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Commercial Print Diversification

When it comes to diversifying into commercial print, sign-makers have the lower risk option of using a trade supplier or investing in their own kit, which comes with higher stakes. Brenda Hodgson investigates

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“Outsourcing gives you access to a much wider range of products. Your offering is effectively limitless, so you can always give your customers what they need,” says Adam Carnell, managing director at Route One Print

Routes to market

Over the past few years the industry has seen a significant level of cross-overs between commercial print and sign-making, in a bid to generate new business and offer added value to existing customers. With many commercial printers now offering banners, large-format printed displays, and point-of-sale graphics as a service, how can sign-makers redress the balance?

For example, if you have already created the built-up signage, promotional banners and pavement flags for a restaurant chain, is there an opportunity to produce other elements of the overall branding work, such as menus, promotional flyers, and business cards? Could you effectively position yourself as the ‘go-to’ place for all of your customer’s print and signage requirements?

If that proposition appears attractive, and it has proven to be so for many sign companies, then the million-dollar question is whether to outsource commercial print work to a trade supplier or invest in creating an in-house facility? However, purchasing new kit is a serious investment for any print-service-provider, large or small.

Simon Cooper, managing director at Tradeprint suggests a third alternative that combines low level equipment investment and outsourcing volume work

As Simon Cooper, managing director at Tradeprint, points out: “The costs are substantial, and include not just the kit itself, but future repairs and staff training.”

The trade route

Conversely, outsourcing these orders to a trade supplier means that investment costs are reduced to zero and there are added benefits for sign-makers.

“Instead, you’ll pay a trade price for any orders you receive, which you can mark up to gain a fair profit,” Cooper continues, who adds: “Working with a company such as Tradeprint eradicates the risk involved with increasing your product range. You can immediately expand your offering beyond your current large-format capabilities, and increase it to include small-format and promotional products to fulfil your customer’s full print buying needs.

“While handing over the responsibility of these orders may be challenging for some, delegating to a trusted partner can free up your time. Rather than producing those orders, you can spend your time on tasks that increase your revenue, such as customer care and sales.”

“Working with a company such as Tradeprint you can immediately expand your offering and increase it to include small-format and promotional products to fulfil your customer’s full print buying needs,” explains Simon Cooper, managing director of Tradeprint

Expanding on the services offered by Tradeprint, Cooper stresses: “Although sourcing a suitable trade printer may seem time-consuming, choosing Tradeprint makes it easy. Our website has transparent, trade pricing available immediately for our full product range, so you don’t have to negotiate for a good price.

“We can integrate into your current systems to reduce the manual tasks involved with outsourcing print work. We also offer white label deliveries as standard, so you can send these orders direct to your customer for a faster turnaround time.”

Cooper concludes: “We know your reputation is on the line with each and every job, so we have stringent quality control processes that ensure a high standard of print. Plus, we have extended the availability of our customer success team to ensure you can talk to us whenever you need to.”

Route One Print managing director, Adam Carnell with the Fuji Jet Press 720S which has revolutionised the company’s business card output

Adam Carnell, managing director at Route One Print, concurs: “Outsourcing can provide many benefits to sign-makers that aren’t possible through using their own kit. For a start, outsourcing gives you access to a much wider range of products. Your offering is effectively limitless, so you can always give your customers what they need.

“Not only is your offering widened by outsourcing, but your prices could be lowered too. Thanks to the economy of scale, trade printers can afford to bulk buy large quantities of stock at cheaper prices. These low prices are then passed on to sign-makers without all the additional costs of depreciation on the machines and staff wages.”

Outsourcing can also enable sign-makers to gain access to higher standards in technology.

Carnell explains: “As a trade printer ourselves, we regularly invest in the very latest in print technology for our factory and are looking forward to some exciting installations later this year. Independent sign-makers with their own kit don’t always have this luxury.”

On the subject of turnaround times, which are often a major concern when weighing up the pros and cons of outsourcing, Carnell offers reassurance: “Here at Route One Print, we have a huge focus on efficiency that allows us to offer some great turnaround times. We’re constantly working to improve our turnarounds and we’re proud to be able to offer several products on a same-day turnaround already, including posters and roller banners. We’ve even introduced delivery upgrades recently where clients can stipulate whether they want their order arriving before 12:00 or 10:30.”

