Automation is still the key
We can try to use the previous 2008 financial crisis as a baseline for comparison to what we are seeing now. The valuable lesson from that recession was that companies that embraced automation for their business operations ended up in a more favorable position compared to their non-automated counterparts. These companies had more knowledge over their cost structure and had the opportunity to control their unit economy. Another advantage of automation is that it naturally results in lower costs per order. Web-to-print became a more crystalized reality after 2008 as more printers wanted to reduce prepress costs.
Several studies show that the majority of print service providers had implemented some type of automation project by 2020. Presumably, automation will also be the key for printing businesses to weather the recession that is likely to occur due to COVID-19. However, starting an automation project right now might be risky in the face of possible low liquidity.
Automation is a fairly broad concept that must be analyzed on a case-by-case basis as it pertains to each individual printer. Let’s take a look at some challenges that the pandemic has already established and might establish in the future.
Ensuring business continuity
Working from home has become ubiquitous over the last couple of months. While government restrictions have yet to be eased, more and more printers are experimenting with remote access for their prepress workers. For this reason, shifting your automation software to the cloud might put printers at an advantage in the current climate. Generally, providing sales and business continuity is crucial during the outbreak to keep revenue coming in.
Remote orders
This may prove to be one of the outbreak’s long-term effects. E-commerce is very helpful while many stores are closed and there are restrictions on shopping outside. The circumstances can potentially expand remote shopping to more traditional goods. Consumers are already used to ordering clothing or books on Amazon, but there is a growing demand for remotely ordering goods and services that were previously considered “offline”. The pandemic will eventually end, but the notion of ordering such things online may remain.
This is likely to apply to B2B applications as well. It’s possible that the rising trend of “digitalizing” the ordering process for B2B printing jobs will receive a significant boost after the outbreak ends.
Increased competition
Market analysts will make different predictions, but there is a consensus that there will be a shortage of demand. People and businesses won’t have a lot of money to spend on printing materials. This shrinking demand will be distributed among the same number of print service providers that existed before the outbreak. Under these circumstances, it is vital to have solid visibility in the market.
Clients will be searching for less expensive print jobs and their loyalty will become questionable in this situation. They might be open to offers from vendors in different locations. This is where a decent online storefront can make all the difference while making efforts to land customers on your site and keep them there.
Market opportunities
Experts agree that opportunities in the market are quickly diminishing. Almost every kind of product will see a decrease in sales. Two obvious product categories that should be targeted right now and in the coming months are packaging and direct mail. Packaging is booming at the moment due to an increased demand for online ordering, and direct mail promises to be one of the most efficient marketing channels during the various stay-at-home orders. This doesn’t mean that every print service provider should scramble to add these categories to their offerings, but if you planned to do so before, it might be a good idea to speed up these projects while the iron is hot.
Conclusion
The printing industry is very responsive to the economy at large. If business is slowing down, printing will inevitably do the same. At times, when it is impossible to influence the external environment, the only available option is to hunker down and survive the recession by improving the overall efficiency of your business and reducing costs where you can. Eventually, the economy will recover, and the measures taken during the downturn will make a company more competitive in a healthy market.
