The LaManna Alliance is proud to once again offer our Printing Industry Predictions and Trends article. I'm so grateful for the powerful thoughts we've received from our experts.
This year, we've divided out predictions into two parts (part 2 can be found here). See you in the Marketplace!
President & CEO
I’ve got some tough love for you: Printing is for the big boys! Don’t expect, in today’s market, to win on price. Remember, you’re more like a family hardware store than The Home Depot. You're not fueled with private equity dollars.
Your focus should be on sales. Pray for sales! And keep thinking about revenue growth.
Otherwise, I see tough times ahead for companies that haven’t capitalized on growth.
To secure or maintain a profitable future, you need to make sure you’re growing and investing in your business. You’ll need cash to get it done and make sure your plans don’t put you in a cash trap.
It’s more important than ever to be strategic and plan. Repeat after me: You’ve got to have a plan.
You need to plan out one, three, and five years. And if you’re really smart, you’ll also come up with a ten year plan.
President & CEO
I haven’t spoken to a printer, in a long time, who is just content where they are. I think, convergence, it’s accelerating and not plateauing. I think it hasn’t even touched some of the segments yet.
Let’s say you have a garment guy, who thinks the future he is wearable textile, wearable technology. They might want to do industrial print. They might try to do that because they’re both screen print based to a large extent. There’s some crossover.
Well, it is a completely different kind of thing that you’re doing. I think what will happen is that they will start down those roads and then they’ll probably buy some companies because that’s easier to do than try to learn it yourself.
I think you’ll see some more M&A. I think consolidation is going to continue. Convergence, consolidation, acceleration.
I know the OEMs (Original Equipment Manufacturers) themselves, the pressure on them to address multiple markets is huge. Because they put a lot of money into research and development to adapt their technology to adjacent markets.
But they don’t get a commensurate amount of marketing spend, in order to address those markets. They might get a little bit more but now they have a marketing spend that has to address six different segments, as opposed to the four they used to play in or the two they used to play in. There’s a lot of stress on them as well.
I think these are going to be driving some changes that will be good. I think the market, what we’re doing, we’re not creating any of this. We’re trying to surf it, just like everybody else and trying to stay ahead of the curve as much as we can. We think all of the stuff coming together is actually very good for the industry itself.
We will see more convergence of services in the Graphics Community, not just at the manufacturing level but at the supplier level as well. As organizations converge we will see better value propositions to the end user. Conventional Printers will continue to expand into Wide format, packaging and Mail service areas. Suppliers will continue to expand their lines to be a One stop shop to their customers.
As technology continues to change our industry we will see more intuitive software that will be able to better manage all aspects of the business in real time, These softwares will be accessible anywhere and will allow the customer to look inside of the plants and know exactly where their jobs are. There will be much more transparency between the customer and the Manufacturing facility.
The need to be connected with your Graphics association continues to increase. The Florida Graphics Alliance saw 25% growth in its membership in 2018…Why? Because there is power in community. Power in networking, power in buying. Organizations realize that it is much more difficult to work through challenges alone. Learning from peers and working together reduces costs and increases sales.
Joseph E. Lyman
A little more than twenty year ago, I managed a council for the American Council of Engineering Companies that represented small engineering firms that employed 25 or fewer employees. At that time, the A/E/C (architecture, engineering and construction) industry was trying to vertically integrate around a concept that would help simplify an owner’s experience of designing, engineering and constructing about anything that could be built.
Unfortunately, up to that time, building a bridge, building or even a school took an architectural design firm, multiple engineering firms and tens (and sometimes hundreds) of subcontractors to create a finished project. There were designs to review, permits to be pulled, engineering to be vetted, materials to be ordered, as well as crews and time schedules to be managed. It became just too much for an owner to steward a complicated project through completion.
Enter the Design/Build concept and the multiple ways it can be used to streamline a project, reduce the burden and relieve the headache an owner has when trying to complete a complicated project. Despite the benefits it provided owners, it was fairly disruptive for the A/E/C industry.
Everyone was asking, “Who would be the prime contractor? What would it do to the Design/Bid/Build method the industry was so comfortable operating?” We all understood it was good for the owner, but at the heart of any disruptive change is how will this impact my business?
Fast forward to 2019 in the print industry. Buyers are demanding more complicated printed projects that vertically integrate their marketing projects. It isn’t just digital media they want managed that mirrors their commercial print project.It is the buyer’s in-store retail signage, their packaging, their tag/label projects, their ad inserts, their mailers and a host of other types of complicated projects they want someone else to help make it less complicated.
Over the years, a medium-sized commercial printer in southeastern Wisconsin had routinely turned down opportunities to print and convert folded carton projects until 2016. That was the year they decided that before long, they would become irrelevant if they did not offer their buyers more options on the manufactured products they created.
With the assistance of a great finisher that could convert in close proximity, they began offering folded carton products and cut and stack labels. In 2018, they produced millions of folded carton pieces and labels for customers. They realize the industry is vertically integrating.
Before the end of the decade, there will not be “Packagers, Tag/Label Manufacturers, Sign Makers, and Commercial Printers.” There will be printers that produce a whole host of different products for their customers because they want to make the process of sourcing printed products easy. And those are the companies that will continue to succeed in the future.
Research Director – Large Format & 3D Printing
We think there are several forces that will make the large format digital printing market buzz over textiles even more in 2019 and beyond. Textiles are already pretty popular in retail/POP applications partly because fabrics are typically lightweight, so they’re less expensive to ship.