Carnell concludes: “As well as our quick turnarounds, we offer a personalised service for all our clients. With dedicated account managers, our clients can be reassured that all their queries will be dealt with by someone who understands their orders.”

Ploughing your own furrow

John de la Roche, national sales manager at Hybrid Services, contends that whilst trade printers play a valuable role, investing in hardware for commercial printing in-house comes with its own benefits.

“Anything that speeds up your workflow will have a positive outcome on your turnaround and keeping things internal rather than relying on an external company to fulfil an order allows you to retain control of all aspects of the process,” observes de la Roche, who adds: “This ensures you can control the quality of the printing and finishing, meet deadlines set by your clients, and also make any necessary alterations the client may stipulate part way through a job. There’s also a cost saving element from not having to pay a trade printer to complete the work for you, which will have a positive impact on your profits.”

Highlighting other positives to be gained by investing in the right hardware, de la Roche remarks: “Hardware options, such as the Mimaki UJV55-320 grand-format, roll-to-roll, UV printer, allow businesses to diversify into super-wide printing up to 3.2m wide, and give enough flexibility to keep the machine in a full schedule. Its twin roll feature makes conventional wide format print output very easy, but its print quality, size, and productivity lend itself to larger output in high quantities. This broadens your options for new business, or even offering a trade print service yourself.”

Canon’s head of graphics and communications business group, Wayne Barlow advises sign-makers to look at the volume of business already being outsourced, the amount it is costing, and how much it affects the margin being made

Canon’s head of graphics and communications business group, Wayne Barlow, muses on this point: “It is always an interesting question over when to invest in new technology and when it’s best to outsource work to a trade printer.

It’s always a key challenge to understand what is best for a business and it’s not one fit for all

“Systems need to be in place that accurately identify the exact spend in a business per job to work out the economics. They need to quantify and challenge themselves around why to send something out of a business when keeping it inside will retain more profit and overall control.”

A visit to Canon’s demonstration and training centres in Birmingham and London are just one of several practical ways in which the company can help customers explore diversification opportunities

Barlow continues: “It’s always a key challenge to understand what is best for a business and it’s not one fit for all. At Canon, we can help customers in a number of practical ways, in a real partnership approach, to enable them to grow their business and indeed review their own efficiencies through a number of initiatives. These include our demonstration and training centres in Birmingham and London, as well as the Canon Essential Business Builder support programme.”

Check it out

Before you buy, Barlow provides a useful checklist for sign-makers looking to go down the commercial print route and draws attention to some of the key questions they need to ask before committing to investment in new equipment: What volume of business is already being outsourced, the amount it’s costing, and how much it affects the margin being made —where are the tipping points? What type of application is being outsourced, is it standard print or complex?

“So that leads to a discussion over the type of equipment that would be required to produce these applications,” comments Barlow, who adds: “Would this be leased, loaned, bought or perhaps outsourced? You also need to think about how much additional work could be picked up to make this asset work harder and how long it would take to pay for the asset.

“At Canon, we can help customers in a number of practical ways, in a real partnership approach, to enable them to grow their business,” explains Wayne Barlow of  Canon

Barlow then concluded by pointing out that other key factors to consider then include: Are you willing to make the investment in equipment, building, and people to develop this service? How will the asset work with other assets you have? Do they work as single manufacturing process, or is the investment bigger than first suspected? How could you produce a better service, and therefore what would be the USP to keep commercial print in-house—for example, retaining revenue in-house? How will you market the service and make a difference?

The third way

There are clearly good reasons for choosing either option: the lower risk trade supplier path or the in-house investment that comes with higher costs and potentially higher risks.

O Factoid: The global commercial printing industry generates about $825bn (£607.3bn) in annual revenue and is forecast to experience annual growth of 2 percent through 2020, according to Smithers Pira. O

However, if you are hesitating on the brink, Tradeprint’s Cooper, suggests a third alternative that combines both options and offers a viable route for sign-makers who want to dip a toe in the water before committing to a major investment.

“Once you have created the demand for commercial print products, using a trade supplier, you can then invest in new kit without a risk. Working with a trade supplier can then bring flexibility to your business,” Cooper explains. He continues: “With a trustworthy printer already on your team, you can be confident your jobs will be produced on time. So that, should unforeseen circumstances strike—such as your kit breaking down or receiving an unexpected high volume order—you have a reliable print partner at the ready.”


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