflected in their slightly more bullish
intentions on recruitment: 64% plan to hire staff in the next
two years, compared to 54% across the industry. And only
one in seven medium-sized firms says they will definitely not
recruit. There were no great surprises when firms were asked
what kind of staff they wanted to recruit: the biggest
priorities were print production (a target for 52% of medium-
sized firms), sales/marketing (38%), finishing (28%) and
online development (18%).
This confidence was also reflected in the finding that firms
with sales of between £500,000 and £2m were slightly more
likely to be planning strategic change (54% compared to an
industry average of 46%). To win business in new areas or
with new applications, medium-sized firms were focusing
more time and money on R&D (52%), realigning their
brand/website (35%), and restructuring their sales/marketing
teams (33%).
Yet medium-sized printers are not being unrealistically
bullish. They do have worries – their biggest being price
competition. Like their smaller and larger rivals, they are
concerned about the state of the economy and new entrants
into the market. But they are also slightly more worried about
their ability to recruit the right staff.
MARKET ANALYSIS
Wide-format printing has tended to derive the bulk of its
turnover from a few well-known markets: posters, exhibition
and display graphics, general banners/signage and retail.
They remain the largest sectors for medium-sized printers
but the findings suggest these firms are looking a bit further
afield for work. They are more likely, for example, to be in
wall murals, transport graphics, floor graphics, billboards,
textile printing for banners and flags, building
hoardings/wraps, textile printing for home/interior décor,
industrial specialty (ceramics, metals etc), and packaging
than smaller and larger firms. Medium-sized firms were
especially strong, comparatively, in transport graphics,
building hoardings/wraps, industrial specialty (ceramics,
metals etc) and packaging.
Nor, it would seem, are they content to stop there: 78%
said opening up new markets and offering new services was
a high or very high priority, compared to 66% for the industry
as a whole. The value-added services medium-sized firms
already offer tended to fall in three categories: total project
management (37%), creative design (35%), and variable data
printing (14%). Yet the most emphatic evidence that
medium-sized firms are not content to rest on the laurels is
the finding that 52% of them are investing more time in
20
State of play:For companies with a turnover of £500,000 - £2m
WIDTHWISE 2011
T
R&D for new applications – compared to 12% for
smaller firms and 27% for businesses with sales of
£2m or over.
This does seem to contradict conventional wisdom
which suggests that wide-format printers are better off
focusing on – and acquiring a deeper understanding
of – a particular niche but many managing directors
obviously feel that it’s more important to spread the
risk, with a portfolio of markets that ensures they don’t
rely too heavily on a single customer.
What’s driving this quest for new markets, niches
and applications? There are virtually no barriers to
entry in the wide-format sector – Boyall Graphics, the
subject of our case study, started life as a screen
printer – and the diversification drive by many
traditional print companies may have forced medium-
sized specialists in large-format to innovate by
developing new services and taking a fresh look at
what they offer the market.
The economic crisis has changed customer habits
too. Most still insist that quality is more important than
price – but then they would say that wouldn’t they?
Buyers are desperate to ensure their advertising
makes the biggest impact while incurring the smallest
costs for storing and managing materials. So the
pressure is on for faster turnarounds, just-in-time
production, increased automation, shorter runs and
for versioning/personalisation – although the evidence
from this survey would suggest that this last trend is
not yet as prevalent as some of the hype might
suggest.
What is clear from the 2011 Widthwise survey – if
you look at the value added services medium-sized
firms already offer their clients – is that many
companies already look less like old fashioned print
suppliers, quoting for jobs on a cost per square metre
basis, and more like strategic marketing partners. This
transition has gone from boardroom rhetoric to
commercial reality, enabling firms to generate more
added value, deepen their relationships with
customers and diversify into such services as data
driven measurement and project management.
TECHNOLOGICAL OUTLOOK
With slightly better margins than the rest of the
industry – and a wider spread of markets – medium-
WIDTHWISE 2011
%o
fre
spo
nd
an
ts
About equal
No
Yes
0
20
40
60
80
100
32% 40%31%
20% 10% 22%
48% 50% 47%
0%
20%
40%
60%
80%
100%
Up to £500,000 £500,000 - 2m £2m+
24% 22% 24%
15%
61%
14%
64%
30%
46%
Not sure
No
Yes
%o
fre
spo
nd
an
ts
Yes
No
0% 20% 40% 60% 80% 100%
51.6%£2m +
£500,000 - £2m
Up to £500,000
48.4%
54% 46%
41.2% 58.8%
Are your wide-format margins better than otherparts of your print business?
Do you plan to recruit in the next 2 years?
Are you having to make strategic changes withinyour business to win business from new
markets/applications?
21
sized firms look well placed to make strategic investments
in technology and 43.5% expect to invest more in 2011/12
than they did in 2010/11, with 41.3% spending about the
same and only 15.2% spending less.
More than six in ten expect to buy a new wide-format
printer in the next two years. This should be good news for
UV machine suppliers as just over half expected to buy a
UV printer of some kind, with 31.3% having their eye on a
new UV curable flatbed printer. The other most popular
targets were latex printers (16.7%), solvent printers
(14.6%) and textile printers (8.3%). Latex printers are
clearly making considerable headway as a fast, green
alternative to solvent printers for outdoor applications.
Printers are not the only focus for investment by
medium-sized businesses. The other principal items on
their shopping list are design software (39%), contour
cutters for finishing (24%), and software designed to
offer better management information or improve
workflow (15%).
Although Boyall Graphics has used management
information systems to analyse key performance
indicators that help it understand business performance,
only a minority of printers seem to want to use these
systems to their full potential. For all the fanfare that
surrounds web to print applications, medium-sized firms
are the only ones in the 2011 Widthwise survey to say they
will invest in this technology.
Reducing running costs and improving quality and speed
should, the medium-sized firms who responded to this
survey suggested, be the principal focus for
manufacturers’ R&D budgets. Any by a small margin, hey
said that the reliability of machines and consumables were
the most pressing technological issues they faced.
THE LAST WORD
Large-format printing companies with turnovers of more
than £500,000 and less than £2m which have survived the
economic strife of the last four years now look poised to
prosper – as long as the fragile recovery in the UK
economy doesn’t completely run out of steam.
They are slightly more bullish in their attitude to
investment and recruitment than their smaller and larger
rivals and yet they also seem, from this survey, to have no
illusions about the challenge they still face. The strongest
companies in this sector already seem to have realised that
strategic change, which used to be something a company
contemplated every decade or generation, may never be
entirely off the agenda.
22
Applications for medium-sized firms(% of respondents involved in each sector)
WIDTHWISE 2011
PostersExhibition and display graphics
General banners / flags / signageRetail / POP / POSWindow graphics
Fine art / photographyWall murals
Transport graphicsFloor graphics
Billboard / outdoor advertisingTextile printing for banner / flags
Building hoardings / wrapsCardboard engineering
Textile printing for home / interior décorIndustrial speciality (ceramics, metals etc)
PackagingTextile printing for garments
Other
0% 10% 20% 30% 40% 50% 60% 70% 80%
78.9%
78.9%
70.2%
61.4%
66.7%
43.9%
47.4%
49.1%
49.1%
33.3%
29.8%
33.3%
21.1%
19.3%
24.6%22.8%
7%
8.8%
How high a priority is finding/entering new wide-formatmarkets/offering new services?
