Navigating Growth Opportunities to Complement Commercial Print

When you hear the term “commercial printer” a few things probably immediately spring to mind if you’ve been in this industry for any amount of time. Those things probably include offset presses, applications like product brochures or direct mail, or long runs that can stretch into the hundreds of thousands of pieces. And while all of those things are absolutely still part of the commercial printing story, there is a reason so many printers are rebranding themselves as marketing specialists, communications management, and the like.

As technology has evolved, it has opened up new possibilities for print. Inkjet — really, all digital — technologies in particular have led to shorter runs, sometimes even runs of one, and more creative ways to get a message in front of an audience. And when you start to add in the smartphone, computer, and internet, there are even more avenues for branding and marketing.

And it hasn’t gone unnoticed.

Anyone who produces any kind of marketing or branding material is looking for new ways to capture larger chunks of client budgets. That could mean sign shops moving into direct mail production; promotional printers offering vehicle wraps; apparel printers expanding into complementary promotional products; or commercial printers doing any of the above.

It’s one thing to talk about the fact that to survive the consolidation and convergence happening across all segments of the industry, commercial printers need to look to new growth opportunities; it’s another entirely to figure out which of those opportunities is right for a business. There is a seemingly endless number of options out there, and not all of them will fit every business’s customer base or complement its existing business. So where should a print service provider (PSP) start?

Evaluating the Options

First and foremost, it’s important for a PSP to take the time to really understand their business. What jobs make a decent profit margin, and which ones are sucking more time and resources from the business than they are bringing back in? Paring down services offered to the ones that make the most sense means freeing up resources to go after new opportunities that might prove to be a better fit. No shop can be everything to everyone, so make sure the services offered are profitable.

Second, talk to clients. “The best way [to evaluate potential opportunities] is to ask your clients,” David Harding, CEO and chairman of HardingPoorman in Indianapolis, Indiana, says. “Ask them, ‘If we had this kind of opportunity, would you support us? Tell me more. How much do you purchase? Will you share the costs?’ Then you can actually back into a financial plan to decide if it will work.”

While the old saying of “build it and they will come” is catchy, it isn’t a sound business model to emulate. To find the best opportunities for an operation, the only people who ultimately matter are the customers. A PSP needs to determine what types of work its customers are sending elsewhere. Start with the best customers and have frank conversations with them — then let that be a guide as to what opportunities you pursue first.

Harding also stresses that if a company invests in new equipment, “track it as a separate line item on your income statement. Then you can determine if you spend enough to make a business case.” Not every investment or opportunity will end up paying off, after all, and it will be important to have the data from the beginning to make determinations after a year or two to get any new ventures off the ground.

Another thing to keep in mind, notes Jim Caughorn Jr., president of Graphic Creations in Knoxville, Tennessee, is what the general economy and market is doing. “Right now everyone is probably keeping a close eye on the economy, and what the pulse of that will be,” he says. “We made a push to not be as susceptible to the economic ebb and flow by developing core competencies in areas like nonprofits and education — things that continue despite what’s going on economically.”

Caughorn notes that taking a look at your own local market and identifying businesses that are less beholden to the ups and downs of Wall Street can be a good way to identify new opportunities or verticals to explore. In addition to the ones he mentioned, other possibilities include anything in the medical space, or local clubs such as the Boy Scouts or Humane Society. These types of organizations all need to do outreach and produce materials no matter what the economy is doing, so building a relationship with them could be lucrative — especially since they provide steady income when the more volatile client bases might be having a rough quarter.

He also notes that examining a market for seasonal applications is another potential growth opportunity every commercial printer should explore. While it’s likely the major retail brands, for example, have a contract with a commercial printer for their marketing materials that can span the country, some of the smaller, local mom-and-pop brands might not. And yet, they have just as big, if not more, reason to engage highly seasonal signage, branding, and marketing campaigns to entice their community to shop with them. This is a great opportunity to build a relationship — the packages might start small, but it could lead to large campaigns in the future as those brands grow. Or it could lead to referrals to other local businesses looking to refresh their printed materials seasonally. With today’s print technologies making shorter, more targeted runs both doable and profitable, this is a good market to cultivate to grow your business.

New Market Opportunities

What are some of the actual opportunities out there for commercial printers to start evaluating? Here is a look at five spaces your peers are moving into — and are finding huge success with:

• Wide-format digital printing of posters or banners, which can complement and tie into existing marketing campaigns for a more cohesive branding effort.
• Vehicle wrapping, either full vehicle or more often just panels, which can be used to help a business brand themselves. This is especially true for small, local businesses with one or two fleet vehicles.
• Apparel printing is a growing segment that many commercial printers are starting to explore. While screen printing is still the dominant technology for this space, new digital options have made it more economical and easy to begin offering printed apparel as part of a broader branding effort.
• Promotional products are a growing opportunity for many commercial printers. While the dedicated equipment is still very much needed for large batches or long runs, there are a number of digital solutions, particularly on the flatbed printer side, that allow commercial printers to offer a range of personalized products to customers.
• Digital embellishments are another big opportunity. While many high-end brands have traditionally used embellishments, such as foil or embossing, to help them stand out, the process was expensive and time consuming. With the latest digital technologies, however, these techniques are open to almost any brand or campaign, and could be a great way to start up-selling current customers to help them improve their ROI and, in the end, cause them to order more printed work.

Caughorn, for example, notes that one growth area his company has seen success with has been offering branded web portals where customers can log in to order, or reorder, materials.

“Clients don’t want to go anywhere else,” he says. “This keeps them sticky. They can have a direct communication into the workflow, see all their assets, and they can log in and order all of it.”

He notes that Graphic Creations has focused on the company’s top 20 to 30 customers for now, ensuring they have an excellent experience, and learning what works best for their workflows. He notes that, for example, Graphic Creation has a bank that is using the service to send out everything from postcards and pens, to deposit slips and business cards — and everything in between — all through the portal.

Harding, on the other hand, notes that constantly looking for new opportunities is something he has baked into the DNA of his business from the beginning. And that philosophy is still one he uses today.

“I still have the placemat from over 20 years ago,” he says. “I was sitting at breakfast with a friend and sketched the ‘hub and spoke’ concept. We would have a ‘mother ship’ that supplied services to the future product lines. The services from the ‘mother ship’ would include human resources, accounting, sales management, customer service, etc., for all the product lines we would eventually support. Each product line would be led by one of our team members and would run like an independent business. Today, the product lines include marketing, storefronts, mailing, fulfillment, wide-format, promotional items, digital printing, and offset printing.”

However, he is always looking for the next growth area. “If you open your mind, there are a lot of opportunities,” he notes. “For example, we recently purchased a vehicle wrap business and a sign business that produces outdoor electrical signs.”

And that brings up another note for those looking to grow their businesses — in these days of convergence, sometimes it’s better to start from scratch, and sometimes it’s better to acquire a business that complements your own. Both approaches can be highly successful, but PSPs should make sure to understand the market or application first, and ensure they have the technology and resources to support it. Alternatively, seek out partners who offer that product or service. That can be a great way to test the waters, so to speak, to see if the opportunity will be as lucrative as you hope before making any large investments.

This is an exciting time to be a commercial printer. There are opportunities around every corner, driven by both technology and creativity. And that’s not even touching on the nonprint opportunities, such as electronic signage, phone applications, social media marketing, or website branding. While none of those examples are traditionally handled by printers, more “shops” have rebranded as “marketing communication specialists.” There are many ways print can be used to help deliver and reinforce a broader message across multiple mediums.

It might be cliché, but the sky is the limit for any traditional commercial printer willing to look outside the box.