The global wide-format print sector is worth €58bn (£54.2bn) annually and requires a relatively low capital expenditure to get into. Yet commercial printers, who splash out millions of pounds on conventional kit, occupy just 3.5% of the market. However, things are slowly, but surely, changing. While commercial and wide-format print have traditionally been two very different worlds, convergence is occurring all the way through the food chain, from SMEs to large print groups. Even in the depths of recession, commercial printers are entering the wide-format market. We caught up with three such printers of varying sizes to find out the benefits and the pitfalls of moving into wide-format.

CASE STUDY 1

PRINT START-UP: REDBUCKET

Kent-based Redbucket is a two-man business run by Stewart Howard and Ron Shea. The pair set up the wide-format operation with a Roland XE 540 eco solvent machine last December.

With the economic downturn taking its toll, wide-format made a lot of sense. Howard, who spent the best part of a decade as a studio manager at Odessa Offset, explains: The investment in wide-format digital is nowhere near that of large-format litho. At the time, banks didn’t want to lend. You can get the finance with digital.

With Shea’s background in proofing technologies and Howard’s computer and digital skills, they set up shop and cashed in on retailers attempting to advertise their way out of recession.

 A lot of the work was banner and outdoor, such as A-boards, but Redbucket has diversified to follow its clients. A company we worked with might say, ‘I didn’t realise you did vehicle wraps. I’ve got vans’, or ‘I need site boards for a building site’,’ says Howard.

During a particularly quiet period, the team decided to set up a photographic studio to produce canvases, which managed to keep the firm ticking over.

Now the company is targeting a more lucrative niche. Schools are particularly receptive to the creative skills that Howard and Shea offer as they can talk these clients through the possibilities for projects that often involve the children.

A series of colleges the company is working with each have a central atrium area with a 7m lift tower. Having produced one 7x4m banner for one, another college had 7m of LEDs along each side and a custom floating fixing system. And the non-standard nature of this work means it’s less likely the schools are going to shop around and compare prices. The more bespoke you go the harder it is for someone else to steal your thunder, says Howard.

Payment is normally 50% up front and the rest on completion. As a small company, Howard says cash flow is crucial to the company. It’s a game that everyone’s playing – trying to hold on to payment, he adds.

Even so, offering a personal service and being involved in the design process does seem to be paying off. The company had a target of £150,000 turnover for its first year, but Howard says this could end up nearer £250,000. The company is already lining up their next investment: a mid-range 2.5m flatbed.

CASE STUDY 2

SME: HARCOURT LITHO

While entering the wide-format market has proved to be a financial hit for larger operators, it's also a good fit for SMEs. Harcourt Litho is a £2.5m-turnover B2 commercial printer based in Swansea that runs a range of Heidelberg Speedmaster presses and Xerox machines. At the start of 2009, it built a mezzanine floor to house a new Mimaki JV33-160, combined with a cutter/plotter and laminator.

Steve Astins, general commercial manager at the 28-staff company, explains that the decision to pursue wide-format was as much pressure from its existing clients, as it was its own ambition.

"We work for large agencies whose clients would prefer to deal with a one-stop shop," he says. "They want to do everything."

The Mimaki has given them lots of options and the company now prints everything from t-shirts and vehicle graphics, through to window etchings, for a range of its clients.

"Our wide-f ormat equipment is running all the time," says Astins.

Wide-format work is typically time-sensitive and can be relatively low-value orders, so Harcourt has introduced credit card payments and launched a website giving instant prices for jobs. It means work is normally paid for up front or on short terms - boosting the company's cashflow.

However, Astins adds the company could not survive on that work alone. "I don't think it would stand on its own and pay for itself," he says. "I would say it's brought in around £30,000 of work so far this year."

Astins says that around half of all clients brought in by Jo John, the company's wide-format specialist who acts in both sales and production roles, go on to take commercial print from the company.

Managing director Ian Harcourt views the company holistically, rather than as a series of cost centres, so he can see the tangential benefits that wide-format brings. In fact, the whole nature of Harcourt's customer base is changing due to its ability to handle wide-format work.

Astins says that 18 months ago, the company was, in the main, a local printer. Today, he says that barely half of the work handled is for local clients, the rest is for national customers and international customers as far afield as Romania and, as a result of its work for the Heineken Cup, Argentina.

So, rather than install more wide-format equipment, the company's next round of investment will be a guillotine and a six-colour B2 press to "accommodate the changing client base and what the new client base wants".

Astins' advice for anyone looking at moving into wide-format is: "You have to have the right people, you have to have money behind you and you have to hit the ground running."

CASE STUDY 3

LARGE PRINT GROUP - ALDERSON PRINT GROUP

The journey into wide-format for Alderson Print Group started with a shopping trip into Kingston. Point-of-sale (PoS) business director Stuart Hobbs took the management team, including the Alderson brothers Ron and Peter, to view the company's work for computer-gaming chain Game in situ, to expose them to the vast potential of the PoS market.

"We were already dealing with a retail client base supplying sheetfed and web work and were handling large-format work on their behalf using sub-contractors, and this gave us a lack of control," said Hobbs. "We gained a commitment from these clients to produce more work for them if we moved into the PoS arena."

But there were additional benefits, according to Ron Alderson. "We like having it all under our roof. We're confident if we do it. You can never be sure it's going to come back on time if you outsource."

One year and £5m later, the £30m-turnover company was winning PoS work on a scale that used up Robert Horne's entire national stock of 150gsm paper even before the division was officially launched.

However, getting there was far from straightforward. Alderson is typically enigmatic about how they decided which equipment to plump for. "We know a lot of people in the trade that know a lot of things, so we turned a lot of stones," he explains.

But they didn't need advice on the show piece of the new division. It was something that both Alderson brothers had had on their most-wanted list for some time. Boasting a 2,050x1,510mm sheet size, the KBA Rapida 205 accounted for half of the budget.

They took over the lease on the gargantuan press from ill-fated Capital Print and Display. Alderson managed to negotiate an ‘as new' warranty.

But, as Alderson says, "it's not just buying the press". Another £150,000 went on the sub-station and a further £500,000 on CTP.

Because the site is on a flood plain, the press hall floor sits over a cavity that protects it from rising water - this had to be filled with concrete to support the nearly 200 tonne weight of the press.

Add in another six-month delay because of power supply problems plus the not inconsiderable issue of the recession and you could have forgiven anyone for suggesting things were not progressing well for the company.

"We were up to our necks in it, so we had to go forward," says Ron Alderson.

Peter Alderson says the company had already survived three economic downturns and invested heavily during each of them. "Every time it's paid us as we've come out of the recession," he explains.

The 205 is complemented by a Rapida 162, while the digital side boasts an HP Scitex Turbojet 8500 with UV curing - one of only two in the UK - bought because of the flexibility in handling everything from PVC to plasticised and vinyl substrates, along with two HP 8000 digital presses.

One of the other key factors the company identified is having "an integrated approach", so that clients not only had one point of contact for all their different requirements, but could also rely on the same consistency of quality for each piece of work, regardless of equipment or substrate.

This meant expanding the MIS across all the new equipment, sourcing all ink from a single supplier, and standardising each press to ISO 12467.

"We manage all the presses to print the same colours - good, bad and ugly, they're the same colours," says Peter Alderson.

The final piece of the jigsaw involved training up existing sales staff and hiring in dedicated PoS sales specialists. The division now employs 20 people, while Hobbs has been given an ambitious target of a £10m turnover in the wide-format division in three years.