Selling to In-Plants? The NAPCO Research/PRINTING United Alliance In-Plant Printing KPI Report Can Help You Better Understand this Critical Market

How well do you understand your in-plant customers and prospects? To sell more Rochester Software Associates solutions to these organizations, the more you know about what makes them tick, the better prepared you’ll be to make your pitch. The findings of the PRINTING United Alliance/NAPCO Research In-Plant Printing KPI Report Summer 2024 (the second part of the report will be released in November) is an excellent starting point to further educate yourself about your in-plant customers and prospects. 

Starting Line – Report Goals 

PRINTING United Alliance and NAPCO Research surveyed 134 in-plants with annual operating budgets of less than $500,000 to over $20 million and with between less than five and more than 60 employees.  

The report's KPIs (key performance indicators) focused on the percentage of jobs delivered on time, the percentage of jobs reprinted because of production errors, equipment utilization rates, and budget/revenue per employee. The survey also examined what in-plants are doing in automation, waste tracking, sustainability, and artificial intelligence and identified their biggest opportunities and challenges.  

Let’s examine a few key portions of the report that are the most relevant for resellers of production print hardware and software. 

In-House Print Applications, Services, and Capabilities 

Survey respondents typically printed from a combination of more than 20 applications, with an average of 11 per in-plant. The most popular applications include brochures (85.8%), booklets (84.3%), and business cards (79.1%), followed by signs/graphics (70.1%), newsletters (68.7%), and envelopes and stationery tied at (67.9%). The remaining 13 applications ranged from 20.9% to 67.2%. Popular services offered by in-plants include mailing (52.2%) and fulfillment (32.1%).  

What this means to you: For the applications, any solution that enhances workflow, such as WebCRD and QDirect, can enable those applications to be performed more efficiently. The emphasis on mailing and fulfillment services reveals an opportunity for software such as RSA’s variable data printing solution ImpactVDP.  

The report also identified the type of equipment most likely used in-house by these organizations, which is useful for anyone selling production print hardware and software. Those include digital printers (color, 88%, and black & white, 73.9%), bindery equipment (85.8%), wide-format inkjet (roll-fed, 69.4%, and hybrid or flatbed, 32.8%), and digital envelope presses (46.3%). Other equipment used includes offset presses (28.4%) and production inkjet presses that are not considered wide format devices (20.9%). 

What this means to you: Obviously, you sell more than just software, and the broader your equipment offerings, the greater the opportunities.  

Outsourcing and Outside Work 

Outsourcing and whether the in-plant accepts work outside its parent organization directly impacts KPIs such as equipment utilization rates and budget/revenue per employee. The survey found that 86.2% of in-plants outsource. Overall, outside work represented 10% or less of budget/revenue for 57.5% but more than half for 8.2% of respondents. On average, the survey revealed that outside work represents 17.3% of budget/revenue.  

What this means to you: This is an opportunity to leverage solutions such as WebCRD and QDirect to streamline workflow and better manage the orders and jobs coming into these organizations.

Budget/Revenue Trends and Expectations 

The trends around budgets/revenues are positive news for resellers. In 2023, 42.4% of budgets/revenue increased. On average, budgets/revenues were up 3.7% for all in-plants surveyed. Equally good news is that 38.8% of survey respondents expect their budget/revenue to increase in 2024, 52.2% expect no change from last year, and 3.7% expect a decrease. (5.2% are unsure.) According to the report, budgets/revenues are expected to increase by 4.1% on average for all in-plants surveyed.  

What this means to you: With more money in their budgets, these organizations may be more receptive to upgrading their equipment or adding new solutions. 

Page Volumes 

Page volumes are trending upward, which is more good news for resellers. Last year, total pages increased for 61.1% of in-plants surveyed. Contributing to this increase was output representing four or more pages, which increased for 64.1% of respondents. Meanwhile, one-to-three color pages and black-and-white pages increased, respectively 44.8% and 42.0%. 

Fully, 60.6% of all in-plants surveyed expect their total page volume to increase this year, with 60.9% expecting an increase in four-or-more-color volume, 41.0% an increase in one-to-three color volume, and 39.5% an increase in black-and-white volume.  

What this means to you: More pages mean more wear and tear on the equipment, more ink/toner sales, and more jobs that need to be more efficiently managed via an RSA solution. 

Automation 

Most respondents (65.9%) are interested in equipment automation features or workflow solutions. Reasons cited include improving productivity (55.0%), faster turnaround (44.2%), reducing costs (40.3%), minimizing errors (33.3%), producing more print volume (29.7%), minimizing spoilage (21.7%), and compensating for the shortage of skilled workers (20.9%). Most respondents (88.2%) identified multiple reasons for further automating their organization.  

What this means to you: A workflow solution such as QDirect is an asset for in-plants looking to streamline their workflow.  

Efficiency Metrics 

The report focused on four key metrics that measure efficiency: on-time delivery rates, production error rates, capacity utilization, and budget/revenue per employee. The goal was to establish baselines of average and exceptional values for each metric.   

• On-time delivery rates for jobs ordered by the parent organization average 94.6%.  

• Reprint rates due to product errors on jobs produced for the parent organization average 2.8%. Nearly 52.0% are at 1% or less, while 20.2% are at more than 4%. 

• Equipment utilization averages 70.8%.  

• Revenue/budget per employee averages $135,360 for all in-plants surveyed. According to the report, this KPI varies depending on how much work the facility outsources ($147,143 if 5.0% or more and $115,705 if less than 5.0%). It also depends on whether it accepts outside work ($141,667 if it does and $128,827 if it doesn’t).   

What this means to you: The efficiency metrics reported in the survey can help you create more targeted proposals for in-plant customers and prospects. 

Opportunities and Challenges 

Survey participants were asked to identify their most significant opportunities and challenges in 2024.  

• Expand capabilities - Wide-format printing was frequently mentioned, but other opportunities, including promotional product imprinting, apparel decoration, fulfillment, and wide-format installation, were also noted. Respondent's primary objectives include creating value by offering more services to the parent organization and filling capacity with more outside work.
  
  
• Increase efficiency - Capital investment in MIS and web-to-print to support automation, increasing production speed, streamlining workflow, removing steps from processes, and greater cost control were identified as strategies to achieve greater efficiency.
  
  
• Insufficient workload - A critical challenge identified was finding ways to bring more printing in-house. 
  
  
• Rising costs - Labor, materials, transportation, energy, and operating costs are climbing.
  
  
• Challenges increasing productivity – The primary issues are aging equipment, a shortage of skilled personnel, and limited space.

Make the Report Work for You 

Leverage the information in the report for crafting pitches and proposals that will resonate with in-plant customers and prospects. You already offer these organizations an opportunity to enhance in-plant efficiency metrics, reduce production error rates, and provide better cost control with solutions like WebCRD, QDirect, and ImpactVDP. By aligning your products and services with the challenges and opportunities facing these organizations, you can establish stronger partnerships and help them achieve their goals.