PRINTING AND IMAGING: Make Color Your Business

The time for black-white printing is out. Color is the in thing, and

enterprises are expected to adopt it at a fast pace. Market research company,

Gartner, forecasts that US will witness a CAGR growth of 18.93% between

2003-2008, for color printer sales. Gartner also predicts that units sales in

India will rise from 12,70,378 in 2003 to 15,33,092 in 2008.

Photo printers will grow by 50.57% worldwide, while MFP color copiers will

move up by 20.97%. However, inkjet color printers are likely to experience a

decline of 11.53% for the same time frame. Robust color printer growth is also

predicted for APac between 2003-2008.

WHY THE SHIFT



There are several factors for the rising sales of color machines. The 'color-capable'

market will accelerate the conversion of mono to color. These means that more

business needs will now rely on color for correct deliverance, like project

reports, sales charts, marketing collateral, etc. With customers identifying

brands with their color marketing collateral, companies now see the value of

color in getting a competitive edge.

"Black and white is not true communication, as the object interpretation

is not realistic," says Don Dixon, Financial Analyst, Digital Documents and

Imaging, Gartner. He adds that color also improves the information retention in

hard copy. Also, the average sales price and running costs of color machines are

declining. While the acquisition costs will continue to decline, it will now be

at a gradual pace.

"Color will become as normal in business environments, as it is in a

normal environment," says Michael Hoffman, Sr VP, Imaging and Printing

Group, Apac/Japan, HP.

Adds PG Kamath, GM, Lexmark International India, "We understand our

customers' needs and provide high-value solutions that go beyond enabling

business users to take care of their diverse printing needs. Our color printers

helps organizations reduce costs and manage their bottom line."

Preparing for this shift, Canon India has launched a digital imaging

solutions lab for the enterprise segment. The lab is designed for customers and

partners to test and customize solutions. The lab will simulate real business

environments and allow enterprises to see how proposed color solutions can

perform with minimal investment using the latest Canon technology.

According to Alok Bharadwaj, Director and GM, Conusmer Imaging and

Information Division of Canon India, the enterprise segment is an early adopter

of new technologies and trends. "Color in office is the latest trend that

is catching up around the world. After all, it lends to more effective

communication and the enterprise segment looks at ways to be more effective in

highly competitive market lace," he says.

Enterprises are taking color printers, especially laser MFDs as they are

getting increasingly cheaper. There is also a growing realization that

communication presentation is as important as the communication for its

effective delivery.

In many developed countries, one third of printing has moved to color

already. In India, the trend has just started and with all the vendors focusing

and driving this trend, Alok predicts that it won't be long before the country

starts seeing major contribution coming from color printing.

CHALLENGES FACING ENTERPRISES



Most enterprises today have to deal with a lot of competition and have to

use every trick in the trade to remain ahead of the pack. Their printing

requirements have to adhere to strict budget restrictions and they want to

maximize returns on their IT investments.

At the same time, they need to create a seamless IT infrastructure for

maximum manageability while communicating more efficiently and effectively with

customers. The CIO has to reduce outsourcing printing cost and enable the

company's sales force to be more effective.

In such a perspective, if color is added to their printing environment, they

can accrue better RoI, in terms of mindshare and revenues. "This is because

content and processes in businesses will be transformed from physical to static

to digital, to mobile to virtual over time," says Michael. "Networking

has enabled all imaging and printing activity-from traditional office printing

and copying inside a company to offset printing outside-to be connected and

interdependent."

At the same time, there has been a dramatic decline in acquisition price and

TCO of color printers, with a converse increase in speed and performance.

DISPELLING MYTHS



There are several myths surrounding color printing, which is why enterprises

shy away from adopting this technology. As a solution provider, it is your job

to educate your customers about the right color printer, which will fit their

budget and their needs.

The foremost belief among buyers is that color printers are is costlier to a

monochrome. While the acquisition costs might be higher than purchase of

monochrome machines, if the cost is spread over a period of time, then color is

much lower, comparatively.

Try this test. Find out the amount of color printing your customer outsources

and cost incurred, for a period of three years. Then, work out how much the

buyer would if color printing is done in-house and spread the cost across three

years. And then your buyer will probably find that it is cheaper to print

in-house.

Also, you can get enterprise customers to realize that they need not rely on

offset outsourcing for their printing needs. Also, offset machines can only

accept bulk-printing demands to offer economies of scale. If a customer wants to

print 10 personalized color brochures, then outsourcing it to a offset jobber

works out to be much more expensive.

"An average SMB purchases 382 billion four-page pages every year from

professional print shops," says Tan Lee Chew, VP, Business and Enterprise,

HP Imaging and Printing Group, Asia Pacific & Japan, HP. According to Trend

Watch Spring '03, an average SMB spends $17,000 annually to outsource

marketing collaterals. The potential savings, if color printing is brought

in-house, can go up to 50%."

Another reason why enterprises avoid color-printing machines is because they

think these would mean deployment of bulky devices. But most of the latest color

printers occupy lesser footprint. Also, they come with single- or four-pass

technology, with various form factors. It can also be backward integrated easily

with the company's existing network.

FORECASTING TRENDS



Gartner predicts that color-enabled applications will act as an accelerator for
sale of color machines. Graphics organization sales will either be flat or

decline, as more companies reply on in-house outputting, especially for

on-demand printing needs. Production in color will grow in double-digit figures.

Market margins will decline as sales increase, but volumes will compensate

for it. Front-end margins will fall, but vendors will devise their own margin

plans for rewarding their partners. Scanning will become more of a requirement

for workflow and imaging, "Something that is nice to have, rather than need

to have," says Don.

VINITA BHATIA

CONVINCING ENTERPRISE BUYERS FOR COLOR

l Point out that acquisition and

operational costs of color products rapidly coming down

l Printing speed increasing along

with the duty cycles, thereby reducing cost per page

l More creative applications are

being developed for color output

l Lesser service interventions as

only individual faulty components are replaced, rather than the whole machine