To stay on top of the most innovative trends, it is important to keep tabs on where thought leaders predict an industry is heading. In a recent Printing Impressions E-Newsletter, senior editor Erik Cagle has given us some insight into what the printing industry has to look forward to in 2015. In order to know where we are going, it is best to know our starting point. According to the U.S. Census Bureau, in the first quarter of 2014 printing shipments dropped 4.7% compared to the same period in 2013. Though there was improvement through the rest of the year, some of which can be attributed to the mid-term elections and politicians’ continual belief in the power of print, the first quarter loss set the stage for just a 2% increase for the year.
The 2% was exactly what Dr. Ronnie Davis, chief economist for Printing Industries of America (PIA), had expected. Davis is also predicting a 2 - 2.5% increase for the economy during the next two years, which he claims is "still short of the typical recovery range of 3 - 4%."
Davis goes on further to presents a number of statistics. One that is not so encouraging shows that the number of shipments for commercial printing and print-related media dropped off by more than a billion dollars compared to 2013. Yet on the bright side, printer profits have increased from 1.7% for all printers and 8.7% for profit leaders just ten years ago, to 2.7% for all printers and 9.9% for industry leaders. Some printers are even making 15 - 20% profit. To position ourselves within these market indicators, Murphy Company is diligently investigating new, competitively priced opportunities and products for its customers.
Cagle’s article also includes some insight from another leading economist in the printing industry, Andre Paparozzi, chief economist for the National Association for Printing Leadership (NAPL).
Paparozzi is encouraged by the strength of printing sales. The previous four quarters saw sales increases of 2.7%, 2.5% 1.5% and 3.3% respectively -- the industry’s strongest growth performance during four consecutive quarters since 2007. NAPL is forecasting industry growth of 2.2 - 3.5% for 2015.
Unlike Davis, Paparozzi’s numbers indicate that print margins are under fire. 46.3% of NAPL’S research group reported that their pre-tax profitability was higher than a year ago. The explanation for the two different outcomes where profitability was higher is due to companies having done something to increase revenue or decrease costs, Paparozzi notes, as opposed to competitive pressure easing.
PIA envisions increased sales for the next two years in segments such as package printing, converting, label/wrapper printing, general commercial printing, quick printing, direct mail printing and signage.
After looking at some of the numbers put out by two of the industries’ leading economist, it looks as if we can be cautiously optimistic about the New Year.
#MCGraphicArts #Forecasting #MC2015 #MCPrinting