This article was contributed by Ed Gleeson, Director of Economic & Market Research, Printing Industries of America.
In 2011 we started off the year with fears of a double-dip recession, but much of those fears have subsided as the U.S. economy gained some momentum ending with fourth-quarter growth of 3.0%. Real GDP increased by 1.7% in 2011, and the printing industry–like the U.S. economy– experienced growth, but at lower levels than 2010.
According to our Fourth Quarter Print Market Survey of over 250 survey printers, sales increased by 3.9%. Taking into account the number of firms that went out of business during the year, we estimate that total industry sales increased by 0.35% in 2011 to $145.1 billion from $144.6 billion. According to the U.S. Census Bureau, 2011 print shipments declined 0.47%. Since the beginning of the year, both our survey panel and the U.S. Census Bureau reported print sales weakening. Most reported industry growth is from companies with more than 100 employees. On average their sales increased by 5.1%, while smaller firms reported sales declining.
Digital toner-based and ancillary service sales were the main drivers of industry growth in 2011. Digital toner-based sales increased 8.5% and ancillary services increased 4.7%. Weighted average* conventional print sales increased by 1.4%, while non-weighted sales declined by 0.6%. Larger firms’ conventional print sales increased by 2.9% while smaller firms’ sales continued to decline. Since larger firms account for a larger percent of total industry sales, their answers receive a larger weight and pull up the industry average.
In 2011 our panel reported prices declining slightly by 1.1%. According to the Bureau of Labor Statistics’ Producer Price Index for the printing industry, prices increase by 1.8% in 2011. Smaller firms with 1 to 19 employees were the only segment in our panel that reported increasing prices in 2011, an increase of 1.2%.
How did your company perform compared to the industry average in terms of percent change in total firm sales, conventional print sales, digital print sales, and ancillary services sales? Were you able to pass along price increases to your customers or, like our panel, did average prices decline? In the Fourth Quarter Print Market Update, available soon at www.printing.org/store/38806, you can compare your firm’s performance to the competition.
The following are some of the main benchmarks available for comparison in the report:
- Percent change in year-end sales
- Sales expectations for 2012
- Printing prices, profitability
- Material and labor costs
- Employment and employment expectations
- Capital spending and access to credit.
We further segment the results so you can compare your company to companies of a similar size, in the same region, and using the same primary printing process. We recommend you compare your year-end results to our survey panel. You can also track how your firm is performing compared to the competition on a quarterly basis, which can help you determine where your strengths and weaknesses are compared to the competition.
For a full analysis of the year-end results, visit www.printing.org/store/38806 to get your copy of the Fourth Quarter Print Market Update. This report will be available for purchase the week of March 26, 2012. All participants in the Quarterly Print Market Survey receive a free copy of the Print Market Update. If you are interested in participating in this survey and getting free access to these reports, please contact Ed Gleeson at egleeson@printing.org.
*Weighted average—since larger firms, those with more than 100 employees, account for a larger portion of total industry sales we give more weight to their percent change in sales, prices, expectations, and profitability to more accurately portray what is happening to the overall industry. In the full report, The Fourth Quarter Print Market Update, we also include un-weighted statistics along with breakouts by size of firm, market segment, printing process, and region.