The real label story is hot enough!

For high-end label press installs, to grow from about 25 to almost 40 in the current financial year financial year (April 1, 2010-March 31, 2011) is frankly quite amazing. We are talking about presses from Gallus, Nilpeter, MPS, GiDue and Mark Andy and there is every indication that our numbers will hold up on the basis of presses already installed and those in the pipeline.

Within seven kilometres of our office in Noida a new Mark Andy and a new Nilpeter have been installed. While some printers are still going in for their first label press and other for a second there are now as many as thirty label printers in India who are adding their their third and fourth machines. The Belgian company Reynders is installing its second Gallus in Bhiwadi, not far behind what their plans were when we visited them last year. A leading label supplier in Kolkatta is installing his third high-end lable press. Wintek in Bengaluru is installing its fourth Gallus. North India has done well in the past six months with several Gallus, Nilpeter and Mark Andy installs. Label presses are in the pipeline in the West and the South as well. In addition the multiple sales of both HP and Xeikon digital presses have surprised us.

— Naresh Khanna

Showtime — Is there a need for exaggeration?

According to Roger Pellow in his presentations at the recent road shows in Chennai, Mumbai and Ludhiana, Indian label printers are buying 140 to147 new presses this financial year (April 1, 2010-March 31, 2011). Industry experts and insiders, including some who are successfully battling each day to sell machines, pointed out to the Tarsus organisers that these numbers are neither correct nor realistic. Some of them even pointed to the IppStar update published in the July-August 2010 issue of this magazine titled ‘Label press installations in India.’

We think that IppStar's more modest figures of almost a hundred new label presses, including a 50% growth in high-end presses to 40 machines, is both credible and creditable. There is no need for exaggeration. Readers wishing to read the entire article can refer to http://www.packagingsouthasia.com/news/Label_press_installations_1377.html

Poll on print demand

There is a poll on the homepage of our website: www.indianprinterpublisher.com

Are you expecting a pick up in print demand in the 2010-2011 financial year? The results so far are:

Yes = 63%

No = 23%

Growth as usual = 14%

Go ahead and log on and vote! If you have something more to add, you can send me an email. You can also comment on-line on the Print Asia blog which is also accessible from the home page.

— Naresh Khanna

The big print and stationery buyers

IppStar has been looking at just the print and stationery expense of the biggest companies operating in India. One of our lists of the 50 largest spenders on print and stationary include 32 banks while the other big spenders include telecom, construction, pharma and healthcare, and oil, steel and paints.

In the 2008-09 financial year, the top fifty companies spent Rs 1,600 crore on print and stationery. In 2009-10, the top fifty print and stationery buying companies together spent Rs 1,670 crore. This represents an increase of 4 per cent in what can only be called an ordinary year for the economy. Keep in mind, that this figure only represents their in-house and operational print needs and does not include what these companies spent on print advertising, marketing promotion or packaging.

KM Mathew

In the early 1980’s I met KM Mathew who tried me out as a print consultant when Malayala Manorama was in the midst of changing over to offset and installing Cruseot-Loire web presses with 4-colour satellites at all its centres. In those days it was just Kottayam, Kochi-Ernakulaum, Kozhikode and possibly Palghat if I am not mistaken. My experience with Manorama over those fifteen months bears out what TJS George writes in the appreciation of Mathew that he has kindly allowed us to publish on page 14.

George writes that KM Mathew was both adaptable and an instigator of change. He always thought of the bigger picture — about publishing change, development and growth not only for his own publications but also of at the very least, Kerala as a whole. When I suggested that with computerised typesetting becoming available there was room for new Malayalam typefaces, he readily agreed to sponsor Malayalam font design work by Mahendra Patel at the National Institute of Design. Malayala Manorama gave a project fee to NID, but typically with the provision that the new font would not be exclusively for its own publications but for all publishers.

At one point during my work at Manorama, a technical seminar was organised to discuss new developments in newspaper technology and offset printing. Again, the mini-conference included editorial and production invitees from many of the daily publishers in Kerala. This event took place in Manorama’s conference room in Kottayam — in spite of the enormous rivalry between Kerala’s daily newspapers.

I have fond memories of both KM Mathew and also his wife Annamma Mathew who took me over to the Vanitha building for a session with her young colleagues. Hearing that I fancied myself a cook, she gave me copies of all her cookbooks — the recipes had been tested by Vasu who looked after me well at the Manorama guest house!

I remember one evening at KM Mathew’s house in Kottayam — particularly for KM Mathew’s easy conversation and his sense of humour. Since I had been to each of his son’s homes in various cities of Kerala, to put me at ease he made a joke about their similar taste in furniture. I could only smile but it was wonderful to be able to get on with the two of them, as it has been to experience the graciousness and generosity of the entire Manorama family.

