Digital photo albums – is there enough headroom to grow?

The print industry in India is one of the few in the world where the net number of print businesses has grown in the past decade, although many offset printers in the bigger cities have closed down. This is primarily because of the influx of new and old multicolor presses in Tier-2 and -3 cities and the low entry cost of digital printing.

Many photo print shops have bought good digital production presses and become suppliers of photo albums. More than 30,000 photo albums (largely wedding albums) are printed in India each day. However, this may not be enough to sustain those among the 6000 digital printers who can print and bind these unique and personalized luxury products.

There are 12 million marriages in the country each year, which comes to an average of 33,000 weddings daily, but it’s a seasonal business. (The number is confirmed by expert sources who have solid calculations of this still popular social phenomenon.) Digital printers who specialize in the photo album business and have large capacities with several presses can produce as many as 400 albums a day during the peak wedding season, but there is not much work for them the rest of the year so they are beginning to develop other market segments.

Nevertheless, the successful photo printers who are buying the newest digital presses are also adding lay flat binding equipment and digital enhancement machines of which the two best known are the Scodix sold by Monotech India and the MGI JetVarnish sold by Konica Minolta India and its distributors. It’s very clear that while value addition with coatings, textures and glittering gold and silver sells with print in general, it fits extremely well with short runs. Decoration is in and booming.

Do numbers really matter?

Do numbers really matter to print businesses? It’s not clear whether the GDP growth rate actually influences their decisions more than local demand and competition. Although our job is to put forward reasonable explanations and justifications for modernization, professionalism and the adoption of new technology, we realize that a great deal of equipment and consumable purchasing is more emotional than rational. The best printers are really those who could make anything work (or get the best out of what they have at any point) and those who have, over time, rationally distilled their experience to find the balance between better technology, automation, ease of use and return on investment.

We do think that numbers matter – both in a general and particular way and in the case of every business. We know that if the GDP really grows at only 5-6%, the print industry cannot grow meaningfully. At that rate it cannot expand because the demand for books, newspapers and magazines and packaging is stagnant or grows nominally (incrementally in volume) and not in real value growth. According to a recent article by a former finance minister, “Growth slowed down rapidly in 2018-19. In the four quarters, it was 8.0, 7.0, 6.6, and 5.8%. It will probably decline further in April-June 2019. Anticipating a downtrend, RBI has lowered the forecast for 2019-20 to 7.2%.

GDP growth is driven by investment (not merely consumption) and gross fixed capital formation was 29.3% (at current prices) in the past year. Promoters are reluctant to invest because capacity utilization in manufacturing was only 76% in the past year. In my February editorial in these pages, I wrote: ‘The publishing and print industries are not showing exceptional or even real growth. Our experience in researching these industries for the past 20 years (in IppStar) shows that high growth only occurs when the GDP growth is far above 6%. In the past three or four years this does not seem to be the case, no matter what kind of numbers the government cooks up and claims.’ Unfortunately, our industry is an accurate barometer of the country’s economy and we need to keep learning how to read its trends and the relevant economic signs. And to keep speaking out.