At the beginning, it has often been largely about investing in a machine to offer small, short-run jobs, sometimes start-up jobs for customers to see how that label or pack looks (and then moving over to conventional printing for the main job). It also offered converters the opportunity to combine technologies combining conventional printing with digital printing: flexo/digital with hot or cold foil.
However, it’s not just about digital printing; it also involves other printing techniques, manufacturing and management steps. It widens the converter's capability and offers a new level of service to customers. It broadens the range of solutions and provides for a broader range of printing techniques. In simple terms, it will enable the printer to better meet their customers’ changing market demands.
Indeed, looking at market trends in recent years soon highlights considerable, and sometimes quite dramatic, market changes that have impacted on brand owners and retail giants – and in turn on their label and packaging suppliers. Take globalization for example.
For brand and retail groups this has created a need for more:
Different language versions
More ethnic and country variations
Such developments have had a major impact on their brand to market operations, and on the way they specify, manage and buy their labels and packs – as well as substantially changing the pressures they have on their supply, management, production and information chains. (Figure 9.1)
Figure 9.1 - Illustration shows some of the key challenges of globalization for brand owners
From the printer’s perspective, this growing complexity in the brand owner’s business will in turn increase the complexity of running and managing their own marketing, sales and production processes, and in managing the sheer amount of information that will need to be handled.
Looked at from the label and package printer's point of view the impact of globalization by their customers will almost certainly mean for the printer:
More time spent in liaison and feedback
More management decisions
More design and color changes
Investing in a digital press is therefore often only the first step in building a successful digital business.
Investment may also be required in the pre-press department, in a more sophisticated Management Information System (MIS), and in building an integrated and more sophisticated and seamless digital workflow that offers:
Improved production efficiencies
Faster and more accurate workflow throughout
Overall cost and waste reductions
Enhanced management information
Better customer information
A seamless workflow and what it can provide for customers’ needs to become part of the company’s sales promotion. It all begins to lead to a different way of working. A different way of thinking when introducing digital.
Certainly one of the key messages that frequently comes across when successful converters talk about their digital printing operations is that ‘when you make the transition into digital then you should take the opportunity to stand back and re-think how you do business.’
Undoubtedly, the introduction of digital printing into a conventional label or package printing plant does bring certain challenges and opportunities.
In particular, digital printing will have an impact on the way selling takes place, on marketing, on artwork and origination, on pre-press and color management, on selecting the best conventional or digital process for the job, and on employee acceptance, training and skills.
These areas are all part of the planning and investment for digital printing and should maybe form part of a flowchart that management follows as part of the investment process. A suggestion for this flowchart can be seen in Figure 9.2. This can also form the basis for actions by different departments in the business, sales, production, pre-press, marketing, human resources, etc.
Figure 9.2 - Management challenges and opportunities when investing in digital printing − re-thinking the business
It is therefore proposed to use this flowchart format as a basis to look at each of these areas in rather more detail.
INVESTING IN NEW SKILLS AND ABILITIES
Investing in digital printing equipment involves more than just buying a new machine. It involves new skills and abilities in the printing plant – abilities which are much more related to IT. Converters and printers moving into digital printing need new people, people who want to work digitally, people that are younger and able to accept the new technology very quickly. It is not just new skills; it’s also a new culture.
Running a digital press may involve up to 15, 20 or more jobs to be produced a day where quality is of the essence. It is not possible to make mistakes when you have very short lead times. Different competences are required for running a digital machine and digital printing operation than those needed for running a conventional press.
Indeed, digital printing really belongs to the graphical department – to the pre-press manager – not the conventional press shop floor manager. However, both types of staff are still required. New people are required for digital, but conventional printing skills are still also necessary because of the finishing unit/operations – that is people that have experience in silk screen, in flexo, in varnishing, in hot foil, embossing, scoring and creasing, etc, depending on the company’s key markets and applications.
