TMN 26 September 2002

Graphics Industry News You Can Chews (TransMandibular News since 1996!)

TMN is an online newsletter 'dedicated to individuals in the printing and graphic arts industry for their self development, their companies success and the enhancement of the printing and graphic arts industry in society.  It does this through education, information and research.'*

*From the Mission Statement of the IAPHC

Industry News

Grappling with Graph Expo

OK pilgrim, listen up, what follows is your highly personalized and possibly variable guide to traversing the halles of Graph Expo inhaling the olfactory blandishments of the inky parfumeries; albeit, fumes devoid of as many volatile organic compounds as better chemistry can devise.

At last year's truncated show, hearts stopped and business ceased as heroes ascended and innocents died in the awful crucible of craziness.

This time around, the auguries suggest we may be more focused and perhaps more scared.  Last year, we wrote of a friend's lament that he had gone to the show in search of answers only to be interrupted by horror.  In his pell mell cross country drive home in a hastily hired car, he realized he had obtained no answers and things were now changed, changed utterly.

It seems to us that many Graph Expo attendees are absolutely in search of some implementable solutions and some functional answers.  Yet in the press kit announcing the event, one finds a quote from John Kaptriotakis of Lysis International, cautioning us: "Don't rely on your vendors to be the visionaries."

R.M. Lunde, chairman of PrintShift wrote to us recently:  "Almost all industry experts are telling printers they need to transition their business from analog to digital.  All of the voices represent a chorus of what they are supposed to do.  However, there is almost a complete silence on HOW to do it, and there is a complete vacuum on defining the actual model into which printers must evolve.  To our knowledge, no one from the vendor community has systematically sought to understand the new environment from the printer's point of view and certainly not the point of view of the printer's customer."

Against this atmosphere of palpable angst we offer these summary keys as you sojourn in McCormick Place South:

1) There will be a noticeable paucity of purple tennis shoes.

2) Certain anonymous dot commerce suffixes have been quietly but not painlessly amputated.

3) There is still no clear bright line of denouement around the perfect, seamless, complete digital workflow.  Darn it!

Abstract Stats

Before you cartwheel off on your giddy gambol through McCormick's hiways to heaven and biways to befuddlement, it is entirely fitting to consider the history of our hallowed craft.

The Acceleration of Change

Not long ago, the omniscient industry guru Frank Romano outlined a rather startling timeline of print progress.

Letterpress printing began in 1439 and ended in 1970 (about 500 years)

Offset began in 1936 and may last til 2040 (about 100 years)

Machine typesetting began in 1886 and ended in 1996 (about 100 years)

Photo-typesetting began in 1945 and ended around 1990 (45 years)

Laser Imagesetting began in 1978 and may end this decade (30 years)

Off press CTP began in 1991 and could last til 2016 (25 years)

On press CTP began in 1991 and may extend into the future

Digital printing began in 1976 and may extend into the future.

Talk about planned obsolescence.  Way too many the readers of TMN have worked with all the above mentioned techniques.  A lifetime of evolution becomes revolutions per minute.  A startling timeline indeed!

So who are we Now?

In this environment, William Lamparter, chair of the Executive Outlook that will kick off Graph Expo observes:  "Printers are focused on either becoming the lowest cost, fastest turnaround, digital assisted print game in town, or they are diversifying into a wide range of adjunct-to-print products and services ranging from digital asset management to digital photography and fulfillment services; some are focusing on personalization and one-to-one marketing through the use of variable imaging digital presses; and some are doing nothing, waiting for the lightning of better times to strike and revive a business headed for oblivion."

Here are a few stats from the formerly known quick print industry to back up Mr. Lamparter's opinion:

Bob Hall's Monday Fax Newsletter deftly encapsulates the competitive pressures faced by the smaller operator.  In the 23 September issue Bob quotes Gary Kusin the CEO of Kinko's:  "In today's business climate, we must be the lowest cost provider."  Contact Bob Hall at BrownDawg@aol.com if you would like more information on his newsletter.

The 2002 PrintImage International Operating Ratio Study notes that Net Owners Compensation, a measurement tool of the putative profitability of quick printing has dropped unerringly over most of the past two decades from a once robust 17.9% to just over 11%.  Importantly, that percentage decline comes right out of ma and pa's pocketbook.