Up to £500,000 £500,000 - £2m £2m+
%o
fre
spo
nd
an
ts
0%
20%
40%
60%
80%
100% 6.9% 6%
16%
3.2%3.2%
22.6%
44%
34%
0%10.8%
24.5%
33.3%
24.5%
48.4%
22.6%
Not a focus
Low
Medium
High
Very high
Planned printer purchases (% of medium sized companiesexpecting to buy)
0% 10% 20% 30% 40% 50%
Textile printer
Dye sublimation (non textile)
UV curable roll-fed printer
UV curable hybrid printer
UV curable flatbed printer
Solvent printer (inc. eco-solvent)
Latex printer
Aqueous printer
8.3%
6.3%
6.3%
12.5%
31.3%
14.6%
16.7%
4.2%
24
WIDTHWISE 2011
State of play: Case Study
On the Boyallalk about return on investment. The decision
to buy a Spuhl Virtu RS35 3.5m flatbed
printer in 2008 has been core to a total
business refocus and subsequent growth path for Boyall
Graphics in Northampton.
The company, which had a turnover of £990,000 last
year and anticipates nudging up to just over £1m for
year ending Dec 2011, started out 25 years ago as a
screenprinter with owners Jeff Boyall and Wayne Cayton
working from a converted garage, producing artwork by
hand before exposing it with an enlarger in a darkroom
and making screens ready for print.
Today things are very different, with 20 staff operating
what is now practically an all-digital house, the central
attraction being the Virtu printer - a savvy investment
made on the back of a strategic decision to reshape the
business.
“Five years ago everything changed,” says Paul
Hickmott, who was brought in as business development
manager to help steer the company in a new direction.
“At that time the company was a screenprint operation
really driven by three big customers and serving the
vending machine graphics sector. It was great that the
likes of Coca Cola were on board, but the whole
situation meant that a lot of cashflow was tied up in
stock and when new Health and Safety guidelines on
healthy eating impacted on the vending machine market
the directors realised it was time to change.”
The upshot was a proactive plan to broaden the
customer base and spread the risk, and to reduce stock
levels to free up more cash for development. “So was
born the idea of focussing on digital print and its
capability of delivering a much wider range of products,”
explains Hickmott. Hence the Virtu purchase.
T
Caption
Paul Hickmott was brought in as business development manager to help steer a new course for Boyall
25
WIDTHWISE 2011
The impact has been massive. First off, the vending
machine graphics business was switched to this
production method then work began on seeking out
new applications for new markets. Within its first full
year of service Hickmott says the machine helped
bring in £50,000 of new business. The company
budgeted for another £50,000 the following year and
took £100,000. Not only that, but the £380,000 tied up
in stock fell to £100,000.
“That’s when we realised the true potential of what we
had,” says Hickmott. “It was clear that, with so many
exhibitions companies in the area, that we should
straight off turn ourselves into a full service provider,
which is what we did. That was great, because a lot of
exhibition operations began using us because they could
see that they could cut out the subcontractor. And we
didn’t have to grow our sales force either – because the
work was coming in anyway.”
Given that nobody else in the area had one of these
machines, and still don’t, the sensible thing to do was to
activate a really strong marketing campaign to spread
news of the company’s capability even further.
“About two years ago we implemented regular
marketing campaign (targeting the exhibition sector
primarily) which we then follow up with phone calls. And
we get a great response.” enthuses Hickmott. “The
decision was taken to repeat the process again, over a
slightly bigger geographical area, and likewise, this is
paying off.”
But it’s not all about exhibition graphics. Having
learned from the vending machine sector that its best to
spread the risk, Boyall has spread its net and actively
gone after other, more niche business.
For instance, a couple of years ago Boyall entered into
a partnership with Radhats to provide fully-branded hard
hats to the construction and other industries. Boyall
spent a year doing R+D into the methodology of the
print job (for which it holds the patent) but was helped
with costs by grants from various government bodies.
The partnership brought in £30,000 last year and its
growing.
In another move Boyall is working with a company that
sells furniture into cafes etc., to produce bespoke
printed tables, chairs and the like. It’s also involved with
other high margin niche work – like glass splashbacks
for kitchens.
“You have to tread a fine line between investing money
in machinery that will help you explore new applications
and markets and doing what you can with what you’ve
got. The latter may make you feel safe, but it’s not really
longer term - you’ve got to invest continually, not just in
capital, but in time and energy,” adds Hickmott.
“It’s not just the new kit that has helped Boyall on a
new growth path. Or marketing the applications it can
handle. We’ve had to learn about Key Performance
Indicators (KPIs) and understand fully how to use the
information from management information systems. We
now have regular management meetings and a Board
meeting each month. Plus we have weekly departmental
meetings – everyone being much better informed of the
issues affecting the business means they understand
direction of the company and feel happier. Like many
people we’ve had to tighten our belt but we’ve
discussed it at weekly meetings where is has gone down
better than may have done otherwise.
“The management team knew that with the new
equipment installed there would be a need for fast turn
around and chasing of quotations and orders along with
a growth in the number of smaller, locally based
customers as the company became more competitive
than the next printer!
“The company rose to the challenge, changing its
ethos from reactive to proactive. The result was a fast
turn around of quotations and orders, no need for cash
to be tied up in stock as orders could be met same day
if required. To support this new capability the company
implemented marketing campaigns comprising targeted
email campaigns into pre determined market sectors,
advertising and editorials in local newspapers and
entered trade competitions to strengthen its brand
collateral locally and within the specific market sectors
the business had decided to target. Last year saw
revenue from new, smaller, locally based customers
increasing by 100% from the previous year so the plan
is working!”
mall businesses are the lifeblood of a
developed economy – that is one of the few
certainties even economists can agree on.
Such titans of commerce and industry as Richard
Branson and Sir Alan Sugar have their place but a
country’s economic health owes a lot more to thousands
of smaller companies that seldom hog the headlines.
Burdened by regulation, squeezed by suppliers and
customers, paid lip service to by politicians, small
business owners don’t often feel like heroes. But in the
face of the greatest economic crisis since the 1930s
many of these entrepreneurs have shown what John
Wayne – or Jeff Bridges in the recent remake of the
famous Western – would call true grit. The 2011 Image
Reports Widthwise survey suggests that large-format
companies with a turnover of less than £500,000 remain
resolute even though margins may be tight, finance
neither cheap nor plentiful and the economic outlook is
just one giant question mark.