CHANGING THE ROLE OF SALES AND THE SELLING OPERATION
In terms of sales personnel, converters installing digital printing have frequently used the same sales people, especially at the beginning when they are looking to see a new customer. Why? Because it is about understanding the needs of customers: this is the product, this is the quantities you have, this is how we think you should decorate, is it a self-adhesive label, is it an in-mold label, is it a sleeve, sachet, pouch, carton? Only then can the most appropriate printing techniques be chosen, whether digital or conventional. So what makes a successful digital selling operation? Put simply, a quick guide to profitable selling of digital printing is shown in Figure 9.3:
Figure 9.3 - A guide to profitable sales and selling of digitally printed labels and packaging
From a strategic standpoint, digital should be used as a way of providing better solutions to customers, whether small businesses, mid-tier companies or larger brands. All ends of the spectrum really have a place with digital printing. With large brands for example, not only do they have smaller components but they also have a requirement to market directly to the specific needs of their consumers. So there’s definitely a place within all segments of the market for digital printing solutions; the message that has to be put across is that digital is not just for sales sampling, prototypes and ultra short runs anymore; it really has a place within the broader market.
It is certainly important for the sales team to not sell digital by the price. Try and sell it as a service because if the salesman is selling it on price it’s very easy to lower the price on the digital because it’s seen as an order of just a few hundred dollars/euros. If the converter or sales person sells too cheap then digital printing will not be profitable. Keep the price high, but sell the benefits of service. Tell the customer they will have it faster, they will have less lead time, less stockholding, rapid response to changes. Try to avoid as much as possible anything that relates to digitally printed labels or packaging being sold purely on price.
The challenge at the beginning comes when the sales team realise it takes the same effort to sell one million conventionally printed labels or packs as it does to sell 1,000 labels or packs printed digitally – yet there is a significant difference in commission paid if the same percentage commission is used whatever the run length. On this basis, the sales person will have to work a lot harder just to make the same money.
Some converters have overcome this by taking on a digital product manager, not to sell but rather to develop new business opportunities with digital and to push digital sales, especially in terms of combining conventional and digital technologies so as to create new added-value profitable work.
What needs to be understood is that digital printing capabilities are the key for many converters to open new accounts; big accounts. They can often create a new account with digital and then work with that client to obtain larger conventionally printed orders. The sales team can then make the big commissions they are looking for. The aim for the converter, and sales team, should be to sell a total package.
A key aspect that often comes across with successful digital converters is that they should try to avoid talking to the print buyer until as late as possible in the process. Wherever possible, always try to go direct to a brand owner/a marketing person; somebody who is looking to what they can do with their product and at how to add value.
If the converter gets caught up with the purchasing person it’s all about how cheap can you make it, how fast can you get it here?
The digital printer should aim to talk on a much more broad level about, for example:
How digital can help to reduce or eliminate stock inventories
How digital can reduce the time to market for product launches
How digital can offer just-in-time production
How digital can provide instant job repeatability
How digital provides color guaranteed proofs
How digital gives perfect register
How digital can give overall cost reductions in the supply chain.
The printer should also ask what other costs or what other issues the customer has in marketing their product? How can the converter use those requirements to offer to make the product sell more easily or readily off the shelf? Are there opportunities to add-value, such as:
New promotional opportunities
Unique or sequential coding
Variable design and graphics
At the end of the day it really has little to do with the unit price of what is being printed. It is more to do with what the customer gets as a decorative label or pack that promotes and markets their product and, ideally, helps them to add value and profitability.
Sales personnel will often be reluctant at the beginning to sell digital on this kind of basis, but when they understand the opportunities, understand not to sell digital on price but added-value service, then they realise that they have a competitive advantage when compared to their competition.
The service element enables the converter to achieve better profitability with digital than with conventional. This is certainly emphasised time and again by the label converters that have both digital and conventional label printing capabilities.
MORE EMPHASIS ON MARKETING
Listen to successful digital label and package printing converters and it becomes apparent that marketing is an increasing part of their success: using direct mail campaigns to specific vertical markets; addressing what the needs may be in a specific market; moving away from the idea of cold calls and of spending a lot of time doing market-concentrated – or consultative – selling. The aim of most of them has been to move away from a sales model to more of a marketing and solutions model.
