Coincidentally, in "How much does Moutai spend on packaging in a year? Where does Yongfa and Yutong, its suppliers, spend nearly 700 million yuan of packaging procurement of this Baijiu enterprise.

Luzhou is located in southern Sichuan, adjacent to Chongqing and Yunnan Guizhou provinces, and is a thoroughfare for the four provinces. It is about 200km southeast from Luzhou to Maotai Town, Renhuai City, where Kweichow Moutai is located, and about 100km west to Yibin City, Sichuan Province, where Wuliangye is located. The triangle formed by these three places is the famous "Golden Triangle" in the domestic Baijiu industry.

Luzhou, Yibin and Renhuai constitute the famous "Golden Triangle" in Chinese Baijiu's liquor industry

How strong is the strength of the "Golden Triangle" Baijiu industry? It can be seen from a place in Luzhou that it is average. In 2017, Luzhou had 152 Baijiu enterprises above designated size, accounting for 9.54% of the national total; The output of Baijiu reached 2.0561 million kiloliters, accounting for 17.16% of the national total; The main business revenue reached 80.782 billion yuan, accounting for 14.29% of the national total.

How much business does such a strong Baijiu industry base bring to the local printing and packaging industry? Three good classmates searched online, but the data for the past three years cannot be found. In 2015, the main business revenue of the printing and copying industry in Luzhou City was only about 3.8 billion yuan. Among them, it should include paper wine packaging products such as wine boxes, trademarks, tote bags, and corrugated cardboard boxes, while container products such as wine bottles and caps may not be fully included.

Compared with the main business income of 71.470 billion yuan of Luzhou Baijiu industry in that year, the scale of printing and reproduction industry of 3.8 billion yuan only accounted for 5.32% even if all of it came from liquor packaging. Is the wine packaging market not as large as imagined?

Even so, wine packaging is still one of the key industries related to alcohol development in Luzhou. For example, there is a specialized alcohol packaging research association in the local area, which is very rare in other regions.

It is understood that there are about one or two hundred printing enterprises in Luzhou, and many are involved in wine packaging. What is their survival status? A local printing company owner complained that the business from the distillery has been declining in the past two years. And the gross profit margin of wine packaging is only about 15%, and after deducting all the miscellaneous items, the net profit is only about 5 points.

The boss's feeling is consistent with the trend of the Baijiu industry: in 2017, the output of domestic Baijiu enterprises above the designated size dropped 11.80% year on year. Since 2018, the output of Baijiu enterprises above designated size has been increasing from high to low, with a cumulative year-on-year growth rate of 7.4% from January to May; Four out of the five months from June to October experienced year-on-year negative growth, resulting in a cumulative year-on-year growth rate of 1.5% from January to October. According to such a trend, it is not surprising that the production of Baijiu in the whole year showed a negative growth.

In addition, the net profit margin of 5 points is basically equivalent to the industry average for a printing enterprise, and is not considered low.

Of course, the situation of the wine packaging market has already been discussed in the previous article. What Sanhao classmates are going to talk about today is actually another topic——

Printing machines that are getting longer and longer

The reason why I have the opportunity to visit Luzhou this time is because well-known offset printing machine manufacturer Roland teamed up with Luzhou Yutong to organize an exchange activity with the theme of "wine packaging".

In this event, a message released by Roland attracted the interest of three good students: domestic printing companies are investing in longer printing machines.

How to understand the "length" of a printing press? Simply put, it is the length of the fuselage. The question is: why does the printing press become longer, as it is a body of steel? The true meaning behind the word "long" is that the number of printing machine units is increasing.

Ladies and gentlemen, in the 1980s and 1990s, not to mention the four color machine, could one have a dual color machine, or even a monochrome machine, and could one just throw away their arms and make a lot of money? After 2000, there were more and more four color machines. However, initially, the format was generally smaller, but later it became larger and larger, ranging from octagonal and tetragonal, to facing and full opening. Later on, it seemed that the four color machines were not enough, so there were more and more machines like 5+1 and 6+1.

What is the situation now? According to data provided by Roland, in 2018, the proportion of seven color and above printing machines sold reached 77%. In 2017, this number was only 44%; Back in 2013, it was only 17%.

