By Cassandra Balentine
Part two of two
Entering the first months of 2023, many print providers are still dealing with challenges stemming from an evolving culture and a global pandemic. Everyone is faced with higher costs, fewer skilled workers, and hard-to-obtain materials.
We’re hoping 2023 is the year we start seeing relief from some of these challenges while utilizing technology to ease staffing concerns with the help of automation.
Inflation and Supply Chain
Similar to any other industry right now, print providers are challenged with higher costs and harder access to materials.
“Simply put, labor, paper, and the variable nature of the market demand have been the huge challenges,” says Jonathan Malone-McGrew, edp, CMP, G7 Pro, senior director of engagement, Solimar Systems. He says the last few years have made predicting the next quarter, or next few quarters, difficult. “On the operations side you have supply chain issues around paper, ink, and equipment availability that produce ripple effects when labor is short and people are less loyal to the brand. The increase in costs and the challenges many industries are facing around labor has meant that organizations have to find ways to stay on track, define, and achieve success and find a path to future growth and profitability.”
One thing is for certain, “people are hurting due to inflation and rising prices of paper, which are increasing daily,” says Reuben Quesus, director of business development, Racad Tech.
“Everywhere you look, whether in your personal or business life, prices are up and products are out of stock. Lead times on materials have doubled and oftentimes even tripled over the last year, and only now does this seem to be improving slightly,” says Angie Mohni, VP of marketing, Nobelus.
“The supply chain crisis over the last year has affected many printers and converters,” admits Chris Minn, head of global marketing, Infigo. “Whether it’s the surge in demand for raw materials due to an increase in orders, or logistics constraints due to lockdowns and border closures, material providers have struggled to deliver the stock that is needed to meet timely deadlines for everyday products necessary to do business—packaging, direct mail, corporate brochures, and more.”
William Mansfield, director, solutions marketing, Kodak, agrees, noting that global supply chain issues continued to impact the supply of raw materials like paper, aluminum, and energy. “In addition to labor challenges, the ongoing increase of prices as a result of the war in Europe and the worldwide inflationary trends. All this meant it was vital printing companies had a strategy for staying one step ahead of the competition in 2022.”
“Obviously the supply chain issues and paper shortages continue to plague our industry but we have seen this improving, at least in our area and with many of our partners,” reveals Brad Kugler, CEO/co-founder, DirectMail2.0.
“The increased cost of materials, such as paper, is a major challenge for the print industry, but also drives the need for further print effectiveness and print platform uptime,” adds Peter Hultberg, chief commercial officer, Baldwin Technology.
“Some current trends with web to print and labor shortages have contributed to encouraging more automation initiatives. Due to Adobe and Pantone’s pending licensing agreements, we have developed Virtual InkBooks to help our customers manage their color libraries,” agrees Stan Carmichael, special projects director, Significans Automation.
The labor crisis is apparent, as print providers struggle to find competent and reliable workers.
“As an industry and even a nation, we are all struggling with labor shortages. With so much uncertainty about what new challenges will emerge as the world continues to change in unpredictable ways, it can be daunting to find effective strategies to combat current issues and plan ahead,” comments Mohni.
Hiring and retaining staff is one element, but Hultberg says it is harder to find people that understand and can operate new technology that is more complex and requires new skills in addition to a traditional printing background.
“The industry is facing a lack of resources overall. Because of labor shortages, more work is being put on champions within the organization, creating stress and havoc for those people,” shares Minn. “Finding skilled staff that want to do two to three times the amount of work they’re used to is difficult, especially when less stressful jobs are offering as much money or more.”
Katie Graham, regional marketing and communications manager, Bobst, points out that challenge of hiring new production staff is forcing the need to rely on more automated production lines. “The second challenge is to reduce the time between order taking, shipping, and invoicing. We are also seeing a drive to deploy new web to label solutions in answer to customers’ needs for ordering on demand.”