It may mean the focus of the printing business changing from a manufacturing function to one that works with customers to better manage and rationalize their supply chain, stock holding, product launches, product variations and varieties, time to market. Digital can have a key role to play in all of this.
Using this type of approach the converter will start to see more companies approaching them. Approaching them about solving their problems The potential customer has received information from the converter; the converter information makes the potential customer want to have contact with them. Try to market what services and added-value benefits can be provided and what can beat the competition.
The Internet can also play an important role in selling digital. By leveraging the Internet technology and capabilities converters have been pleasantly surprised to find there are lots of people, potential customers, out there that want digitally printed labels.
DIGITAL OR CONVENTIONAL PRINT – HOW DOES THE PRINTER DECIDE?
The challenge for printers that already have conventional printing presses but are new to digital printing is to decide where they make the decision (and how and when) between whether the incoming job goes conventional or digital?
Key factors in this decision-making process involve estimating for both printing technologies, collecting comparative data, knowing the crossover points between processes, understanding the true cost of processing digital orders and streamlining the administration process. These key factors are summarized in Figure 9.4 and explained in more detail in the following paragraphs.
Figure 9.4 - Digital or conventional – making the decision
Certainly one of the keys to success seems to be in the ability of label and packaging printers to estimate and quote jobs from both a conventional press standpoint and also from a digital press standpoint; obtaining very accurate costing comparisons for each process that can be compared in the run up to the decision-making process.
Many converters now use a calculation or MIS system that helps them to make such decisions on the basis of ’what is more appropriate for the customer?’ They make a price calculation for printing the job by conventional printing – by different printing processes if required – and also by digital printing. Then they chose the most appropriate process. Essentially it can then be controlled by the production and/or sales team to see which process is the most feasible and whether it takes into account all the parameters to make a good job for the customer?
Having said that, other converters with digital have a process in which the sales team alone make the decision on whether to go conventional or digital, but again on the basis of a comparative price calculation for each process.
The important thing is that somebody in the company has to be empowered to make that decision. The more comparative information they have available to make that decision the better. Interestingly, once a customer has experienced what they can get from digital, they may never want to change back to conventional printing.
With MIS software packages such as LabelTraxx, Radius, CERM and theurer.com, the converter can create a quote for a job on their digital machine, then duplicate that for a conventional press – even change the press, change the material, change the number of colors – whichever factors might differ between the two machines.
Compare the two estimates to find out where the crossover is; that is the point at which either conventional or digital becomes more cost effective – and profitable.
One aspect of digital printing that is often overlooked is the actual cost of processing orders. When moving to a digital workflow the aim is to have a higher volume of (probably) lower value jobs. Most companies have a fixed cost for actually administrating a job through their factory – the cost of quoting that job, processing the order, creating purchase orders for materials. That’s usually a fairly fixed cost. However, if the converter has a higher volume of lower value orders then the cost is going to go up for administration.
The aim should be to streamline the administration processes as much as possible. Look at ways to try and minimise the costs of administrating jobs in a digital workflow. For example, the LabelTraxx digital store front end can be added on to a printer’s website, enabling their customers to log on and request instant digital quotes. This is also integrated with the LabelTraxx MIS. One set of data is maintained and customers can place their orders online for digital products and also have the option to upload their artwork to a specialised FTP site.
Today, it is even possible for converters that are looking to invest in digital label and package printing to work with some of the MIS suppliers to actually run programs to see where the break-evens would be between conventional and digital before they actually make an investment decision.
INCREASING THE IMPORTANCE OF PRE-PRESS AND WORKFLOW AUTOMATION
Many label and package printing companies investing in digital printing for the first time may well already have a pre-press system, such as Esko.
They are therefore looking to understand whether the same equipment and process can be used for digital printing as is used for conventional.
Also, what is the role of pre-press in digital?
