On-demand Printing--Delivering Digital Dollars
Value-based pricing. Many print providers equate price with their cost plus a required margin. In digital printing, this cost-based approach can leave money on the table. Profitable pricing is linked not only to the cost of the manufactured goods but to the value to the customer of the services accompanying those goods. Fortunately, in this era of consolidation, outsourcing and the return to core competencies, there is a higher-price stratum of customers who recognize added value and are willing to pay for it.
Dedicated operations. For profit leaders, the marketing strategies drive the structure and management of the operations, rather than the converse. Because the more successful businesses are focused on only one or two markets, the operations can be dedicated and streamlined to meet the particular requirements of those markets. Since digital printing operations typically deal with dozens to hundreds of orders per day, they must be unrestricted by conventional production management methods that are geared to lower order frequencies.
Efficiency over automation. The more profitable operations are automated only after management really understands the requirements and most efficient workflow for the business. For example, some print providers have invested in the latest in-line finishing technology, only to find that it has limited their flexibility to accommodate changing print product requirements. Likewise, significant investments in production management systems should be considered only after the processes and workflow are stabilized at a high level of efficiency.
Market-driven rather than scale-driven. Two of the most visible early failures in digital color printing were driven by management focus on large scale rather than on markets. Among the businesses that we have audited, there is no strong correlation between size and profit. Ironically, some of the biggest operations show the lowest returns! The important differentiators are market focus and operational efficiency, rather than size.