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01 August, 2008 11:24

Multifunctionals: a device for all seasons

by Sara White

When it comes to replacing old copiers and printers with multifunctional devices, energy efficiency, print management tools and running costs are key to the decision making process.

The paperless office never came to pass but the profile of the office print environment has changed with the inexorable advance of the multifunctional copier printer, replacing personal printers and promising cost savings and productivity benefits. While the benefits of a multifunctional approach to printing are often financial, the standalone printer is still an important part of the mix. But the emphasis is now on balanced deployment, choosing the right mix of printers and multifunctionals (MFPs) depending on work pressures and internal requirements.

The big issues facing companies today are concerns about the economy and the impact of the credit crunch, acquisition and running costs, and environmental issues, particularly energy consumption and paper usage.

"Financial constraints, the economic climate and increasing environmental pressures could have a detrimental effect on unit sales, hardware prices and cost-per-page margins," said Cecile Drew, Gartner

Vendors are feeling the impact of euro exchange rates with the weak pound affecting profitability, while prices are being squeezed across the board. It is worth noting that print prices continue to fall, while investment in new hardware developments is creating new economies of scale for users. One of the advantages of the market-wide adoption of multifunctional devices has been that the copier specialists are facing up to the challenge of print vendors. Both see opportunities in attracting new business with managed print contracts based on click per page payment systems for copy and print output, thereby reducing costs.

It is essential to make sure that contracts are as transparent as possible. As prices drop, sellers will be keen to protect their margins and may well add costs to contracts, particularly on service and maintenance.

Trends

The combined printer, copier and multifunctional product (MFP) shipments market in Europe, Middle East and Africa (EMEA) totalled 52.6 million units, an increase of 4.3 per cent in 2007 compared with 2006, according to Gartner.

"The current period of unit growth may not continue," said Gartner principal research analyst Cecile Drew. "Financial constraints, the economic climate, and, more importantly, increasing environmental and health-scare pressures could have a detrimental effect on unit sales, hardware prices and cost-per-page margins. Vendors must be firmly focused on greener print technologies, helping customers print less, act more responsibly and promote environmental sustainability."

In 2007, the print market was still in a period of strong unit-growth, driven primarily by the demand for MFPs, which outsold printers. Although colour-page devices continued to grow at a strong pace with sales up 34 per cent, Gartner pointed out that mono-page devices remained the predominant choice among offices, with 18 per cent growth and an 85 per cent share of the page market.

Market share: printers, copiers, MFPs

Vendor	2007 shipments	2007 share %	2006 shipments	2006 share %	2007/2006 growth %
HP	23221	44.1	20723	41.1	10.8
Canon	8337	15.8	8124	16.1	2.5
Epson	6661	12.7	6296	12.5	5.5
Lexmark	3986	7.6	5012	9.9	-25.7
Brother	3224	6.1	2902	5.8	10.0
Others	7210	13.7	7334	14.6	-1.7
Total	52637	100.0	50392	100.0	4.3

Source: Gartner (February 2008) (Figures in thousands) www.gartner.com

Financial pressure

Inevitably, the credit crunch is affecting buying decisions and there are signs of a slowdown in purchases. Canon head of office marketing Tracey Fielden said: "It is not that companies do not want to invest in technology, but they are putting off purchasing decisions. The exchange rate fluctuation is also affecting business with the impact of the euro on the pound.

"But we have seen a large upturn in managed print contracts, especially in financial services where they see that print is a key area where they can cut costs. They are looking at print as an entirety in their organisations and focusing on what documents they print and how. It is being driven by CFOs and CIOs. People have switched on to the idea that print is an uncontrolled cost in business. People are thinking about what they are printing and what it is costing. In bigger organisations, it is more important as so much paper is generated."

Kyocera product manager Rachel Dean added: "As a general rule, with the credit crunch and issues like that, we are seeing managed services and click contracts becoming more common. SMB is our key marketplace and we have seen a huge increase in colour from this segment. Overall, there is quite a lot of saturation in the market. People are keeping products longer and they are less keen on looking at new products."

While MFP sales may be strong, there are indications that desktop printers are still key to the office print fleet. Fielden said: "There is desktop creep - desktop printers are less cost-prohibitive to buy. It is still a product where you do not need to sign off for capital expenditure if it is are less than £500."

Lexmark managing director Steve Purdy said: "There are still a lot of companies with a mixture of single function printers. But the consolidation message is getting through - you can reduce costs by taking out a number of devices. Education is an important area - there are early adopters, but you need to reach a broader group."

Greener printing

Environmental audits

An environmental audit should consider the following issues:

* Power energy consumption through printer fleet consolidation

* Reductions in paper consumption

* Use of duplex (double-sided) printing

* Policies for recycling spent hardware and consumables

Typical paper consumption is increasing and there is a clear bias towards print over copying. With growing awareness of environmental issues, soaring energy prices and ever-increasing paper costs, there are strong arguments for conducting a green print audit, assessing printing in the same way as you would conduct a traditional audit of fleet size and usage patterns.

Paper usage

Paper usage is often not considered a top priority when considering overall print costs. But this could be a mistake. Purdy said: "In the SMB market, customers are looking at reducing costs as one of their primary concerns. We have got an over-arching message of ‘print less, save more' and it goes from the inkjet arena to the top end. We have done some analysis of the overall impact of a laser printer or laser-based MFP and found that paper, because of the high production costs, is the largest environmental factor by a distance - 80 per cent of the environmental impact of an MFP is paper usage. It far outweighs energy consumption and shipping and processing costs.

"Paper use is still growing in the office because of the prevalence of email and use of the internet. First and foremost you should look at what you are printing and how you can print less by duplex printing and using multiple image printing. The use of workflow solutions is critical," he added.

