By Melissa Donovan
As in years past, the August issue contains our annual state of the industry report. We reached out to market-leading vendors to gather information on the technology, people, and applications influencing the graphic arts. The overarching theme after sifting through all of the data is that digital is changing how we, the consumer, think. The power to personalize and customize is more than company branding or promotional material found on signage, but moving into fashion, the industrial sector, and who knows where else. Recent advancements in equipment, consumables, and software solutions support this.
Above: Westwind Design Group of Calgary, AB, Canada won first place in the Digital Output 2017 Application of the Year awards for its work for The Calgary Stampede.
Continuing to Progress
A stagnant industry is not only boring, it eventually becomes non-existent. The graphic arts continues to advance through new technology introductions. In addition, it influences other markets to embrace digital.
Technology includes equipment, consumables, and software solutions. On the equipment side of things, Jim Lambert, VP, GM – digital division, INX International Ink Co., says great strides took place in the last few years, specifically in regards to higher resolution and faster printheads. “The driving factor is the method for delivering the drop or dot. Printheads are faster with higher native resolutions, allowing for printing in single pass, which is competitive compared to offset printing,” he shares.
“Digital ink has advanced side by side with device and printhead technology resulting in wide color gamut and durability such as light and water fastness, washability, and handling and rub resistance,” explains Dan Halkyard, senior market manager, S-One Holdings Corp.
Jim Halloran, VP sales and marketing, Lintec of America, Inc., believes we are witnessing a steady but slow evolution in printing equipment and matching materials like ink. An example of this is the progression of UV-curable inks becoming more flexible and curing with less energy.
Other advancements on the consumables side include media, specifically textiles. According to the 2015 Statista Industry Report on Textile and Apparel Manufacturing, $73B of textile products were shipped within the U.S. in 2014. These numbers reflect the significant growth and opportunity for digitally printed textile media, shares Michael Compton, product marketing manager, Top Value Fabrics.
“In the fabric world, yarns are reverse engineered specific to different printing platforms. Integrating new fabrics and technology is now the industry norm. Once the crocking issue is resolved in pigment printing and can run with the same reliability as dye-sublimation, we will see significant changes,” suggests Kathryn Sanders, marketing and sales, Pacific Coast Fabrics.
Another focus in regards to media is ease of installation. “This is evident by the increase in products that do not require professional installation teams, but allow store level employees to install graphics themselves,” cites Kylie Schleicher, marketing manager, Ultraflex Systems, Inc.
“Cost reduction and simplicity are becoming more of a priority. In fact, the application process can be so easy that no professional installation is required. Labor is always the most expensive part of the overall cost, but by helping control this an overall campaign becomes more cost effective,” recommends Darren J. Speizer, VP of sales and marketing, Drytac.
Besides ease in install, labor costs continue to be minimized with advancements in software solutions like workflow products and RIPs. “The best solutions drive print shops to greater profits with print production tools that customers can rely on. RIP providers need to understand the products that shops are selling and provide tools that make them easy to produce. Because of this, the industry constantly looks for innovative ways to reduce downtime and improve production times,” shares Bryan Manwaring, director of product marketing, Onyx Graphics, Inc.
“There is more emphasis put on workflow and interconnectivity between what used to be dissimilar processes. We see more blending of traditional and digital workflows, which brings more diversity to the shop floor. The ability to bring previously outsourced work back in house for more control and profit continues to grow,” explains Josh Hope, senior manager, industrial printing business development and marketing, Mimaki USA, Inc.
These updates to technology—equipment, consumables, and software solutions—enable other segments, like industrial, fashion, and home décor to adopt digital printing processes.
According to Terry Mitchell, director, marketing communications, Graphic Systems Division, Fujifilm North America Corporation, the biggest advancement in the last few years is the development of inkjet technology for many print applications across several market segments. “Inkjet technology solutions have existed for many years in wide format applications, but more recently we have seen advancements in inkjet applications for general commercial printing and industrial applications.”
“The industry has embraced the broader range of what is possible with inkjet. Customers in the signage and graphics space recognize the parts of the market that are becoming commoditized and come to us for solutions to move into higher margin markets like soft signage, corrugated display, or thermoformed products,” says Ken Hanulec, VP of marketing, EFI Inkjet.
Larry Salomon, VP, wide format, Agfa Graphics, experiences the same type of requests from Agfa customers. In particular, the company’s industrial printing division works with manufacturers to support inline printing as part of the production process.
Other industries implement digital printing because the equipment continues to offer reliability and ease of use. “This has led to a lot of new businesses that aren’t traditional printers adding printing to their manufacturing or customization workflow. Runs are as low as one piece, as LED UV, sublimation, and other technologies allow vendors to personalize a variety of consumer goods easily and cost effectively,” shares Andrew Oransky, president, Roland DGA Corporation.