The results also challenge some common
misperceptions. Small businesses are often branded as
technological recidivists but a significant proportion of
smaller, wide-format printers have embraced social
media. Entrepreneurs are often lambasted for blinkered
complacency yet the vast majority of smaller companies
in this survey are contemplating investing in design
software as they try to add value while four out of ten
plan to make significant strategic changes. Large-format
printers with a turnover of less than £500,000 may face
some tough challenges in the present but nobody could
accuse them of ignoring the future.
STATE OF BUSINESS
In a year where the UK economy grew by just 1.7% – and
16,044 businesses became insolvent – just surviving felt
like thriving. Over 100 large-format printers with
turnovers of £500,000 or less took part in the 2011
survey and their responses create an intriguing portrait of
an industry where the last 12 months have been good (for
a surprising number of companies), bad and sometimes
downright ugly.
Let’s put some figures on this. On the whole, although
half of companies with a turnover of £500,000 or less
reported that wide-format accounted for less than 40% of
their sales, this sector generally delivered a greater
proportion of their revenue than for their larger rivals. In a
difficult trading year, 27% of small companies managed
to improve their margins, 27% saw no change and 46%
said their margins had deteriorated. The good news was
that 48% said their wide-format margins were healthier
than on other parts of their print business. That may
explain why seven out of ten said they expected more
of their turnover to come from wide-format in the next
two years.
Looking ahead, the major concerns for smaller
companies in the wide-format sector were the general
state of the economy, price competition and the number
of new players seeking to break into the market (see
chart 1). Finance remains an issue – no great surprise
given that the Bank of England has recently found that
banks are still failing to meet their targets for lending to
businesses – but the responses suggest it is less of a
concern than might have been expected.
Such worries may explain why smaller printers are
significantly more bearish about recruitment than
medium-sized or large businesses: only 46% were
planning to recruit in the next two years and three out of
ten weren’t looking to recruit at all. Yet they were more
bullish when it came to investment, with 38% expecting
to spend more in 2011/12 and 44% planning to spend
about the same.
These results are supported by surveys by
organisations like the Federation Of Small Businesses
which have found that although entrepreneurs are
becoming more confident, most aren’t expressing that
confidence by hiring new staff. With 64% of respondents
to the 2011 Widthwise survey having ten employees or
less, head counts may not change significantly until the
recovery gathers momentum. Some small companies (see
case study) have developed a business model which
relies on a few, multi-tasking staff, abandoning the more
rigid demarcations of times gone by, and may be quite
happy not to recruit for years to come.
In good times, companies focus on growth. Bad times
tend to concentrate the mind on cash and margins.
Reading between the lines, the 2011 survey does suggest
that many companies have realised that some kinds of
growth can seriously damage the health of a business.
Four of ten smaller companies were making strategic
changes to enter new markets, add value, expand their
range of services and/or to reshape their business for the
challenges ahead.
State of play:For companies with a turnover under £500,000
WIDTHWISE 2011
S
27
MARKET ANALYSIS
As a rule of thumb, the markets served by large-format
printers with a turnover of less than £500,000 are much
the same as for bigger companies. The usual suspects
– posters, exhibition and display graphics, general
banners/flags/signage, retail POP and POS and
window graphics – would seem to supply the bulk of a
printer’s turnover, no matter what size they are. These
five sectors – and fine art photography – are also
expected to generate the most growth. That said, there
are some differences in emphasis: smaller firms are
significantly more likely to be involved in fine
art/photography and textile printing and less likely to
be offering cardboard engineering.
There is a natural tendency for smaller firms to focus
more narrowly on a few key markets or customers. That
may explain why, the 2011 survey results suggest,
finding a new market is less of a priority for smaller
printers. One in six said that developing markets was a
low priority, or no priority at all, one in four didn’t
regard it as particularly important, while the same
proportion regarded developing new markets and
services as a top priority.
Yet if you analyse what smaller companies are doing
to win new business, they seem much less complacent:
47% are attending seminars/conferences (some
investment for companies that typically have less than
ten staff), four out of ten are forging closer links with
suppliers, and one in three are seeing to improve their
brand image. Sales forces are always under pressure in
a recession so it is no surprise to find 38% of smaller
firms seeking to restructure their sales and marketing
efforts. One in eight small firms were taking the destiny
in their own hands by spending more on applications or
R&D. Some suppliers have been willing to help printers
experiment with new materials for little or no outlay.
Wide-format printing is not a commodity although it’s
often bought as such – especially since the recession
when many customers got rid of many experienced (ie
expensive) staff in their procurement departments. In
their desire to add value, most smaller firms have put
their faith in creative design: almost two out of three
offer this service and over half expect to invest in design
software in the next two years. Investing in design is not
new but it looks like a profitable strategy for printers as
they seek to build closer, more enduring (and hopefully
more lucrative) relationships with their customers.
28
General s
tate
of the
economey
Availa
bility / cost
of finance
Amount o
f new
entrants
intoth
em
arket
Price
competiti
on
Fore
ign
competiti
on
Recru
iting
staff w
ithth
erig
ht skil
l sets
0
1
2
3
4
5
6
5.46
3.11 3.
59
4.45
2.27
2.97
Major concerns for small businesses(Average rating 1-7, 7 being the most important)
0%
20%
40%
60%
80%
100%
Up to £500,000 £500,000 - 2m £2m+
24% 22% 24%
15%
61%
14%
64%
30%
46%
Not sure
No
Yes
%o
fre
spo
nd
an
ts
Do you plan to recruit in the next two years?
PostersExhibition and display graphics
General banners / flags / signageRetail / POP / POSWindow graphics
Fine art / photographyWall murals
Transport graphicsFloor graphics
Billboard / outdoor advertisingTextile printing for banner / flags
Building hoardings / wrapsCardboard engineering
Textile printing for home / interior décorIndustrial speciality (ceramics, metals etc)
PackagingTextile printing for garments
Other
0% 10% 20% 30% 40% 50% 60% 70% 80%
79.3%
71.2%
71.2%
62.2%
60.4%
53.2%
45%
27.9%
43.2%
30.6%
26.1%
20.7%
8.1%
15.3%
12.6%
11.7%
11.7%
2.7%
Applications for smaller firms(% of respondents involved in each sector)
WIDTHWISE 2011
TECHNOLOGICAL OUTLOOK
With economists arguing in public over the prospects
for the UK economy, smaller wide-format printing
companies could be forgiven for stalling or slashing
their investments. Yet they appear to be taking a
relatively robust stance: only 18% expect to spend less
in 2011/12 than they did in 2010/11 and 50% plan to
invest in a wide-format printer in the next two years.
The scale of these investments may not be huge – 93%
plan to invest less than £75,000 in wide-format in the
next two years – but it represents a significant risk for
companies with sales of £500,000, especially given
that many are still facing pressure on their margins.
The technological focus for smaller firms is slightly
different than for the industry as a whole. The most
popular big ticket items are UV curable flatbed printers
but only 22% of smaller firms plan to buy one in the
next two years, compared to 46.7% for firms with sales
of £2m or more. The expense of UV is perhaps still
something of a deterrent for smaller firms who are far
more likely to invest in a solvent printer than their
larger rivals. Yet the research suggests that smaller
print companies have been quick to appreciate the
potential of aqueous and latex printers.
