It has been almost 50 years since the corporate world was introduced to the concept of the paperless office, a predication that was laughably off the mark. But while multifunction devices are still mainstays of corporate Australia, businesses are definitely starting to print less, which is heaping pressure on the office printing industry.
In response, suppliers are evolving and enhancing their strategies. They are focusing on different market sectors to offset declining revenues or coming up with new ways to capture greater market share against their competitors.
This is most evident among large enterprises, which have always been the growth engine for the office printing industry. Today, the large enterprise sector is accelerating its shift away from office printing. This will impact longer-term revenues across the supply chain. This has led manufacturers and resellers to turn their attentions to the small to medium businesses (SMB) market as well as the small office, home office (SOHO) sector.
Australia’s printing ecosystem
The office printing ecosystem in Australia is made up of around 15 global hardware manufacturers, as well as a channel that includes product distributors covering both hardware and consumable, store retailers, IT and software resellers
and traditional office print dealerships, as well as an assortment of managed print services (MPS) providers.
Across the customer base, these suppliers face both challenges and opportunities. In the large enterprise market sector, the trend is towards declining device unit numbers as well as reductions in print volumes. In SMB and SOHO, there remains potential to increase unit numbers and consumables sales.
Large enterprises are scaling back print volumes and device unit numbers as they implement a strategic approach to managed print services. This approach provides transparency to control costs while supporting a growing business initiative to migrate, digitise and automate paper-based documents, data and content, much of which
can slow the business down.
Their call to arms is not only cost-driven. Enterprise buyers have recognised that true productivity and efficiency requires removing the slow and somewhat disconnected process-related boundaries of paper within their organisation.
Senior executives from the large enterprise sector have acknowledged that managed print services provide them with greater transparency around costs, control and management of their print-related functions. With the acceleration of customer-driven, mobile-based platforms, enterprises have realised that paper content within their business needs to be digitised faster.
A recent example is Westpac’s ‘WorkSmart offices’ program. To demonstrate how the company is transforming its 200-year-old workplace, the Sydney head office has effectively banned paper. Two printers will service the 350 staff on the Sydney WorkSmart pilot floor and are almost hidden as part of Westpac’s ‘paper zero’ initiative. The takeaway is a 175:1 user-to-device ratio.
This could well be just the tip of the iceberg.
Enterprises implementing MPS usually start with the aim to consolidate, rationalise and standardise device fleets, thus reducing device unit numbers within the organisation. This is coupled with a growing social attitude towards reducing print volumes, or even questioning the need to print at all.
Print volumes at larger enterprises are being reduced through a mixture of software applications around print security and an increasing strengthening around print policies that encourage print-less behaviour.
Karl Sice, head of Staples Technology Solutions, Australia & New Zealand, believes managed print services has not only helped organisations to cut costs, but helped them transform business processes. Large enterprises are now becoming focused on digitising documents and creating a digital document workflow, all of which delivers better outcomes.
While SMBs aren’t as far down this path, smaller businesses are following the lead set down by large enterprises. They, too, are trying to reduce print volumes due to the increased importance of digitisation and mobility.
But is it all doom and gloom for the industry? No, not just yet. While print volumes are seen as declining, device hardware sales are actually going up.
Scott McLennan, managing director of major Australian printing distributor Dynamic Supplies, has seen resellers increase their focus on the SMB market. Customers with smaller device fleets generally weren’t targets in the past, so this new attention has helped increase numbers of devices sold.
McLennan believes customers are moving away from the larger A3 sheet multifunctional devices and down to the smaller, A4 sheet, cartridge-based MFDs. In the past, a typical client may have bought one larger A3 MFD, but now they are transitioning to two smaller A4 devices, effectively doubling unit numbers.
This change sees Dynamic Supplies resellers sending out more cartridges to coincide with the hardware unit increase, though McLennan admits customers are printing less.
Next: a major shift in sizes