Luzhou Yutong's Roland Roland 700 EVOLUTION Excellent Edition Printing Machine

As the unit grows, the printing press naturally grows longer and longer. In Yutong, Luzhou, Sanhao witnessed the ongoing production of the Roland Roland 700 EVOLUTION Excellent Edition printing machine, which is a customized model with "8 colors, glazing, and double drying", with a visual length of about 20 meters.

San Hao specifically consulted with relevant personnel. At present, the longest installed printing machine in China for Roland is the ultra long customized machine introduced by Kunshan Kewang with 9 colors and dual glazing, equipped with a connected cold pressing system. This machine has a total of 13 units, with a length exceeding 30 meters.

Domestic printing companies are investing in longer printing machines, and I believe Gaobao Company has the same feeling. At the end of 2018, Gaobao had collaborated with multiple enterprises to hold touring technical seminars and on-site demonstration activities.

Among them, the Libida 106 from Yongji, Guizhou is an ultra long model with 13 units of 10 colors and dual glazing, and a cold ironing unit. Hubei Jinjia's Libida 106 has 10 printing groups, 2 polishing groups, and 2 drying bases, totaling 14 units, with a length of 26 meters.

As the leader of the offset press market, Heidelberg Company stated in a media exchange event in 2018 that the proportion of long machines with six or more colors in sales in China has rapidly increased, accounting for 59% by unit and 44% by unit.

The three major offset printing machine manufacturers in Germany are all showing the same trend. It can be seen that the owners of domestic printing factories are indeed increasingly fond of printing machines with more units and longer body sizes.

Behind the growing length of the printing press

The situation in the Chinese market is like this, and what about foreign peers? Three good classmates discovered that foreigners seem to have started earlier than us in this direction.

For example, there are reports that as early as the end of 2008, a printing factory in the United States named K&D began using a 16 unit Heidelberg Speedmaster XL, known as the "world's longest single sheet offset press" at that time.

At the end of 2016, there were reports that Gaobao had installed the world's longest single sheet offset printing machine for packaging printing in Germany. This machine has a total of 14 printing and post press processing units, with a length of 42 meters.

In November 2017, Roland installed the world's longest Roland 700 EVOLUTION Premium Edition printing machine in the United States, equipped with 14 units and a total length of 45 meters.

Is there a single sheet offset press longer than 45 meters? Bosses who have met may leave a message in the comments section.

Why are printing presses getting longer and longer? The truth is actually very simple. As stated by people related to Roland, one important reason why printing companies invest in longer printing machines is to avoid direct price competition, as four or five color operations are facing enormous price pressure.

Simply put: Printing machines with more and more units and longer body sizes can bring new competitive advantages to printing enterprises.

Gaobao Printing Machine with 13 Units and Cold Pressing Units in Yongji, Guizhou

Where are these advantages reflected? Three good students believe that there are at least three points:

One is to significantly improve production efficiency. Simply put, many ultra long printing machines are like a combination of multi-color machines, polishing machines, and stamping machines. By integrating different functional units together, it can greatly save time in preparing live parts and converting between different devices, and naturally greatly improve output per unit time.

Moreover, as the top models mainly promoted by various offset printing machine manufacturers, ultra long printing machines are mostly equipped with automation technologies such as automatic plate loading, registration control, automatic cleaning, and digital ink control. Compared with traditional models, production efficiency is also significantly higher.

The previously mentioned K&D company in the United States has stated that the Heidelberg Speedmaster XL with 16 units completed 700000 prints in 5 days, while using the Heidelberg Speedmaster CD 102 six color machine for the same business would take 3 weeks.

The second is to achieve technological innovation. By arranging and combining printing, polishing, and stamping units, the ultra long printing press can achieve different process effects based on the product characteristics of the printing enterprise. At the event held in Luzhou, Manluolan shared several customized cases of ultra long printing machines for different printing enterprises, as well as the corresponding process effects.

The third is to reduce operating costs. This is easy to understand. Improving production efficiency itself will reduce the unit production cost of the product. At the same time, integrating different functions into one machine will greatly reduce the demand for the number of operators.

For example, how could it take five or six operators to add a printing machine, a polishing machine, and a stamping machine? Now, two or three people may be enough.

