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In this electronic world, many say print is dead. But Alexander Knieps, the founder of online printing company, Printulu, echoing the words of famous author Mark Twain, says reports of this death are greatly exaggerated.
“If you look at how this industry is developing, I don’t think we are moving into a paperless industry, at least not in the next 50 years. Afterwards, I don’t know. It is all about what channel is out there and whether it is affordable,” says Knieps.
We meet Knieps at an industrial park in Modderfontein, east of Johannesburg. This is where business cards, posters, postcards, and flyers are printed for thousands of companies, media houses and coffee shops across South Africa. In a matter of minutes, a pile of paper flows from the printer.
On this spring day, the sun shines brightly and the sky is clear. The tranquillity is shaken by the loud rattle of paper being printed.
“In our age of technology, when you are studying, nobody thinks, ‘ooh, let me go into paper’. I think it is a very rare thing,” says Knieps.
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Knieps, who is born and bred in Germany, founded Johannesburg-based Printulu last year. The name is a combination of the words print and Zulu (a South African language). He studied business at EBS Business School in Germany and got his master’s degree at ESADE Business School in Barcelona, Spain.
Starting the business has been far from plain sailing.
“The first couple of months, we were completely bootstrapped. You get your first clients, you show some nice traction, and then, in the beginning of the year, we raised some funds, which were a couple of million rands, which are enough to last for the next two years,” he says.
Investors are hard to find.
“South Africa is not the easiest place to raise money. There also isn’t much money in the market because of the current economic climate. [When] it comes to online printing, people just look at the industry itself; they don’t think how you could invest deeper. There aren’t many investors and it takes a while to close deals [compared to] anywhere else in the world,” he says.
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Knieps says the future for paper printing is mass production.
“We are batching up all these smaller orders and print them in bulk and that is how you can disrupt the market. Hence, you see a shift from offline to online in the industry,” he says.
He calls on other entrepreneurs to get with the times.
“The industry is very inefficient in a way that there is a lot of competitive pressure. There are thousands of printers in Gauteng who are operating with an archaic business model.  You have inefficiency on the one side and macroeconomic pressure on the other. That is why a lot of printers are closing down even though we are growing strongly at the moment. If you see those components, it actually makes people a lot more price sensitive and that actually helps the business to scale,” he says.
Print dead? Not in the world of Knieps.

Print Money?

As if Zimbabwe doesn’t have enough problems, in October the government will try what could be an ill-fated experiment of printing so-called bond notes.
It’s a reaction to the shortage of US dollars that have been legal tender in Zimbabwe since the Zimbabwean dollar disappeared. The shortage is so bad the banks are trying to ration dollars.
“I can only withdraw US$100 a day and that’s if I’m lucky. I have to wake up very early in the morning to queue, otherwise there will be no money in the ATM. If I come late I can find even 60 or so people queuing,” says Tukudzwa Mutasa, who lives in Harare.
The southern African country has been unlucky, to say the least, when it comes to currency. It printed its way into hyperinflation and even introduced bearer cheques that carried and outlived their expiry date. In 2008, it suffered catastrophic hyperinflation and even had a one hundred trillion dollar bill which could be exchanged for US$0.40. Almost 10 years later, it is worth more as a souvenir on eBay, where you can buy it for US$70.
This all led to the Zimbabwean dollar being ditched and the country adopting up to nine currencies from other countries.
The US dollar is king in Zimbabwe. In 2009, 49% of people used the US dollar, 49% used the rand and 2% used other currencies. In 2016, 95% of people use the US dollar.
The Reserve Bank of Zimbabwe (RBZ) says the stronger US dollar is encouraging traders to take the currency out of the country.
“I can’t take the rand because it is weak. I buy the things I sell in South Africa and have to factor in costs, so I would rather sell in US dollars so that I make a little bit of profit otherwise I would be wasting my time,” says informal trader Chipo Dungare, in Harare.
<img loading="lazy" decoding="async" class="alignleft size-medium wp-image-5299" src="/wp-content/uploads/2017/05/MTE5NDg0MDU1MDgwMzcxNzI3-300x300.jpg" alt="" width="300" height="300" />
Into the mix, in October, come piles upon piles of what many see as worthless paper. Zimbabwe will use the gold standard, which is a monetary system where a country’s currency or paper money has a value directly backed by gold, to print its own version of the US dollar, called bond notes. There is a guarantee of US$200 million by the African Export-Import Bank (Afreximbank) to back the bond notes. The scheme will also reward people bringing foreign currency to the country with a 5% incentive on all foreign exchange receipts.
Reserve Bank Governor, John Mangudya, says the bond notes, like the US dollar, will come in $2, $5, $10 and $20 dominations. This is unlikely to convince people to use it.
“This is a shakedown; casino economy presided over by dangerous clowns who don’t see beyond today. How can you explain repeating a failed experiment of 2008 of printing dollar signs and figures on bond paper and declare that as currency? Really? Do these people learn at all?” asks political economist, Maxwell Saungweme.
“This is the return of the Zimbabwean dollar by another name. It won’t work. It will crash on day one,” says a Harare-based analyst who chose to remain anonymous for fear of victimization.
Former Finance Minister, Tendai Biti, called citizens to anger.
“The return of the Zimbabwean dollar marks the gross admission by this regime that it has failed, and failed in absolute terms, and that it will drag everyone along in the plunge to abyss that now awaits this economy. It is a cynical, disrespectful and contemptuous move that has absolutely no logic, sense or justification on any rational ground whatsoever,” writes Biti on his Facebook page.
“Zimbabwe is effectively a supermarket economy consuming goods produced in other countries. In 2014, its exports were US$3.7 billion against imports of US$6.3 billion. 2015 was no better; exports were $3.2 billion against imports of US$6.03 billion.”
Promise Mkwananzi, Director of Zimbabwe Informal Sector’s Organisation, says this policy reveals confusion.
“The tragic result is that there is already panic and despondency in the country. This will cause an unprecedented decline in FDIs already at its all-time low. This will see the Zimbabwean economy continuing to suffer,” he says.
But the people running Zimbabwe believe there is no problem.
“The bond notes are coming no matter what because we are trying to solve a problem here. The media exaggerates what is going on here in Zimbabwe. They talk about protests but I don’t even know what they are talking about. It’s always business as usual here and often I have to see in the news that there was a protest,” says spokesperson of the office of the president, George Charamba.
Along with the RBZ and the government, the Employers’ Confederation of Zimbabwe (EMCOZ) is behind the bond notes, but it has reservations.
“The consultations before the announcement, if any, were less than inclusive and the confusion and fear that was created could have been anticipated and, to a large degree, reduced if not avoided. It would have given business the necessary confidence if it had also been announced whether this is a short, medium-term or long-term measure and the fate of the bond notes once they have served their purpose,” says EMCOZ president Josephat Kahwema.
What is certain is that in October the banks will be full of freshly printed paper. You’ll know for sure whether it’s worthless when you go to spend it.

Tag: Printing

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