America is a big country, notorious for big ideas, so it’s no wonder we have a hankering for big graphics. They don’t get any bigger than grand format, in every sense of the word. It’s a big investment, a big leap in capability, a big machine, and if you’re not careful, a big headache. It’s also a market that has recently witnessed several big changes, with more developments looming on the horizon.
Two major suppliers, Vutek and Scitex Vision have recently been acquired—by EFI and HP, respectively.
"You see people very nervous right now," says Patric Coldewey, sales manager, Gandinnovations Corp. "People don’t like uncertainty," in their suppliers, he added. Coldewey noted that his company has seen a significant jump in demand through the Fall, a development he attributes in part to the recent acquisitions.
That uncertainty is unwarranted, says David Bartram, marketing manager, Hewlett-Packard (IID). "We’re excited about being part of HP. I think it makes us a stronger company, and it’s a big statement about the grand format market," Bartram adds. "We have access to a lot more R&D and will have more resources in general."
"The merge with EFI results in very positive synergies," states Jane Cedrone, marketing manager, Vutek. "There are no major changes in our business on the horizon," she adds.
The present consolidation is only the beginning, predicts Ziki Kuly, director of marketing, Hewlett-Packard (IID). "Océ may buy someone, Gandinno-vations may be bought; this consolidation will bring more resources to this market."
The grand format market is already blisteringly competitive, says Patti Williams, consulting partner, I.T. Strategies. Sales of grand format machines are slowing because the market is close to saturation, though vendors are having success upgrading their existing customer base with new technology, Williams adds.
"Price rationalization has helped move the grand format market into the mainstream," says Brian McLeod, VP marketing, Roland DGA Corp. "A product that was $80K is now $50K, so that opens the doors to a lot of new customers."
"Demand has also migrated toward lower-priced, eco-solvent models," says Jeff Miller, VP sales, Matan Digital Printers Ltd. Overall demand is a bit soft, he adds.
The growth in lower cost eco-solvent printers is having an impact on printing work; grand format work that would previously have been outsourced by smaller print shops is now being produced in house, Williams says. "This is a well canvassed market, it’s full, and there are so many printers out there," Williams adds.
"We see demand for wider format applications growing," notes Ken Van Horn, product manager, Roland DGA. "It’s competitive, though."
"The industry appears to be headed in a good direction," says Harry Gandy, CEO, worldwide sales, Gandinno-vations. "With the increased awareness of flatbeds, as well as better speeds and quality, customers are really looking into buying a grand format printer. The print shops around the world have figured out that digital grand format printing is the way of the future because of the production rate."
Times Are Changing
Two significant trends are shaping the grand format market, according to manufacturers and analysts—the rise of UV inks and printers, and the proliferation of lower-cost grand format printers from Asia.
According to I.T. Strategies, UV-curable flatbed printers are muscling into POP printing, thanks to their ability to print directly to rigid substrates. While UV equipment and consumables are still commanding premiums, market forces will ultimately drive those prices down. The question then becomes, will solvent die out? Perspectives are mixed, but most manufacturers caution against eulogizing solvent technology too quickly.
"I’m impressed and terrified of UV," says Alan Barrett, president, Redhill Inkjet LLC. Impressed, he says, by the performance of the machines but terrified by the lack of ventilation in some of the inexpensive machines from Chinese manufacturers. "Some of these inexpensive UV machines have nothing to protect the operators from the micro-droplets, which could cause an allergic reaction in a small percentage of the population—like a bee sting—and possibly kill someone. The safer machines filter all air coming from a UV printer."
"UV will be a big deal in a few years," Bartram says. "Roll-to-roll solvents won’t be replaced by flatbeds, but in terms of quality and speed, UV has a lot of promise."
"UV is the future," Cedrone says. "The technology allows sign shops to compete with screen printers, and screen printers to compete with photo labs. In short, it allows niche businesses to become full service shops," she adds. "Those that don’t embrace it will fade away."
The costs have come down, such that, "people are no longer holding back," on purchasing a UV printer, Cedrone adds.
"Solvent will be around longer than most people think," predicts Barrett.
"UV is more flexible than many people think," Coldewey notes. "It may not be able to saturate well for the more complicated vehicle wraps, but it’s perfectly capable of going around rivets. It’s also more efficient; you don’t have to out-gas the media before you laminate, like you do with a solvent. You can print and laminate a vehicle wrap in a day," with a UV system, he says.
UV consumables will remain pricey compared to their solvent competitors, but the speed inherent in using UV is a significant attraction, Bartram says.
Expect more UV printers from the solvent manufacturers as well. "We’re looking at this technology for the future," says Matan’s Miller.
Gandinnovations will jump into the market with a 600 dpi roll-to-roll UV printer in January 2006, Coldewey notes.
Asian printer manufacturers have made inroads in the U.S. market with aggressively-priced machines, offering a seemingly inexpensive way for sign shops to jump into the grand format market. Yet many vendors are quick to question the follow-on commitments from these overseas vendors to providing parts, service, and support that must accompany any sale. Several U.S. reps for Asian manufacturers, however, insist that broad-brush stereotypes betray the diversity and maturity among the more reputable Asian suppliers.
