Expanding the consumables business“Packaging printing is a blue ocean and Heidelberg is the perfect partner to help you swim” — Klaus NielsenQ: How is the current financial year for Heidelberg India in terms of sales of sheetfed multicolor offset presses? Any perceptible trends such as improved purchasing power of Tier-2 and 3 city printers?
For Heidelberg India the current financial year has been successful in terms of sales of latest technology and to the packaging segment. Among others, we have sold and installed the first two packaging presses with the Inpress Control System. We have installed our first CX102 and XL106 presses, and are just about to start installation of the first Heidelberg press with an in-line foil system. The majority of these presses was installed in and around established printing hubs and each of these presses has given their owners a significant competitive advantage. Our expectations for the future are also positive especially as the Euro has devalued by 20% due to the latest decisions of the European Central Bank.
Klaus Nielsen, managing director of Heidelberg India. Photo PSAQ: Do you see a marked or pronounced slowdown among commercial and book printers or do you see this segment as still interested in new presses?
We still see an interest for new presses from commercial and publishing segments in India. The underlying economic uncertainties influenced the investments in such a manner that low-cost, low-automation equipment was preferred. While I understand the risk management of a lower investment point, I still find it concerning that automation is being compromised, in an increasingly competitive environment, where faster turnout of printing jobs is critical for survival. Printers investing in a low-cost, low-automation model will face operational challenges due to job turn-around pressures in the future.
Q: Has the competition from used presses abated; is there more interest in new presses than ever before?
Earlier in the year, the Indian government decided to discontinue the option of importing used equipment under the Export Promotion Capital Goods (EPCG) scheme. This meant that print shops able to generate the required export orders could save 28% on the import duty compared to a used press. Further discussions are under way on ministerial levels to ban used equipment below a certain age, however, I am given to understand that AIFMP is addressing the same. Used presses still carry relevance in the market, but choosing between new or used equipment depends purely on the printer’s investment objective or criteria.
Q: For India we expect the 2014-15 financial year to witness sales of 60 to 70 new multicolor presses. Do you find this a reasonable estimate and how has Heidelberg fared in this regard?
Basically there are two sources for such information, the ‘import statistics’ and us ‘the suppliers.’ While the former is hard to argue against, the latter tends to be overly optimistic. Since the financial year is still not over, I cannot verify the above numbers. But anyway I expect Heidelberg will again be the largest supplier in terms of contract value.
Q: How do you see the monocarton or folding carton market shaping up? How would you describe Heidelberg’s success in this market for 6 color-plus coater and 6 color-plus coater full UV presses?
In the past few years, the packaging segment has been portrayed as the printing industry’s ‘Blue Ocean.’ While this might be true, many print shops have also realized that in order not to drown in the blue ocean, they need a perfect partner like us, who can teach how to swim. While packaging offers opportunities for new entrants, we have also seen green site operations closing down in a short span of time.
Heidelberg India has significant expertise in packaging and UV printing with close to 400 printing units installed in the past six years. I strongly believe that we are the right partners for any packaging printer, who wants to avoid spending 6 to 12 months experimenting in order to gain the required knowledge level to actively compete.
Q: Despite shedding some of the postpress manufacturing, Heidelberg still seems aggressive when it comes to converting machines (diecutters and folder-gluers) for the packaging market. How do you think this will play out in the Indian scenario?
We have made some changes to our worldwide strategy, the most significant of which is of course to sign up with Masterwork Machinery (MK), China. This will give us access to a much wider range of diecutters and folder-gluers, enabling us to very aggressively build on our current installation base. In any case, the Indian market will benefit from having an additional committed quality supplier.