Have you ever had to place an order for preprinted labels where the minimum quantity was significantly higher than your requirements? Do you have any SKU’s with multiple years of label inventory on hand?
You may remember my earlier post on this type of situation, Minimum Order Quantities Cost Money: http://colorlabelsondemand.blogspot.com/2013/02/minimum-order-quantities-cost-money.html.
According to Mark Brimstone in his editorial in “The Universe Is Changing Again” at Printing Impressions (http://www.piworld.com/blog/the-universe-changing-again-noel-ward#), you will soon have greater flexibility in label order quantity as more printers move from flexographic (offset) to digital presses. Let me explain why this greater flexibility is occurring; as well as giving you my opinion on how this trend will grow the print on-demand color label market.
You may be wondering, “why the requirement for large order sizes?” With an offset press, set up time may take as long or longer than it takes to print a small quantity of labels (Mark’s Statement: changeover time between shorter run jobs can keep productivity per machine well below 50 percent). Therefore, the fix cost of the press includes both the setup and run time. When printing large quantities of labels, the setup time becomes a minor portion of the overall costs. Paraphrasing Mark, “Conventional label printing prints large runs well. For less popular products or regional brands, shorter print runs increase set-up times and production costs or require maintaining inventories of printed materials that are subject to waste and obsolescence.” Amen; one of my key points on why companies should move to print on demand color.
But Mark makes a slightly different interpretation. Again paraphrasing Mark, “By comparison, digital presses can produce labels in short and moderate run lengths—with virtually no on-press changeover time. This efficiency can fulfill the needs of big brands, niche products, local brands, regional offerings, different languages, test marketing and promotional offers. Digital labels are effective for virtually any opportunity where a shorter run can reduce the total cost of packaging, increase production efficiencies, take advantage of market opportunities, and enhance brand awareness.”
Mark argues that digital presses like the HP Indigo WS 6600 (which may cost up to a $1 million as well as per impression click charges) are the answer. These digital presses will, according to Mark, “increase the range of new applications, offer shorter runs and enable customized jobs—will take some of the offset label printing business.” “Some” of the label printing business moving from offset presses to digital presses seem reasonable. As the global label business equals $57 billion, “some” could be a lot of money!
But I content another portion of the global label printing business will move to on-demand color. With the new technology available, end users can print the exactly the labels they require when they need them.
During my trip to Pack Expo, I featured a few companies for in-plant prime labels: http://colorlabelsondemand.blogspot.com/2013/09/pack-expo-2013.html.
Or my follow up post on the Affinia L-801:
As these ~$10,000 printers produce labels with up to 1,600 x 1,600 dpi at speeds up to 12” per second at prices per label comparable to digital presses, end users can realistically afford print on-demand color label solutions. Even if the price per label is more, an end user will reduce waste, administration, inventory and potential error costs by printing only what they need when they need it. Combining the new technology with the benefits of print on-demand color labels, many manufacturers will move to this process. Thus print on-demand color will capture “Some” of the $57 Billion label market as well.
Offset to Digital to On-Demand seems like the logical progression to reduce the costs while increasing the flexibility of producing color labels. If you have ever purchased too many preprint labels, contact me to discuss moving your label production “in-house”.