Print supply chain’s role in the future of business9 April 2018
Market consolidation has seen some vendors refocus on their traditional print businesses, while others have expanded their IT capabilities. Packaging & Converting Intelligence considers how the print supply chain can best serve the future workplace.
At its core, the print industry has changed little in the past several decades, leaving manufacturers with a juggling act. Traditional products and services may be profitable in the short term, but relying on them is not sustainable. Companies will need to develop capabilities and shift resources to new markets.
Making a strategic move now will avoid the inevitable disruption inherent in change and enable companies to exploit some of the following trends. The print market is massive, and the opportunities within it are correspondingly vast, as Vince Mallardi, chairman of the Printing Brokerage/ Buyers Association (PBBA), can confirm. “Printing revenues will increase by 3% to nearly $200 billion. Print will benefit from more promotional spending to saturate existing markets, particularly food and beverage, and banking and investment. With the saturation of existing markets, the focus will continue to be on strategies for investment into opportunities.”
One key development will be the rise of intelligent, connected, multi-function printers (MFPs), which provide enhanced productivity and efficiency to manufacturers and users. Incorporating features that predict failure and reduce unscheduled downtime, these systems will also include workflow apps that help printers move from paper-based to digital processes.
“The capabilities of high-speed digital printing devices will continue to be better exploited by integration with systems from various manufacturers – software and hardware – configured together as complete manufacturing cells,” says Bui Burke, senior vice-president, sales, Screen Europe. “These bespoke printing and converting lines are now recognised by manufacturers as the best way to deliver the most efficient production systems. In the coming years, it will no longer be necessary to purchase a typical ‘jack-of-all-trades’ line from one vendor when custom-designing will be a better and more affordable approach.”
Printers must follow technology vendors by improving software and speed to market, rather than focusing exclusively on hardware. A ‘silo’ mentality and individual product design may enable unique products to be developed, but is useless in a market that requires speed and agility to fulfil orders. Software expertise will become one of the most important differentiators for the print industry as businesses seek to accelerate digitisation.
With innovation and product value increasingly defined by software, manufacturers must address new challenges like cybersecurity and data privacy while developing capabilities in areas such as digital workflow and augmented reality (AR).
Jan de Roeck, director, solutions management, at Esko, agrees with the importance of improved software scope. “We see that the moment the brand fails to keep trust, they are no longer relevant,” he says. “Consumers want to be engaged by products, or with related online content; they are looking for a personal connection. Providing a lot of product variation in shops or online requires tons of effort; it means getting product to market quicker and a larger variety of new and creative products.
“A lot of effort is wasted because there are too many steps in the supply chain. If we don’t dramatically shorten and standardise the supply chain, it will become a barrier to enriching consumer engagement. Brand-owners and converters’ management software will become much more integrated. Supply chain stakeholders will start to integrate systems to exclude a number of steps, some of which are still manual.
“Many converters find it hard to accept workflow automation, and a lot of people are scared of IT. This can be addressed through powerful, but easily installed and user-friendly integrated software.” Companies like Amazon have dramatically changed people’s expectations of retail. “Consumers now want same-day delivery if they live in a city, and only want to wait two days at the most if they live in the countryside,” explains Dennis Mason of Mason Consulting. “The knock-on effect is that print delivery expectations have become more compressed, and printers will need to react. Digital printers will probably be in the best position to do so, but even they will need to tighten up internal processes.
Delivering on expectations
“Perhaps the most important aspect of this is that printers that have close relationships with graphic designers will be in the best position. Too often, artwork and files coming to the printer must be checked and reworked – a time-consuming process that often requires back-and-forth communications with the client or designer. Being able to change jobs on a press in just a few minutes will not help a job that is stranded in pre-press waiting for a designer or client to return a call. The entire process must be smooth and effortless.
“The most successful companies in 2018 will strive to get as close as possible to the smooth process from clicking for an order to receiving the package on the doorstep that Amazon provides.”
“There will be further adoption of fixed-colour-palette printing in 2018,” says Debbie Waldron-Hoines, consultant director at EFIA. “More brands and converters will be looking to use this printing technique and reap its many efficiency benefits as cost competitiveness increases in the retail environment.
