INKISH.NEWS -

Since January, I have been in 14 countries, and let me share a not-so-secret secret. The printing industry is terrific, and seeing how owners of printing companies of all sizes and within all segments are innovative, intelligent, and creative - with a fantastic eye for business, one word comes to mind - endless.

These people see endless possibilities selling print, and the successful ones never complain about getting customers to get enough orders. I haven't spoken to a single printer that doesn't believe in print, and with that in mind, they are willing to invest in both technology AND people. The people thing is the only thing I hear in almost every country - and yet - these companies manage to get business done and find solutions. One of the solutions is to cross-train staff to operate multiple machines. Flexible work hours (mutually) are finding their way into more and more printing companies, but one denominator is the companies' endless willingness to invest in technology. We almost always visit companies that have already invested in new technology or are about to. Successful companies invest in workflow/automation, inkjet, and binding equipment, generally more automated than past generations! The result is higher productivity and higher profits.

So let's take a look at a few examples. The first is the Brazilian company Forma Cetra based in Sao Paulo. The company is operated and owned by three siblings - two brothers and a sister. 11 years ago, and the company processed offset plates for printing companies in Sao Paulo and the suburbs. With more than 3,000 printing companies in the Sao Paulo region, the company was a success. Still, the three siblings decided to change the business and become a digital printing company focusing on the production of books. That didn't come overnight, but 11 years later, Forme Cetra is considered one of the leading Latin American digital printing companies. Three T-series HP printers (230, 240, and 250), an Indigo 100K, and a B2 Heidelberg offset machine delivers more than 150 million US Letter Size/A4 prints a month - delivered as perfect book blocks or as sheets for saddle stitching or coil/Wire'O binding. Francisco Souza is managing the production, and I, of course, asked him why they have selected the technology they have. And the short, condensed answer is quality, reliability, and productivity - and when you see the three Hunkeler lines that create stacks of perfectly aligned book blocks, you soon understand that the production is developed to make money - and they do! Though all other processes in the company are pretty labor-intensive, there is no doubt that Forma Cetra invests in technology where its more viable - in a market where labor is impossible and inexpensive compared to Europe and the US.

Besides print production, Forma Cetra also has a vast IT department that develops IT solutions for customers, and this is also, by the way, something you see in successful companies - IT services as an integrated part of the offerings!

To put things in perspective - Forma Cetra operated in a market where the technology is WAY more expensive than in most countries - not only because of Brazil's political and economic situation in general but also because import taxes are as high as 60%. You have to be VERY smart when operating a business where the price level of all the products you sell is lower, but the investments are higher. Regardless, a company like Forma Cetra grows, and as they have not reached any limits in their current business, there is no reason not to believe that next time we visit them (and I expect to), we will see a company considerably larger.

Today we visited another freaking interesting company - this time in Buenos Aires - Argentina. If you think conditions in Europe and US are complex, consider this for a second: The inflation in 2023, according to statista.com, is 98.59%. You can't import technology without permission; it must be aligned with export, so the trade balance isn't influenced. When you have permission to buy, that isn't a guarantee that you can pay for the imported goods - and as the payments are paid to the government, the exchange is about 50%. These are almost impossible terms for any business. As I was told during my visit, companies often need to find alternatives and be creative - and that is in a country where everything looks more like Madrid than any third country - OR that is at least how the world looks when you visit Buenos Aires. I got to the countryside, and here the smaller cities are in devastating conditions; poverty is what you see, trash everywhere, and you understand that Argentina and its economic problems aren't to be solved any soon.

Yet, we visit Docuprint in a suburb of Buenos Aires that is as modern as it gets. Five pillars are the basis for Docuprint. Books, transactional, IT services, Publishing, and leasing/service of Lexmark/Xerox printers and LG Panels - so what we see is a well-designed business. Leonard Menoyo is the CEO and 2nd generation owner of Docuprint, and with what we see while visiting them - you see a company that has become one of the first movers in digital print in Argentina. The core is an OCE and an InfoPrint printer, with a new Ricoh VC70000 soon to arrive. On the binding side, three Hunkeler lines and two Horizon BQ-series for paperback production - and this is effective. In the film, you'll soon see from Docuprint; you will see and understand that with all the limitations described above - this has become the default. These are the conditions business owners operate under in Argentina - and you have to salute the owners for their endless effort to push the boundaries.

And, oh, I forgot. On top of everything I wrote above, printing companies in some parts of Latin America have to live with load shedding and relatively constant power outages and ZERO options for credits to most of their customers or to printing companies as well - just because the countries are in such miserable situations.

So endless creativity, effort, and still potential. Sao Paulo you have a population of 24 million people, and Buenos Aires approx. Fifteen million people and Latin America is such an exciting market because books and print still play an enormously important role.

I will also say this is an endless opportunity for vendors. You can sell more, I am convinced!

May 30, 2023

Author: Morten B. Reitoft