In Larry Hunt's always excellent Color Copy News for August 2002, Larry reports that the overall average selling price for color copies has dropped from $.86 in April 1999, to $.74 in June of 2002.  If you are now, or are thinking of selling color copies, you really should avail yourself of Larry Hunt's expertise, contact him at larryhunt@aol.com

Still another quick print survivor asked this telling question in an online forum a month ago:  "Has anyone instituted a minimum invoice charge?  Please say yes and that it's $50.00.  If so, please tell me about your wild success."

A Canadian shop owner replied:  "We do not have a minimum bill amount.  Most of my neighbouring shops do, though, usually set at $5.00 even if someone does just a few photocopies.  I have heard of some shops that have every customer on COD unless they do more than $xxx per month or per year, say $300 a month.  We are reviewing every customer account below our top 100 with an eye towards putting them on COD."

That discussion reminds us of Dick Lunde's observation reported earlier this year that his average job ticket was shrinking in size but the number of invoices written was growing. Thus proving the notion that customers need shorter run lengths of more items.

Nor is it just the quick printers who are engaged in soul searching -- Robert A. Larson publishes the DDIN quarterly journal for the many segments of the Die Cutting process.
He writes:  "I go into many steel rule dieshops and ask a rather simple question:  'What do you sell?'  The answer is typically:  'Well, we sell steel rule dies.'  I look at the person and say, 'No you don't, you provide your customer with tooling solutions to save them money and to become more profitable.  You provide your customer with consulting services, you mentor their people, you provide answers on how they can save money and you add to their profit margin.'  This generally blows the individual's mind.  He is so busy trying to get the next die out the door that he cannot think in such abstract concepts.  In many cases he does not have a clue how to transform himself into an added value service provider."

And how many years ago did Mr. Lamparter enjoin us:  "Printing is transitioning from a craft based manufacturing industry, to an information based service industry."

Or as the poet Frost once reminded, it's the path not taken that makes all the difference.

Accounts Receivable R Us

In a recent TMN we wrote about Dick Gorelick's provocative conclusion that the migration of so-called Informational Printing to the Internet (or to Kinko's for crying out loud) and the simple fact that Promotional Printing is highly seasonal in nature means that printing has become a real peak and valley type of business.  Informational printing can no longer be counted upon to balance out the jobs-in-progress board.

Among other nasty impacts, the cash flow of the business is changing with rapidity.  Mr. Gorelick's Graphic Arts Sales Foundation says the difference between the best sales month and the worst sales month at the average printing firm is 2.2 times and he forecasts the gap will widen further.  We urge you gentle reader, whether you own your own plant or are the newest press loader in the shop, to consider the impact of that feast or famine cycle on your own breadwinning.

The Squeeze is On

The good folks at A.F. Lewis Information Services compile massive abstracts of the size and scope of the graphics industry.  (First time subscribers can have their copy for US$999.)  They note that the number of printing plants has dropped from 70,729 in 1992 to 57,359 in May 2002.  And they write:  "In the year 2000, these data (data detailing the number of plants employing more than 10) led us to observe that there were more medium sized and larger commercial printers than ever.  Two years later, there are no more 'sweet spots' - plant counts are edging down in all size categories."

And of course one causal factor of the temporary growth in larger shops may have been the dot com fueled merger mania of the late 1990's.  Nonetheless, the facts are facts, the number of plants is shrinking and one could argue that mastery of the digital workflow will raise the barriers to entry much higher than ever previously known.

Wanna Stretch the Envelope?

Still there are positive glimmers on the horizon.  The United States Postal Service will soon be filing its first ever negotiated service agreement with Capital One Services Inc. which happens to be the single largest producer of first class mail in the US.  As Pete Peterson, of Western States Envelope is happy to point out -- all that mail requires printed envelopes containing materials that are invariably also printed matter.
Maybe better times are coming.  The USPS seems to think so -- it's spending $2.5 billion in the next year on new automation equipment, new trucks and etc as it gears to add 1.65 million NEW delivery points in fiscal 2003.

