SIC 7334
PHOTOCOPYING AND DUPLICATING SERVICES



This category covers establishments primarily engaged in reproducing text, drawings, plans, maps, or other copy by blueprinting, photocopying, mimeographing, or other methods of duplication other than printing or microfilming. Establishments primarily engaged in printing are classified under SIC 2752: Commercial Printing, Lithographic; SIC 2754: Commercial Printing, Gravure; and SIC 2759: Commercial Printing, Not Elsewhere Classified. Those companies engaged in providing microfilming services are classified under SIC 7389: Business Services, Not Elsewhere Classified.

NAICS Code(s)

561431 (Other Business Service Centers (including Copy Shops))

Industry Snapshot

The quick-printing industry represents a relatively new dimension of both the commercial printing and graphic arts industries. Most companies in the photocopying industry began as printers offering while-youwait service dubbed "quick printing." What began as a small segment of the printing market experienced phenomenal growth beginning in the 1970s, changing the printing industry forever. In 1969, 1,000 quick printers were operating in the United States, and by 1974 that number had reached 6,000. From 1975 to 1992, the quick-printing industry exploded, and an estimated 30,000 businesses were operational by the early 1990s.

By 2000, the number of quick-printing establishments was dwindling, due to consolidation in the industry. There were 7,743 quick-printing establishments in 2000, down 5.2 percent from the previous year, and down 0.7 percent per year since 1994. The volume of shipments in the quick-printing industry was on the rise, however, with $5.96 billion in shipments in 2000, up nearly 13 percent from the previous year. Sales in the industry had increased at an annual rate of 10.6 percent since 1994.

Organization and Structure

The quick-printing industry generally provides two types of services: convenience and commercial. With storefront locations in strip malls and downtown shopping districts, the convenience quick printer serves the needs of small businesses and consumers. Convenience quick printers include both independent and franchised operations that rely largely on copiers and paper plates on 11" × 17" presses. The commercial printer typically provides services similar to those of the convenience shop, with larger facilities and several added capabilities for serving the needs of larger businesses.

Background and Development

The quick-printing industry emerged from the development of the Itek camera/platemaker, acquired in the early 1960s by Bill LeVine, a commercial printer. This machine produced black ink on 8" × 11" paper with photocopiers or electrostatic plates, forming images in powdered or liquid ink directly on the surface to be printed.

In the 1970s, quick printing generally produced black-and-white or one-color offset prints on flat surfaces using photomechanical plates or paper mats. By the end of the decade, however, the industry was augmented by the introduction of high-speed copiers, which produced one-color prints.

By the 1980s, many quick printers were able to offer a variety of paper sizes and two- and four-color copies. Furthermore, high-speed copiers became more common in the industry, as did large document copiers. During this time, copier technology advanced, and some quick printers offered desktop publishing systems, camera and darkroom facilities, and advanced bindery equipment. The 1990s were dominated by the growing adoption of digital technology, new products and services, Web pages and publishing, and transmission of data to the quick printer electronically. Regardless of a business' development, continued growth and perhaps survival are dependent on adaptation to and adoption of digital imaging and electronic communication.

The historic paths to becoming a giant in the industry have been to open multiple small sites and build volume, open a facilities management site within a large corporation, or migrate steadily from quick printing only to graphic arts services.

Some of the challenges to the industry have been the cost of paper, which seems to have stabilized; keeping up with technology; and the increasing demands for shorter turnaround time. Printing and copying is divided into four major areas: multicolor copying (26 percent), copying (25 percent), black and white (17 percent), and rapidly growing digital printing (6 percent).

Toner-based copying dramatically changed the nature of quick printing, especially for high-volume work. High-speed copying, able to produce quality halftones and two-sided copies, set the standards for the quick-printing industry. Wide format or folio printing has also continued to grow with close to 200,000 printing devices installed 1996.

To strengthen the scope of their service, quick-print shops began to expand into areas outside of copying and printing. For example, according to a 1990 National Association of Quick Printers (NAQP) member survey, 81 percent of its membership provided fax services and 53 percent offered desktop publishing. Some shops even rented computers and sold office supplies. Although not the source of major profits, such diversifications offered customers value-added service.

Many quick-print shops tested the market for color copying and further automation in desktop publishing. By 1992, more than 60 percent of NAQP's membership offered full-color copying. Moreover, a joint study conducted by the NAQP and Quick Printing magazine indicated that the companies widely regarded as industry leaders had offered color copying services since at least 1987.

