The laser cutting and engraving market is an exciting field these days and getting hotter. What are the emerging and changing trends in laser equipment? What are consumer attitudes and market segment growth? Is this an area of the industry that is still growing as it has for some 20 years?
Present day laser engraving has consistently held a major presence in the R&I industry ever since it came on the scene in the early 90s. It is an area that has continued to grow and provide profit potential for business owners even during the recent economic downturn. So what is happening today?
I recently had a Q&A session with major laser engraving machine manufacturers to learn about the latest in laser engraving trends, technology, marketing potential and more. Their responses were interesting and enlightening.
Is the interest in purchasing laser engraving machines and laser engraving in general growing, remaining the same or declining?
Laser engraving is definitely a hot spot in the industry that only gains momentum as time goes by. Many people new to the engraving or award business instinctively ask about laser engraving equipment first before any other marking method, and that is one of the reasons why interest in laser engraving remains high. “There is a misconception that CO2 lasers will do everything that a rotary machine will do and do it faster and better. That fuels interest,” says Jonathan Cohen, Engraving Equipment and Software Product Manager for Gravograph, Duluth, GA. “In many cases the laser will be an appropriate solution, but it is important to discuss the customer’s scope of work and to educate them on the differences between rotary and laser engraving.”
That said, the majority of the manufacturers say that interest in laser processing systems and laser engraving is growing for a variety of other reasons, including improvements in technology, developments in laserable materials and more applications arriving within the market.
Most manufacturers are reporting a marked increase in demand as the economy continues to recover. Epilog Laser,
Golden, CO, saw record laser sales in both 2009 and 2010. Epilog provided 1,200 laser systems to a single supplier for marking pet tags, but that is not what will fuel future growth for the company. “We find the laser industry to be in an incredible growth stage,” says Mike Dean, Vice President of Sales and Marketing. “We’ve seen a lot of growth in industrial markets, consumer and entrepreneur markets and, surprisingly, in the awards and engraving market. 2010 has been especially strong in the awards market.”
Escalating interest in this market is also attributed to the versatility of laser engraving systems and that, consequently, opens up many new applications that fuel growth across many industries. The more that people become aware of the machinery capabilities, the more interest is generated, and that feeds on itself. “To those of us who have been in this business for twenty years or more, it’s surprising how many people we run across that are just now seeing their first laser. There are still a lot of new opportunities out there,” states Dean. “For example, we’ve recently seen an increase of custom cabinet makers who laser engrave their logo and contact information on the inside of high-end custom cabinet doors. They’re not only providing a service for customers, they’re helping gain exposure for their brand each and every time that door is opened.”
Guy Barone, President of Xenetech Global, Inc., Baton Rouge, LA, agrees that interest in laser engraving continues to spread as the laser engraving process is understood by more people through experience and improved education. According to Barone, “Overall, we’re seeing an increase in laser interest especially from nontraditional users. For example, those who previously would subcontract industrial part marking are now researching and buying lasers and rotary systems as well. These customers are attracted to the variety of materials a laser will mark as well as the productivity it can produce.”
An improving economy also appears to be a key factor of growth in the laser engraving market. “We are seeing growth most likely due to the financial crisis coming to an end. People are more willing to invest in equipment,” says Mira Wu, MarCom Manager, GCC America, Inc., Walnut, CA.
What has happened with the price of equipment recently?
A big turning point in laser engraving occurred a few years ago when prices began to dip even as technology continued to improve. “Until 2008 it was impossible to find a U.S.-made entry-level system for under $10,000. Today that price point is about $2,000 lower for a high-quality 30-watt machine from Epilog,” says Dean.
Today, all of the manufacturers say that equipment prices have remained stable but technology has steadily improved, and that means more bang for your buck. “Both laser equipment and laserable materials continue to be more affordable,” explains Gravograph’s Cohen. “Pricing has remained stable but the equipment has gained features, performance and quality.”
Where are you seeing buying activity?