Interestingly, according to a recent study in New South Wales, Queensland and Victoria, Australia, private consumers still love their postman.  Receiving direct mail was twice as popular as receiving promotions by e-mail or phone; nevertheless, 25% of the respondents were receptive to receiving e-mail promotions so long as it originated from a firm they were already doing business with.

The Envelope Manufacturers Association (EMA) was pleased to see that direct marketers are planning to gear up their spending in the next six months, although a caveat is that the spending maybe aimed at infrastructure and systems, which according to the EMA portends smaller and more targeted mailings.  Can you say variable printing?

VDP is not a social disease

IAPHC member Mark Day in Akron, Ohio recently contacted us looking for source of info about variable data printing (VDP).  Fellow member Dave deBronkart of PODi was able to provide the following spot-on assessment:

"Not all variable data jobs produce great results, any more than all offset printing jobs produce great results.  In both cases the job needs to be put together by someone who understands design, who understands how a printed page reacts with the (individual) reader's mind.  After several years of working with this, we can say that the key is simple: the key is to earn the reader's attention by displaying something that's genuinely more interesting that a generic message.  When that happens, not only do you get more response, people actually tend to react differently too -- they buy MORE, respond faster, etc.

In order to earn people's attention you need to have information about the recipient that lets you vary the content.  It may be as simple as age group or shoe size that they've purchased in the past.  Given that information, you intentionally vary page content, in the same way you'd speak differently to two different people if you knew something different about them."

According to Daniel Kita of Heidelberg USA writing in the July/August IPA Bulletin, "With variable data and personalized marketing, response rates regularly top 8 to 10 percent - as much as a 400% increase over direct mail."

Wow!

Digital Ports of Call

Most printers will be inexorably drawn to the digital press displays sure to be found round every corner at Graph Expo.  And little wonder -- Barb Pellow of the Rochester Institute of Technology told the IPA 2002 Technical Seminar that the color digital printing market is growing at a rate of 22%, compared to 2% for traditional printing.
She wisely counseled that a baseline target of 700,000 monthly color digital impressions was needed to be successful and also urged folks to think through the infrastructure impacts of the many, many short and shorter runs that is inherent in VDP.

Depending on the niche you wish to attack we encourage you to stop and take a peek at   the 74 Karat from KBA North America, (sponsor of the Best Use of Emerging Technologies Award in the 28th International Gallery of Superb Printing) or the Heidelberg NexPress or the Xerox iGen3 which all have fans among the increasing numbers of printers and former prepress houses atop the digital printing bandwagon.

From Dick Lunde's shop in Laguna, California to the Envelope Manufacturer's Association market assessment to the world class research at PODi and RIT, the message is consistent -- shorter runs, more personalized and variable runs.  Are you ready?

A very successful sheet fed printing sales rep we know (who always enters the International Gallery of Superb Printing,) had long worked for a multinational printer which had grown to be the world's second largest.  Then an offer came along from another well known printer in New Jersey which had multiple international locations as well.  When our man took the new gig, imagine his surprise to be told that his primary focus was to be digital print sales, to the exclusion of almost all other activities.
Can you hear the future calling?

Whilst tripping through the turnstiles at Graph Expo, see if you can track down one or another of these two "presses" first displayed at the big IPEX show in Birmingham, England earlier this year -- the first is called 'the.factory' from a firm called Dotrix.
(formerly Barco Graphics.)

'the.factory' is digital press aimed at specific industrial niches such as labels, laminates and even wall coverings.  Andrew Tribute memorably calls it "sort of an on-demand, short run gravure and offset press." 

The second press is Scitex Digital Printing's Vantage press.  Like 'the.factory' this press uses inkjet technology and is clearly an indication that inkjet is about to arrive as the next big thing.

Does Size Matter?  The Largesse of Inkjet

"By the next Drupa, inkjet technology will be very important for the printing industry.  Agfa, via its cooperation with inkjet supplier Xaar, should have a new digital color press.  Heidelberg also will have an inkjet product developed by Spectra, an inkjet supplier in which Heidelberg has invested."  Andrew Tribute writing in the June issue of High Volume Printing.

Graph Expo has not missed the point, as it has devoted a special pavilion to wide format inkjets.  A recent NPES study says the wide format inkjet market could be worth more than $11 billion in the US by 2005.  However, most clients don't think of commercial printers as being purveyors of this sort of work.  According to the NPES only about 15% of this business is currently going to commercial printers.