The 2011 survey doesn’t reveal any great
enthusiasm for such trendy applications as variable
data print or Web-to-print in any sector of the wide-
format industry but smaller firms appear even less
intrigued by these innovations than their larger rivals.
One intriguing paradox jumps out of the results. Asked
to identify the biggest technological challenge they
faced, smaller printers identified workflow yet only 7%
expect to spend money on software to ease this
problem. Maybe the software suppliers still have some
convincing to do.
THE LAST WORD
Since the 2007 economic crisis, running a small
business in the wide-format printing industry has been
far from beautiful. The wonder – especially in an
industry that was also undergoing rapid, significant
technological change – is that more owners didn’t
choose to ride off into the sunset. But from the 2011
Widthwise survey, you get a sense of a sector that
does, at least, believe it is back on solid ground and
has decided that even though it can’t predict the future
it can still plan for it.
49%
1% 4% 3% 5%
16%
65%
0%10%20%30%40%50%60%70%80%
Other
Databse
hosting
/ managing
/ cleansing
Website
building
/ content c
reatio
n
Web-to-p
rint
Varia
bledata
printin
g/ ve
rsioning
Tota
l pro
ject m
anagement
Creativ
edesig
n
Value-added services offered by smaller firms% of respondents offering services
0% 10% 20% 30% 40% 50%
Textile printer
Dye sublimation (non textile)
UV curable roll-fed printer
UV curable hybrid printer
UV curable flatbed printer
Solvent printer (inc. eco-solvent)
Latex printer
Aqueous printer
3.5%
4.7%
4.7%
5.8%
22.1%
33.7%
12.8%
12.8%
Planned printer purchases(% of smaller companies expecting to buy)
0%
10%
20%
30%
40%
50%
60%
Finish
ing– conto
ur cutte
r
Finish
ing– la
minato
r
Finish
ing– str
aight li
necutte
r
Softw
are– workfl
ow/ M
IS
Softw
are– desig
n
Softw
are– W
2P
Softw
are– VDP
Other
9%
4%
26%
7%
51%
0% 0%
4%
Do you expect to invest in any of the following forwide-format in the next 2 years?
29
WIDTHWISE 2011
30
WIDTHWISE 2011
State of play: Case Study
Smallis beautiful
f small is so beautiful, why does everyone want to
grow their business? Well, perhaps not everyone
does – not by the traditional measure of turnover,
number of employees etc. anyway. According to Peter
Barnham, one of a trio of directors that formed Milton
Keynes-based large-format specialist Graphics Works at
the end of 2005, success is about growing margin and
running a small, flexible operation is key to that.
By the time you read this Graphics Works will have
moved into its third factory and grown its turnover to
£500,000. Over £100,000 has been ploughed into kit
since the formation of the company which now runs four
roll-fed Mimaki machines, an Oce Arizona 350GT and,
the newest addition, a Canon iPF800S (plus various
laminators). But it still has only five staff and though the
intention is to increase profitability, Barnham is bent on
keeping the company slim and trim.
“To grow as a business you have to be light and very
flexible – too strict a growth strategy may hamper you. I
believe it has been easier for the smaller guys to
succeed in the last two years because it’s easier to
change direction when you need to. That’s why we’ve
deliberately kept slim in terms of personnel. I’d much
rather have a few really experienced, committed and
entrepreneurial people that I pay more than have a
bigger staff that do what they think they need to do and
go home.
“I think defined job definitions within a business are a
thing of the past. Everybody these days needs to be
entrepreneurial, and that means everybody in the
organisation. My idea is to have few people, but all of
whom come up with ideas for development. My
background is in R+D and the other two directors come
from a creative background, which is perhaps why we
see it this way, but it seems to be working for us. People
within a business need to multi-skill and understand how
their input can feed into the business. Everyone here for
instance talks to clients – they have the background,
knowledge and confidence to do that and they therefore
all feed back information that will expand the company.”
That client feedback is essential to how Graphics
Works does business and to its ongoing development.
“It’s easier to build on existing customers than finding
new ones – plus you don’t want to lose those you have –
so to keep them sweet and the business moving forward
you need to keep coming up with something new and
offering them solutions they might not even realise they
need – then they will stay loyal to you.
“This means accepting that you’ll have to devote
energies to R+D, and we do. The fun for me is finding
out what a machine can do that the spec. sheet doesn’t
mention. An ideal customer is one that comes to us with
a problem and we investigate how to deliver a solution.
The first job, because of the R+D input, may not make
money, but the concept will subsequently. And that’s the
sort of work that brings in higher margins.
“Let’s be clear – we see no point in chasing turnover.
If our machines have capacity and someone comes in
with a low margin job we’ll take it but we won’t chase it.
That’s a good way of killing yourself ultimately.
“We’ve survived well during generally bad economic
times because we’ve been flexible enough to find new
solutions for customers, developed more profitable
niches [like photo printing onto acrylic and bespoke
digital wallcoverings etc.] but also because we’ve
been financially astute and reviewed how we work
with our suppliers.
“When the recession kicked in for instance, we
looked at the materials we were buying. For us 24-hour
turnaround on jobs is normal and one-to-two hours is
regular! Given that we are printing on some more
unusual substrates etc. the answer wasn’t to destock
but we negotiated on better rates with suppliers and
also made sure we went with those who were keeping
their own stock levels up and could therefore respond to
us all the quicker. Plus, those we work with are happy to
I
I THINK DEFINED
JOB DEFINITIONS
WITHIN A BUSINESS
ARE A THING OF THE
PAST. EVERYBODY
THESE DAYS NEEDS TO
BE ENTREPRENEURIAL
“”
31
WIDTHWISE 2011
supply material for R+D purposes, not all are.”
Also crucial to Graphics Works’ success has been the
company’s financial standing and ethos. “Part of the
reason we’ve done well is that when we set up the
business it was purposefully with no borrowing so that
we wouldn’t be hampered and when the economic tide
turned that stood us in good stead. That, together with
the fact that we always pay on time means we’ve had
no trouble in getting credit with the consumables
suppliers etc. On the kit front, we’ve managed to secure
any monies needed from the normal lenders.
Interestingly, we’ve found the suppliers’ own finance
houses to have been tighter than the high street banks,
some of which have also been difficult, but others have
given us the nod within a couple of hours.”
So what key messages would Barnham send out to
companies in a similar turnover bracket? Put simply,
“be flexible”.
“You have got to be in a position to be whatever your
client wants you to be, no matter how unreasonable
that might seem! There has been a lot of deskilling
within the client-base. Years ago, staff were
experienced and understood how print processes
worked. Now you’re working with people who have no
idea what they’re ordering. For instance, we had
someone asking us for bespoke wallcoverings for a
151-room hotel – they wanted delivery in four days.