The PSP Profile
It’s challenging to nail down a specific definition of today’s PSP. “One interesting aspect of our market is that it contains incredible diversity and there is no ‘typical’ customer. This was true ten years ago and is true today. There are many different ways to be successful and no standard size company defines that success,” suggests Larry D’Amico, director of sales, large format, Durst Image Technology US.
Organization size, revenue, and services offered vary greatly and continue to change. Based on a 2016 industry survey conducted by the Specialty Graphic Imaging Association, 29.1 percent of PSPs polled had an annual sales revenue of $250,000 to $1.5M. This is the largest percentage, whereas the smallest percentage, at 2.5 percent, had an annual sales revenue of $20M to $35M. 33.7 percent of participants reported a company size of one to four employees. And of those in the one to four employee category, 62.7 percent make $0 to $250K a year.
Citing Printing Industries of America, John Fulena, VP, commercial and industrial printing group, Ricoh, says that the average PSP employs under 100 staff members and generates up to $10M in sales.
“At the other end of the spectrum are the large facilities. Among these companies we are seeing growth—but also consolidation. These are sign and display companies that expanded and invested in $1 million or more wide format inkjet presses to manufacture product for larger companies,” explains Greg Stewart, strategy and product marketing manager, Kongsberg business unit, Esko.
SA International (SAi) conducts on-going customer visits and semi-annual customer surveys. “We have over 50,000 active end users in North America, with the majority of them sign/print businesses. The typical PSP using our software has $250,000 to $1,000,000 in annual revenue and one to three wide format printers. Approximately 15 percent of them outsource work at least weekly. On average, PSPs’ per-employee annual revenue is around $110,000 and hasn’t changed significantly in at least the last five years,” admits Dean Derhak, product marketing director, SAi.
“While annual sales have only grown modestly in the printing industry over the past few years, many PSPs have remained successful due to reducing operational costs and increasing production efficiencies. This is the result of dedicated decisions and steps PSPs have taken to mold their businesses to today’s economy and the needs of today’s customers,” explains Eric Hawkinson, senior director, marketing, production print solutions, Canon Solutions America.
Customer needs are “faster, cheaper, and better,” says Jason Yard, marketing director, Mactac Distributor Products. “That has been the theme for decades, but is more evident in recent years. End customers are making decisions faster, so they want their graphics faster. They also want it cheaper than they wanted it a year ago because there is more competition. And they expect it to be even better quality than the last time, so it creates quite the paradox for print providers.”
To combat the paradox, today’s PSPs look to differentiate themselves by expanding service offerings and merging multiple technologies under one roof. “More printers are diversifying the range of products offered or markets served. In the past commercial printers, sign and display printers, tag and label printers, and everyone pretty much served a segment of the market. We see commercial printers expanding into sign and display and packaging segments, and some sign and display printers offering traditional commercial print,” admits Mitchell.
“Today’s print shop offers a variety of platforms to augment traditional materials. What used to represent separate and distinct industries is now under one roof, making the race to stay relevant all the more vexing. The most obvious difference in modern print shops versus those of a decade ago is the prevalence of flatbed printers. What used to be a luxury is now a necessity. This technology is singularly responsible for the changes described above. Once PSPs realized they could print on virtually anything, hybridization started taking place. Photo labs printing billboards, screenprinters sublimating, and electric sign companies wrapping cars,” describes Brett Thompson, graphic marketing manager, Piedmont Plastics.
One thing that almost every print provider has in common is the need to produce products efficiently and cost effectively while standing out from the competition by offering unique services thanks to technological advancements. “PSPs have evolved into a far more spectacular business than what they were five to ten years ago. The creativity of today’s PSP coupled with their clients need for high-quality prints on materials we never dreamed of printing on is what drives the creation of innovative equipment,” shares Jim Peterson, founding partner, Vanguard Digital Printing Systems.
“Looking at it from a financing standpoint, PSPs that survived a difficult economic environment and made investments in technology to stay competitive are stronger and more profitable than in years past. Balance sheets are de-leveraged on average, and income statements look better with decent profit taking,” adds John Cote, NA sales manager, Zünd America, Inc.
Variations in Applications
A common theme in the last few years is new applications driving technology advancement. The variety of applications produced via digital is astounding. “Digital creates new applications and enables mass customization. It is changing the way we think about visual communication, fashion, and decoration,” advises Sebastien Hanssens, VP marketing and communication, Caldera.
Perhaps one of the most out-of-the-box applications is three-dimensional (3D) printing. “3D printing is a relatively new application that has come a very long way in a short time. The direct influence on our industry is still in the early stages, but it is clearly something that is on the horizon. 3D scanning and full-color output are now a possibility and the demand for high-quality output in the marketplace will continue to drive new advancements in the field,” says Hope.
Similar to 3D printing in that it is relatively new and unique are industrial and direct object applications. “Whenever a shop finds a new unusual substrate it can print to and do a good job of it, it’ll find business, and that encourages the industry to develop technology to make that success repeatable. Products for industrial and residential décor, and architectural applications are great examples of solutions PSPs can offer uniquely without pressure of market commoditization,” shares Fulena.