One of the reasons why printers/converters invest in digital is because they want to diversify. They want to be able to deal with the shorter runs, to be able to provide a hybrid solution, to diversify their product range, to avoid becoming a commodity business. So where does pre-press come in with the conventional and digital printing operations? Well, in basic terms, pre-press offers a lot of opportunity to drive cost out of the whole process.
In a hybrid workflow for example, complexity is pretty high. The converter needs to have, to a fair extent, to try and reduce the risks of an operator making an error. An error of applying wrong trapping, wrong features or wrong step and repeat, wrong legends and which is good for proofing.
All of these things can use a lot of overhead cost in the final product, and that’s where margins can disappear. Pre-press is therefore very instrumental, certainly in a digital world, in keeping costs under control and in ensuring production efficiency.
If a printer/converter already has an Esko system for his conventional printing he is already in the right place to start his digital operation, but what they do need to look at is how far they can further automate the workflow.
Workflow automation is an area that is constantly progressing and is undoubtedly an area where a lot of benefit can be found. Certainly if you talk about postponement of the job, the decision to go either conventional or digital. Then if digital – what kind of digital, which press – then automation is a very important factor in reducing the risk of the operator making an error, and it should ideally be seamless.
Looked at in this way, a seamless and fully integrated digital workflow will eliminate plates and plate-making stages, minimise press running wastage by printing exact quantities, cut out ink color matching, provide instant job changeovers without registration problems or press downtime and provide a greater production flexibility – particularly beneficial if there are many versions, variations or language changes.
HP Indigo for example, now has a number of workflow solutions and product enhancements. Working with its MIS partners, HP Indigo now provide new levels of JMF/JDF-driven integration with the Esko DFE, delivering jobs fully automatically from estimating to print, including automatic imposition and color management.
Esko has also expanded its digital front end (DFE) infrastructure to include cartons and flexible packaging applications. This enables seamless integration of the HP Indigo 20000 and 30000 digital presses into the production workflow through the Esko Automation Engine.
COLOR MANAGEMENT BECOMES A CRITICAL FACTOR IN ORIGINATION AND ARTWORK
Is the origination or artwork that comes from the customer or designer more critical for digital, or less, or no real difference in terms of dpi definition and quality achieved?
Well no, designers create images that will make nice jobs; they tend to use hundreds of Pantone colors in designs (colors that are never actually all printable). That’s where pre-press comes in. The whole idea for pre-press is to optimise a design for volume reproduction. And no, to that extent, it is not really any different in dealing with digital pre-press.
A digital press by definition provides a fixed ink set on the press. It’s not just like a flexo press where the ink density or color can be changed by the press operator. So to that extent, color management is a more critical factor in a digital world than it is in conventional because, if the converter has to reproduce a particular blue for instance, how does he know that it will come out correctly on a digital press?
On a flexo press or an offset press, the operator can put that particular ink on the press, but in the digital world the converter is forced into a different, clever approach. The color has to be determined before it even goes to the press.
Remember, digital is a calibrated system, it’s a nice easy profile and the customer’s image file will be reproduced very, very accurately. The color matching is absolutely perfect, much better than that usually achieved on a converter’s conventional presses.
Figure 9.5 - Digital is a calibrated system in which the specific color or colors on the label or pack have to be achieved at the pre-press stage before the job goes to press. Illustration courtesy of Esko
The aim for origination and pre-press for digital label and package printing should therefore be to:
Turn color matching from an art into a science
Hit color targets quickly, reliably, and consistently
Reduce waste and time spent matching color on press
Implement a color managed workflow that allows the switching of presses whilst maintaining consistent color
Implement inkjet proofs where color is a target that can be hit.
Figure 9.6 - Comparison of inkjet proof against digital (HP Indigo) print. Illustration courtesy of Esko
Today, some label converters/printers still proof on their digital press because they think it’s the only way to do it. Indeed, unless the converter has the right software it probably is the only route. The way forward however, is to take digital proofing off the press.
Additionally, there is now a service that printer/converters can offer to their customers which is to put the proofing device in the customer’s facility and allow them in their own office to judge for themselves the advantage of 4- or, say, 7- colors. The converter can do this because he knows what comes out of that proofing device is also what’s going to come out of the press.