People just don’t understand that producing a
massive wallcovering isn’t the same a printing off a
few business cards.
“The problem is that there’s no clear route to print
anymore, designers hand off projects to contractors
who have no interest or involvement in what they are
asking for. It used to be that a designer within an
architect would have a lot of materials knowledge. Now
they just want to sit in front of a screen and design and
don’t get excited about materials and possibilities -
which is why we encourage designers to come to us
and see for themselves what we can do. We need to
educate them about what’s achievable, and then also
put a bit more reality back into timescales.
“The print sector also needs to start making money
from pre-press again. People are frightened to charge
and so everything pre-press has been devalued – we
need to claw that back.”
Peter Barnham: runs a small company with big vision
Secrets of successLASCELLE BARROWCo-founder,Augustus MartinA lot of my success in large-formatprint has been about buying theright equipment for the business.Along with this goes avoidingbuying some of the wrongequipment! I have three principlesthat I try to stick to:- Only buy equipment where youknow you have a market. If you are buying and hoping forsales you can be sure that other people are doing so aswell.- Buy the right equipment for your customer base andworkload. Buy a machine that delivers the right quality andthe best combination of running cost, speed and machinecost for your business- Large-format is still a fast moving market. Always try tobuy equipment where the purchase is justified on the workyou actually do now, but that also has something extra tooffer. Maybe some extra width or an extra colour that willopen up new possibilities for you and your customers thatwill take your business forward.
These principles have helped me make some purchasesthat have done very well for our businesses. They havealso stopped me from making some other purchases thatwould just have contributed to the overcapacity so
prevalent in our industry.
MARK SIMPSONChairman,Simpson GroupI don’t believe the ‘secrets ofsuccess’ in the large-format printsector are that different from anyother business. The bottom lineis that you have to work hard andfocus on your business almost24/7. Yes, I even dream about
POS. If I were asked to pick out one key area to ensuresuccess it would be to cultivate an obsessive focus onyour customers and their needs. This entails gettingeveryone who works in your business to understand howthey add value to your customers. Too often in businessthere is a one size fits all mentality where customers needto fit in with the way a business operates. This approach isno longer relevant. You need to tailor your products andservices to suit the customer so making it easy to dealwith you. For example customers should be able to accessinformation and advice quickly and easily. Being able tospeak to a helpful, knowledgeable person face to face orover the phone is essential. The over use of email as aform of business communication is a curse to developingbusiness and relationships.
MICHAEL AYERSTManaging director, VGLVGL's business is dependant onoffering quality, service and value.This sounds simple but if you get itright customers will trust you. Thekey to any business success is thecustomer and a long-term loyalcustomer is the starting point forany growing business. We takequality, service and value seriouslyand we invest continuously in technology and people to achievecustomer satisfaction on a continuous basis. Behind what soundsthe most obvious statement is a lot of hard work from everyoneat VGL to avoid complacency, which, in my view, is the death of
a company.
ANTONY BAGLIONIBusiness developmentdirector, BAF GraphicsWe believe that being able to understandthe requirements of our clients andtranslate these into well thought outgraphic solutions is key to success in ourbusiness and demonstrates that we aremore than just a print company.Accurately interpreting the needs of ourclients and offering them ideas and advice
based on knowledge and experience, enables us to be able toprovide the best value to our clients.
Hand-in-hand with this knowledge we aim to offer our clients witha seamless end-to-end service that includes artworking, productionand installation. Our ultimate aim with each of our clients is tooperate as an extension of their visual communications marketingteam interpreting their concepts into graphic solutions that drawfrom our experience and the full scope of our production capability.
TIM ANDREWSManaging director,Hollywood MonsterContinuous investment in our equipmentand staff is key to our success. We haveinvested heavily in the latest technologyenabling Hollywood Monster to provide forhigh-profile clients across all sectorsincluding sports stadiums, festivals, rockand pop concerts, shopping centres andproperty developments.
We’ve worked hard to diversify and break into new marketsectors and that effort is now beginning to pay dividends. We arewinning new contracts that are providing us with excitingopportunities to develop and grow our business. More customersare recognizing and appreciating the quality of our work andHollywood Monster has gained a great reputation for deliveringprojects on budget and on time.
WIDTHWISE 2011
33
AGFA: The use of wide-format printers is now an established production process, and is becoming more focused on
applications using a growing variety of rigid and flexible materials. As a result, we are developing and building greater
versatility and productivity into our machines, based on the core technologies already accepted in this industry sector.
CANON: The wide-format market showed impressive growth during 2010, demonstrating that it is already bouncing back
from the recession – attributable in part to the rapidly expanding range of applications made possible by wide-format print
and, to the fact that more businesses are seeing the benefits offered by it.
DURST: We have seen an increase in industrialisation within the wide-format market. To remain competitive in the market
you need consistently high productivity, which requires automation and sophisticated workflow systems. Value-added
turnover can be achieved through developing new applications and specialisation in niche market areas.
EPSON: Our ink and media sales would suggest that areas of the wide-format market are still busy and that there is work
out there. That said, businesses are generally not expanding and for many, hardware replacement cycles are being
lengthened.
FUJIFILM UK: The current state of the wide-format market is buoyant. Due to the combination of a reduction in run
lengths, a growing need for variable data and more POS campaigns on a broader range of substrates, 2010 was our best
year for digital hardware sales.
HP SCITEX: In spite of the tough trading conditions, 2010 actually proved to be relatively successful for our HP Scitex
division, thanks largely to the continued interest in our latex technology, which ultimately led to a positive impact on our
overall market share position.
MIMAKI: Our continued development of new and complementary technologies ensures that even in tough economic
times we're seeing positive levels of new investment across the many sectors we work in.
OCÉ: We’re seeing consolidation. It’s like a forest fire going through the industry. While this can be devastating for some,
the stronger printers, particularly those who have already invested in new technology, are now finding space to provide more
added-value and are ready to expand as the upturn arrives.
ROLAND: Our machines are being used increasingly by users in complementary areas including industrial production,
textiles, labels, proofing and prototyping, with growing interest from the commercial print sector.
SCREEN: The wide-format market is buoyant and growing fast. Digital wide-format is unlocking potential in many markets
as more people are discovering and unlocking new applications.
34
Suppliers’viewpoint
WIDTHWISE 2011
From your viewpoint, how would yousum up the current state of thewide-format market?
The Widthwise poll purposefully surveys only print businesses involved in large-formatprint to take the temperature of the sector. But what do their suppliers make of thecurrent market? Melony Rocque-Hewitt asks three key questions of some of the mainwide-format hardware manufacturers. Here’s what they have to say…
WIDTHWISE 2011
What do you think will be the mostsignificant trends/developments inthe sector in the coming year?