We are reminded of the time years ago when we found ourselves recommending that customers go down the road to Kinko's to obtain engineering sized photocopies.  A good friend at Xerox explained that providing architectural and engineering copies was a marvelous hook to obtain even more of the ACE market's conventional printing needs --ACE being Architects, Contractors and Engineers.

We wonder if perhaps wide format inkjet is not a similar cleverly designed hook which may help you reel in much larger dividends.

Moreover, the rapid improvements in digital color inkjets means that today a printer can send a client a proof via the Internet and it can then be output on a digital color inkjet printer for layout and art approval.

Take some time to visit the large format inkjet pavilion and consider this from Laurel Brunner writing for Printing World in Britain on 16 September:

"One of the justifications for this additional investment (a separate inkjet device for soft proofing) is that is makes more sense to fire up a cheaper engine to produce proofs than to use a costly platemaker.

But there is another reason that supports the rationale for additional investment: large format proofers can also be used to produce exhibition, poster and point of sale material.  The addition of such potential new revenue streams could swing the balance when weighing up the investment decision."

Industry Tid-bits

1) Ever wondered who makes the stuff that allows scented printing to stir your memories?  The 'stuff' is called slurry and Mandy Lanter of Lipo Technologies in Ohio is the person you need to contact to learn more.  We trust that Mandy will soon be joining the Columbus Club (in fact she may have done so already.)  contact Mandy via e-mail at mlanter@lipotechnologies.com

2) A comprehensive new manual for printers determined to keep up with environmental mandates is available from Jelmar Publishing Company at 516/822/6861.  It is titled Environmental Regulations for Printers and it costs $385 US.

3) Jim Richmond, former Vancouver Club President and now resident in the Sacramento, California area is an expert in the pressure sensitive label business.  The man is flat out smart!  He has formed a new consulting firm called Spirit Mountain Technologies and would be happy to work with you if the need arises.  Contact Jim at 916/718/9204 or via e-mail at richmoji@otn.net

4) Industry consultant and all around fine fellow Dave Fellman has a new website you should feel free to check out at http://www.davefellman.com/ or contact Dave via e-mail at dmf@fellman-nc.com

5) We would like to compliment Jim Sheets, president of Printmasters Professional Printers in Greenville, South Carolina.  Jim is also president of the Graphic Arts Club of the Upstate.  Last month he sent us a letter: 

"Printmasters Professional Printers has requested the following awards be forwarded to Printmasters by September 19th, 2002 which is the evening of our Gallery presentation.  Printmasters won two Bronze awards; we would like duplicates of each of those awards.  In addition, Clemson University won two Bronze awards which i will present that evening.  Crowson Stone won one Bronze award and would like to order a duplicate...."

We commend Jim, and Warren Woodruff of Crowson Stone for their wisdom in ordering duplicate awards to present to their respective clients.  In this hyper competitive market, it makes sound business sense to remind customers just how highly you value their business.

We would also like to commend Jim for the letterhead on which he submitted his duplicate award order.  On the left hand margin side of the letterhead each customer contact person and their title is listed along with Jim's contact info and the firm's web address, e-mail address and of course phone, fax and mailing address.  The first impression you get from his letterhead is that Jim's firm cares about customers and making it easy to buy from Printmasters Professional Printers.  Well done Jim!

Your Knowledge Network Obviously Works (Y'KNOW?)

Y'KNOW Requests:

1) From Patti Copeland, president of the San Francisco Club of Litho and Printing House Craftsmen:  "I am looking for a digital ink scale for the City College of San Francisco.  If anyone has one they can donate, no longer use, or are able to give up due to an upgrade, your gift would go to a wonderful Graphic Communications program. Thank you very much!"  You can contact Patti via e-mail at OnyxDrgn01@netscape.net

2) From Jim Sheets of Printmasters Professional Printers is Greenville SC:  "We have a customer who needs some labels. Medical manufacturing, high quality and must run through a Zebra printer."  Editors note -- this request has been bouncing around the global Y'KNOW Network to a variety of sources for nearly a month.  It is apparently a rather challenging project.  We therefore suggest serious inquiries only to jimsheets@printmasters.net  Thank you!