The customer can then make a decision: is this worth it or is this not worth it? Do I want to pay for the extra clicks or do I not want to pay for the extra clicks?
Ultimately, a report can then be automatically generated with some of the Esko pre-press tools. This will automatically fill out the job production details; the customer details; whether it’s 4- or 7-colors – everything can be fully automated so that the converter does not spend a single minute setting it up. All very high level.
Indeed, the digital printer/converter will be surprised at the extent which the manual operation that’s being done today can be automated to reduce error, automate operations, introduce color consistency, as well as the degree to which the converter's front end (the digital pre-production system) is capable of putting the converter in a situation to make the most out of their digital press investment – which ultimately is what it’s all about.
But a word of caution, some of the larger digital label and package printing converters can be printing and shipping on an average day somewhere between 150 and 200 different job versions. That means between 150 and 200 pieces of artwork can come in everyday. Can the origination/pre-press/proofing department be geared up to handle and process that quantity of artwork? Ideally, the digital printer should aim to educate each customer to provide artwork in a way that the pre-press operation can best work with it – not just as a PDF, because every other print shop can work with that – but in the way that will be the most cost effective for both sides and that will help to ensure the optimum printed result.
INVESTING IN MIS
Managing a successful digital label or package print plant will almost certainly create more information to be processed and handled, require better customer communication, speedier access to information, a need to work smarter, to enhance consistency from estimating to processing orders and, perhaps most importantly, to cut time and costs for greater profitability. This all leads many digital label and package printing companies to review and install or upgrade their management information systems.
Certainly, when looking at the issues around digital label and package printing the cost of administration is usually seen to be a higher portion of the overall cost. Therefore in order to maintain, indeed improve, profitability, the focus must be to reduce costs by streamlining the administrative process. The reason for this is that a higher volume of orders tends to create bottlenecks in:
So let’s look at some of the bottleneck areas in a little more detail.
Looking at where bottlenecks in estimating may occur. These can be found because of multiple equipment passes, deciding where/how the job can be produced most profitably, through looking at new markets and applications, and in deciding where to estimate – on-line or an estimator.
ORDER PROCESSING BOTTLENECKS
There are a number of areas where order entry and processing may occur. These areas include managing multiple versions and SKUs, the rapid entry of items that are re-run, in managing new product approval, through storing specifications for each product and during communications with production.
PRE-PRESS AND PRODUCTION BOTTLENECKS
Bottlenecks in pre-press may occur in determining the most cost-efficient layout of items going to press (ganging), in managing digitally primed or non-primed stock in inventory, in the identification of roll stocks with digital coatings, in the submission of jobs to press, in dealing with the ‘frame’ concept on Indigo presses, or in the duplication of information during pre-press processes. Production specific bottlenecks can come from frequent changes of material and settings on the digital press, from constant change-overs for finishing, e.g. die changes, or from more versions, more splicing, more QA, etc.
MIS AUTOMATION TOOLS
Looking at MIS and successful workflow and job automation there are a range of tools available.
Web estimating and ordering
Cross-over analysis for estimating (to go digital or conventional)
MIS integration to pre-press
Integrated on-line product approval
File planning (to semi-automate frame layout)
Managing semi-rotary and rotary die inventories
Managing the movement of un-primed stock to digitally primed stock in inventory.
JDF integration with digital front-ends
At the end of the day MIS and workflow automation in the digital plant should be used to cut time and costs and to work smarter. It should provide quick access to information plant wide; offer better customer communication (from first contact to order to on-going contact); provide more consistency from estimating to processing orders; give access to industry best practices and, above all, provide greater profitability.
As explained at the beginning, ‘making the transition into digital printing gives a label or package printing converter the opportunity to stand back and re-think how they do business.’ Digital printing does indeed involve making changes to the way that the business is managed and run; in who is empowered to make decisions; of increasing administration automation; of investing in MIS; in changing the way that sales and marketing function.
Get it correct, and the digital label and package printing business will undoubtedly become a more successful and more profitable business.