As expected, current economic conditions influence buying decisions. Many businesses are maintaining status quo, but laser equipment manufacturers report seeing buying activity across all sectors of the market. This is happening for various reasons: there’s a need for more productivity by doing more work in less time, resulting in less expense; the ability to mark a variety of materials with one machine; or to bring engraving in-house for the first time.
One market segment that appears to be experiencing significant growth is new business startups. “We’ve definitely seen an increase in people starting their own businesses with a laser. Given the relatively low price points of entry-level systems, buyers are beginning to realize that starting a profitable business with a laser is indeed a realistic endeavor,” says Dean. In addition, he says that existing successful laser engraving businesses receive a lot of exposure. That helps others see how and why a laser engraving business might be a good option.
New business owners can start with a part-time home-based business without huge startup fees or overhead costs. Learning to use the equipment is generally a quick and easy process. “Given the questionable state of the economy, people feel empowered as they start a new venture that allows them to be in control of their own business,” Dean adds. “You don’t have to worry that the powers-that-be are going to lay you off when you’re in control of the finances and success of your own business.”
Current business owners looking to increase revenue streams by adding laser engraving capabilities is another growing market area. “Many existing businesses will start offering laser engraving services to supplement their primary business. A case in point is embroidery shops that could use a laser to cut twill or fabric and also offer awards and plaques very easily, or jewelers bringing laser engraving in-house to increase margins,” says Gravograph’s Cohen.
The same holds true of general engraving businesses that currently have rotary engraving capabilities and want to expand their productivity and product offering. Similarly “business turnovers” are an area where laser engraving is selling. As businesses are sold or future generations take over, the new owners often see a need to modernize equipment and the first priority is usually a new laser.
There also appears to be a healthy portion of repeat buyers who are adding and/or upgrading equipment to their existing operation. James Hays, Marketing and Technical Writer for Universal Laser Systems, Scottsdale, AZ. says, “The companies that have made it through these tough few years are the best organized and most efficient ones. They’re busy upgrading and expanding their processing capabilities to win new business and keep up with demand, and are taking aggressive positions to protect their market share from upstarts.”
What feedback do you receive from first-time laser buyers?
Along with feedback about specific machines and features, manufacturers say they also hear many positive comments about advanced technology, machine reliability, productivity and ease of use attributed to laser engraving in general.
“The typical response is along the lines of ‘I thought laser engraving machines would be much more difficult to program and operate. This laser is much easier to operate than I ever imagined.’ At first, new users focus on engraving the easiest materials to process. Once they learn to think outside the box, they find out just how versatile these engravers are,” says Gravograph’s Cohen.
Epilog’s Mike Dean concurs. “We receive tremendous feedback from first-time buyers about how their machine allows them to complete more work in less time, that they found it extremely easy to get up and running and that our support structure never fails to help them as they get familiar with the equipment.”
What does it take for an engraver to be successful in laser engraving today?
“Imagination, creativity and a knack for finding new applications,” says GCC’s Mira Wu in response to this question. Other manufacturers agree that successful laser engraving businesses have these qualities.
One of the biggest differentiators between marginally- and widely-successful businesses is being able to think outside the box to help customers with anything they need. “It’s really important to have the capabilities to handle a wide spectrum of requests. Satisfying the customer will lead to referrals which are the life-blood of any business,” Gravograph’s Cohen says.
Xenetech’s Guy Barone states that today’s economic environment has forced engravers to become more efficient and effective in every aspect of their business, and that includes increasing production and adding value to product lines by providing services that competitors don’t. “Engravers need to stay current on designs and materials. Sustainable or ‘green’ materials are exceptionally popular right now as are multimedia projects that incorporate more than one material. Projects need to be clean, crisp and contemporary,” Barone explains. “Engraving businesses also need to be open to expanding the types of customization they offer. When customers will pay upwards of $150 for a laptop engraving, it’s no time to be limited in the services you offer.”
