State competes with private printers
The capital’s commercial printers say they are investing in modern technology and making their businesses more efficient despite what they see as unfair competition from state‑owned, heavily subsidized printing plants.
That’s good news for their customers, who not long ago had to send work outside Ukraine to printers in the Czech Republic and Poland, where the quality of the work was higher and the prices were lower than could be obtained closer to home.
Today, managers of Kyiv’s largest printing houses say they’re closing that gap – shortening lead times, improving quality and lowering prices. They are even making inroads into the export market themselves, developing clients in Russia.
Last year’s government decision to introduce tax concessions for the printing business is credited with helping jump‑start the industry.
Oleh Nezhyvoy, head of corporate sales for Blitzprint, a subsidiary of the Blitzinform publishing house, said that until recently, customers had to use separate service bureaus to handle advertising, design and printing services. Now, he says, large printing firms have consolidated and offer a one‑stop shop, where customers can have all phases of a major commercial printing project done in one spot.
That consolidation, Nezhyvoy said, has changed the face of the country’s publishing and printing industry.
By managing and coordinating entire projects, from pre‑press and printing through cutting, folding and binding, printers have streamlined the process and consequently brought down costs, he said.
Mira Printing’s co‑founder, Viktor Zadorozhny, agreed that the move toward consolidation has resulted in cost efficiencies. He said that it has improved the industry’s competitive environment as well.
“This is the only industry I know where a company will invest millions to sell at lower prices,” Zadorozhny said.
Zadorozhny said that while it could cost about $2 million to get into the printing business, the capital investment could be recouped in as few as five years.
The work that large printing businesses have done to better organize their work is being changed by investments in high technology.
Most printers continue to print using offset lithography, but cutting‑edge digital technology is making it possible to go from concept to press entirely using computers. Paper, rulers, glue and pencils are becoming the printing trade’s tools of the past.
Nezhyvoy said that his company has invested more than $2 million in digital printing technology. The new equipment is scheduled for delivery in October. On delivery, German technicians will train the Ukrainian workers.
In the future “the print production process will be more streamlined, more efficient and more reliant on technology,” Nezhyvoy said.
Digital printing technology continues the trend toward a streamlined, more efficient printing process, and Nezhyvoy said it would allow his firm to pursue contracts from customers outside Ukraine. Where Ukrainian publishers once looked to foreign printers for affordable quality work, now foreigners are looking to Ukrainian printers.
Blitzprint is one of them and actively markets its services abroad.
Nezhyvoy said his firm is negotiating with Russia’s largest publisher, Independent Media, and others. A deal with Independent Media could mean that Kyiv’s Blitzprint would print magazines such as Elle, Oriflame and Cosmopolitan. He said that Independent Media presently uses a printer in Finland to produce some of these publications.
Not all printers are as eager to embrace digital technology.
“Digital printing is new and very expensive. It is not realistic to expect a boom in this market in the near future,” Zadorozhny said.
Adopting new technology means that existing employees will need to upgrade their skills, while new employees will require extensive training. But Zadorozhny said that ineffective marketing and poor process management, rather than outdated technology, posed the greatest obstacles to his industry.
In the future, Zadorozhny said, a company’s success or failure may hinge on how effectively it manages its work.
Blitzprint’s Nezhyvoy agrees that process management is an important element. But he said that new technology and trained staff encourage efficient management approaches.
Most of the printing industry’s high‑technology workforce is relatively young. Zadorozhny said that few Soviet‑era printing specialists opted to receive training in the new focuses and modern technologies adopted by the industry.
“You will not be able to print high‑quality color magazines if workers are still using rulers and arranging layouts by hand,” he said. “Computer‑aided design and modern printing technologies must predominate.”
Zadorozhny said that specialists from Heidelberg Finishing, a German printing equipment manufacturer, provide regular seminars and training for Kyiv’s Printing Institute students.
Newspaper publishers complain that state‑owned plants, like Pressa Ukrainy in Kyiv, can print newspapers at up to 30 percent less than private printers because of the subsidies and tax advantages government‑owned printers enjoy.
Publishers who rely on commercial printers must either sell their publications for a higher newsstand price than those of competitors printed at government‑owned plants or dip into advertising revenues to make up the difference in printing costs, said Mykhailo Veisberh, president of the Ukrainian Newspaper Publishers Association.
Veisberh said that state‑owned shops also have an advantage because they can use newsprint purchased by the government, whereas competitors are sometimes required to import newsprint and pay customs duty.
He said that as state‑owned plants are eventually privatized, the impact of competitive pressures could decrease. However, no deadline for the privatization of the largest state plants like Pressa Ukrainy has been set.