3) From Joe Stevens of Kaye-Smith and the Seattle Club:  "I am looking for a good supplier of custom cartons.  The order specs are

7 1/2" x 2 1/16" x 3 1/2" with a 1" lid or a 3 1/2 " lid

10 5/16" x 7 1/2 " x 3 1/2 " with a 1" lid or a 3 1/2 " lid

Quantities for the above are 5,000, 20,000, and 50,000

Thank you!"  You can contact Joe at Joe.Stevens@kayesmith.com

4) From Helen Marsh of the New York Club and The Color Wheel:  "I have a friend in Australia who is sending two employees to the US on a research mission in mid-October.  They are hoping to meet other printers in Chicago and on the West Coast.  I will handle arrangements in New York City.  Anyone interested in helping Kelly and Gary from Lilyfield Printing learn more about Total Print Management and in specific how printers and print management companies conduct business, what IT platforms are required, logistic strategies and management requirements are encouraged to contact me or Reg Hammond  at Lilyfield Printing in Sydney, Australia."  You can contact Helen at hmarsh@thecolorwheel.com or Reg Hammond at rhammond@lilyfieldprinting.com.au

5) From Roger Buck of WardKraft in Fort Scott, Kansas:  "Do you know of a supplier of laser compatible foil or an IAPHC member who might be able to help me?"  You can contact Roger at RBuck@WardKraft.com

6) From Tony Sarubbi of John Swift Printing and the North Shore Club:  "We are looking for a used Heidelberg plate bender for a post Drupa model 102-5P&L."  You can reach Tony at asarubbi@johnswiftprint.com

7) From Wayne Kreps of Illinois Graphics and the Central Illinois Club:  "I'm looking for anyone who has had experience with "Express Press Maintenance and Technical Services."  They would provide a Maintenance Service Agreement for our mostly Agfa equipment in our prepress department."  You can reach Wayne at wkreps@ilgraphics.com

8) From Joe Benoit of Moore North America and the Capital District Club:  "As our business continues to ramp up, we need quality individuals to fill the positions of Night Supervisor as well as web press operators and bindery workers.  Moore has made a stunning turnaround and this is a chance to join in our success.  We are based in Albany, NY with an abundance of leisure time activities in this great area."  If interested, please contact Joe at Joseph_R_Benoit@gs.moore.com

IAPHC News

International Printing Museum Needs YOU!

On 14 September, the IAPHC Executive Officers attended the 50th anniversary celebration for the Santa Monica Bay Club.  The truly enjoyable party was put together by past 12th District Governor Bill Leahy and Club President Martin Sprints.  Some 100 industry people attended, including past Santa Monica president Mark Barbour, who also happens to be the curator of the International Printing Museum based in Carson, California.  Although Mark is too polite to 'put the arm on you' himself, he is in the final leg of a harrowing race to obtain enough financial support to obtain a permanent home for the Museum and its many in-house and outreach educational activities.  As anyone who has met Mark can attest, the man has an abiding passion for the incredibly rich history of the printing field.  If there is any way you, your company, or perhaps an education fund you support could send a few tax deductible dollars to Mark it would be a tremendous help in assuring the further development of this industry treasure.  You can reach him at 714/529/1832 or via e-mail at printmuseum@earthlink.net  Time is running out (escrow closes in another month's time) so if you share Mark's love for Printing History, please consider his very worthy plea.

Platinum Fund Still Growing

During the redoubtable Albuquerque Convention, run by the indomitable Kahuna's, and enjoyed by the imperturbable delegates who overcame the world's worst hostelry -- several members of the Second District, notably Helen Marsh of New York and Alice Lynch of New Jersey were impressed into service in the sale of raffle tickets by the Italian Impresario himself, Second District Deputy Governor Joe Prestino.  The proceeds from the sale of a press sheet of US currency were donated to the Platinum Reserve Fund - in tandem with individual gifts from Chairman Howard Drayson, past Chairman Ray Rafalowski, 6th District Governor Pete Peterson, 10th District Governor Jeff Jarvis and 12th District Governor Richard Jones, the Platinum Fund grew by over $1,300 -- we thank every one who responded to the persuasive Prestino.