Warren Knipple, President of Trotec Laser, Inc., Ypsilanti, MI, agrees that in order to be successful, engravers need to become more efficient and effective in their engraving operations. “This means reducing cycle times, improving throughput and reducing down time. Sales diversification into new markets by leveraging core capabilities to new customers and new applications is also key,” he states.
“The fundamentals of the market haven’t changed,” says James Hays from Universal Laser Systems. “The engravers who succeed are the ones who react quickly to the market needs, have a close eye for detail, seek out new opportunities and manage their operations efficiently. Individuality and a creative streak are any engraver’s trump card.”
Are engravers becoming more creative with their laser equipment?
One of the major advantages of laser engraving is that this field provides an incredible opportunity to put those creative juices to work, and from all accounts it appears that business owners are doing just that.
“There is no doubt about this,” says Cohen. ”As technology improves and as people become more experienced and as new laserable materials arrive in the market, owners and operators are doing things that couldn’t be done before or were not previously thought of. It’s also a matter of survival to continue to think and act creatively.”
Dean notes that every time his company speaks with a customer, they hear of new ways the laser is being utilized. “Engravers have kept their finger on the pulse of the market and since they have seen equipment improve and change over the years, they have a great idea of what types of applications their engraving systems are well suited for,” he says.
What are the most profitable market areas for laser engraved products?
Versatility comes into play again because there is not one single most profitable market in laser engraving. The profitable shops are venturing into all kinds of markets including gifts, awards, signage, industrial marking and model making.
Even better is the fact that engravers have been able to use laser engraving technology to branch out into new, and sometimes unique, markets. Examples of new markets and applications include: patterns for quilting; scrapbooking; wooden signs; mirror marking; debossing dies, appliqués; packaging; and stamp manufacturing. Engravers continue to use laser processing systems in new and interesting ways. The rock band OK GO, for example, used over 2000 pieces of laser engraved toast—that’s right, toasted bread—in its video for their song “Last Leaf.” The video production company used laser systems from Universal Laser Systems to engrave a different image on each piece of toast which were then filmed in stop-motion animation. “The versatility of the equipment opens up opportunities in new markets every time you turn the machine on,” says Hays.
Dean says that they have seen customers move from creating awards and trophies to offering custom photo engraving, memorial engraving, tech gadget engraving, fabric engraving and cutting, and more. “We have several award customers who have also purchased a FiberMark laser for direct metal marking. These customers have done fantastically well by expanding their businesses into an entirely new field of metal engraving for serial numbers and bar codes for the same businesses that they are currently selling awards to.”
What new educational resources are available to laser owners?
Unlike the early days of laser engraving, there is a proliferation of education and training available today through online tutorials, webinars, classroom training, one-on-one assistance over the Internet and more. Every manufacturer offers a plethora of resources to help laser owners. Universal Laser Systems, for example, offers first-time customers a free two-day training program in addition to webinars, video tutorials and a monthly factory training course at the company’s headquarters. Epilog has an online “Sample Club” that features files and instructions that customers can download to create instant samples. The company also offers a “Virtual Training Suite” that features technical articles, how-to instructional videos and online demonstrations. Additionally, Epilog and its distributors regularly host laser engraving seminars and workshops across the country.
What are the most popular types of lasers?
All of the manufacturers indicate that CO2 lasers in the 30-50 watt range are still king in the R&I industry. This type of system represents an economical engraving solution that is easy to use and extremely versatile, providing both performance and value. “Buyers, especially new ones, want to get the best possible use of their machine and that includes being able to engrave and cut an array of materials. With the exception of PVC, almost any material can be cut and engraved with a CO2 system–wood, paper, plastic, treated metal, glass, fabric–the list goes on and on,” says Dean.
As far as table sizes go, manufacturers report the biggest demand is for mid-sized systems with table sizes in the 24"x18" to 29"x17" range. These systems provide a relatively large bed size in addition to the most advanced laser engraving features.
How popular are YAG and fiber lasers today?
Is there anything new in laser engraving software?
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