The highly competitive digital printing street facing markets are still attracting new entries despite casualty levels as retail print rates plummet to Rs. 8 to 9 per A4 color page. Mayank Makhija, a young BBA of IP university started Amit Digital Print just six months ago at the Naraina Phase I community centre market adjacent to two established market players Bharat and JMD Digital. Makhija’s entry is a considered decision as his father Rajkumar is a reseller of Canon monochrome and Konica Minolta color presses. A friend of the owner of Amit Printers of Nehru Place and Okhla, Makhija has co- branded his unit with him. Young and educated entrepreneurs with insights and support from family and friends are ready to invest heavily in a market with paper thin margins – one described as both hyper-competitive and self destructive.
The economics of market place
Makhija agrees that margins are paper thin in the printing business as 70% of his clients are walk-in customers. With over half a dozen digital press operators in the same market, everyone is ready to cut prices at the drop of a hat to woo a customer.
Students and corporates usually pay better rates but there are many dealers and aggregators who collect orders from corporates and push down the rate of an A4 color page to as low as Rs
8.5 to 9. With a Rs 3.5 click-charge payable to the manufacturer, this leaves just Rs. 5 as operational cost, says Makhija.
Rent, electricity and staff – each cost around Rs. 30,000 a month adding up to nearly Rs. one lakh as monthly operating expenses. Then there are the installments to be paid to the equipment financiers. Investment in a digital press shop including associated cutting, binding and peripheral equipment and some redundancy is usually between Rs. 1.25 crore to Rs 1.5 crore. Makhija has a 7010 Canon color digital press as his mainstay besides a Canon 8295 monochrome printer and a Konica
Minolta 6050 color press. He also has a 36-inch HP inkjet printer and Jindal desktop cutting and perfect binding machines and a thermal laminator. “I am still not making money because my shop is new and needs continued investment as well as installment payouts, but I hope to see returns in the next six months as I learn the tricks of the trade and acquire more steady customers,” says Makhija.
Canon dominates the show
The Naraina community centre retail market is dominated by Canon machines with Xerox providing some resistance. According to printers like Amit and Bharat, Canon’s machines are rugged and its service is excellent. Ekjot Singh of Jolly Reprographics, who has five Canon digital presses including a 7011, however, adds that all the major brands provide comparably good service and are price competitive but there is a perception that Canon is the current market
leader. “It is possibly a sheep mentality, a reason why most big printers including me, stick to the market leader Canon,” says Singh.
The volume at the Naraina market is around half the volume at Nehru Place (see Indian Printer and Publisher January 2013, page 38) with the average printer executing around one lakh copies a month at the West Delhi print hub. However, market rates as well as click charges are similar, making the Naraina market even more challenging than its South Delhi counterpart. Nehru Place being the biggest regional hub for cheap computer hardware and software in North India has an influx of outstation customers on a daily basis that also add to its digital print volumes. The preference pattern is however similar with Canon dominating and Xerox coming a distant second in these printing hubs located in the crowded mass markets of North India.
