This month’s panel of print experts discuss the challenges and opportunities in the sector today
PITR: In your opinion, what is currently the biggest challenge within the print industry?
Andrew Hall, Marketing Manager, OKI Systems (UK):
“Maintaining access to print in office space. Transition away from PCs to mobile/tablet/cloud forms of working can reduce access to printers. Connectivity with ever newer forms of applications is key to ensure those that need to print can still do so. The need remains but the technology needs to enable it.
“Market maturity, many players with low growth means vendors need to work hard to maintain or gain market share at the expense of others. Differentiating in a crowded, mature marketplace.”
Shaun Wilkinson, Managing Director, UTAX (UK):
“Both the way we work and the office environment continue to evolve and, without doubt, keeping up with that rate of change is the greatest challenge facing the print sector. How do we remain relevant in a world of digitalisation, connectivity, multi-user document collaboration and automation?
“Documents – paper essentially – continue to be at the heart of every organisation, but we all need to think about so much more than the printed output. Document capture through scanning, cloud storage, access via any device at any time, and efficient workflows that enhance productivity, are just a few examples of how MFPs and specialist software are being used to boost businesses.
“MFPs are growing increasingly sophisticated and our challenge is to demonstrate how they can be an integral part of today’s working world. Cultural change is happening now, not tomorrow, so we need to keep up and embrace that change.”
Mark Ash, Head of Print and Director Business Enterprise Team, Samsung:
“The biggest challenge that our clients face is ensuring that they are not left behind as their customers’ needs and expectations change.
“In particular, increased mobility is now a key factor in the modern workplace, with employees requiring access to business critical information anywhere and at any time. This ‘always on’ culture is the direction businesses are heading in. And, with millennials set to account for half of the UK’s workforce by 2020, they’ll increasingly be the ones that are driving this digital agenda forward as they strive for the same experience at work as they receive as consumers. It means that the connected workplace is here to stay, and will become a key factor in both hiring and retaining top talent, who are looking for that work/life balance.”
Dan Wogan, Product Manager for Managed Print and Solutions, Epson UK:
“The biggest challenge facing the print industry is encouraging businesses to adopt more environmentally friendly approaches. The paperless office is failing to materialise because the written word, on paper, is still a very powerful communication tool. However, switching from energy-consuming laser printer fleets to inkjet models, has a very strong environmental impact and bring benefits including increased speed and reliability. For example, if UK business switched to inkjet printers, it would save enough power to run at least 60,000 households.
“Epson is committed to persuading SMEs to ‘make the switch’, which is why we’re investing 50 million euros into inkjet production facilities. It’s not just about the printers themselves, though; the industry must also adapt to new trends in purchasing. It’s becoming common for customers to rent IT equipment rather than purchasing an item with a one-off fee. At Epson, we’ve introduced a managed print service called Print 365. This allows SMEs to manage the costs of an inkjet printer over a longer period, entering into what resembles a mobile phone contract. The deal provides added value for resellers, as it allows them to build longer, ongoing relationships with customers and provide ore flexibility. We’re confident about overcoming these challenges and ushering in a new era of affordable, greener, and speedier inkjet printing.”
Matt Goodall, Service Director, Office Evolution:
“The biggest issue facing the industry at present is cost. It permeates every layer of the industry, the customer wants the cheapest print cost they can get, the dealer wants the cheapest running costs they can get and the manufacturer wants the cheapest build costs they can get.
“The issue, as is always the case, is of course quality. The customer gets a low copy cost but the service will suffer, spare supplies can’t be left on site, response times are poorer and downtime increases. The dealer gets a product that is built to a budget and to maintain their margins looks to the aftermarket or grey market for the supplies to regain the profit gap that has been lost. The manufacturer maintains market share but loses out on the sale of supplies and gets squeezed by the dealers to secure new opportunities.
“So where does this stop, well in short it won’t, or at least not until the economy recovers and stabilises. As with every occurrence of recession or economic stress the focus becomes cost and moves away from value and quality. At Office Evolution we continue to provide a high quality service, we carry out regular reviews with our customers and we try to be as flexible as possible so that the customer can grow with us. We retain our base through that high quality response and minimal downtime. But like the rest of the industry, we have to do all of this with a cost vs. value and quality mind set.
