Editorial
February 2011
Diversifying the revenue base now key for printers
Our Technology Survey reveals that business as usual is no longer an option
Pundits in this industry have been putting out one consistent message over the past few years: printers need to diversify their revenue base. Various options have been put forward, including variable printing, mailing and fulfillment, embracing digital services and becoming a marketing services provider that depends less on print and more on services. And studies, like some published by NAPL in the U.S. backed up that sentiment. Revenue growth had come in large part to those printers who had branched out.

And yet, for just as many years, that message dissipated into the ether almost as soon as it was uttered. Two years ago in our Executive Survey, and in surveys since then, most printers said they were adopting none of the options we asked about to expand their business. That included web-to-print, transpromo, marketing services, signage and so on.
 
The same result bore out in our Tech­nology Survey this issue. When asked what they had done over the last three years to broaden their service offerings, 35% said they had done nothing. Though, in fairness, 34% had invested in variable printing.
 
To be sure, it’s no easy thing to make changes, especially when many of the options are unproven and carry too much risk. Being walloped by harsh economic blow and hearing about the erosion of print in favour of the internet does make it inviting to just hunker down and hope it will just pass.
 
But I think it’s sunk in that this will not just pass. To borrow further from the pundits, we are in the midst of a transformation in this industry and maybe we’ve arrived at the “tipping point”—that time when things go over the brink and begin to change.
 
Because there seems to be movement out there. When asked how printers plan to expand over the next three years, many indicate they will be decidedly more pro-active than they have been in the past. A full 40% of our respondents plan to institute web to print, followed by variable printing, marketing services, and mailing and fullfillment.
Over the last three years only 19% of respondents said they had embraced web  to print to grow their business. And the printers who plan on doing nothing has shrunk to just over 20% from 35%.
Expanding into new markets and going in new directions was also cited by  almost 56% as the major reason to invest in new technology.
 
This is good news for many reasons. Finally, the mindset is changing and managers are embracing the idea that operating according to the status quo is no longer a viable option. It hasn’t been viable for some time, actually. It also hopefully points to a new spirit of positivity permeating this industry. The past few years have been brutal, but those left standing can now begin to concentrate on planning for the future, rather than just coping with daily crises. And, also hopefully, it may get investment moving again, even if it doen’t look like it’s going to be heavy iron that’s bought. Certainly the printers on our survey say they don’t plan on scaling back technology investment.
 
For a real-life example of this mindset, look at our Pathfinder subject this issue. David Allan of Rhino Print Solutions realized early in the recession that doing the same things the same way would not lead to growth. He heeded the call to broaden his business and in a time when most shops in North America were busy retrenching, he began investing in a serious way.
Filomena Tamburri is the editor of Graphic Monthly Canada. She can be reached at ftamburri@graphicmonthly.ca
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