As early as 1991, a study by Printing Industries of America predicted that quick printers would represent the largest segment of the printing industry, measured by the number of establishments, by the year 2000. Much of this growth was attributed to the introduction of franchise operations during the mid-1970s. The prediction proved true: franchisers became an integral part of the quickprinting industry, and the top four companies had roughly 1,000 shops each.

Acquisitions and mergers were prevalent in 1996. There were 85,000 high-speed copiers operating in the United States, with 45 percent of them in the print-forprofit sector. Quick-print shops derived 35 percent of their revenue from copiers that are easier to operate than presses and incorporate finishing productions such as binding and/or stitching or gluing.

With the market for photocopying and duplication services booming, retailers in related industries saw the opportunity for expansion. Their distribution infrastructure was already in place via an established chain of retail outlets. Office superstores found easy entrance to the market by establishing quick-print sites in their stores. Office superstores such as Office Depot, OfficeMax, and Staples actively sought a chunk of the traditional quick-print market. For example, by the mid-1990s, OfficeMax carved out 5,000 to 7,000 CopyMax quick-print shops within its stores.

Video capturing, a process in which individual frames can be pulled from videotape and incorporated into printed materials, represented another area for growth in the industry. The ability to generate art and assemble pages electronically also remained a lucrative service. According to Bob McKarney of the quick-print franchise Sir Speedy, "In the near future, quick printers will be able to go directly from computer to press. PC color software and filmless platemaking systems were developed before the century ended. For short runs (300 to 500), an operator could direct graphics directly from computer to color copier." By 2000, this proved to be true.

In spite of predicted shakeup in the quick-print industry, which experienced its first-ever decline in sales in 1991, the industry recovered and continued to grow throughout the decade. Observers had predicted up to a 25 percent reduction of shops in the mid-1990s, claiming that only those capable and willing to keep up with technology would survive. Tom Carnes, president of PDQ Printing, observed in American Printer that "the market is over saturated with quick printers. Many are good at putting ink on paper but not at running a business." Elwood Smith, past president of NAQP, agreed: "Many quick printers won't make it," he noted in American Printer , adding that "Those that do will have to provide extra-good service and quality products. They will have to be customer oriented and market driven."

A growing number of quick printers were turning to the Internet for advertising. For example, displaying initial color proofs for review by clients, StarNet provided an on-demand fully digital printing service running Docutechs and Indigo E-Print 1000 machines. Another company, Dave's World, was set up exclusively for Internet and intranet work. Targeting audiences and specializing may become more important than generalizing and diversifying in the future.

Current Conditions

Although the number of quick-print establishments shrank, the industry was nevertheless growing in 2000, up approximately 13 percent for the year. That represented a significant rebound for an industry that was coming off a decrease of 23 percent in shipments in 1999. Sales in the industry have increased at an annual rate of 10.6 percent since 1994. Chains and franchises began dominating smaller, independent printers who had further trouble as paper and energy prices rose in the early 2000s. All 10 leading states in terms of number of quick printers saw a drop in the number of operations in 2000, with Texas experiencing the biggest loss of 11 percent fewer quick printers.

Forecasts for growth in the industry vary. Demand for inexpensive copies and among commercial customers is likely to increase. New large format printing technologies are enabling printers to produce commercial photos and graphics, which could also increase sales. The rise of digital photography—with 22 percent of households in the United States owning a digital still camera at the end of 2002—promises to widen the market as well. Kinko's announced in April 2003 that it would install digital print kiosks in 800 locations due to the high demand for retailbased digital photofinishing services.

However, quick-printing competition is likely to increase in other areas with the popularity of e-mail and Web sites as marketing vehicles and may have a negative impact on industry sales. Since 2000, most of the major quick printers offer services via the Web, including the ability to take orders, upload digital documents, and receive same-day service. Customers can also design business cards, logos, and other products online where they could be saved for easier reordering.

Industry Leaders

Among the leading companies, including private and franchise, are Kinko's, Inc., with $2.1 billion in sales, and TRM Copy centers. The top franchises in the industry in the early 2000s in terms of dollar volume were Sir Speedy, Kwik Kopy, AlphaGraphics, American Speedy, Insty-Prints, Proforma, LazerQuick, and Signal Graphics.

Founded in 1981, TRM Corporation had 398 employees and $70.6 million in annual sales in 2002. Rather than owning and operating retail copying centers, TRM Copy Centers placed its 30,000 TRM Centers in small, independent retail establishments such as pharmacies, gift shops, and convenience stores throughout 56 metropolitan areas in the United States, Canada, and the United Kingdom. This mode of operation allowed the company to maximize its market potential and more effectively compete with regional shops. Host locations of TRM copiers collected the usage fees for the copiers and were billed by TRM on a monthly basis. TRM's inventory of copy machines consisted largely of copiers that the company rebuilt to better-than-new condition and serviced through a highly trained field staff. Most customers used TRM machines for convenient, low-volume copying at reasonable prices.

