HP Leads the Digital Print Industry Transformation (Part 2)

October 13, 2017

 

We last checked in with HP's Nick Price to update us on the company's growth strategies in the Asia Pacific and Japan region. We continue the conversation to get his views on the digital print space. 

Why is digital printing growing?

 

Digital printing has historically been seen as a good solution for short runs. However, with significant improvements in digital printing technology, the economic crossover point is becoming more and more attractive

 

Today, HP have presses that can produce up to 100 million metre square of printed output per annum, which was unheard of just a couple of years ago. This kind of productivity and competitive cost per copy completely changes the game and is driving the charge towards digital printing.

 

Secondly the flexibility of digital printing is also creating new applications and opportunities. Mass customization means that each and every printed page can be different. Brand owners, and their creative agencies are now leveraging on the possibilities and are integrating them into their various product campaigns. The labels and packaging segment has seen an explosion of personalized and mass customized campaigns that simply cannot be produced with analogue printing due to fixed images on plates and cylinders.   

 

What are your observations on the digital printing industry in Asia Pacific? As a global player, how do you perceive the Asia Pacific market?

 

Much of the future global growth in print and packaging will happen in Asia Pacific, both through export manufacturing demand, and increasingly through domestic GDP growth; consumers in Asia Pacific will have more money to spend and are becoming more discerning and demanding. This is good news for the print and packaging market as it is driving overall volumes and variety. 

 

We are seeing this play out, with the larger players expanding their position and footprint in the market through acquisition and capacity building. These large players have developed a healthy mix of conventional and digital printing and have learned how to maximize them together.

 

At the same time, this is putting a lot of pressure on the small to medium-sized businesses that have ageing analog equipment and are relatively risk-averse in regards to new technology. Having a business transformation strategy and understanding the benefits of digital printing would certainly equip them with the choice points, and more importantly how to leverage both conventional printing and digital printing together.   

 

What industry trends are gaining traction now in Asia?

 

Most print segments have already seen digital printing becoming mainstream. However, we now see the growth of digital printing in labels and packaging increasing significantly over the next few years.

 

Mass customization will also likely grow in this space, so we will see more and more unique designs for the same product.

 

However, probably the single biggest change will be the impact of e-commerce on retail and the way print and packaging is produced. Delivery boxes will become printed real-estate space on which personalized messaging and advertising can be printed. This will create new revenue streams for retailers and will elevate the importance of secondary packaging.

 

Most of this will require digital printing due to the customised print and the fast turnaround time required.

What challenges do digital print adopters in Asia face? 

 

Printing and packaging is becoming more complex. Individual print runs are declining yet the number of jobs produced per day is increasing, add to this the need for faster turnaround times. All these factors increase complexity to production.

 

The main challenge will be in return of investment (ROI). Those companies that are not prepared with adequate workflow and properly trained and experienced staff to manage this complexity will result in inefficiency that will impact profitability.

 

This will require some mindset change and business transformation on the part of the print providers to survive.

 

How can printers make the easier transition into digital print?

 

Printers and brand owners can now take advantage of a large number of resources in Asia, including various demo centers, customer open houses and the ability to test as many ideas, substrates and relevant applications on demo presses. Choosing a supplier that has these resources and shows a long term commitment to both country and region will be crucial to success.

 

In operational terms, the transition will be a combination of things. First of all, identify which work can be moved easily to digital print, for example:

  • Multiple SKU’s with short runs

  • Jobs which have frequent design changes

  • Jobs which have many separations/plates/cylinders

  • Work which requires fast turnaround time

  • Many jobs on same substrate

By moving this type of work to digital first will help to maximize conventional presses for longer runs and less changes.

 

This will improve margins on existing equipment and also gives time for the organization to learn and adapt to the new skillsets required to sell, market and produce digital print.

 

What is the single most important feature that PSPs should keep in mind when making digital print purchases?

 

Buying a digital press is just the beginning of the journey and certainly no guarantee to success.

 

Developing a partnership approach with the digital printing supplier will be critical and aligning on clear expectations from the beginning will set a solid foundation. A long term partnership will help increase the chances of mutual success, since a digital press is much more than just a piece of hardware that requires a good operator. 

 

There are many levels of engagement that will help with success, such as service, technical support, businesses development, marketing & brand owner networking.

 

Asia Pacific, while progressive in terms of technology, is still very much price-sensitive. Costing plays a big part in the final decision. What are your thoughts on this?

 

There is still a mindset in Asia that the cost of ink is the main factor when considering digital printing.

 

Of course production costs are important, however, there are significant operational cost savings that directly benefit from digital printing that need to be factored in, such as:

  • Elimination of cylinders, plates, chemistry, solvents, recycling, CTP and hardware

  • Reduction of inventory, print only what you need and get paid for everything you print

  • Reduction of make-ready, time and waste

  • Reduction of storage and warehouse management

  • Faster turn-around time with more jobs per shift

To truly succeed though, digital printing should be part of a broader business transformation that will require time, a steep learning curve and a rethink of current skillsets throughout the organization.

 

It is critical to build a strong sales and marketing team that understands the value proposition of digital printing to develop new business opportunities. Equally as important is to develop a production team that is properly trained and experienced in order to maximize the operational benefits of the digital press.

 

Without a healthy sales pipeline, happy customers and efficient production, it will be hard to sustain a long term business. Ultimately ink costs will become a minor cost component of the overall investment and business transformation.

 

What is the one thing that the digital print industry should do more of, or perhaps should do better in? 

 

Brands, publishers and retailers are constantly looking for ways to innovate and differentiate for their consumers in an ever competitive market place.

 

The adoption of digital printing is often made for operational considerations, however it can also provide a wealth of new opportunities that can benefit the brand owner in a big way.

 

Education and collaboration will lead to the creation of new ideas and applications that will ultimately filter down the supply chain and benefit all of those suppliers that have digital capabilities.

 Jeb Hurley and Nick Price from HP's PageWide Industrial business for Asia Pacific & Japan

 

HP is working tirelessly with brand owners to share and collaborate on the possibilities of digital printing and in the last few years we have seen a proliferation of new print and packaging ideas.

 

However, the more we can educate and share the possibilities of digital printing as a broader industry the more the brands owners will start integrating them into their design, product marketing, manufacturing and procurement processes.

 

This will help move the conversation from cost reduction to business growth.

 

 Any last messages?

 

Come and visit HP’s Singapore Centre of Excellence (CoE) to see the possibilities for yourself.

For the full story, read the latest issue of Print Innovation Asia.

 

 

 

 

 

 

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