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I’m an ink nerd. I started formulating and manufacturing inkjet inks for high-speed inkjet printing systems in 1982, supplying inks to printers producing direct mail, lottery tickets and business forms. Our customers tend to be large printers who run 24 hour a day operations. Over the years, we gained an understanding of what our customers needed and how to satisfy those needs. We also learned how to work with customers and with printer manufacturers to expand the application space for inkjet printers. This article describes a bit of what we have learned and what we predict for the future.
"The reality is that print technology is a complex and evolving space"
Over the past few years, the industry has seen a range of roll-to-roll printers from large companies like HP, Canon Océ, Screen, Infoprint, Xerox and Kodak pouring into the market. At the same time, a number of companies have also introduced imprinting systems. All of these printing systems give printers the ability to create relatively high-quality variable-information documents. We have found, however, that there is still a lot of room for improvement in the output quality of these printers and, more importantly, an opportunity to reduce the total cost of printing.
Based on our experience, printers have a number of priorities. A low total cost to print; reliable printers; a rapid response to the technical issues that inevitably arise; and the ability to adapt printers in order to pursue other business opportunities. It seemto me that the ultimate objective for the inkjet printing industry is to align itself to the priorities that are so important to printers.
A reduction in the cost to print seems to be inevitable. At the moment, there appears to be more printer and print head companies than the market can justify. Customers are being asked to have a sole source for inks, print heads and other consumables. As a result, impression costs are high and, as the CEO of one of our largest customers told me, printer manufacturers dictate how profitable printers can be.
Given the oversupply of printheads and printing systems, it seems logical to assume that the market will succumb to competitive pressures. Ironically, the reduction in total printing costs should actually benefit everyone in the value chain, including the major printer manufacturers. Infotrends produced an interesting chart, which graphs the point, on a cost per print basis, where inkjet is economically viable versus traditional printing. In their chart, it appears that inkjet is economically feasible for runs between 4,000 and 10,000 forms if ink costs $150/liter. If however the ink price is $25/liter inkjet remains economically feasible for print runs between 1,000,000 to 2,000,000 forms. I know that if we are selling 100 times more ink, we will make more profit even with much smaller profit margins. The same thing applies to all other consumables.
So what will happen? Eventually one or more print manufacturers, eager to increase their sales, will adopt more open policies and pricing, giving customers what they want. Some smaller printer manufacturers are already experimenting with more open business models. We know because we are helping those manufacturers open new markets with a range of inks specifically developed for these new markets. This area of our business is exploding.
It is an exciting time to be an ink nerd. Inkjet ink chemistry is moving forward at a much faster pace than in any time in the 30 years that I have been formulating inks. Specifically dye and pigment manufacturers are making new better colorants.
This is especially true for pigments. The new pigments run more reliably and print much darker higher quality images on an expanded range of substrates. While the gains made by colorant manufacturers are impressive, it pales in comparison to some of the polymeric binders which have become available to formulators. These polymeric binders are enable formulators to create high gloss, low rub inks that can print on virtually any kind of paper. These novel inks are just starting to flow into the market.
Print head and printer manufacturers are making equally impressive gains. Printheads are faster and more reliable than they were as little three years ago. There seem to be two or three new printheads entering the market every year. Printer manufacturers continue to add useful functionality to their printers. New printers print higher quality images faster, more reliably and are easier to operate efficiently.
Over the years, my company has had the opportunity to work with printers to develop inks for new applications. In many cases, those efforts ended up expanding the potential application space for inkjet printing. This lead to the sale of more printers, and in some cases the creation of new market segments.
The premise behind our approach is that the customer is usually better positioned to identify new opportunities for inkjet printing, and more motivated to pursue those opportunities. The customer sees where he can gain a distinct advantage and create additional profit using underutilized equipment he already owns. The challenge is creating an approach that allows the printer to pursue new opportunities while maintaining a good working relationship with the printer manufacturer. One solution that appears to work is for the ink supplier and/or printer to set up a cooperative agreement that allows the ink supplier to work directly with the printer. The ink supplier agrees to either direct all sales through the printer manufacturer, or provide the manufacturer with a royalty stream.
An added benefit of this approach is that printers get the kind of quick responsive service that is so important to them. When there is a problem, they have direct access to both the printer manufacturer and to the ink manufacturer. As a result, printing problems can be addressed quickly and downtime is reduced.
This approach to expanding the market for inkjet printers ends up benefiting everyone. The customer gains a competitive advantage over his competitors and is rewarded for pushing the envelope. The printer sells more printers and consumables, and the ink supplier sells more ink.
See Also: Manufacturing Outlook