Indy prepress shops in danger of extinction

If you want to get to the heart of the current prepress dynamic there is really only one question to ask – how many CTP devices sold in the past year have gone to stand alone prepress businesses? Hard to get definitive figures for such movements but a quick poll around the main suppliers indicates – practically none. CTP devices are going out the doors as fast as they can be supplied and they are all going to printers.

And printers with their own CTP devices are no longer customers of prepress bureaus. They don’t buy film, they seldom buy plates, they only ask for the digital files to be sent, files they can often as easily get from the advertising agency or the customer’s own art department.

In one fell swoop CTP has signalled the end of the stand-alone prepress industry as it has been constructed for decades. After the years when film output was a river of gold, when the prepress sector with its high-end scanners and imagesetters was the technology nexus of the graphic arts, it is increasingly obvious there is little or no money to be made outputting film. It is also becoming apparent that trade shops cannot simply substitute platemaking for filmsetting, it’s whole different business and one that printers generally want to control themselves.

So it follows that trade shops, and what used to be known as bureaus, need to find something else to do, some other form of business. And it is late in the day; if a trade shop has not substantially reinvented itself by now, chances are it is doomed.
(By the same token, if any small to medium-sized printer has not invested in CTP by now they are also, more than likely, doomed. All the major printers made the move years ago.)

You could see it coming

It is a gloomy scenario but one which comes as no surprise. Pundits have been predicting it for years, even if many felt guilty when raising the spectre, as though to mention it was to conjure it into being. For a time there was a false economic barrier with the price of CTP plates was almost double that of conventional ones. The argument used was ‘why bother investing in CTP when the consumables will cost more or just about the same as the proven technology of film and plate.’ That disappeared as the cost of CTP plates came down and while they are still above those of conventional plates it’s not by much and the lack of film cost certainly levels the playing field. In fact, according to David Currie (sic), of Currie & Company, the cost of consumables has halved since the introduction of CTP.

The other argument employed was that printers could not justify the expense of a platemaker when they had only one of two presses. Utilisation rates were bandied about as though the real argument was whether the platemaker operated all the time or only when required. Certainly CTP is not cheap, at least not in the high end, but printers like to control their own supply of plates, always have and always will. It was a no brainer whether to have a platemaker on site, as always, or to leave it to the trade shop miles away and not working on Saturday night when an operator puts his knee through a plate. As to cost, the popularity of polyester CTP and two-up machines for small to medium-sized shops quickly made such arguments redundant.

The final argument centred on quality and undoubtedly at the beginning some CTP engines struggled to match film and conventional plates. But that did not last long and soon CTP was being sold on the basis that it produces better quality dots, sharper images and more consistent running. It was always going to be a better technology, cheaper too, once the initial installation costs were amortised. The only amazing thing is that so many prepress companies failed to see the revolution coming and understand its implications.

Gone without a trace

It is the nature of things that failed businesses leave very little trace on the industry, apart from their devastating impact on owners and creditors. Old established names shut up shop and are forgotten in no time. Takeovers and mergers eliminate industry trademarks that have stood the test of years.

So, how many prepress businesses have gone west in the past decade since the industry began to go digital? Impossible to say, but an indication can be gleaned from the membership of GASAA (Graphic Arts Services Association of Australia) the traditional prepress association. According to Gary Knespal, executive officer, prepress businesses now make up around 15 per cent of membership. This has not had the devastating impact that might be imagined because GASAA, unlike many of its putative members, moved quickly and vigorously to reinvent itself and has grown in size and numbers in recent times. However the fall in percentage cannot be attributed alone to the more diverse membership, which now includes art directors, digital printers, photographers, and advertising agencies. It is simply that so many trade shops have amalgamated, being taken over, or gone out of business.

However, it would be wrong to consign prepress trade shops to the dustbin of history entirely, especially those serving the packaging industry where esoteric skills and professionalism are essential. Flexo prepress is a different world and one where the packaging printers seem happy to leave it to the independent professionals. It is also the sector where CTP has had the least impact, although that is changing especially in Melbourne, where White & Gillespie has just installed a Creo.

There are also still a fair number of lithographic prepress trade shops in existence, not all servicing the packaging industry. Maybe they are not making as much money as previously but almost all have reinvented themselves to some degree. Most of them are so transformed they would now baulk at being described as prepress shops. In many cases they are the leading edge of a new type of multimedia business.

