The first thing that comes to mind when we talk about printing is the print-cum-cyber cafe around the corner. Vinod, a local print-shop owner, when asked to explain his business, gives a vague yet practical explanation: “Everyone cannot afford to keep a printer at home, and this is where people like us come into play.” Vinod is part of the segment, which is predominantly known for its unorganised set-up rather than the conventional form, but no one is complaining. “Overall, the printing market in India is pegged at Rs 1.25 crore and the digital printing segment comprises roughly about 4.5 per cent of the total,” says Puneet Chadha, Director, Graphic Business Solution, HP.
The Indian print industry is highly fragmented. The organised sector includes the publishing, packaging, advertising and media segments. These largely comprise B2B services. The unorganised sector, on the other hand, comprises stationery and photo-copying shops, which largely cater to individual customers. The Indian print industry, including both the organised and the unorganised sectors, provides employment to a large number of Indians. The print industry in India is a capital intensive as well as operationally challenging business. It involves mostly family run businesses, which are passed on from generation to generation. Business in the unorganised sector is mostly owner driven, which lacks standardisation and employee benefits. “The Indian print market is rapidly expanding, with the estimated number of printer being used in India varying from 1,30,000 to 2,50,000. An estimate of 250,000 looks reasonable when we consider the incredible number of small digital shops that have surfaced over the last decade,” says Sethunath Padmanabhan, Director, The Print Bazaar.
What is this segment all about?
This segment is primarily focused around unorganised print and copying, which is a huge market. There are a lot of challenges and concerns about this sector. The Print Bazaar is an initiative launched to make printing convenient, accessible and affordable to all.
The Print Bazaar is a print and copy centre focusing primarily on B2C and SME/MSME segments at the store level. Its business model is based on the number of customers served and not on number of prints per customer. Through an extensive network of company-owned stores, The Print Bazaar introduces world-class printing and imaging solutions to India’s high growth markets. Talking from an organised point of view, there are a few companies based in Bengaluru and some small scale initiatives in Mumbai. Also, there are local players with multiple stores in a region.
“We believe there is potential for at least 5-10 big players to operate in this segment along with the unorganised players. The Indian print industry is growing at 12-15 per cent per annum, while digital printing is growing at 25 per cent per annum. The key will be growing the pie rather than targeting the existing pie,” Sethunath adds. While volume is important for business sustenance, The Print Bazaar believes in increasing the customer base, since this is a category
that needs substance in India to operate at a bigger level. Business printing is a major driver for business. This includes business cards, brochures, letterheads, etc.
Issues plaguing the industry
The challenges faced by the organised print retail industry are similar to those faced by any organised retailer in India. Lack of infrastructure, trained manpower and a retail culture are the major drawbacks in the Indian market. Print and copy centres are a category in the international market, for example, Fedex office (Kinkos), UPS and Agfa graphics work in the similar category internationally, however with different positioning. For starters, it is highly unregulated; software piracy and taxation are other important issues that need to be addressed.
In India, there is no category for print shops. People relate to print shops only for business, while print and copying for personal use is huge. India is still in the formative stage of creating such a category and has a long way to go. However, according to varied print industry experts, the scenario is gradually shifting towards betterment. They say digital printing, as a category, is now getting accepted in the Indian market. However, as there is no business model that can be followed, this segment lacks the required information for proper business estimation.
The industry needs to have a strategy in place to overcome this challenge. The retail and print industries operate as separate industries and both are capital intensive. Combining these two industries will create a compounded effect on the liquidity. As it is difficult to get loans easily for digital machinery, equity infusion becomes the only option for scale up. One can minimise this impact by differentiating one right from the beginning. The product mix, machinery, logistics and supply chain, along with the vendor base, need to be planned before the business can start on ground. “One should function as a retailer rather than a printer,” says RPS Chawla of Chawla Printers at Nehru Place.
The retail angle
The signs of maturity in this segment are gradually becoming visible. Recently, HP had introduced its digital graphic solutions, primarily targeting the home segment. With this first-of-its-kind innovation, HP believes that the role of digital printing in the print industry can be more integral, and this is where the printing solutions in general will come in handy. “We plan to have these products available through our vendors and distributors and are also offering the service of getting the wallpaper pasted, though right now, it is limited only to Delhi-NCR. We recognise the need for us to grow our channel network; there are some people who are keen and capable of taking this forward. We feel home furnishing outlets, toy stores and book stores are places where the footfalls are already visible,” Chadha adds.
Going the e-print way
As the e-commerce business is growing, the print business is also expected to grow in this segment. The likes of Justprint, Myprint and Snapfish are already offering their services online. The Print Bazaar will launch a web portal in the near future. But, one believes the co-existence of online (e-commerce) and offline (retail) is going to be vital for success in this business. One of the main challenges in printing and delivery is logistics. With a chain of print shops and e-commerce operating together, this model can be successful.