Who wouldn't want machines with higher efficiency, better process results, and lower production costs for printing bosses?

However, currently it appears that investment in ultra long printing machines is mainly concentrated in areas such as cigarette packs, wine packs, and cosmetics packaging that have relatively high requirements for process effectiveness. For example, as mentioned earlier, Yongji in Guizhou mainly produces cigarette packaging products, Yutong in Luzhou and Jinjia in Hubei mainly produce wine packaging, and Kewang in Kunshan mainly produces cosmetics packaging.

Behind the increased investment in high-end equipment by relevant enterprises, there is also a faint demand for packaging upgrading in tobacco, Baijiu, cosmetics and other industries. This is another topic, so I won't talk more about it here.

When printing machines can also be customized

To some extent, the pursuit of ultra long printing machines by packaging printing factories is consistent with the pursuit of high-speed, multi-color, and large format printing machines by composite printing factories. Essentially, they are all aimed at achieving greater competitive advantages and profit margins through efficiency improvement and cost savings. Even if there are peers who still want to provoke a price war, bosses who hold heavy weapons will have more confidence in their hearts.

The reason is very simple. Assuming that the average net profit margin of wine packaging products is around 5%, as the boss said, if the efficiency and cost savings of the ultra long printing machine are improved, it can be increased to 8%. These three additional points can either be converted into net profit or serve as a price reduction space for market competition.

The problem is that although the ultra long printing press is good, it requires a lot of real money and silver to pay. For both Roland, Gaobao, and Heidelberg, long machines are generally not standard models, but need to be customized according to the needs of printing companies. So, at the event in Luzhou, Roland focused on promoting its customized printing machine named Ultima.

Printing machines have also become on-demand products, indicating that offset printing machine manufacturers are increasingly paying attention to the personalized production needs of printing enterprises; On the other hand, it also indicates that the competition in the printing market is becoming increasingly fierce, and printing companies hope to strengthen their market competitiveness towards specific products and even specific customers through customized equipment.

Kunshan Kewang Mangluolan Printing Machine with a length exceeding 30 meters

The prerequisite for doing so is that printing enterprises must have sufficient financial resources to support them. Because one characteristic of the ultra long customized machine is its high price. For example, the budget made by Luzhou Yutong for this Roland Roland 700 EVOLUTION Excellent Edition printing machine is about 30 million yuan, and the price of Gaobao machines with 13 units and cold pressing units in Yongji, Guizhou is said to be as high as 45 million yuan. The high-end offset printing machines that were once used on Moments in 2018 are mostly worth around 40 million yuan.

What kind of printing company is buying such a printing machine? One type is listed companies, such as Yutong, Yongji, Shanghai Xianggang, etc; Another type is the leader of segmented markets or deeply bound large customers, such as Kunshan Kewang, who has been working in the cosmetics packaging market for many years, and Hubei Jinjia, who is the main packaging supplier of Jinjiu.

For most printing factories with an annual output value of tens of millions of yuan or even lower, it is obviously a bit difficult to invest in such a big guy.

What impact will the differences in investment capabilities of different enterprises have on the future competitive landscape of the printing market? An obvious possibility is that the stronger, the stronger. Large leading enterprises further strengthen their competitiveness through equipment updates, in order to gain more market share or consolidate their existing position in the market.

Meanwhile, longer printing presses mean higher production capacity. With the increase of ultra long printing machines, more packaging and printing factories will feel the squeezing and extrusion effects brought about by efficient production capacity.

In other words, the investment of printing companies in ultra long printing machines may promote the concentration and integration of previously relatively dispersed segmented markets such as wine packaging and cosmetics packaging, helping cigarette packaging companies with clear patterns but facing price pressure to stabilize their gross profit margins. Boss, is that what's going on?

From commercial printing machines that constantly become new, faster, and larger, to packaging printing machines that continue to grow longer, each field has different product characteristics and operational models, but the overall trend is basically the same: high investment brings high efficiency, and high efficiency brings great integration.

At this glance, has the printing industry entered an era where capital and efficiency are king? Or is it just like that?

Alright, that's all for today. Finally, good luck to all bosses!

Statement: The viewpoint of this article only represents the author himself. Sohu account is an information publishing platform, and Sohu only provides information storage space services