"When you buy Asian equipment, you have to be very careful and you have to know what you’re doing" advises Barrett. "The Korean machines are good; they have the same quality control as U.S. manufacturers. The Chinese are getting there, but they are still inconsistent."
It’s not enough to score a good deal on the price, Barrett continues. "You have to make sure they can come to your shop and fix the printer if it breaks down. A lot of people end up buying a disposable printer because there’s no one around to service it for them."
"The core strategy for Keundo is to offer something different and better than alternative Asian values," says Hojeung Lee, sales manager for the South Korea-based Keundo Technology Co., Ltd. "Our products are designed and executed to compete favorably with Vutek, Scitex, Gandinnovations, and NUR at a far greater value than any other alternative printers in the marketplace."
Bill Grambsch, president, ACCI, and a U.S. distributor for Keundo, agrees. "We have had to fight the perception that all Asian products are of inferior quality; and yes, some are, but we are the real deal. Look at the components that we build into our printers and ask any of our U.S. clients. We have a pedigree in this market; customers can talk to us and our service and support is in the U.S."
With the relentless competition and large install base of digital printers in the billboard market, printers are casting an eye for new opportunities.
"The sign market is still a huge market and some of it can be done with a grand format machine, especially when you consider that about 50 percent of graphics made on a grand format machines are only wide format in size. It’s brought in for volume applications," Bartram says.
One promising market still up for grabs is textile printing. The big question mark is who gets the business—traditional printers or interior design firms, Williams wonders. Printer makers are encouraging their own traditional customers to explore this market while also sending feelers out to the design community.
"The interior design community is beginning to awake to the possibility," of digitally printing textiles, Williams says.
Even if standard interior design work eludes regular printers, there is a hybrid market—what William’s coined deco-advertising—that traditional sign shops and digital printers can still tap. Deco-advertising blends signage with decorative textiles like wallpaper. The interiors of many restaurants, fast food chains, and any retail franchise is a potential location for deco-advertising. "We asked print for pay shops what their top two applications were, and five percent were doing decorative applications. 64 percent also indicated that decorative printing is one of their top two applications they expect to increase in the next year. So it’s clearly an emerging market," Williams notes.
"Textiles is the next new market we’re looking at," says Roland’s McLeod. "It’s the logical place to go," echoes Roland DGA product manager, Ken van Horn.
"I think textiles is a huge market," says Kuly of Hewlett-Packard (IID). "There are some speed limitations with digital printing, so it’s hard to break into, say, t-shirt producing. But for expositions and wallpaper and some short-runs on cotton—we can capture that market."
"I do have some customers doing wallpaper and Venetian blinds but it’s not a big application yet," adds Coldewey.
Perhaps the most important consideration to be made before making the leap to grand format is whether the business is there to support it. Buying the machine in the hope that the new capability will suddenly bring new business in the door is a risky strategy, considering the magnitude of the investment, vendors say.
"How do you sell this extra capacity?," Bartram asks. It’s difficult—though not impossible—to build business around the machine rather than vice versa, he adds.
"One of the biggest problems I’ve seen is that people don’t buy a big enough machine," Coldewey counters. "If you have the market share, the machine is a much better investment than, say, another employee. It can pay for itself quickly. It’s not as big of a risk as some people think, but of course, you have to study your market, and don’t act foolish."
When shopping for a printer, Coldewey offers a straightforward suggestion—take a seat. "I have some very simple advice—watch it print," Coldewey says. "Go to a tradeshow, get a chair and a stop watch, pull it up to the printer, and sit there for two hours. If you see the operators struggling with it the whole time, you’ll likely have problems with it in your shop."
Verify all claims, particularly those based on speed, personally, Grambsch says. "Bring a file and see it printed," he adds.
"Everybody buys their printer for speed but ends up running it for quality," McLeod notes. "So in the end, most users will actually sacrifice speed for quality. Resolution is the real point of competition."
It’s important to pay particular attention to the print head. "The technology [advances] are coming from the print head manufacturers," Barrett says. "They control which direction this market is headed."
Coldewey agrees, "You are shopping for a print head. You have to buy the newest heads or else you’re going to a gunfight with a bow-and-arrow; you’re outmatched in the market."
Making room for the printer is only a sliver of the facilities maintenance required before you take the plunge. Some floors need to be reinforced and proper ventilation equipment must be installed and up to local codes before you can ramp up, states Tony Miller, product manager, Roland DGA. There’s also the more obvious, yet frequently overlooked, issue. "Can the printer fit through the door, or are you going to have to crane it in?," Miller says.
There’s also the question of the complimentary finishing equipment. "When you produce ten-foot-wide graphics, you need the finishing equipment on hand to deal with that," Miller says. When sizing up your facility, factor in the requisite finishing equipment as well, Miller advises.
When the new equipment is up and running, be aggressive, Coldewey urges. "You can do good business on a smaller machine," Coldewey says, but without a grand format printer, "you can’t hit a home run."