“There will always be someone promising to do it ‘cheaper’ but the likelihood is that you will lose quality, service and value, and as we often see and in those famous words ‘We’ll be back’ often securing contracts again after the cheaper alternative has been tried.”
Mark Smyth, Chief Operating Officer,Vision:
“In my opinion, the current, largest market challenge is sustainable growth. If you do not have a strong business plan and strategy, resellers in the current climate will find it challenging simply to remain static!
“We formulated a growth and business plan in 2015 that combines several key components to Vision’s continued growth and success. Inevitably as we endeavour to execute on our plans, some components of the plan are more successful than others and it’s a combination of components that’s key and not just one focus and go to market strategy such as Managed Print!”
Mark Bailey, Managing Director, EBM:
“For us, one of the biggest challenges we’ve faced is business’ attitudes towards printing. It’s either seen as a necessity that ticks over, often haemorrhaging money; or something they would like to try and do away with altogether. This is not realistic for a number of industries, however, and to overcome that, we focus on helping those clients who want to reduce cost by showing them how to print smarter. This doesn’t necessarily mean printing less, but it’s all about finding the right managed print solution to meet their needs.”
David Tulip, Managed Print Programme Director, Network Group / Technology To Go:
“Like many industries, there are multiple challenges and pressures, for the traditional copier-type reseller margins have been under severe downward pressure for some years now – not only on the tin but now the service revenue as both channel players and end-users look for commoditisation. It is of course one thing to compare hardware (even between manufacturers nowadays as let’s be honest looking at office MFDs they all do the same thing!), the time when the hardware should not be commoditised is when there is a unique customer requirement and/or higher volumes to ensure you have the right horse for the course.
“How on earth you can commoditise service I don’t quite know – yes the principle is fine but in practice what the end-user is delivered is often something very different! So margin is a huge challenge within the space which is not going to go away very quickly. New technologies such as Epson RIPS and HP PageWide also mean that ink is no longer slow and expensive and this will also have downward pressure on revenues and margins… but why the race to the bottom?
“I think the definition of Managed Print Services is so varied from manufacturer, to partner to end-user and this is an immense challenge as I see companies losing business as they are pricing for a ‘true service’ and situations where the customer is not getting the service wrap they had anticipated. Furthermore, there are still situations where either the customer has been mis-sold or not undertaken their due diligence.”
Julian Stafford, Managing Director, Midshire Business Systems Northern:
“The biggest threat to the print industry is the decline in people printing. Younger employees coming into businesses today are far more IT savvy. They have been brought up using electronic devices as part of everyday life, which means they are far more comfortable reading documents on a screen. Whereas people of my generation like to print documents if we need to read something carefully.
“Midshire supplies IT services to a large number of primary and secondary schools. Children currently going through school now read books on e-readers and tablets, and do their class and homework on either a laptop or iPad. They are completely comfortable sharing and collaborating online, without the need to print.
“The decline in printed pages is going to accelerate over the next 10-20 years as these children develop into the workplace. Technology is really beginning to change the way we learn and work. And at pace.”
PITR: Where do you see the most opportunity?
“There are still areas of growth – colour continues to grow in use and enabling customers access to fast, affordable colour can help them transition away from mono printing to improve their printed communications.
“Direct mail is also making a comeback. People are overloaded with digital communications which now often go unnoticed. For example emails are easy to delete without even opening whereas direct mail does get opened so there is opportunity for colourful impactful document creation for direct marketing.”
“This challenge mentioned above is also the opportunity, especially for those dealers who grasp the nettle and think solutions first. Dealers should aim to be trusted partners who deliver real world solutions that truly solve the problems of their customers, drive productivity, enable new ways of working and integrate with each individual business. Those solutions also need to be practical and cost-effective, fully integrated with existing IT set-ups and delivered with the minimum of disruption at a time when there’s so much uncertainty in the current business climate.
“Working in collaboration with print partners also brings opportunities. Our UTAX Partners, for example, can draw on technical, sales, marketing and finance help with their tenders. Finally, it’s worth pointing out that hardware is still very much an integral part of the overall package, as we’re talking evolution, not revolution. As I mentioned above, documents are still at the heart of even the most modern working environments. The opportunity comes in leveraging the power of what we in the print sector can achieve to the benefit of end-users.”