“With the complementary drive towards value-added printing, the industry will see further growth in innovative varnishes and effects.
“With the continued expansion of online retailing, the need for packs to stand out on shelves and screens is more critical than ever.
“The demand for cleverly designed packs will continue. From easy-open to convenience and sharing, or single-portion packs, consumers will request products that suit their lifestyles. If the consumer wants it, packaging and printing innovation must deliver it.
“The rising age of printers is starting to worry the industry. 2018, with the integration of the Apprenticeship Levy, should see more companies getting involved in education and training of staff to drive up new talent attraction, as well as retain skilled employees.
“EFIA is supporting the flexo industry with the newly launched e-training Academy and is linking with a number of educational institutions to support its members. Today students do not leave school or university thinking of entering the print or packaging industry. This needs to change.
“Finally, EFIA recognises that a number of British brands are returning their manufacturing to the UK despite ongoing Brexit negotiations. Some businesses are suffering at the hands of the weak pound and, with the resulting increase in supply-chain costs, they are opting to return to the UK. This is fantastic for the UK’s manufacturing sector and a welcome boost for its economy.”
Chris McNamara, executive officer at the Independent Brewers Association, notes that the Australian market now has more than 430 independent brewing businesses, the vast majority of which have some sort of packaged product in their range.
“Shelf space is at a premium,” he notes, “so companies are increasingly realising the importance of printing that will appeal to retailers and consumers. A key issue is regulatory.
“There is an increasing requirement for label space to be taken up by marks required by government.
“Standard drinks information, which has been a longstanding requirement, will soon be joined by a container deposit symbol as the larger states begin to roll out these schemes.
“At present pregnancy warning information is voluntary but this may change in the future and there have been discussions around energy labelling. All of this will lead to very busy real estate.”
Christian Menegon, HP’s business development manager, graphics solutions business, believes print service providers will evolve into cross-media specialists. “Ovimex, for example, has recently purchased an HP Indigo 30000 to develop its commercial printing activities with some folding carton and synthetics production.”
Security will continue to be a watchword among print providers. While big data is nothing new, advances in predictive analytics and techniques like data mining modelling and artificial intelligence will improve range, quality and speed of services, and vendors will invest more in machine learning to better protect print devices.
The main defence against cyberattacks is authentication and intrusion detection. The risk can be mitigated through algorithms and anomaly detection that enable threats to be detected in real time. This sort of capability should start appearing in the print sector this year.
Advances in voice recognition are also anticipated. Companies like Nuance and Sharp are already developing virtual voice assistants. The latter recently announced the integration of its devices by launching Alexa for Business, which works with Amazon Echo devices, in November last year. While it promises to boost office productivity, it is still in its early stages and has a few inherent security concerns to overcome.
Finat’s managing director, Jules Lejeune, feels that change is the new constant in labelling. “The recent past has seen the technical profile of the industry radically redrawn with the adoption of digital presses, new substrates, and advanced inks and coatings that can deliver sparkling haptic and optic effects,” he says. “New packaging media – flexible packaging pouches and sleeve labels – are now within the standard offering of a ‘label converter’.
“In addition, brand-owners’ determination to connect more closely with their customers is driving label personalisation at a variety of levels. This year will see these trends develop, but, with the initial hype behind us, the industry is gearing up to create a sound business platform upon which all this new action can perform efficiently and profitably.
“Finat will be focusing on key aspects of management that are central to running a successful business. Perhaps the most significant of these is the need to recruit and retain a new generation of competent staff for the industry’s expanded production base. Attracting such employees is very difficult, but Finat has established a special initiative in partnership with the national label associations to drive the development of such a new, young, capable workforce, and it expects to see real results in 2018.
“With brand-owners driving the work agenda, and an increasingly strong multinational base of competitors in the field of label production, effective marketing of a label company’s capabilities to the potential customer base is also critical.
“This will be a year of consolidation, of absorbing and refining the results of the past few years, and of continuing to deliver what the brand-owners need. The future is bright for labels and print.”