Digital Printing Economics

Although digital printing has many advantages and cannot be achieved by traditional printing, the price is still a consideration that customers spend on printing costs. While the low-cost traditional printing is still the mainstream, the demand for digital printing is just a matter of price. It is highly sensitive and the price is only at the “threshold” where the print volume can be expanded. The critical point for digital color printing is 5 cents per page. This paragraph is the recent article written by Mark Printman, Ph.D. (published index), an American publishing and printing expert. He believes that the development of color digital printing is slow, mainly because of the basic economic factors of supply and demand. As for the advantages of digital printing, how much market can be created? No one has made strong data so far.

The demand curve (Demand Curve) in economics is a basic tool to describe the relationship between consumption and price. From this, it is also possible to estimate sales, which is useful for market analysis and production planning. Fleming’s Strategies on Demand Company produced an economic model of digital printing as early as 1998. The direct cost of printing was calculated and tracked until year-to-date. Because color numbers are now approaching the critical price, it is the timing of the discussion.

Print on Demand (POD) Originated in 1989, 15 years of growth, monochrome high-speed digital printing systems such as Kodak, IBM, Océ, Xeorx, and other brands, printing a variety of documents, manuals, forms, gradually replacing the small tradition Printing and copying equipment. In 1994, Indigo and Xeikon launched a color digital printing system. They wanted to follow the monochromatic digital printing and develop the color on-demand printing market. It is estimated that within a short period of time, it will be possible to compete with traditional printing within 5,000 strokes. But the result completely failed because the price of digital color was 30 times that of the traditional, and the quality of color could only be accepted by a very small market. Digital color was gradually forgotten by the industry.

Digital color then went towards personal printing, separated from traditional printing in the market, and appeared in a complementary and non-competitive manner, but the results did not improve. According to Fleming's analysis, this is because people have overlooked two important economic factors. The first factor is that digital printing competes with traditional printing for the same group of customers. In other words, the total printing budget of this group of customers is not increasing due to new technologies. Historically, the demand for printing has accounted for gross gross national product, and has not changed because of the progress of production methods. In the 60's, transfer printing replaced lead printing; in the 1980s, various documents were printed; electrostatic image (laser) technology replaced percussive printing; in the 1990s, monochrome digital printing systems replaced small traditional printing machines, but these technologies were Change did not significantly increase the print volume. The only exception is inkjet printers, which have opened up new markets for home printing.

The second economic factor is that the demand for printing is extremely sensitive to price. At the end of 90 years, each page of A4 color printed up to a dollar, the market demand is extremely narrow. In 1998, Fleming estimated that if one page of A4 color is printed down to 5 cents, the print volume will increase significantly. In 2001, after personal printing and the remaining digital advantage still failed to produce print volume, Xerox divided the price of the DocuColor iGen3 with 5 US cents for its second year, after which major manufacturers began to cut prices. The progress of monochrome digital printing, because there is no such thing as color printing, has almost replaced the traditional printing of short prints; now it is the turn of digital color printing, because the price reduction has begun to accelerate.

Fleming uses the theory of supply and demand of economics to divide the change in demand by the change in price to determine the price change rate (Elasticity) of the demand. If there are few choices of the available goods, the rate of change will fall, the more the selectivity, the higher the rate of change. The bigger. Digital printing competes with various traditional printing systems, so the rate of change is large and demand is highly sensitive to price. Fleming believes that market surveys conducted by means of questionnaires and statistics on the willingness to use digital printing at a certain price are not accurate. Therefore, instead of the ratio of digital printing to the total printing volume, trends can be more clearly seen. Taking statistical data as an example, the monochromatic digits for 91 years of printing are $0.013 per page A4, and the overall average printing (traditional plus digits) is $0.0023 per page; in 2002, the figure is reduced to $0.006, and the overall average changes are not significant. 0.0021 USD. The number of color figures for the year 95 is $0.31 per page, and the overall average is $0.011; the figures for 2002 are reduced to $0.08, and the overall average is $0.010.

According to Fleming's calculations, the demand for digital printing has a high rate of change of 2.8, which is more sensitive than expected. Based on this, the share of monochrome digital printing can reach 4.5% this year, and it can increase to 7.5% by 2007. As for the digital color that everyone is interested in, although the current market share is only 0.5%, the new equipment from various manufacturers gradually reduces the price to 5 cents at the “critical point,” and the output will increase rapidly. In 2007, there will be 2% of the market share.

The slow progress of digital printing has had various explanations and rhetoric over the years. Fleming explained it with basic economics, which does give people a fresh and practical feeling.