80 per cent of the environmental impact of an MFP is paper usage. It outweighs energy consumption, and shipping and processing costs

Different approaches to machine design can also help with environmental issues. Kyocera has carved out a niche with its long-lasting Ecosys print drum technology, which keeps replacement parts to a minimum and reduces the impact on the environment in terms of resources. Unlike conventional OPC drums that need to be replaced after every 30,000 to 50,000 copies, amorphous silicon drums can keep running for 300,000 to 500,000 copies without replacement.

Dean said: "Energy consumption is coming to the fore and environmental issues are becoming more of a focus. As a whole, long-life drums help to reduce wastage. There is less waste from materials being swapped out and there is less need for engineers to come out. One of the key Kyocera Mita messages is less maintenance and less engineer callouts."

Reducing costs

The long-running argument about A4 versus A3 continues to rumble on. There is a legacy of A3 machines, often not a business essential, and they cost more to run, use more energy and take up far more space with larger footprints. There are certain sectors with high A3 use such as architecture, construction and graphics, but on the whole, when companies assess output in accounts and marketing departments, there are often ways to print on A4 instead or minimise the overall number of A3 machines on site.

"The prevalence of A3 devices is typically high in companies, but when we do analysis we find that less than 2.5 per cent of output is A3. People are surprised that 30 per cent of a fleet can be A3-capable," said Purdy. "You can get a lot of cost savings by reducing A3 usage. There is a bit of inertia when people review contracts and it is one of those things that nobody challenges. The volume of A3 machines is declining, but it is still a significant share of the market."

Managing print output is the best way to reduce print costs. "People are becoming more conscious of each print job that they are doing and there is more pressure to produce software solutions to improve productivity and reduce costs, for example routing software to print the job on the most appropriate speed device," added Dean. "If you are printing a 20 page mono document, the software advises the print driver to send the job to a mono printer to get the lowest cost per page."

Why colour?

Inundated with messages about the effectiveness of colour, many customers are purchasing a colour device but using it to output mono or worse still, printing in colour when it is not necessary. Regardless of assurances from dealers or vendors, this is a very expensive way to print and it is essential to consider overall print output in mono and colour before specifying new machines.

Black and white printers and copiers are still the mainstay in the public sector and corporates. For businesses, running costs and the total cost of ownership are absolutely critical to the bottom line and where colour is being introduced, people increasingly want to control colour output. But, note, colour printing still costs at least four to five times the price of mono. Expect to pay around 5p to 8p per page for a colour page with five per cent colour coverage on a colour MFP compared with as little as 0.4p per page for mono prints. Colour makes an impression, but you should consider whether you really need it for in-house documents.

"The consolidation message is getting through - there are early adopters, but you need to reach a broader group," said Steve Purdy, Lexmark

"We need to advise people to look at their real colour needs. The choice between inkjet and laser is the trade-off between acquisition costs, total cost of ownership and running costs," said Purdey.

Consider colour purchases carefully - decide whether you need a colour device for volume colour, but stick to a mono machine for black and white printing. With a 20 per cent premium on mono page output from a colour device check your print contracts carefully. It is worth noting that there are plenty of hidden costs - minimum print volumes, scan charges, service charges, warranties and higher colour consumable costs. Look for high capacity consumables to reduce costs.

However, business users are still not convinced that colour is the future and colour print represents a minority of business print output. There is clearly a determination on the part of companies to keep control of their print costs and contain colour output.

"Colour is still high on the agenda but we are really focusing on print optimisation. There is an increase in colour sales and we are seeing migration to colour with replacement of mono single function devices with colour devices. Although there is an upturn in colour, companies still want to control costs," said Fielden.

Colour prices are coming down and there are plenty of promotions in the market. Kyocera product manager Rachel Dean said: "We are really focusing on trying to incentivise the channel to sell colour. The new Kyocera colour range has market potential, particularly with the improvements in colour print quality and the upgraded firmware on the devices. The cost is coming down while the speed of machines is increasing. The cost per page is a major factor for customers, particularly for colour."

Reliability

Product reliability and durability are the most important issues for users of MFP copier/printers, according to JD Power and Associates 2008 Office MFP Usage Study. But almost 60 per cent of all MFP users reported experiencing at least one paper jam per month, which is by far the most common problem experienced.

Other common problems were paper drawer malfunctions, toner and ink problems, paper size detection and perceptions of slow printing speeds. The report ranked Panasonic colour and Xerox mono MFPs top in satisfying business users.

"Business users have a low threshold for paper jams as overall satisfaction falls below the industry average when users experience just one jam per month for colour MFPs and four paper jams per month for black and white MFPs," said JD Power senior director of the technology practice, Larry Wu.

Choosing an MFP

When considering replacing small workgroup printers with multifunctional devices, it is important to balance the number of users with the speed of the device. There is nothing worse than rationalising the printer stock only to find that users are queuing for ages to collect jobs. When replacing a 25ppm printer for four users with a workgroup device for up to 12 users, you really need to look at a MFP with speeds up to 45ppm.

The advantage of the MFP is the ability to combine functions - print, copy, scan and even fax - in a single device. Using a MFP can change the workflow in an office, but it is not always the best solution. Reliability is a critical issue. You need to consider your output requirements and balance this against running costs.

What you will get with a MFP is cheap mono print costs, particularly on copier-based devices, where toner inks work out much cheaper than cartridge consumables. However, there are more service requirements and for those of you used to printers with few, if any, service issues, this could be a deterrent. This is why it is important to ensure that service level agreements (SLAs) provide adequate levels of cover, particularly in terms of response times and geographic support for different office locations.