Internet Printers Cutting into Profits

How do you deal with customers expecting you to match prices with some internet gang-printer? Is your profitability also being reduced by all these internet printers now?

 

On the positive side, as a small printer you can outsource the items you're not equipped to print and deliver a finished product to your customers that looks more professional than ever. Unfortunate reality is that in a small town there may never be enough volume to get some of the equpment you'd really like to have, so at least now with the Internet and pretty good accuracty to your digital files you can outsource the specialty items you can't afford to equip yourself to print and get the finished items back in just a few days.

 

The problem I have is that more now than ever, customers shop based on lowest price rather than reasonable price for the quality they really want.

As far as the ease of outsourcing now, the drawback is it means you are putting your reputation on the line based on someone else's work far away that you have little control over. If the job doesn't come back on time or to your spec, who does the customer blame? Plus not having the equipment, you lose the ability to be creative with the actual process.

 

if you check, the internet printers are well price for, stationary, which we dont make any money out of any way. but are incredibley expenisve with Leaflets, books ETC. for example. their is a net printer who works mainland UK. he charges for 50K full col double sided A4 leaflets £1350 GBP. I charge for 100K of the same £1250 GBP. so my 100K is cheaper than his 50K. and we do all artwork and finishing free. they charge extra for both. so to be honest i think the net printers only really affect the very small printers who only have alot of stationary and NCR work - that work to me is a burden because i dont make enough money on it.

 

well ob1 just because you can charge 1250gbp for 100k doesn't mean you should. Depends on your overheads. Maybe this other guy works from industrial premises with the latest kit and pays a decent set of wages - whereas you might be working on your own out of a garage - do the maths.

What about future investment in capital equipment - if you don't build in a decent margin how are you ever gonna get that 10 colour press with ctp et al?

'Cheap' is killing the trade - you said yourself - 'you don't make enough out of stationery and NCR' - why do you think that is?

 

HI Richard, i hear what your saying, and i agree with most of it, but if i am located in a huge city (which i am) thier is going to be alot of printers, hence more compitition and so i and all others have to adjust their prices accordingly and also not to kill themselves. but if i am in a smaller town were i am the only print or one of a few printers, we all can charge more than what we would in a bid town. my margin is decent or else i would not bother. i work from a 1000 sqm building. oh, i already have a ctp, just got to start trying for the 10 col now what presses do you have? if you dont mind me asking

 

Komori 626 (6 colour with perfector & auto plate loading plus washups).
Our CTP is AGFA Palladio 30. Now if we were printing 100k on 130g 4/4 we would be around 1660.00gbp. That's with artwork supplied. Our premises are only 2500sq ft. which we own outright - we have 8 staff all fully qualified professionals.

I can't see how you can make a decent margin on that example - (1250.00 for 100k) - even if you had a cheap web press. How much do you pay just for the paper?

 

HI Richard

Just out of interest how old is your Komori? do you have any truble with the perfecting unit, as i hear that the japs do not make very good short perfectors.

Your right, i do not make ahuge return on 100K which is why i tend to try and stay away form doing and offer insentives if they order 50K or less, which is a deposit and a one month term to pay in installments. and i will tell you why i do it for that price, because their is a printer local to me who does it for 1200, and if i do it for 1500 i will lose all of the customers work including the work that does make me a good margin. our ctp is an B1 Scitex lotem with Kodak proccesser. and i do actually also have a web press. im lso looking for other presses, if you have naything or know of anything?

 

Komori is a 2001 - freshly installed. We perfect every week - the perfect changeover takes 3 minutes and is completely automated, 1 button does the job. Our Last Lithrone had over 150mil impression on the clock it was a straight 4 and on its last working day still churned out work at 13k/ph!

I do get very protective about pricing - sure competition is good, but you still have to make a decent return otherwise you may as well put your money in a building society. Also whatever happened to not selling your expertise cheap? I hear what you say about your local competitor, we get the same thing here in Derby. Stupid prices to try and win work - well I tell you what, we would rather let the press stand than do a job for a pittance.

It's about time the rest of the industry saw the light too.

 

i agree with what you say, but their is always going to be a small printer, working from a garage like you said, who is willing to work for small profit, and in this industry you have to adjust your own prices to suit or else you will end up with nothing. look how big graphoprint was, and he ended up going skint. but hopefully this time next year our industry in uk will be rising up as close as it was before.

if you dont mind me asking, how old was your onld komori, and also if you dont mind me asking how much did you get for it. oh, and i am hoping you can help me, i am looking for another B1 press, you dont happen to know any printers selling one. sorry to bother you about it

 

No bother - that's what forums are about. Our old Komori was 1989 L428 (B2).. I would really recommend Komori B1, fast easy to run and high quality output. L540 would be my choice with auto plate and at least auto-blanketwash.