“Inkjet technology’s very nature is jetting liquids of various types onto practically any substrate. We are just at the infancy of what will be possible in the future by jetting liquids. It’s no longer unheard of to think that today’s print providers will move towards industrial inkjet applications as new substrates and inks are developed,” argues Randy Paar, manager, marketing – display graphics, large format solutions, Canon Solutions America.
Lambert believes that direct object printing is a focus for many printer companies. “Take a look at a water bottle, a can, a caulk tuber, or a tapered drinking glass—many of these are now digitally printed and opening up new opportunities for brand owners. They can now create marketing campaigns that are more regionalized. And since no films or printing plates are required, they are really loving the flexibility and the ability to print on 3D objects that were impossible to print on several years ago,” he continues.
Applications that cannot be replaced with LCD screens or web graphics influence development. These include décor, packaging, and apparel. Halloran believes new applications will be driven toward the “decoration of things. Meaning if you are decorating walls, windows, rugs, and chairs you can’t lose business to a PDF or a tablet.”
“Décor and event—creating a mood or theme—applications are influencing the industry. These are targeted at entertainment venues, offices, and residences. Instead of printing a sign, poster, or banner—three of the most common applications—UV inkjet technology is used to customize or personalize an image to make it more upscale,” agrees Salomon.
Packaging is another application with staying power. “In wide format, corrugated display and packaging is one area with the most room for growth. There can be tremendous efficiencies with digital in that space, especially with a system that can replace litholam,” says Hanulec.
“Attracting new customers is the key to growth, being able to offer specialty display and box packaging software services at a reduced price to larger retail brand manufacturers could quadruple a small shop’s business overnight,” suggests Michael B. Frawley, VP of sales, MCT Digital.
“In flexible packaging and folding cartons—markets were digital adoption is low, the growth will surprise everyone. Brands want to stand out on the shelves and want to attract consumers for all kind of occasions. Corrugated printing is a new frontier—millions of boxes will become more than a box especially in retail and for online shopping,” adds Francois Martin, global marketing head, Graphic Solutions Business, HP Inc.
Printed fabric used for apparel is irreplaceable. “Fast fashion benefits from fabric printing technologies that produce unique, durable, vividly colored garments on a range of fabrics that go well beyond polyester,” shares Halkyard.
“Leggings have led the way for digital printing in apparel, but we’re seeing a shift from performance fabrics to high-end fashion,” concurs Sanders.
The traditional signage market, especially point of purchase (POP) and out-of-home advertising applications, remain significant. Specialty materials used to wrap walls, vehicles, windows, and even floor graphics are ever present.
“Taking into consideration how increasingly competitive the retail landscape has become in the past few years, retailers are looking for any place—like floors, windows, and walls—to promote products. With advancements in adhesive technology, there are now more opportunities to utilize these spaces to efficiently turn them into advertising mediums,” says Speizer.
According to Yard, the development of specialty materials effects the industry. “Wall, floor, and window products have expanded exponentially and influenced print providers to become experts on all things architectural. In many cases, these specialty materials provide higher profit margin as well.”
“Installers continue to push the limits of films by wrapping objects with extreme contours. Vinyl manufacturers need to keep this in mind as new products are developed. Questions to answer—will the film conform, will it stay down in challenging areas when stretched, and do adhesives even stick to the object the installers are trying to wrap?,” asks Molly Waters, senior technical specialist, Avery Dennison Graphics Solutions.
Continued advancements in graphic films provide special visual effects. “Installers leverage the appearance of special effects with films that provide different looks such as texture, sparkle, metallic reflective, and color change films. Colors, effects, and textures continually evolve and require refreshed pallets to stay relevant with personalization and customization trends,” says Tammi Johnson, business development manager, 3M Commercial Solutions.
Magnetic applications are also used frequently and continue to push the industry in new directions thanks to ease of use and versatility. “There’s a big push for magnet and magnet-receptive media being used in retail signage such as menu boards and in-store wall graphics and POP displays. These systems allow retailers to easily change out their graphics for different dayparts or seasonal offerings,” shares Jim Cirigliano, marketing manager, Magnum Magnetics.
“This combination of printable magnetic and magnetic-receptive sheeting is popular because it works for small applications such as restaurant menus and retail POP displays, as well as large architectural and commercial full-wall mural designs, with the same high resolution, vibrant, attention-getting color achievable with other printable substrates,” shares Mike Gertz, marketing manager, Master Magnetics, Inc.
A Fascinating Future
We keep moving into new markets and introducing new technology, all thanks to the immense promise of digital inkjet technology. It’ll be interesting and fascinating to learn what the next 12 months have in store for us. Digital Output will continue to report on all of these developments.
Aug2017, Digital Output