Membership Value

We were chatting with Walt Gutowski of the Grand Rapids Club the other day.  Walt has some older equipment he no longer uses at Swift Printing and he decided to list it for auction on eBay.

Walt says the experience has determined another means of expressing the outstanding value he derives from his membership.

1) He asks the bidder if they are IAPHC members - if they are, Walt knows something about their credentials instantly.  He knows they are 'real' if you will.

2) If they are not members, he directs them to our CraftNet website and offers the toll free number and points out they really should be members.

3) And, in order to verify his credentials, he encourages his bidders to call us at IAPHC head office -- we've been in his shop, know how well he takes care of his equipment and can vouch that he is a man of his word who can be trusted to honor a bargain.

Walt has had inquiries from all over.  That may say something about the power of eBay, but we are most impressed by Walt's desire to become, as past Chairman Larry Nelson was won't to exhort -- a consumer (a user) of HIS Association.

Industry consultant TJ Tedesco recently wrote:  "Trade associations provide their members with a wealth of opportunity.  Of course, your membership is only as valuable as you make it.  Active participation in association events only enhances the association's value for you and your company."

We know, due to the virtual bounce (e-mail being forwarded worldwide) that YOU gentle reader, may not yet be an IAPHC member.  We are asking you to remedy that condition and to avail yourself of a wealth of opportunity.  Please e-mail Lesley Addy at laddy1069@aol.com or director@iaphc.org and she will make sure you get connected to our Knowledge Network -- still the greatest bargain in the graphic arts.

Not to belabor the point, but there has been some item in this virtual newsletter that has given you pause -- it was "News to Chews" upon.

That has value.  If you are not yet a member, YOU need to support the IAPHC so it can further support you.  Can we count on you please?

Los Angeles Convention

Under the able, experienced and calmly guiding hand of Doug Haines, Convention Chair, plans are proceeding apace for the 84th IAPHC Convention to be held this August at the Sheraton Universal in Los Angeles, California.  The IAPHC Executive Officers toured the facilities on 13 September and were most impressed by the amenities, the location and the hard work already invested by the Los Angeles Convention Committee.  Shortly, registration and agenda materials will be posted on CraftNet.  In the meantime, you can support the efforts of Doug and his committee by buying a Convention lapel pin, discuss supporting the Convention thru the mini-trade show or other activities designed to maximize the Convention experience.  This Convention will be long on training and self development opportunities and short on sit down meetings.
Please check in with Doug if you want to help: dxhaines@paccd.cc.ca.us

Cruiseman Calling all Craftsmen

From Arthur "Cruiseman" Mole of the Vancouver Club:

The 2004 Convention marks the first time the IAPHC will have a Convention which takes place in both Canada and the US, as you partake in a magnificent 7 day Cruise from Vancouver to Alaska.

You won't want to miss what will be an incredible, inspiring, never to be forgotten Convention experience.  Already more than 90 members, families and guests have taken the plunge and reserved a spot aboard the luxurious Celebrity Cruise Ship "Infinity."

In a month's time, the ship will go on sale to the general public and travel agencies.  Right now, our Association has the unique opportunity of being the only group able to make reservations.  Take advantage now, flexibility is unlimited, choose your cabin, choose your deck, with fantastic rates starting at $999 US pp double occupancy, which price includes Convention Registration.

Visit the website below and explore our 2004 floating Craftsmen Convention:

http://www.cruiseshipcenters.com/iaphc/

or visit the direct link from the home page of CraftNet.

We encourage you to invite Aunt Hermoine, and your best client, and your paper vendor, and your babysitter's better looking brother and Uncle Stinky too; heck bring them all, it will be a once in a lifetime trip.  Ahoy there? 

That's all Folks!  --30 --

Yours in Craftsmanship,

Kevin Keane
IAPHC
7042 Brooklyn Boulevard
Minneapolis MN 55429-1370 USA
800/466/4274
http://www.iaphc.org/

Remember: The Holidays Aren't over 'til you celebrate International Printing Week

The theme for the 2003 (12-18, January 2003) celebration is "PIE7" which is shorthand for:

Printing Industry is Evolving, Educational, Exciting, Enlightening, Empowering, Entertaining and Effective.