With more than 1,000 centers throughout 30 countries, Sir Speedy, Inc. is one of the world's largest franchisers of copying centers. Headquartered in Laguna Hills, California, the Sir Speedy franchise network generated about $400 million in network sales in 2002. The annual average sales revenue for a typical Sir Speedy center exceeded $500,000; of those franchises, the top 25 averaged over $1 million in sales.

Sir Speedy has adapted to cash in on the computercreated document and electronic duplication now prevalent with digital technology. Sir Speedy acquired PIP Printing near the end of 1996. Toronto-based Moore Corporation sold its chain of quick print and copy centers in Europe to Sir Speedy in 1996. Sir Speedy president Don Lowe recently signed an agreement with Eastman Kodak to launch Kodak's Photo Portfolio CD to create multimedia presentations for customers. SpeedNet, a bulletin board, lets franchisees create and send documents in minutes to any one of 880 copy centers. It targets the 41 million Americans who work at home.

Kinko's Copies—a nonfranchised corporation that is controlled by Paul Orfalea, the 32 percent owner of Kinko's, Inc.—became a $400 million plus chain in 1995. By 2002, sales were an estimated $2.1 billion. In a major move possibly precipitated by a copyright infringement lawsuit, Kinko's decided to shift from a college student clientele toward small and medium-size businesses, including self-employed people working from home. At the end of the 1990s, Kinko's operated more than 1,000 business centers. It has also equipped its stores with self-service desktop publishing computers. Voice and video services, allowing customers to conduct video conferencing for $75 an hour, began in 1996. Most centers now offer Internet access to customers. With its copying and computer supplemental services, the company caters to executives, small business owners, and home office workers. Nearly all Kinko's shops are open 24 hours a day and market themselves as the customer's branch office. An investment fund injected $200 million into Kinko's in exchange for a minority stake in order to help finance expansion. Going into the new millennium, Kinko's planned to go public.

Kwik Kopy Corporation, a $372.7 million empire based just outside of Houston, Texas, is among the oldest quick-print shops in the industry. Founded in 1967 as an offshoot of Bud Hatfield Printers, Kwik Kopy had 25 printing centers by 1970. In 1972, when franchising became the leading trend in the quick-printing industry, Kwik Kopy's business flourished, and by 1977 the company had established 170 printing centers in 18 states. Posting an 18 percent growth rate annually in the early 1990s, Kwik Kopy had 735 centers in 13 countries, including Canada, Australia, South Africa, Israel, and the United Kingdom, by 2000. Kwik Kopy rewards its franchise owners for timely submission of reports and other behaviors it wants to reinforce. The company's Stars program allows franchisees to mentor their peers by visiting each other's shops, suggesting changes, and submitting feedback to corporate headquarters. Kwik Kopy's target customers are volume repeat corporate accounts.

AlphaGraphics, which operates about 300 stores in 14 countries worldwide, offers AlphaLink Direct, allowing customers to electronically transmit documents and graphics from their home, office, or laptop computer directly to local AlphaGraphics sites around the world. The company was founded on the principle of combining high technology with sound business practices. Systemwide sales for 1996 were $246 million. AlphaGraphics' strategy going into the new millennium called for acquisitions internationally and a projected goal of 700 stores by 2000.

Workforce

Nearly 160,000 owners, managers, and other employees work at the 33,000 quick-printing centers throughout the United States. In 1997, the total number of employees involved strictly in photocopying and duplicating services was at 87,221; roughly three-quarters of these were production workers. The latter group worked an average of 36.5 hours a week and earned an average of $10.80 per hour in 1996. Growth in the industry was projected to continue into the 2000s. According to Printing 2000, the quick-printing industry could expect an annual growth rate of between 5 percent and 8 percent during this time.

By 1999, the photocopying and duplicating services industry was dominated by large franchise operations and operations linked to office superstores. Nonetheless, average sales for all establishments, many of which were single-owner, small shops, were an estimated $888,000. An average of 8.6 employees worked in each shop and accounted for about $103,000 in sales per employee. According to PrintImage International, the premier professional industry association, management positions (i.e., production, customer service and general managers, and bindery supervisors) averaged $10.56 to $20.76 per hour with $675 to $6,500 average yearly bonuses. Wages for professional employees, (i.e., graphic artists, press and copier operators, strippers, and mailing service technicians), averaged from $9.15 to $14.64 per hour and $575 to $1,062 in yearly bonuses. Also, a new trend in the industry was to engage outside sales representatives. Average compensation, based on average sales of $303,577, was generally about $52,000.

