Friday, November 26, 2010

A new digital press; the anatomy of a new acquisition…

So you are in the market for a new digital press? Well then you are in luck as you have many choices to look at. With offerings from every major player in the market the job of making an intelligent choice is quite daunting. No one machine can be perfect for every situation and no one manufacturer can be everything to everyone.
Before walking down the digital printing isle to chose something off the shelf, you will want to review carefully at your current customer base and the jobs that they are providing to you, the skill sets of your people and the current equipment capabilities and capacity and your business as they are today. A bit of dream building and having a clear vision of what you want to accomplish both in the near term and the future can be a job by itself.

Take into account that a digital press acquisition in not an inexpensive one and is a decision that you will have to live with for a while. Whether you purchase or lease and what options you chose will have a lot to do with the current state of your business and your short and long term vision is for your company. A solid business and marketing plan are essential when undertaking such an expense.

Environmental considerations, Electrical needs, Space requirements, Speed, Reliability, Output Quality, Throughput, Substrate Handling, Duty cycle, Image Processing in both Accuracy/Power & Speed, Initial Acquisition Price, Cost to operate, Serviceability, Operator Control, Uptime, Training & Ongoing Support, Color Management and the ability to put this new asset in line with a workflow system or MIS system are all considerations that you must take into account when shopping. Companies that cannot answer your questions and provide you with a reasonable level of confidence cannot be considered seriously.

Let’s face it digital printing has come of age and is a serious rival to offset lithography. Run lengths for digital are getting longer while the average run lengths of offset lithography are getting shorter. At the GATF/PIA training I received in PA last month we were told the national average has dropped to 5000 sheets per run. At the same time the digital printing technology has evolved to the point that the delta between digital and offset has risen significantly from on average 1500 sheets to the 2500 sheet neighborhood. Even with the industries greatest achievements and innovations set up times are still 30 to 45 minutes on an average 4 to 6 color press. Highly skilled labor, Chemicals, Plates, Make Ready are still serious pricing components to any offset job. The systems required to drive these new offset presses are expensive and have many cost factors associated with them as well.

Now that the economic pressure has put companies on alert CMO’s are being pressured to do more with less both in marketing budgets and in labor. Companies are reaching out to find new ways to increase ROI of their marketing campaigns and are seeking to increase revenues without increasing the money spent to bring in those revenues. Marketing and Communication departments have redefined what “good looks like” and have looked to the science of timing and relevance to increase response to their offers.

With this science the advent of cross media advertising and elaborate relevant campaigns have become the norm. Print service providers have also had to redefine themselves and have been stretched from selling a commodity in their chosen craft to becoming a practitioner of a manufacturing science and participating in a solution based sale. Reaching out to expand their horizons the common print service provider has had to look for new revenue streams and retool their staff in their transition to marketing service providers.

Now many printers are selling a product based service instead of just a cost center product. With 1 to 1 marketing and the ever increasing sophistication of conditional variable data printing the choice of a digital press has become a very important one indeed for the printer that intends to be around in 2020. With many companies looking at variable data printing the ability to print long digital runs has changed the way to make a digital press choice.

So where do we start in the dissecting of a digital press acquisition? Well let’s start with the workflow surrounding a digital press. Many companies have already invested or will invest in a make-ready/workflow tool. Whether you use something simple like a suite of applications, or something more advanced like a server based solution there are many options available; one must look at what solutions are supported by the equipment and what training and ongoing support is also available.

If your sales rep and his/her team do not have a strong resume and experienced background you cannot take them seriously in their recommendations for your business. As important as the attributes of your press are so is the connection to that company both from a training and support side and from a recommendations side. You cannot spend enough time to know everything therefore you have to have a relationship that is strong enough to be able to count on their recommendations at a certain level. Sure you have to be a student of the business but the reality is you have way too much on your plate to learn about everything involved.

Pick a company that locally has a strong presence both in production print and in the ancillary services and has the relevant knowledge to help you become successful. Make-ready tools, Workflow systems, Business Development, Hardware setup and support, Business system integration, Initial training and long term support along with the typical financial services and flexible billing options are all key elements to take into account. Listen for people with vision but that are not unrealistic or that sound like “perfection in a bottle.” People that don’t talk about the risks associated with a solution are not being realistic. You should always be presented with options and a well thought out upgrade path so you are not caught off guard.

Make sure to know what level equipment you need and that the company you are looking at has a sufficient upgrade path for you and your business. Make sure to take the time to understand all of the cost elements and product limitations and upgradability. Digital presses can cost from $50,000 to millions of dollars. Ensure that your system is modular and has a way to add feature sets as your business adds new revenue streams and takes on new offerings. The last thing you want to do is short change yourself by buying the cheapest machine on the market without taking into consideration what you may be doing in 3, 5 and even 10 years.

Companies that don’t show interest in your business processes and rush to offer a “solution” without taking the time to observe and ask questions are not going to be good business partners now or in the future. Reluctance to slow the process down to seriously talk to you and your key operators and production managers are not going to offer anything but a nightmare down the road. Without a true understanding of your current capabilities, capacity and business offerings any proposal given to you would be futile.

Look for companies that not only have a good product but have local talent that understands both your needs and business model. Listen to the questions being asked and the level at which they communicate with you and their responsiveness to your requests. Be willing to give a serious contender the time to be able to fully grasp both your current situation and your future vision. Companies that are not interested in your future will under or over sell you and compromise you and your company.

Many a printer has gone out of business by over extending themselves. There are almost as many companies that have gone out of business by not taking new technologies seriously and not having the firepower to compete in the marketplace effectively. The effective use of technology is a delicate balance and sometimes it takes someone from the outside to help. Look to sound organizations that can help like the GATF/PIA who have a broad understanding and membership that crosses all sections of the industry. Whether you are a specialty printer or a general commercial printer they can offer invaluable advice as they see things from a 50,000 foot view.

After you have narrowed the field to a manageable list of potential suitors it is time to look closely at the hardware and software solutions that are being presented to you. In the next segment we will look at the hardware considerations of a digital press and what options are available.

Pirate Mike

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