Label and Packaging
In the label and packaging industry, the main challenges this year have come from labor, media supply, and weighing capital equipment investment decisions in a puzzling economic climate. “Not surprisingly, the conversations on the Label Expo show floor revolved around the real business issues that converters are grappling with today. They weren’t there to hear the usual feeds and speeds. Given industry wide shortages, they wanted to know how the Epson SurePress could help them minimize media waste. Or given the trouble everyone’s having in recruiting and retaining talent, they asked about how Epson automation will lessen claims on scarce labor resources in their shops. These were substantive conversations beyond specs and brochures,” admits Victor Gomez, director, Industrial Labels, Epson America, Inc.
“Our main challenge has been to keep up with a label demand that spiked during the pandemic and has yet to abate—fortunately,” he shares. Label converters saw more orders, smaller but more frequent, which is perfect for digital printing. “Digital is now a fact of life, and most converters have some sort of capability—whether a desktop Epson ColorWorks on demand printer or a production press like an Epson SurePress. Yet with the sustained boom in business has come a hunt for more capacity of all kinds. Capital investment was on hold in many shops because of the general economic uncertainty. But there are only so many shifts one can add, and existing equipment does go down. With the prospect of higher interest rates, the incentives to invest now rather than later are compelling.”
Technical support was a challenge until recently, as access to customers and travel was complicated by pandemic restrictions. “But we managed and Epson actually doubled the number of field techs servicing SurePress in North America in the last two years. Despite the tight labor situation, Epson’s label team has grown since 2020. We have more people and resources in product management and service than ever before to continue to bring our ColorWorks and SurePress label solutions to a market that is increasingly turning to us to help navigate these interesting times,” says Gomez.
Adding Value, Margins
The demand for customization is forcing print providers to consider the margins and value of the work they provide.
Nowadays it is becoming increasingly evident that marginality is higher for short runs than for longer runs. Companies are now looking at personalized and 100 personalized customized items, in lesser quantities, but tailor made,” shares Matteo Muto, sales and marketing operations, Valiani s.r.l.
He says this is particularly true in the sign and packaging markets, where restaurants, cafes, food and beverage companies, stationery shops, and businesses of every kind want to receive as many different jobs as possible in a very quick time. “Customization is at the core of this tendency. This cannot be made for instance when it comes to the so-called die cutting process, ideal for high production since it enables to get thousands of boxes in a little time, but all identical, one like the other. As most enterprises do not care too much about large quantities, this is how we explain the tremendous rise of cutting plotters in a sector like this. Cutting plotters allow to create several jobs, each of one is totally different from the other, thus respecting the personalization creed.”
He stresses that cutting machines ideal for short and medium runs are very versatile and lead companies to move around a range of business activities, from packaging to signage, from apparel to finishing operations, from printing to coating. “There are many companies at the international level with a long and successful history that have been providing reliable and sturdy equipment designed to last for 15 or 20 years. The reasoning could be ‘spend today to earn tomorrow,’” says Muto.
Design is another important element when it comes to high-value items. Mark Geeves, director, sales and marketing, Color-Logic, feels that unfortunately, most printers forget about design. “At Color-Logic we believe All Print Starts with Design, and until creatives understand what is possible in digital print today, the adoption rate of metallics and print embellishments will be implemented only slowly. Press and printer manufacturers are bringing out great new printing technologies, but they think their most important clients are printers. Their ultimate target markets, however, are agencies, designers, brands, and chief marketing officers.”
It is clear the challenges of 2021 and 2022 will penetrate into 2023. One of the best ways to get ahead of these issues is to invest in the latest technologies.
“We see the biggest challenges as continuing the rate of rapid adaption to change and the ability to fluidly respond to changes in the macro and micro environments,” admits Elisha Kasinskas, marketing director, Rochester Software Associates. “Maintaining a strategy and focus can be challenging when so much time is consumed with operational and production challenges and there is reduced staffing.”
However, as an industry we’ve hopefully learned how to implement tools like automation to improve efficiencies and reduce staffing needs.
Read our Year in Review article as well as part one of this series for more insight into 2023.