Man Roland slams creative financing for presses

Yves Rogivue, CEO of MAN Roland USA speaking on a panel debate on the topic ‘where does the future lie?’ launched an attack on creative financing, branding the practice as a vicious cycle that the industry needs to break.

“It keeps questionable ventures in business, and has turned printing into a commodity and hurt us all,” says Rogivue. “I call on all print manufacturers to stop subsidising businesses that hurt our industry.”

Peter Lane of Lane Print and president of Printing Industries was at the conference, and believes Rogivue’s comments are important in the context of improving profitability within the industry. “Man Roland was one of the leading suppliers on the panel, and the emphasis of Rogivue’s speech was that there have been some examples of financial activities which have not been in the best interests of the industry.”

Lane emphasises that while the assertions of Rogivue’s speech are difficult to prove, they are claims that should be taken note of. “If it is in fact correct that suppliers have been selective in the organisations they have offered support to, then the industry has not benefited. Ultimately it has resulted in a further reduction in prices, rather than an increase.”

Rogivue charted a future for the industry where technology in the form of large presses and computer integrated manufacturing (CIM) for large and small printing companies will dominate. He espoused the use of CIM to reduce human intervention in the majority of print jobs.

Finishing off he issued his clarion call for better financing.

When Funding Hurts

"But in recent years, we’ve seen funding schemes that have hurt our industry. I’m talking about the so-called creative financing deals that press manufacturers have made in the past with questionable printing ventures. This is how these doomed deals transpire: A manufacturer will suspend payments on a press for six months, a year or even longer in order to get the machine into a facility that is not credit worthy.

"Because he has no press payments to make, the printer can afford to reduce its prices to bring in business. The result: other printers in the area need to lower their prices to the artificially low levels, which in turn, upsets their financial stability. In the majority of cases, the press manufacturer takes back the press and the subsidized printer goes out of business.

No Happy Ending

"This is not a happy ending for the printers that remain. Once the prices are lowered in their marketplace, it’s difficult for them to raise rates. That means the legitimate printers have to work with reduced profit margins, which leaves them with little capital to invest in new equipment. Without new technology, they can’t be more efficient, which in turn damages their profit margins even more. That’s what creative financing creates — a vicious cycle that we need to break out of now.

"In short, it’s easy to see how so-called creative financing has helped turn printing into a commodity, and has hurt us all. I call today on all equipment manufacturers to end the practice of subsidizing facilities that continue to damage the very value of what our industry produces. Because in the final analysis, we are print — each and every one of us. That means it’s our responsibility to advance the future of our industry and to continue its proud tradition of being the world’s foremost media choice."