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The Opportunity for Print On Demand Solutions in the Label Industry


Introduction

InfoTrends recent study entitled, The Opportunity for Print On Demand Solutions in the Label Industry, provides production printing equipment, supplies, and software manufactures the information necessary to understand the nature and extent of the full-color on demand label printing opportunity.

Research for the study consisted of a detailed survey of 213 label converters worldwide. The survey asked about types of printing equipment used, pre-press and post press capabilities, substrates use, use of conventional and POD printing equipment, desired printing improvements, and purchasing plans. Telephone interviews were also conducted with a wide range of suppliers, label converters, and label customers.

The Print On Demand Opportunity

According to the study, dedicated full-color Print On Demand (POD) label presses generated $246 million in label sales in 2005, a total that InfoTrends forecasts to be $393 million in 2006 and over $1.7 billion in 2011.

Figure 1: Worldwide Retail Value of POD Label Press
Labels ($Millions)

In a world market valued at nearly $63 billion for all types of labels in 2005, labels printed on POD label presses for use on consumer goods are a small but quickly-growing part. The installed base of POD presses is currently less than 2% of all label presses, but that this share will grow to 7% by 2011.

The Figure below illustrates InfoTrends’ estimates for installed base, based on projected shipments and retirements. Regional shares of installed base expected to change somewhat over time. In 2005, EMEA appears to have accounted for about 50% of the installed base, while North America captured 40% and ROW captured about 10%. Over the course of the forecast period, InfoTrends expects to see considerable growth in installed base of POD label presses, rising from 405 units in 2005 to nearly 1,900 units at the end of 2011.

Figure 2: Worldwide POD Label Press Installed Base (Units)

Ten years after the first POD label press was introduced, this category of digital printers has hit its stride. Right now, enhanced products from experienced vendors are meeting markets hungry for equipment to print short runs of high-quality labels. Not only can POD label presses do that, but the newest ones are proving to be profitable for longer runs as well, up to 30,000 or more labels.

POD label presses are full-color digital print systems built for printing labels in particular, but also capable of printing tickets, tags, and even folding cartons. These POD label presses print short and medium length runs of full-color, spot-color, and even variable-color labels. They offer greater flexibility than conventional label presses, especially in terms of job setup and changeover times. InfoTrends estimates that revenue to OEMs from POD label press sales will total $90 million in 2006 and $154 million in 2011.

While the installed base of POD label presses is growing quickly, the label converters installing this equipment are also growing their use of it—selling more jobs, running the presses longer, using more supplies. This is a great situation to be in, not just for OEMs, but also for the makers of all the related media and software.

The preceding is an excerpt from InfoTrends’ report entitled “The Opportunity for Print On Demand Solutions in the Label Industry.” The complete document is available immediately. To learn more about the report or to make a purchase, visit our online store or contact Nicole Shown at +1 781.616.2100, ext. 207 or nicole_shown@infotrends.com.

Copyright © 2006 InfoTrends. All rights reserved. Reproduction or reuse of InfoTrends materials is strictly prohibited without prior written consent. If you are interested in referencing InfoTrends’ content, please submit your request to allison_jones@infotrends.com.

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