That’s a practical reason, and as marketing budgets are stretched we think that would be enough to drive additional use of digital textiles, but the other trend that we see happening is that retail marketing is changing and retail stores are changing. Some big retailers like RadioShack, Payless ShoeSource, and Toys “R” Us are closing stores while others like Ulta Beauty, Target, and Five Below are expanding.
Fast fashion is a fast-growing brick-and-mortar segment that focuses on getting fashions from the runway to the store very fast and turning inventories quickly in response to customer demands.
These retailers that are building new stores and more aggressively marketing fresh inventories are driving in-store marketing and fast cycle times. Furthermore, retail stores are opting for textiles as a way to make messages stand apart, to grab the attention of shoppers and convert sales of in-store foot traffic as a way to combat the impact of Amazon.com.
Finally we saw some important products for digital textile printing come to market at the end of 2018 to try to address the market need for one-step digital textile printing that can help accelerate the printing of textiles among large format PSPs. So, textiles will be more in demand and easier to produce quickly, so we think there will be a lot of focus on this in 2019.
In Rock’s M&A world, we think the companies that have some digital textile printing capability should be valued higher than those that have nothing to offer in that segment.
Sales Predictions for Top Performing Companies
Here we are, almost 20 years into the 21st century, and yet…
Our industry STILL relies on outdated sales methods.
We still choose broadcast mode when talking to sales prospects.
We still gather data without any clear way of using it promptly or effectively.
In 2019 it’s time for:
A fresh sales approach.
Sales methods that mesh with today’s buying preferences.
Empowered sales people who can meet a buyer where they are and carry them through to a successful sale.
This is the year that owners finally:
Put their foot down about the use of stale sales ploys.
Dedicate time and resources to elevate the leadership skills of sales managers.
Hire or promote talented employees into strategic business development positions.
This year sales managers will drastically expand reach and impact through:
Professional social selling.
Well-written, tactical sales emails.
Proper online networking.
And 2019 is the year that owners gather the executive managers (sales, marketing, business development, operations, IT, and customer service) for a master strategy session where they:
Map out the year, with targets, tactics, and an execution plan.
Define success, set deadlines, and assign accountability.
Track the entire customer acquisition cycle, hone it, and take ownership of it.
In the coming year, the best companies will raise the bar.
That is my wish, my expectation, and my prediction.
Sandy Hubbard is a Marketing Strategist who works with owners and executive-level sales and marketing professionals to systematically dominate in their market sector. Connect with her on LinkedIn and Twitter or read her blog posts here.
2019 Will See Continued Growth with Digital Foil and Cold Foil
The world of print decorating continues to change and grow. The growth, especially in metallic finishing, is taking place through technology advances that have opened up new opportunities to add special finishes at more feasible costs and with faster turnarounds.
Digital technology has not only changed the world of print but has now had a large impact on the finishing and decorating of printed materials.
These changes will continue in 2019 as many of the new decorating technologies are still in their infancies. Most of the overall growth will be with digital foiling and coating technologies; however, cold foiling for both narrow-web label and sheet-fed folding carton applications will see expansion. And, FSEA has seen a resurgence of the more conventional hot foil stamping techniques in recent months, brought on by an increase in overall demand for metallic finishes.
Digital foiling can be accomplished by using either a varnish adhesive or a toner adhesive – overviewed in the “Foil Cheat Sheet” that was recently published in print and online by the Foil & Specialty Effects Association and PaperSpecs.
Digital foiling with a varnish adhesive refers to technology from companies such as Konica Minolta/MGI and Scodix. This technology applies raised UV adhesives to the portion of the printed substrate where the foil will be applied. In a separate area on the machine, the foil adheres to the raised varnish and creates an embossed look to the metallic or holographic foiled area.
When a toner adhesive is used, the printed piece is first printed in a rich black on a toner or HP Electroink digital press. The sheet is then run through a laminating device (known commonly as sleeking) and, with the help of a touch of heat, the foil adheres to the black toner areas. In most cases of digital toner foiling, the piece is run through a digital color press where the foil is overprinted in certain areas, providing the opportunity to create a variety of metallic colors with one pass of foil.
The digital foil process allows printing projects of smaller run sizes to consider decorating enhancements because there are no tooling costs involved. And, both varnish and toner adhesive foiling provides the opportunity to personalize and use variable data with metallic foil – something simply not feasible with either hot or cold foil processes.
Because the overall packaging market is expanding and companies are fighting for brand awareness and shelf presence, growth in the decorating of both labels and cartons will continue. Studies show that foil and specialty coatings have an impact on consumer choices at the shelf. Companies know that high-visibility enhancements sell.
The growth in decorating technologies that now can be applied on a much broader selection of printed materials will help spark growth in 2019, even if overall commercial printing sees some decrease. The choices that print service providers (PSPs) and End Users now have at their disposal help spur growth of metallic foil and other decorating techniques. As the years pass and digital technologies mature, this will slow down; however, they are still new enough to indicate considerable growth potential in 2019 and beyond.
FSEA provides a wide range of resources to help print finishing companies remain profitable today and into the future. From real, tangible benefits offered through cost-saving programs to educational opportunities (FSEA Annual Convention, IADD·FSEA Odyssey, webinars, case studies and articles) to green initiatives proving the sustainability of foil decorated paper/board, the FSEA strives to provide its members with ideas, data and solutions to grow in today’s marketplace. For more information, call 785.271.5801 or visit www.fsea.com.
I want more predictions! Take me to part two. Click here.