While packaging is hot in India the urban infrastructure is not

In the last six months we have been basking in the heat exuded by the continuous investment by India’s packaging industry entrepreneurs. The building of large purpose built plants outside the cities and the purchase of not only brand new high capacity machinery but also of high level quality and inspection systems which were and are still considered by some to be luxuries. In other words, the new expansion projects have gone beyond immediate necessity and have entered the realm of what is desirable to compete globally.

My second observation is that when one travels to these new plants in various parts of the country and often through the rubble of new highways, overpasses and metros under construction, it is clear that the urban infrastructure is far behind.

A recent study by David Caploe, the chief political economist at www.economywatch.com highlights both the potential gold mine that is urbanisation in China and India and the underinvestment by India in its cities. Caploe estimates that urban households in India could increase seven-fold to 89 million by 2025 and the markets to benefit most would most likely be transportation and communications, food and health care, followed by housing and utilities, recreation, and education.

Caploe also says, “India has underinvested in its cities; China has invested ahead of demand, and given its cities the freedom to raise substantial investment resources by monetizing land assets and retaining a 25% of share of value added taxes. While India spends US$ 17 per capita on capital investments in urban infrastructure annually, China spends US$ 116. India has devolved little real power and accountability to its cities, but China’s major cities enjoy the same status as provinces and have powerful political appointees as mayors. While India’s urban planning system has failed to address the competing demands for space, China has a mature urban-planning regime — emphasising the systematic development of run-down areas — consistent with long-range plans for land-use, housing and transportation. The starkest contrast between the two countries is that China has embraced and shaped urbanisation, while India is still waking up to its urban reality and the opportunities.”

Of course much of rural India would argue that there is no investment in the rural infrastructure and that the cities already have a much larger and disproportionate share. We thus enter the realm of politics. And although one does not have to buy Caploe’s thesis one has to answer it with some serious investigation of the facts — and a plan. Plans that are both visionary and detailed, let alone with some element of time frames.

Naresh Khanna

Commercial printers and digital print

“We offset printers will have to install a digital press within the next few years come what may . . . The decision to go in for a digital solution is not one of choice — it is more of a compulsion” — Amit Tara, Tara Art Printers

Some of the vendors of digital presses may be frustrated by the slow pace of Indian commercial printers buying digital presses. It is true that to some extent commercial printers are pre-occupied with other issues such as the intense competition over printing rates, or building new plants and buying more presses and postpress equipment. However there are many printers who have bought digital presses, and they are quite frank that this is necessity. One forward looking commercial printer in Pune who has a relatively small digital press in addition to his new 4-colour offset, in fact says that it is a profitable activity and extremely advantageous. For instance he is able to produce a short run of auto maintenance manuals for just 60 to 70 dealers around the country.

We met another printer last week who does a lot digital printing for offset clients who need copies yesterday and for those who need advance copies before the entire offset run can be printed and finished. This printer also no longer proofs on a colour managed ink jet. Instead he simply gets a high quality digital output of the entire job. Right now digital print is outsourced but this does not seem to be a challenge. He does not believe that offset is viable below 2 or 3 hundred copies.

Another young printer friend of ours, Amit Tara is quite outspoken about the need for digital printing. In his comment he shares many of the beliefs of Indian offset printers whose investments in heavy metal have generally been remarkable both for their ROI and also for their very gradual market depreciation. He says, “In-spite of all the hype about digital you will see only a handful of people going for digital. The moment the system gets installed in your premises it has zero value in the market. And considering it is more electronic equipment and less mechanical there is a preference to buy first hand . . . Then when you compare it with capital equipment [such as an offset press], which you can resell for as much as 50 per cent of its initial value even after 10 years and after having recovered the cost from it, it is quite a comedown.”

He goes on to say, “We offset printers will have to install a digital press within the next few years come what may. We cannot afford to say no to a customer who is getting their 5,000 monthlies printed from us when they come to us for 200 hundred invites, and neither can we always afford to go to another quick print shop. Printers will not go to another printer for prepress work, instead they will go to a prepress bureau. Similarly offset printers will not like to send their regular customers’ short run jobs to other printers. The decision to go in for a digital solution is not one of choice – it is more of a compulsion. An offset printer will be very successful because he can decide what will be more suitable for each customer and job or even part of a job. To outsource these digital jobs when we know the margins these digital printers enjoy and are charging us, is just not palatable to us.”

-- Naresh Khanna