Teaching Experiences -- China Connection
We discussed what successful U.S. printers are doing to get out of the "commodity" business, such as setting up a fulfillment center, diversifying into package printing, maintaining databases, etc. An executive from a large U.S. printer I met at Drupa told me that he is talking to some Chinese printers that currently print some jobs for him, but now they want to take the final step and actually send the finished products to the ultimate customers, rather than to a middleman. While those new business models appear attractive to Chinese printers, their time is well off into the future.
Competition from India
For the near future, package printing appears to be their best opportunity to generate the kind of profits necessary to stave off competition from new entrants into the printing world, such as India, Vietnam and Indonesia. What advantages and disadvantages do printers in these countries have?
For starters, India has lower labor rates than China and, most importantly, they are used to communicating in English and have a rule of law concept firmly established. However, the tariff and non-tariff barriers in existence in India preclude--except for the very wealthy printers and newspapers--purchases of the latest machinery and systems. Therefore, a lot of used equipment still finds its way to India. Vietnam is a rising star in the printing industry, still relying mainly on used equipment, but with labor rates even lower than those found in India.
The message for Chinese printers is not to bask in possessing low labor rates, but how to compete with their neighbors for offshore customers.
Education is one of the keys China is using to make sure that people running the industry today, and those that will run it in the future, are aware of these challenges. That's why they have people like myself with printing knowledge and educators from universities such as Wuppertal teaching short courses. That's also why many of their graduates enroll in post-graduate programs at foreign universities. It's why many faculty members from Chinese printing schools go abroad for extended stays to improve their knowledge base. I also met several educators in Wuhan who worked in the United States for a number of years, then decided to return to China to teach the latest technologies to eager students.