35
1. Gill Mussell, Canon UK,LFP product manager2. Steve Collins, Agfa wide-format inkjet accountmanager3. Michael Lackner, Durstmarketing manager4. Mark Rowland, HP5. NickWhite, Epson salesmanager for pro-graphics
AGFA: There is considerable talk about the growth in digital textile production, and we see our Anapurna and Jeti UV-curable
production machines fulfilling this capability as well as Agfa’s dedicated fabric printer. In addition users are looking for niche markets
to expand their service offerings.
CANON: A number of businesses that have previously outsourced their large-format work or not used wide-format printing at all
are now bringing it in-house. Undoubtedly one of the reasons behind this is a need to keep a closer eye on costs, which is also
behind another important development – the introduction of pay-per-click models to the sector.
DURST:Over the next year or so we will see further advances in productivity. Such factors as fast order fulfilment, mass
customisation and print-on-demand will take on even greater importance. For the manufacturer this requires producing highly
flexible printing machines with the typical features of variable data printing and fast media change.
EPSON: The businesses that are performing best in the current climate are those that have used their expertise to extend into
new areas, such as new online photo books for example, and this trend will continue in the coming year. Conversely, some
businesses are bringing their print in-house to increase flexibility and reduce turnaround times. This is a trend that will grow
supported by easy to use and affordable hardware and software.
FUJIFILM UK:With printers needing to increase output and quality, cost per copy will play a key role as digital technology
continues to challenge a broader range of print applications and market segments including packaging and industrial. There will
also be continued investment in ink developments in order to enhance the flexibility of end-user application. UV Ink technology will
begin to move more into the traditional entry-level solvent market.
HP SCITEX:We will see an increase in the number of electronic displays used in conjunction with digitally printed graphic
displays, especially in the retail environment, as well as in public places like airports and railway stations. There will be an increasing
trend towards PSPs moving into the niche and specialist areas of print production but still retaining the capacity to produce more
generic print.
MIMAKI:Outdoor durable print capability continues to be the mainstay of our core market, but we're seeing that augmented by
dye sublimation output (which is outdoor durable in itself - just on different substrates) and LED UV technologies. We’re expecting
the flag, fabric POS and event branding sector to continue to expand, allowing us to, at long last, catch up the continental European
market. Green issues will remain at the fore.
OCÉ: As consolidation continues, companies are looking to partner with organisations that can help them add value to their
businesses and support them for the long term, enabling customers to focus on being creative. We are seeing that support services
are as important as the equipment choice, because if a machine is down it costs far more than the savings people often think they
are getting.
ROLAND:We’re experiencing a tremendous upsurge in demand for more affordable production units that can be used by
experienced and new users of professional inkjet equipment. As a result, we’re putting our wide-format expertise into desktop
solutions that bring our advanced technologies to a very broad spectrum of end customers.
SCREEN: You will see more wide-format companies starting to diversify to offer a range of high-value products, and carve out
profitable niches for themselves in areas such as office and home decor, small-format personalised gifts, signage and decals etc.
1. 2. 3. 4. 5.
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WIDTHWISE 2011
AGFA: We are seeing greater emphasis on workflow requirements. Companies are investing in our wide-format
printers as we are able to support businesses of all sizes that need to offer accurate colour managed output.
Throughput efficiency is also important, and the increase in popularity of the Agfa M-Press Tiger is testimony to how
we are meeting this requirement.
CANON: Customers are telling us that they need to keep a really close eye on what every print costs, how it is
used and what return it generates. This is a need that wide-format digital print is particularly well positioned to
respond to. For instance, in response to customer demand Canon has recently developed Total Service Care, a pay-
per-click model for large-format print.
DURST: One of the key issues will be the greater importance placed on green products. Retailers and brands will
demand greener products and smaller carbon footprints, requiring the use of environmentally friendly media and inks,
with low toxicity, free of VOCs and recyclable.
EPSON: A key issue for businesses during the current economic situation is to find enough work. This will result in
flexible printers that can deliver profitable business over multiple applications remaining solidly in demand.
FUJIFILM UK: Key issues will be quality versus output and cost per copy. ’Digital awareness’ and ‘education’ will
also be buzzwords, as will discussion on the availability of finance.
HP SCITEX: We envisage the acceleration in the replacement of solvent technologies by either UV inks or latex
inks – the range of solutions now available using these two technologies makes solvent an increasingly redundant
option. The ‘green’ factor should not be under estimated either. Successful PSPs will need to offer clients printed
output that helps reduce the impact on the environment.
MIMAKI: The (cap)ability to diversify is becoming ever more important. Being able to produce new, exciting and
lucrative product lines is a sure-fire way to prevent customers from straying. Answering 'yes' to a request means the
customer is less likely to look elsewhere, so ensuring your digital print arsenal contains hardware capable of
producing the broadest possible range of products is an easy way to put this in place.
OCÉ: Print companies need to choose their printer supplier carefully and think of it as an ongoing long-term
partnership. We are working with many of our existing customers to upgrade them to a faster system. Companies that
have invested in the right systems and have a solid business plus the right skills will be in a stronger position to grow
their business.
ROLAND: People want versatility at an affordable price, and our new desktop solutions complement Roland’s
wide-format systems. Users need the ability to produce more than just print — they want tactile finishes and special
effects, too.
SCREEN: Companies need to be looking for better than standard quality and increased flexibility and functionality
from their print systems. As time passes the quality expectation in the general market will increase, so it is important
to factor this into your thinking when investing in a device that you may well be using for three to five years.
What do you think will be the key
issue for wide-format digital print
in the future?
6. Bui Burke, ScreenUK salesmanager
7. Duncan Jefferies, HybridServices (distributor forMimaki)
marketingmanager8. Brett Newman, RolandDG
technical director9. NigelMcNae, FujifilmUK
national salesmanager, screenandwide-format inkjet
10. Dominic Fahy, OcéUKbusiness group director, imaging
supplies and display graphics
6. 7. 8. 9. 10.
he topic of sustainability has inspired hundreds of
conferences, thousands of regulations and
millions of speeches. So it comes as something
of a shock to discover – from question 32 in the 2011 Image
Reports Widthwise survey – that only 18% of respondents
have environmental accreditation. That failure is put in
context when you consider question 33: only 4% of
respondents said most clients asked about accreditation,
while 63% said customers never asked.
From these stats, it would be easy to conclude that wide-
format printers and their customers are refusing to recognise
the significant, radical changes that lie ahead. Easy but
wrong. In answer to Question 31 – how important is it to offer
green options? – 59% of respondents said it was more
important than two years ago, while 14% said the issue was
still important. As you might expect, the bigger the printer
the more weight was given to the environment, with seven
out of ten businesses with a turnover of £2m or more saying
green options had moved up the agenda.
