Sage Advice for Safe Investments from Andrew Paparozzi
Back in the day, if you made an error of investment, you threw a tarp over it and got on with your life. We don’t have that margin for error any more. So observed Andrew Paparozzi, Chief Economist for Idealliance, in a presentation called “Capital Investment: Where Companies are Planning to Invest and Why” (one of a series of free briefings at PRINT 17 in the Learning Experience Theatre, Booth 3861). He detailed how Idealliance, a trade association, tries to protect its members against mistakes that could hurt their businesses with the Capital Investment Research Program, a Canon-sponsored activity that tracks what printers invest in, how much they invest, and how they arrive at the investment decisions they make.
The program draws its findings from regular surveys of a non-anonymous group of participants who reflect a broad spectrum of the industry in terms of revenues and degrees of profitability. Paparozzi said that over the next three years, more than half of them (54.8%) plan to invest about the same percentage of sales in new equipment and technology as they did in the previous three years. Investments range from 1% to 12% of sales, with most in the 3% to 8% range.
Printers invest in many different things, but most frequently cited, are workflow software; bindery finishing equipment and systems; digital infrastructure solutions; management information systems; and web-to-print.
The “why” of capital investment is as important for Idealliance to research as the “what,” according to Paparozzi. Most (95%) of respondents said their investment objectives included one or more of the following:
- Achieve a more efficient workflow
- Automate processes and reduce labor costs
- Work faster to shrink turnaround times
Getting better at investing with care and caution is essential in an industry that has grown more competitive even as it has shrunk in size, Paparozzi said. Asked what they would most like to improve in their decision making, the survey base put “more unbiased, agendafree input” at the top of the list for evaluating investment options.
Vendors can help, Paparozzi said, by asking more open-ended questions about the nature of their customers’ businesses and by talking less about products and more about how customers can make their businesses grow.