“The industry’s biggest challenge is also its biggest opportunity. As workplaces become increasingly mobile and connected, our print partners are now able to incorporate their offerings to enhance the connected workplace. This is because the cloud-driven capabilities of Samsung’s print technologies enable traditional paper-based workflows to develop into efficient and integrated digital solutions that remove costs, improve productivity and enable that all-important mobility.
“Users can access, scan and print documents directly from their phones and tablets; they can edit documents directly on the MFDs; and they don’t need to be logged into the corporate network, enabling complete flexibility. It’s an opportunity to promote MFDs that work like a business, large or small, and boost the productivity of every single one of its employees.”
“We see the most opportunity in the business inkjet market. There’s clearly a lot of appetite for these cost-effective models, as demonstrated by the fact Epson has registered a 40 per cent year-on-year increase in unit sales. Over the next three years, we’re going to allocate a further €185 million towards PrecisionCore inkjet technology, capitalising on the enormous market opportunity.
“We also see more opportunities in the green printing and recycling fields. We have an environmental vision for 2050, which involves all units across our business abiding by green energy standards. At CEBIT 2017 we demonstrated our PaperLab innovation, a revolutionary product which allows employees to recycle paper instantly on site. The device removes almost all the water from the recycling process. Our belief is that one day everyone will have a PaperLab device in their home, allowing them to recycle instantly, bringing an end to paper wastage.”
“The biggest growth opportunities lie with the combination of the multifunctional products and the various software options that control costs. This ties in with my comments about costs, customers want transparency, who is doing what printing/copying? Who is doing colour, who is wasting money? We supply Papercut software and we have seen a huge increase in customers seeking cost control software.
“The simple integration process and the choice of reports and analysis allows a customer to see where they are spending money. As a dealer, this new direction allows another revenue stream and helps to secure customers to your offering. This combined with scan options, document archiving etc. all allow you to secure more product lines into your existing customers and helps combat the ever reducing CPC.”
“Our market has been consolidating for some time, resulting in less resellers and therefore less competition, and some resellers are now restricted in their technology offering and the market requirements they can meet and satisfy.
“Consolidation is driving change for both customers and resellers and this creates further opportunity. Customers typically do not like change, therefore contract renewal and tenders are often the trigger point for the client to decide it’s time for a new supplier. It’s at this important time that we need to be highly active in the market to potentially compete and win!”
“Incorporating additional managed services, such as managed IT, is a definite area for growth, and one we have invested in. We believe that there is a huge opportunity for businesses in streamlining managed services, and by working with a single provider they are able to improve efficiency while reducing cost.”
“So with the foregoing in mind there are a number of opportunities; resellers must differentiate to be successful – the challenge is that much of the messaging is the same and let’s be honest the topic of ‘print and copy’ isn’t sexy. So there is opportunity for those who can provide Professional Services, who can not only talk about but also understand and assist customers with business processes – who can integrate software to help the customer get more from their investment.
“Opportunity exists to educate the customer that the market has changed – Epson RIPS and HP PageWide for example are valid parts of today’s solution. I sense a shift from centralised to local print over the coming five years and businesses reaping savings in not only productivity but energy efficiency too.
“I think the market will continue to be ripe for IT Managed Services companies who have effective managed print services as part of their portfolio to excel and continue to win more business and provide greater value to their customers.
I think a further development of this is a cost per seat model that augments well with existing IT Service contracts where customers get not only a single bill but a simple cost model which is more transparent.”
“The flip side of this is the opportunity for print suppliers to move into managing their clients’ IT infrastructure. The potential to tap into alternative revenue streams is enormous.
“In the past four years, Midshire has moved into traditional IT, hosted desktop, data storage, server replication and endless other areas. IT is now the fasting growing part of the group.
“I also expect to see a huge growth in the sale of managed A4 MFPs and printers. Copy costs on these products continue to fall, some matching those of A3 devices. For the past 10 years we have been removing non-managed expensive to run desktop printers and replacing with fewer, strategically placed managed A3 MFPs.
“This is already beginning to turn on its head, with us now just as likely to replace non-managed A4 fleets with an A4 managed fleet allied to even fewer A3 devices. Giving customers the convenience of desktop printing with the benefits of lower running costs and the ease of a fully managed fleet.
“This will accelerate the removal of non-managed A4 fleets and help managed service providers capture all the pages in their clients.”