A printer in Lucknow during the time of the pandemic - The Noel D'Cunha Sunday Column

What is the change in the commercial print market in Lucknow and Kanpur that we should be aware of?
The majority of the print industry in Lucknow belongs to the commercial segment of offset printing. The ink on paper market in Kanpur is based on packaging. The commercial printers have been facing stress during the past three years in this region. Somehow, they managed to overcome the bad times. Once the Covid-19 lockdown occurred, the commercial printing segment has been badly impacted.

How so?
Most of the firms are dependent on jobs related to the government. This includes, promotions, books, magazines, brochures and stationeries.

What happened when the lockdown was over?
The market trend changed. The government, MNCs, industries all started to move towards saving revenue. There was a mindset shift. This altered the print scenario. The order by the central government crippled the commercial printers when they directed all states to restrict or avoid printing of promotional articles like calendars, diaries, greeting cards etc. This piled further misfortune on the suffering of printers in Lucknow and Kanpur.

What are the print stats in Lucknow and Kanpur?
The commercial printers of both cities are running at 20-30% capacity utilisation since lockdown.

Any signs of improvements?
Very little up to now.

What effect will WFH policies of large corporations have on the print volumes?
Work from home has not only affected but somehow enhanced the suffering of commercial printers. Since no physical offices are running there is reduced or no demand of stationery for office use. Moreover, the festival promotions were discouraged by big companies since all movements were restricted. This reduced the requirements for the printing of posters, leaflets, brochures etc. Most of the big companies have opted for digital media to boost their promotions. This is because digital outreach is simple and effective. It has fulfilled their requirements with ease plus it is cost-effective.

Have run lengths plummeted?
The overall run lengths have come down regularly in the past few years. Post lockdown, the equation has changed drastically. High volumes are being restricted and companies are planning for zero wastage of their office stationery. The nationalised banks have started to reduce the printed stationery required for their branches since most of the printed stationeries are shifting to online systems. In addition, there is uncertainty about the cost of raw material used by the printing industry.      

What will be the effect on run lengths? Will shorter run lengths mean more digital print volumes?
Run lengths will reduce. Buta slender margin remains for offset printers so as to sustain themselves. I feel, anything above hundred which is printed and is not customised can be produced through offset printing due to cost-effectiveness. Plus, offset provides high quality. Today, turnaround time will play an important role. This means, well-equipped presses will have an edge over outdated presses and manual post-press.

Will colour vs mono print volumes equation change in the post-Covid era in Lucknow and Kanpur?
Not really. The colour printing segment is cost-effective and readily available in the market. On the contrary, customers find producing a good mono print job much more difficult. The ease of access to colour printing has transformed most jobs to four colours. However, there will be certain segments such as text printing in novels, books or magazines which will buck this trend.

Any major changes in the wedding photo album market across Uttar Pradesh that you foresee?
The photo album market has suffered across the nation. This includes Uttar Pradesh. There have been restrictions which have been imposed post-lockdown with minimum number of invitees in marriages. As a result, many marriages were postponed or organised in a simple form at the courts. This shift reduced the requirements of marriage cards and photo albums. Most middle-class homes have chosen to reduce their investments in marriage. Today, saving money is top priority.

What about the education vertical?
There is a major slowdown. Many small publishers are facing a huge cash crunch since the payments which was expected mostly after the start of new sessions have stopped due to the cessation of schools and colleges and other educational institutions. Even today, educational institutions have not been allowed to open. Most of them are organising virtual classes. This has eliminated the traditional mode of education, like books and study material.

What has been the trickle-down effect?
The reduction of jobs in the printing industry and publishing has contributed towards loss of jobs. I feel, this is more than 30%, post-lockdown. The situation would had been much better if only liquidity would have been inducted by the government. This could have boosted the print and publishing industry.

Will firms invest more in technology - and do away with dependence on people availability in their printing shopfloor. For example, investments in workflows and finishing equipment?
In my opinion, the alternative to increase productivity while maintaining the quality with consistency and minimum possible cost price is the only choice for printers in India. We have to automate the process from start to finish in order to increase efficiency. Although India is a country with maximum youth in the world, the unfortunate part of the story is, they are not highly skilled. The big challenge for the printers is, to procure modern automated equipment in order to enhance their productions and quality. Most high technology machines are manufactured outside India. This makes life miserable for printers who have to bear the cost of customs duties and government levies.

What about schemes like EPCG schemes?
The import duties may be saved. However, this comes with many side effects. Most printers fall in the trap of buying foreign equipment through the EPCG scheme. In order to save themselves from the EPCG penalties, the print firm changes its strategy. It starts to concentrate on exports whereas they should concentrate more on consolidating their domestic business. We have witnessed that the export market has been unpredictable. This coupled with the unstable currency in the past few years has added a lot of stress on printing exports.

Funding options from the financial institutions?
Again, this is not easy for many printers. I feel, the financials and the books have to be maintained to qualify for the high value of capital goods. Furthermore, even after ticking all the boxes to adhere to the financial conditions, there is the burden of very high lending rates. Don’t forget, India is amongst the highest in the world. It can skew the debt-equity ratio of an SME or SME print firm. We have to find different solutions. Time is running out.

Moving away from Lucknow, what are the trends you are picking up from fellow printers in the Bundelkhand region and Purvanchal region?
Both these areas have been deprived of good infrastructures in the past. Currently, both Bundelkhand and Purvanchalare undergoing a transformation. However, a lot of groundwork is pending. Once completed it may help in developing the industries in these areas.

Should print be bullish about Bundelkhand and Purvanchal?
As you know, the print industry is an ancillary for all industries. Hence print expansion is possible only when ample MSME units are established. The transformative change which I expect to see in the near future is when the industrial corridor from Punjab will pass through these regions. This corridor will go up to Kolkata. Many industrial areas are proposed to be coming up along this corridor. The connectivity in this region will improve. And we can expect highway connectivity with the major cities of UP. Once this project reaches fruition, it could be a game-changer for this region. Fingers crossed.

One lesson you have learnt from 2020?
2020 has taught us many lessons. The most important lesson to be learnt is to plan your future in advance and keep ample liquidity of money with your organisation. Any unprecedented situation may arise in the future also without a warning. Therefore it would be better to prepare policies for your company in advance. The motto: should be live in the moment but you and your team should be ready for the future.

As the honorary treasurer of the All India Federation of Master Printerswhat is your message to the fraternity for 2021?
The challenges for the micro and small printers are getting tougher and more cumbersome every year. Most owners are struggling to overcome the challenges. They feel they don’t have the necessary clout to sustain – and register growth. The only way out of this, is for the printers to join hands with each other. They can solve their financial issues, map the inventories of machinery, pool their purchase, reduce internal competition and collectively market print.