Should Print Providers Worry About FedEx Office Becoming a Larger Player in the Wide-Format Market?

BPIC: One of the most discussed topics on our social-media sites this year was FedEx Office reporting its deployment of new grand-format inkjet printing devices to its centralized productions centers across the country for producing rigid signs, banners, posters, P-O-P materials, and more. And the company was awarded a 4-year contract from Boeing (FedEx Office now serves as Boeing’s primary print provider). [Editor's note: Here is the original story.] Many readers were suspect of FedEx Office becoming a larger player in the wide-format space, particularly on the b2b side of things. Is this a sign of things to come? Should print shops be worried?

Dan Marx, SGIA: I wouldn’t be surprised if FedEx Office doesn’t become a larger player in the wide-format space. Today’s wide-format industry as a whole holds a unique place in the graphic-communications industry in that it has remained robust while traditional print has lost much of its past power. Other sectors are looking to the value-add that our technology brings in order to stay strong. The worry for print shops will be the downward effect big companies can have on price points, because their economies of scale are different.

Tim Greene, InfoTrends: FedEx is indeed a formidable company and it’s likely to grow its wide-format business. But I don’t think that FedEx growing means others have to “worry” or get smaller. Is this a sign of things to come – are other printing organizations going to enter wide-format digital? I think the answer is yes. I believe that many commercial-print companies are looking at wide format because the commercial business is very soft. They’re looking at markets that are adjacent and they think, “We do print work for many companies that also buy wide format – why don’t we offer that?” So, to gain a greater share of their customers’ print spend, they enter wide format, either by acquiring a company that does it or by investing in the equipment themselves.

Peter Mayhew, LightWords Ltd: If, as a PSP, you’re heavily dependent on national/corporate accounts, then, yes, you should be looking over your shoulder and refreshing your contacts with your customers’ headquarters. I would not be relying just on my local connections to secure national/corporate business going forward.

Marco Boer, I.T. Strategies: And, don’t forget, this is not FedEx Office’s first attempt. Under its previous Kinko’s brand, a similar attempt was made – at that time to better amortize the hardware investment and provide a more consistent level of quality. But Kinko’s never put in the investment to drive print volume demand to its central print locations. Today, however, Web-to-print has become a commonly accepted means – and in some cases, corporate-dictated means – to purchase print. Big corporations tend to prefer to deal with big suppliers (for consistency, geographic reach, and volume discount reasons). Time will tell if FedEx Office will be more successful this time around.

BPIC: Another interesting topic making the social-media rounds this summer: Toshiba’s announcement of a National No Print Day, and the Printing Industries of America’s call for its retraction. In the space of just a few days, Toshiba ended up cancelling the day in question. Comments?

Greene: I think more was made of it than should have been, it was probably kind of a silly idea in the first place and of course cancelled as it should have been. Don’t get me wrong, I think Toshiba’s intentions were good. But there are a lot of very positive “green” messages coming from the printing market, so I think the idea of a “no-print day” as a way to celebrate sustainability is misplaced.

Mayhew: To quote the well-known fictional character Homer Simpson, “D’oh!”

Boer: Toshiba America set itself up as a lightning rod for the angst that is pervading the established print industry about its future. What Toshiba should have done is take the opportunity to take it one step further and continue the dialogue. By the way, it’s noteworthy that Toshiba America is the only Japanese copier/printer manufacturer based in California, a state perhaps more aware about environmental issues than most due to its air-pollution problems.

Marx: I think the biggest question for “print” – and in this case I mean the commercial printers of the world – is, what is their plan? What will they become as the Internet and social-media market explode? How do they stay relevant? One fascinating figure that came out of a recent SGIA survey was that zero percent of our respondents now use direct mail to attract new customers. This is a true paradigm shift in the industry.

This is Day 9 of our Industry Roundtable Q&A. For Day 8, click here.