Let's face it ... the printing business is going digital.

The front end of the printing industry has already been replaced by digitally driven processes and the press room is not far behind. Graphic Arts Dealers need to recognize the changes around them and learn how to capitalize on digital printing.

The trends are clear. Small offset presses have already gone the way of dedicated typesetting, color separation and film based proofing systems. All have been replaced by digital technologies. The narrow width digital presses have taken over the duplicator market and slowly but surely are moving to the 4 or 6 page market encroaching on half-size offset press.

Offset printing continues to be more flexible and have a lower cost point for even runs of 2,000 especially with the efficiencies added to the presses to shorten makeready times and increase run speeds, but when you add inline finishing operations and front end automation into the mix along with a more appealing work environment to attract electronically biased young employees savvy printers are going digital.

The Future For Dealers Is Unfolding Another trend that will affect dealers is the growing interest in hybrid equipment that marries offset presses with digital inkjet heads to provide variable imaging or versioning. Then there is the promise of Benny Landa's Nanographic printing which is digital printing using highly automated printing press hardware and lower than current cost digital inks. Why is this of interest to Dealers? Because these emerging changes require distribution, support, implementation and supplies. These are the same services as in the past but with different products.

Going digital also opens the doors for print providers to add to their bag of tricks of related services like variable imaging, web to print services, improved automation and other services to meet their changing market. While the volume printers still find offset printing the optimum process it is a fact that digital quality is getting better while the cost per copy is lowering.

While the multi-million dollar cost of a high speed ink jet web press is out of the reach of small to medium size printers it is expected that over time the cost of the high speed digital presses will become competitive to higher end offset sheetfed and even web presses. A glimpse at what is coming is represented in Landa's presses that are both web and sheetfed with an ink cost that promises to be closer to offset inks per impression. While we will not see this press for a few years what has been seen will influence the development by other digital and offset press manufacturers to meet this future competition.

While we often think about digital printing in the context of being used for direct mail, books, documents and commercial printing, a growing interest and adaptation of digital technology is being applied to the label and packaging industries. This is not new since the Xeikon, HP Indigo and EFI Jetrion have been addressing this market for a while.

At the Drupa and GraphExpo many digital press exhibitors promoted their products for these industries. But, since most package printing is long runs today, digital technologies are not cost effective. But add a hybrid tower to the presses and things can change.

There are plenty of profitable opportunities for graphic arts dealers in the selling of equipment, supplies and services to digital printers. Where commercial offset printers are a slowly eroding market the growth of the digital market is significant. One reason is that there is no hard fast definition tied to the users of digital printing equipment. We know offset presses are located in printing companies or inplant printing departments while digital presses can be located anywhere from the press room to the office to a manufacturing line.

Global Channel Dealer Summit
Dealer Communicator, partnering with Print Media Partners and the Grapic Arts Show Company, co-sponsored an important conference at Graph Expo 2012. The object of this program was to enlighten dealers on changes in the channels they sell in. Included were sessions from methods of selling and promoting to the evolution of the products they sell. The "Summit" served as a networking hub for channel partners to meet with peers from around the world. Dealers were able to convene with manufacturers and customers to explore new business opportunities.

In an opening presentation at the Summit, Dr. Joe Webb dynamically outlined the state of the industry. Some trends in commercial printing are obvious: fewer and smaller print businesses; fewer suppliers (can be good news); increased digital base replacing offset; and mainstream print is disappearing. To illustrate these points a chart showing the pattern of commercial printing sales per capita peaked in 1995 and then started dropping until it is predicted that by 2020 this consumption of print will be more than 25% its peak. The number of commercial printing establishments will be down by a third by 2020 with the biggest drop in the next 8 years.

An interesting fact is that Ad Agency and Graphic Design firms now employ more people than commercial printers. When you consider that digital equipment fits these types of creative and content generating organizations, it is easy to see dealers getting seriously involved in these growing markets.

It was pointed out how digital printing and prepress has changed purchasing habits. In the good old days of printing when heavy iron equipment was purchased to last and the dealers fed the printers with consumables. In the digital world upgrades and integration is prevalent while the consumables sold are proportionally lower. The role of the dealers is to find and bring new equipment, software and services that will help printers find new revenue streams.

Gerry Giuliano, Worldwide Channel Support Manager of Kodak, asked the audience: "Is your organization ready for success?" He pointed out that everybody is feeling the competition and businesses need to streamline their organizations, reduce operating costs and have a plan to transition to new technology seeing it as a way to grow the business.

Successful Dealers Are Those That Know Their Customers' Needs And Partner In Helping Them Change Dealer Communicator observes that the most successful surviving dealers are those that watch how their customers are changing and partner in helping them change. They also help their customers find opportunities to expand their businesses by using the new technologies instead of sticking with the traditional and familiar ones.

Carl Joachim, Senior Partner of Caslon and Co., talked about The Digital Engine Opportunity. He emphasized that dealers need to look at themselves and determine what is different about their organization and their competitors. Differences can be measured on how a dealer can make a difference to their customer by bringing solutions that help them grow their business.

In the narrow sized digital printing business it can be selling and training to do variable imaging or how to create web to print solutions. Like Giuliano, Joachim feels that dealers need to be sensitive to their customer's changing needs. He emphasizes that having a good service organization with good response times is mission critical. From the observations of Dealer Communicator that the dealer service organization can be a good profit center. Especially if the dealer is selling digital equipment and supplies to organizations like corporations, creative agencies and other non-traditional printers.

Giuliano (Kodak) agreed in the "must haves" for success, and to meet the challenge of adjusting to the changing printing industry, dealers need to invest into training both technical and sales. He pointed out that a way for a dealer to differentiate themselves in the marketplace is with knowledgeable service people and a good spare parts inventory or at least a way to expedite parts as needed.

Carl Joachim also advised that when selling digital solutions an asset to the sales team is to have a solution analyst type of individual available. Now, this may be a technically savvy sales rep or a person on the team that can plan and otherwise be involved in the site survey, demo, configuration and statement of work. He pointed out that selling digital equipment is not a short sales cycle. Knowing what is needed and matching the need to the solution is part of the sales process if you want to be successful.

This editorial probably sounds like selling narrow format digital equipment is hard work. It really depends. A dealer can get one customer that knows what they want and has done all their homework comparing different products, workflows and has done a ROI cost analysis. However, it is more likely that a customer needs help in making a transition into digital printing. And, if they are a creative organization or marketing group they will need help from specifications to installation.

In a series of interviews done by PRIMIR (Graphic Arts Show Company market study organization) in a study of successful printers and inplants that have transformed their organizations, one of the largest issues was getting vendor and supplier help. In most cases the customer ended up doing it themselves. In some cases where the vendor was helpful they stayed with that vendor. We are in the age of consultative selling.

Change Is Hard but it is evident that if dealers don't change they will disappear like the typographers and prepress trade shops. Fighting change is a losing proposition with many casualties. The products you sold yesterday are going away or gone - long live the new products including the narrow format digital press package with the front end workflow and backend finishing along with the supply business. Those that recognize that the change is going to happen and that it is not a fad, will learn how to cope and adjust. Hopefully that is you. DC