The charitable conclusion to be drawn from all this data is
probably that most printers are more focused on offering
green options than pressing for a certificate to prove their
credentials. That is not a stupid view – few of us judge a
company on the quantity or quality of the certificates in their
lobby. But it may soon prove untenable, especially for
printers who are supplying publicly quoted companies or
organisations in the public sector. As these groups are hardly
short of potential suppliers, they could simplify their
procurement process with one box-ticking exercise vetoing
any supplier who hadn’t, for example, met a standard like
ISO 14000/14001. The more high profile a brand, the more
likely the company is to declare that it only hires ‘green
printers’ – whatever that might mean. This line of thinking
may explain why the poll shows that 48/6% of printers with
sales of £2m or over do have environmental accreditation,
compared to just 6.2% for businesses with a turnover of
£500,000 or less
There is a growing pressure on big companies,
especially retailers– which buy a lot of wide-format print –
to environmentally audit their entire supply chain. This
pressure was sparked by a few scandals where well-
known corporations were revealed to be using child
labour or running sweatshops. But as the pressure has
grown, the demands have widened and many global
businesses, desperate to protect their brand image by
being good corporate citizens, are becoming much more
vigilant about their supply chains.
In Wal-Mart’s 2010 sustainability report, the retail giant
(which owns Asda) says: “When we launched our
sustainability programme we set goals to guide our efforts to
become a more responsible company. We would: be
supplied 100% by renewable energy, create zero waste and
sell products that sustain people and the environment. In
updating our goals, we turned the focus to increasing the
transparency of our supply chain. To know the true impact
of our business, we need to look at were products are
sourced and manufactured, how they’re shipped and
packaged, how they are used and what happens to the
product when it’s disposed”.
If any printer was in doubt about what they need to focus
on to green up their act, the Wal-Mart statement gives a
clear guide. It’s not just about what substrates or inks you
use, it’s about everything: the waste you produce, the energy
you use, the way you transport your product and even what
actions you take to offset the environmental consequences
of your business. Where Wal-Mart has led, many companies
– not just in retail – will surely follow. Clearly, the 25% of
printers who, in response to Question 31, denied that
environmental issues were of any importance are probably in
for a rude awakening.
So what should wide-format printers do? The obvious
place to start is with an environmental audit of your own.
This should be brutally honest so you have a truly accurate
picture. Sustainability can be a vague, almost opaque term
so be sure to define your terms clearly, explaining what
sustainability means for your business, why its important and
who it is important for. You can then – as Wal-Mart did – set
goals and targets to guide your policies over the next few
years. (And one of those targets should be achieving some
kind of accreditation.) No company can transform its carbon
footprint overnight. Indeed, customers would be suspicious if
you did. Suppliers can help, both with specific products –
HP, for example, has developed a carbon footprint calculator
– and general advice on best practice.
Doing the audit, defining your strategy, these are the
glamorous bits. But many attempts to make business
greener go awry because they aren’t monitored properly. The
best way to ensure you stay on course is to give a senior
manager, with direct access to the managing director,
responsibility for the programme, ensuring that actual gains
match projected targets – and raising the alarm if they don’t.
This manager should also be responsible for spreading the
38
sustainabilityShould we be looking at the likes of Wal-Mart’s programme?
WIDTHWISE 2011
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WIDTHWISE 2011
More important thantwo years ago – 59%
Less important thantwo years ago – 9%
No shift - not important – 18%
No shift - important – 14%
How important is it to offer ‘green’ options these days?
No – 68%
Yes – 18%
Plan to – 14%
Plan to
No
Yes
Up to £500,000 £500,000 - £2m £2m+0%
20%
40%
60%
80%
100%
120
11.9% 16.7%
66.7%
16.7%
48.6%
32.4%
18.9%
81.2%
6.9%
%o
fre
spo
nd
an
ts
None – 63%Some – 33%
Most – 4%
0%
20%
40%
60%
80%
100%
80.2%
45.8%33.3%
54.5%
12.1%
52.1%
2.1%17.8%2.0%
None
Some
Most
Up to £500,000 £500,000 - £2m £2m+
Do clients ask for environmental accreditation?
0%
20%
40%
60%
80%
100%
No shift - not important
No shift - important
Less important than two years ago
More important than two years ago
26%
12%6%
56%
Up to £500,000 £500,000 - £2m £2m+
8%
17%
19%
56%71%
5%16%
8%
%o
fre
spo
nd
an
ts
39
good news when landmarks are passed. Too many bold
attempts to make businesses sustainable peter out, after a
few months, into notices on walls telling customers how
many gallons of water or tonnes of paper have been saved.
That audit might help you educate your customers. Not
every buyer of wide-format print is as ambitious as Wal-Mart.
Many pay lip service, deterred by misperceptions about the
costs. As the Norwich wide-format printer Repro Arts has
pointed out, “People may think that price is reason enough to
look the other way when buying eco-friendly and stick to
cheap, old-fashioned plastics and PVC products. But with
more people buying into the green market, prices are coming
down.” Indeed some mass-produced environmental products
from suppliers like Dufaylite are cheaper than PVC. At a time
when there is relentless pressure on costs, what’s good for
the environment can often be good for the bottom line.
So what, you might ask, could going green do for your
business? Not much really. Just deepen your relationship
with your customers, grow revenue, reduce your costs and
improve the working environment. The excuse that you’re too
busy to think about green issues at the moment looks less
convincing than ever.
Overall response
Overall response
Overall response
Response by company size
Response by company size
Response by company size
Do you have environmental accreditation?
Define your termsThere are many ways a business can be good or great so be clear which kind of greatness you seek. For some, longevity orconsistent profitability are paramount. Others seek glory or influence. Reviewing Jim Collins’ book ‘Good To Great’, Peterssaid: “Some companies Jim has chosen have performed well but haven’t led anybody anywhere. I don’t give a damn whereMicrosoft is 50 years from now. But Microsoft set the agenda in the world’s most important industry at a critical time and
that to me is leadership, not the fact that you are able to stay alive until your beard is 200 feet long.”The choice between being the new Microsoft and a very long beard sounds simple but each managing director will weight
influence and longevity differently and that weighting should shape your strategy.
Decide why you’re in businessThe obvious answer is to make money. But successful companies – from Apple to HP and Virgin – have a culture definedby something more than profit. The right ideology can inspire staff. You don’t need a fancy mission statement. At HP, theideology, as defined by founders Bill Hewlett and David Packard, consisted of five simple principles, the last of which wastwo words: “Integrity, period”.
Make good decisionsSounds trite doesn’t it? But if your decision-making is flawed, you’re less likely to hire the right people, buy the righttechnology or service customers. Think of the last ten major decisions your company has made. How successful werethey? What would you have done differently? And were decisions taken after different views were aired and debated?
Many bad decisions are driven by confirmation bias. We are hard-wired to believe evidence that supports our view andoften dismiss contradictory data without even realising it. Confirmation bias – and groupthink, the term for our tendency to gravitate toa consensus no matter how absurd it might be – still blight many organisations. Yet research has shown that even a lone idiotchallenging a consensus will lead to a better decision. Imagine what a difference intelligent, open debate might make.
Stay humbleThe cult of the rock star CEO is so powerful we assume they should all be as visionary as Steve Jobs or as arrogant as SirAlan Sugar. Yet they are not your only role models. Gary C. Kelly, the new CEO of Southwest Airlines, recently definedleadership saying: “You need to be a good person and genuinely feel joy at other people’s success, and not be so inwardlooking. An ideal leader is described by other people as someone who convinces them he cares about them.”