America and the World

Quick-copy centers expanded internationally in two ways. Some particularly well-financed franchise operations opened shops abroad. Others, including independent operations, added services geared toward international business communications needs.

Franchises such as AlphaGraphics and Sir Speedy established operations in Russia, Hungary, Australia, Bahrain, the United Arab Emirates, Canada, and Mexico. AlphaGraphics planned to build a network of 40 printing franchises in Mexico and expected to open 40 shops in Spain. In 2000, Sir Speedy expanded into Thailand, Singapore, and Poland.

Some expansion plans took the form of joint ventures, such as the union of American Speedy Printing Centers of Bloomfield Hills, Michigan, with a British printing shop to create EuroSpeedy Printing Centers in the United Kingdom. Kinko's Copies branched out into the Japanese market with services based in Nagoya under the name Kinko's Japan KK.

Smaller, independent quick printers found that exporting services was not the only way to take advantage of the growing global economy. Many quick printers began offering foreign language word processing, page layout, and typesetting computer programs; translation and proofreading services; and an increased awareness of foreign standards for paper and envelope sizes and business forms.

Research and Technology

The most dramatic technological developments in the 1990s involved desktop publishing. Elwood Smith claimed that "Desktop publishing represents the next step in the evolution of quick printing—the most important innovation since the Itek camera/platemaker." Given the increased amount of work based on disk conversion, some industry observers even predicted that quick printers would eventually become desktop publishing experts.

Offering one-stop service for all printing needs, Alpha-Graphics was one of the first quick printers to become involved in publishing, referring to itself as a desktop publishing retailer. Several other shops made complete conversions to computerized service—including Laser Image in Durham, North Carolina, which operated a completely automated shop, including computerized page layout, high-speed copiers, high-speed laser printing, and electronic color copying.

Computers were also used increasingly for managing shop operations in the industry. By the end of the 1990s, utilizing software for estimating needs, tracking orders, and updating inventory had become the industry standard.

A new class of multifunction peripherals combining printing, copying, scanning, and/or faxing into a single system has also emerged. Xionics Document Technologies, Inc., is the leading supplier of these embedded systems whose technology has been adopted by Hewlett-Packard, IBM, Seiko, Epson, and Panasonic. RISO furthered the trend toward multifunction systems by making it possible to incorporate once separate, after-print operations such as perforation, slitting, scoring, folding, and stapling. Another innovation is Electronics for Imaging's Fiery Xje embedded controller that turns digital copiers into high-speed network printers such as the Ricoh Corporation's Aficio 2000 series.

Mopy, the practice of making multiple copies of originals to take to the printer, can cut costs in some cases. The HP LaserJet 5 SiMopier is touted as the first printer designed to make multiple copies; this method could save two cents a page.

New "gapless" printers pioneered by Heidelberg-Harris have been followed by other versions from Mitsubishi, KBA, and MAN Roland. The technology eliminates or minimizes the blanket and cylinder gaps and makes it feasible to build wide-format color quality offset presses that run at high speeds and take a digital image and print it on paper, film, canvas, or adhesive-backed material for large format jobs. Once limited to pen plotters, it is now 85 percent of the inkjet market. Changes in plotters have resulted in applications in quick-print shops with large format color printing solutions.

Further Reading

Company News Archives. "Corporate Profile for Sir Speedy, Inc." New York: Business Wire, October 1999. Available from http://www.businesswire.com .

D & B Business Rankings 1999 , Bethlehem: Dun & Bradstreet, 1999.

"Digital Processing Presents Challenges, Opportunities." Photo Marketing , April 2003.

Franklin's Printing. "About Franklin's." Cypress, TX: International Center for Entrepreneurial Development, 2000. Available from http://www.franklins-printing.com .

Hoover's Company Capsules. Austin, TX: Hoover's Inc., 2003. Available from http://www.hoovers.com .

"Industry News." Network. December, 1999.

"Kinko's." DSN Retailing Today , 21 April 2003.

Longheier, Brian. "Quick Print Industry Grows by 13 Percent; Sales Increase Amid Consolidations." Photo Marketing , February 2002.

Print Image International Web Site. 2003. Available from http://www.printimage.org .

"Survey Indicates Quick Printers Bullish, Plan to Expand." Chicago: Print Image International, February 2000. Available from http://www.printimage.org .

Weintraub, Arlene. "Late to the Party." Business Week , 21 August 2000.



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