NPA #2 – Industry turnaround year for innovative printers – Andy Vels Jensen

The managing director of Heidelberg continued his tradition of telling it like it is by predicting that for the have not printers who struggle with low or unknown profit levels, the year ahead is likely to prove even tougher.

“We are told it's bad out there. A printer I met the other day said he turned down a print job, as adding ink to the paper would devalue the paper! He resold his packed paper and made a better margin,” joked Vel Jensen, but only being slightly funny.

The pithy comments came in his introduction to the Heidelberg Australia Award for Excellence in Craft, which this year went to the Ducor Group for its Mallon Publishing title Australian Marsupials. (Pictured above: John Tait, CEO Ducor (left) receiving the Award from Andy Vels Jensen.)

In a typical hard-hitting delivery Vels Jensen concentrated on the threat posed to the local industry by Chinese printing and how to combat it. He emphasized that there was no point in printers attempting to combat increased competition, especially from China by trying to reduce capital equipment costs.

“You could be lead to believe that an investment in the cheapest quality equipment will allow you to compete on equal grounds with overseas printers. What you may not know is that 98 per cent of A1 and A2 printing presses used in China today are imported,” he said.

”In fact more than 4000 new printing units were imported into China last year alone. Backing this up is the fact that many of the large local press manufacturers in China are reporting falling revenue; this in a booming market and economy.”

Know your enemy

According to Vel Jensen, Chinese printers have the advantage over Australian printers not only in cost of labour and, at best, lose legislation and rules of production, but also in having most of the major brands of consumables, from plates to inks to paper, being produced in China. No duties, fairly easy and low cost logistics, and no foreign exchange worries. The assets they buy cost the same as in Australia, however, the equipment is totally void of most automation.

“It helps to keep the people in the 160,000 plus Chinese print shops busy and happy…
“My point being, yes we face some huge challenges, but you can’t win by attempting to replicate the Chinese print business model or by challenging new legislation or working against the changing buying habits of our society. You need to understand it, deal with it and create your own innovative and competitive advantages.

“I don’t think this is the first time the industry is required to stand up and face some serious challenges. It can be done. Perhaps it's time to even consider getting to know your overseas competition better so you know how to beat them at their own game.

“But first and foremost, I guess, we need to believe in our own industry, our own business and in our ability to succeed. I say lobby government and corporate Australia when they inflict harm on your business, voice your opinion and demand more level playing fields, but let's not go blaming others for our troubles or be caught waiting for someone else to fix it for us.

"Fixing this business is purely a Do-It-Yourself thing."