Bosses don’t always know best, so when your business faces an important strategic choice don’t preface the meeting with a clearstatement of your views.
The lives of the great business leaders share one painful recurring theme: like rock stars, CEOs suffer from built-in obsolescence.How they prepare for that – by building the right team or planning succession – is their ultimate test. Many studies show that firmsthat grow their own management are likely to outperform those who import leaders.
If, as Collins says, the ability to embrace change defines a great business, your company is more likely to adapt and evolve if yourstrategy is driven by debate, not ego.
The clinching argument for humility is the fall of Enron. That’s what happens when your managers really believe they are “thesmartest guys in the room”. Hubris is always expensive in the long run.
42
How good isyour company?
n Hollywood, they say a good director sometimesmakes a bad movie but a bad director never makesa good movie. Business isn’t quite that simple. Badcompanies can have a good idea that gives them an
edge, but in the long run their inferior management willstill be their downfall.Business is so volatile in the 21st century that today’s
winners can be tomorrow’s losers. Yet a critical appraisal
of the works of such management gurus as Jim Collins,Tom Peters, and Peter Drucker suggests that successful,enduring businesses share certain qualities. True, sometraits are incredibly generic: Collins’ advice to “hire goodpeople” will only come as a revelation to managers whohave consistently appointed jerks. With such caveats inmind, let’s explore the characteristics of an enduringbusiness.
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Serve yourcustomersFor Peter Drucker, this was a company’sprimary responsibility. Profits are an
essential condition of the company’s continued existence but theygenerally follow if you are servicing customers. The designthinking revolution – in which designers changed their customers’thinking (and increased their own value) by studying the enduser’s needs – is a case in point. The most compelling information you can give your customers is to tell them something they don’tknow about their customers.
Trust your passionTom Peters and Collins often differ but agree on the power of passion. Peters says: “All the strategy guys talkwonderfully about these ideas and skip over the incredibly boring part – people.” Collins thinks passion canbe quiet, Peters prefers an upfront leader who thrives on chaos: “Wouldn’t you like to think a quiet leader
would lead you to the promised land? That’s total, utter bull.” The key is that passion exists and spreads beyond the boardroom.
Ask questionsNew bosses often arrive with inspiring mission statements. But when Darwin Smith took over a famous, butmediocre corporate giant called Kimberly-Clark in 1971, he didn’t have a mission – he just asked questions.What could the company be the best at? What was it especially passionate about? How could it improve itsnumbers? The questions helped Smith transform Kimberly-Clark. His brave decision to sell paper mills and
bet on an emerging product called Kleenex now looks like genius. Smith was practicing what Drucker called “plannedabandonment”, recognising that yesterday’s successes were no longer useful.
Balance discipline and creativityFew companies have managed the tension between individual innovation and systematic organisation aswell as 3M under William McKnight, president from 1929 till 1948, who helped make innovation arepeatable, systematic process. He gave staff scope to think but created enough barriers to ensure that onlythe best ideas – like Post It – survived. McKnight proved that quality, not quantity, of ideas was paramount.
Be realistic about technologyThe new economy has led many to overestimate the power of technology. When Collins studied businessesthat had been hailed as technological pioneers he found “these companies dwelled little on technology as akey variable”. He concluded that technology couldn’t make a bad company good, it just accelerated thegoodness that already existed.
Create a cash generating moatAmerican billionaire Warren Buffett asks two questions when analysing a potential acquisition. Does it
have a moat (a defensible competitive advantage)? Does it consistently generate cash? They are bothuseful, common sense ways of appraising your company. If you don’t have a moat, could you create one –and generate more cash? These are not questions you read in many business bestsellers but the answerscould profoundly impact your company.
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ife’s a journey, not a destination! Never has this
popular nugget of self-help advice been so
appropriate. With people spending an apparent
70% of their time out of their home it’s not surprising that
out-of-home advertising is one of the fastest growing
traditional advertising mediums in the UK.
Unlike with any other medium you don’t have to tune in,
turn it on, dial up or turn the page to see it, it’s just there for
free, incidental and unavoidable and with the advent of
mobile marketing, the out-of-home space is becoming even
more dynamic.
Planning and buying manager Paula Evans at Transport
Media, the Manchester-based specialist ‘out-of-home’
planning and buying agency, believes that digital wide-format
printing has been instrumental in the rise of resurrecting
dead space – the time it takes to get from A to B, now
enticingly known the Third Space.
“Digital wide-format printing has allowed advertisers to be
far more flexible, vibrant and creative. It has really raised the
bar on quality and therefore client confidence levels. We
know for example, we can match any pantone or special
colour, which in the past would have been a problem. I can’t
stress how important accurate colour representation is when
it comes to branding and logo prints,” she says.
“From a planning perspective, wide-format digital printing
has substantially raised the bar on quality as well as
durability issues. A lot of this has to do with advances in
substrates, materials and the inks used. For example, vehicle
wrapping can now take the daily wear and tear of city life,
not to mention the forces of nature. Our clients get far more
value for money. Campaigns look good for longer.
“Digital printing has made everything even more efficient -
the fact that we can now print on one high quality vinyl skin
rather than on split paper sections makes everything look so
much better and removes any installation errors,” she adds.
In her ten-year career as a planner, Evans has witnessed a
plethora of new applications that in the past weren’t even on
the menu. She also believes it is far easier to create
integrated media campaigns, as print technology makes it
easier to adapt imagery from different media channels.
A trend for bling, says Evans is one of the more noticeable
trends arising within the last 18 months. “Print that shimmers
or is a good and cost-effective alternative to
electroluminescent and is very popular,” she states.
In addition to this, a tendency to enhance print with sound
and interactivity is growing. Bus shelters for example, have
become complete environments that can incorporate sound
effects, or even contain actual panels that act like vending
machines. “All these add-ons to print really enhance the
experience,” says Evans.
While Evans agrees that moving imagery is currently
biased to London other key city centres such as
Birmingham, Manchester and Glasgow also use screens,
static print is still dominant, and as far as the regions are
concerned print still makes up 95% of campaigns.
“There is no doubt mobile interaction is on the rise but
there will always be a place for static print,” she says. “Media
owners have invested heavily in making out of door spaces
attractive to brands. The versatility of inks, the on-going
developments in substrates all keep pushing the boundaries
of creativity which in turn continues to keep print strong and
relevant.”
www.transportmedia.co.uk
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WIDTHWISE 2011
LPauls Evans ofTransport Media
THE VERSATILITY OF
INKS, THE ON-GOING
DEVELOPMENTS IN
SUBSTRATES ALL KEEP
PUSHING THE
BOUNDARIES OF
CREATIVITY WHICH IN
TURN CONTINUES TO KEEP
PRINT STRONG AND
RELEVANT
“
”
The LastWord