With "fatser, cheaper and better" the axiom held dear by all publishing companies, odds are that you, as production people, may look for a supplier nearer your shore than Asia to provide faster turnarounds and even faster delivery at one point or another. Enter Poland. Throw in lower labor costs—currently four times lower than in Germany, Denmark, Sweden and France—a high level of education and a healthy stream of foreign direct investment (FDI), and Poland's rise in the global print manufacturing landscape seems predestined. Even its midpoint location between Paris and Moscow has been an attraction of sorts to the publishing industry.
"The most advantageous factor in the Polish printing industry currently is its EU accession. It brings about easier export within the region. And with our relatively competitive labor costs, great geographical location within Continental Europe and modernized printing facilities, Poland is going to be on every European publisher's map," says Grzegorz Boguta, president of the Polish Culture Foundation and CEO of NOWA Publishers and of his own media/publishing consultancy firm.
His sentiments are shared by Slawomir Sokolowski, editor-in-chief of Poligrafika—Poland's magazine for the prepress and printing industry. "Our printing houses are getting stronger, better and more qualified. But best of all, there has been a major mindset shift. Several years ago, during one particular industry conference, the stance among the printing houses was one of wariness—of the competition from EU member countries, of their survival. Now, it's our neighbors who are wary of our rising industry dominance, especially in the central and western European regions," Sokolowski said.
Then and Now
Until the end of 1980s, Polish printing companies were exemplified by obsolete equipment and outmoded printing practices. This sluggishness was very much due to the fact that these companies were state-owned enterprises (SOEs), heavily dependent on government contracts and financial support. During those times, domestic commercial entities naturally turned to neighboring countries such as Germany and Scandinavia for their higher-quality and full-color printing services.
Then, in the early 1990s, imports of printing materials were made tariff-free, creating a wave of secondhand machinery procurement initiatives. Quality printing was made possible, and full-color magazines and newspapers started to appear in the Polish market. By the mid-1990s, some of the SOEs were put under the State Treasury's National Privatization Program and readied for auction. Several were bought by private investors or went into joint ventures with foreign equity. Modernization of the printing industry started in earnest at this point. Suppliers of machinery/workflow processes, ink and paper from all over Europe poured in. By 1998, the Polish printing industry—mainly in corrugated board, packaging and offset printing—pulled in FDI worth more then $250 million. And between 1995 and 2000, Poland's magazine/periodical exports jumped fivefold. Conservative estimates put new presses installed since late 1999 at about 100. More printing companies have purchased or leased brand-new machines rather than buying cheaper secondhand ones. In 2002 alone, more than 30 CtP installations were made countrywide.
Presently, the number of printing companies stands at more than 18,000, a big jump from 15,000 in 2001—an indication of the industry's rapid expansion in domestic as well as export markets. But less than 20% of these companies have over 1,000 employees or are dealing in exports. The Polish printing industry is therefore divided into two distinct groups: local small printing houses locked in a competitive struggle for domestic business and larger foreign-backed entities such as Poligrafia, Winkowski and R.R. Donnelley, which are eyeing the export markets. Overall, newspaper and color magazine/periodical printing is currently the largest sector, accounting for more than 50% of the total industry revenue.
Future Path
"The major factor slowing our printing industry is the lack of international marketing experience. Only a few plants have managed to attract foreign customers outside this region," says Boguta. "But every supplier is increasingly aware of the need to expand its market beyond the European shores. So we'll definitely see more action from Polish printers in the near future." He also predicts more consolidations among the small- and medium-sized printing houses. "Product-wise, some houses will go into digital printing in order to offer more flexible services to their customers, while some will venture further into fulfillment services for Polish as well as foreign publishers," he says.
Meanwhile, Sokolowski is involved in PrintinPoland.com, an Internet-based B2B platform for international print buyers and Polish suppliers, that was launched last month. "We're talking about a platform for everybody in the industry, not just book printers. At present, Poland has top names in the different printing sectors: Winkowski, for example, is well known in the magazine printing business, while a specialist like Cezar is the top European name in highly processed labels and packaging. It's no exaggeration that I see the future of Polish printers everywhere, in all sectors." And as we speak, Polish printers are opening their printing facilities outside the country, in places like Russia and Ukraine.
With the country's EU membership in the bag, previous market advantages enjoyed by many Polish printers—specifically low prices—will come under scrutiny. With EU regulations in place, offering low prices will no longer be an option. As such, many printers are now aiming to solidify their reputation by preparing for ISO certification, installing enterprise-wide management systems and other methods of competing with their Western counterparts.
And as of May 2004, a 22% value-added tax (VAT) was imposed on magazine and book printing services. How well Polish printers will react to the VAT and the strict EU regulations remains to be seen. Despite all these potential obstacles, there's no denying that Poland has become a force to be reckoned with in the European print manufacturing landscape. So if you are looking for quality, shorter runs and even shorter lead time for the European markets, taking a closer look at Poland could be a crucial step in your production planning.