One thing is certain though, they are not of much interest to CTP vendors. A ring around some of the leading supply companies – Creo, Screen, Agfa, Currie & Company and Heidelberg – indicates that no more than five to ten percent of CTP engines have gone into trade shops in the past two years. Indeed Gary Seidel of Screen maintains that he changed the focus of his company from trade shops to printers as far back as 1998. “We go out of our way not to do that [sell CTP to trade shops]. I can’t see a trade shop being able to make a profit from buying a large CTP device. No trade shop wants to move to twenty four seven in order to supply a printer and no printer wants to have his press standing idle waiting for a replacement plate.”

He recognises there are some trade shops that have made the switch to CTP and have formed alliances with a series of printers. They operate on selling plates where they once sold film, but it’s a business model he remains sceptical about. “It depends entirely on the strength of the relationships and there are not many people out there doing it. I don’t think there is much of a future in it.”


Other forms of business.

One industry notable who has spent time at the coalface of prepress is Russell Cavanaugh, now on the supply side as business development manager of DES. In a previous incarnation he was a partner in Network Graphics, the forerunner of Graphic Synergies, which went under last month (see news section pp 40). According to Russell he could see the writing on the wall in the 1990s. “When I looked ahead all I could see were forced mergers and acquisitions. Selling film is a classic example of price elasticity. If you sell it for less you will get the business, and that’s what people did.
“But the printing market in Australia is fairly well educated and when CTP came along the smart printers bought out their prepress suppliers in order to take the digital expertise they required in house.”

A notable example of this is the Offset Alpine, latterly IPMG, takeover of Sinnot Bros., where the printing company gained a highly skilled digital workforce just as it was considering the move to CTP. That Offset Alpine proved to be one of the earliest and arguably one of the most successful early CTP installations can be traced to the level of expertise Sinnot Bros. brought into the organization.

Some printers, recognising the necessity and the value of moving into CTP went ahead and developed their own inhouse expertise in handling digital files by first buying imagesetters. This allowed them to build the digital workflow when outputting film before taking the plunge into CTP. In many cases it was the lack of digital workflow in printing companies that delayed their entry into CTP.

Another evolution came with the development of CTP facilities management, a form of business pioneered by such companies as Colour Chiefs in Brisbane and John Della of Pageset in Melbourne. It involves the trade shop investing in the CTP equipment and installing, operating and maintaining it on the printer’s premises. This provides the printer with the outside expertise in file management and construction, and though the actual output function with modern CTP engines is relatively automated, maintenance is still the trade shop’s responsibility.

This synergy would seem to work best where the trade shop has more than one such installation, otherwise it leaves the business vulnerable to change of management attitude within the printing company. In effect it may leave the prepress house in the position of being part of the printing company – without the benefit of being bought out in the first place.

Getting back to core skills

This leaves the remaining trade shops looking for an exit or for a way of reinventing themselves. It forces them to isolate their core skillset, which in a digital age will likely turn out to be the ability to manage and manipulate data. This can involve anything from retouching photos, to flight checking files (although even this is being automated by such companies as QuickCut), to archiving images. Mainly it involves ensuring that the files are presented to the printer as required.

For those businesses with a graphic design or studio aspect, practically nothing has changed except they no longer get paid for sending film to printers; now they send properly constructed PDFs. Equipped with a battery of large Macs or a Quantal Paintbox they are properly regarded as premedia rather than prepress shops. While many advertising agencies are busily taking their own premedia work inhouse (Clemenger Harvey Edge CHE), others are content to forward files to be finished and archived by standalone premedia companies, though in truth the line between design and production is becoming increasingly blurred.

Digital printing to the rescue

Digital printing presents an obvious opportunity for trade shops. The first digital presses in Australia went into Michael Tan’s WYSIWYG in Sydney during the mid-1990s and since then many bureaus and prepress shops have followed his lead. Not all have been successful, and in some cases the inability to make the change forced some spectacular busts. But the question is whether the decision to get into digital printing did anything other than hasten the end.

Digital printing is a whole new ball game, with its own challenges and uncertainties, but one that must appeal to digital and graphic savvy professionals. It will take a new approach to production and it does move the companies out of supplying premedia into selling the end product to the customer. But for many prepress and trade houses there would appear to be few alternatives other than to give it a go.
And as that great Australian seer, John Singleton says, “I’d rather have a go than leave the money to the kids.”