Try DDJ Graphics (oop North) and mention Eyetech Graphics - he should get you a decent one for reasonable money.

Yes I heard about Graphoprint, they were big but the market is ferocious now and B1 seems the hardest hit which begs the question - where is all the B1 work going. My guess...China for the moment. Give your staff two bowls of rice a week in lieu of pay and bob's your uncle, you can undercut the world. H&S what that? Human rights - get real.

 

I liked that gag. Yeah i actually know DDJ, its dave isnt it, but i dont buy off dealers. my ideal would actually be 540 plus coater, so tha would allow us to do pretty much any work that we need to do.

what you said about asia is correct they work for nothing and from the below video i have posted, you will know how they can afford the presses,

http://www.youtube.com/watch?v=NVkotQ-We88

just hit the link

 

Holy Cow! That vid brings back memories of my apprenticeship (1971-5). We were running Nebiolo 44s - all guards up (until factory inspector rang to say he was coming!), hickey pickers consisted of your thumbnail held against the rotating plate cylinder! One accident I witnessed, an engineer tried priming an internal oil pump that was driven by the main two foot high helical cut gears - he didn't stop the press. Result - severed thumb - the press didn't even pause.

David and I go back a long way.
He was European Sales manager for Komori during the time I spent in Spain as Sales Manager for the Komori agent there - Neufville SA. As deals go I think we did well. Our old Komori went for 75k and we bought the 626 for 187k. I hear what you say about dealers - but unless you know exactly what you're buying and are prepared to source your own engineers to install it's the best route for most. And then there's the warranty issue. Presumably you bought at auction? How was the experience?

 

I have yet to buy any major equipment at auction, but usually i do bid, but i usually only bid to sell on. in terms of what yo say about engineers i have 2 good ex heidelberg engineers on the end of my phone when i need them. and they are independant so they are very reaosnable about pricing. i dont actually need a warrranty on a machine. the machine is going to break down, and if you know the machine you are running, you will be able to sort most break downs. but when i buy i like to buy off printers although these days printers are not selling as cheap as they used to

so you were an apprentice on a nebiolo. i saw one of the i swiss it was huge... used for packageing i think

 

Heidelberg & reasonable are two words that don't belong in one sentence!

To return to the topic, we had a price match situation last week - 36000 A4 170g 4/0 split over 36 kinds. Our price 2244.00 - digital printer online 2550.00.

Result: another litho printer willing to go 1600.00 - ok we drop our pants and go 100 lower by discounting our m/r's and plates. End result: client decides to stay with current printer, all that's happened is I (I blame me!) made the other printer lose 100 or 200 off his profit line and devalued that job for next time. Not very satisfying I'd rather lose the job at 2244.00 knowing that I didn't undersell what we do. After all, the investment in plant and people isn't cheap - and what price do you put on the years of effort in gaining the training & expertise that makes a professional lithographer?

All I know is I wouldn't apply the same price bashing if I were having private medical care - would you go for the cheapest brain surgeon you could find?

So that's my minor rant, now then...what kind of plant do you have?

 

Hi rrichard, i have a 4 col gto, a 5 col komori 28 (1990), a 4 col roland 600 b1, and a zirkon supra 4 bak 4 (half web)

 

Bloody hell a Zirkon - not seen one of those for a while. Eastern bloc - Czech I think - when I was in Spain (1988) we took one out and replaced it with a Komori System 32 (16 page). A big beast - it did 54000 copies per hour!

OK...here's my query to you - how much do you charge for a 4 col m/r and a 4 col set of B2 plates? I'll do the same after your reply.

Maybe it's a good idea to have poll on this one?

 

hi richard,

the thing is i dont actually itemize my invoces so in rality i do not no how much i charge, i could work out how much i pay. Zirkon is german not czech,i would love a system.but the zirkon is a very good press.

 

We don't itemise either - but surely when you quote for a job you calculate how much the setup and plates are charged out at?

What about the presstime - hourly rate etc?

If you don't know what your costs are how can you possibly know what to charge - unless you just pricematch or undercut any given price.

A recipe for ruin if you ask me - but hey each to their own.

BTW how much did you get your L528 for?

Zirkon - not Czech but East German (when there was an East Germany!)

 

HI, lol, no i dont just try to under cut the printer with the cheapest quote, for a full col set up i charge about 100 quid, but if i no i can get more from a different customer i would up my price.l 528 was bought bout 6 years back, for abou 40K, plus dismantle and reinstall, i bout it from a finance company. just out of intrest,how much did you get for your 26" komori.