The global economy is back on the upswing after the experiencing a historic recession in recent years, and the printing industry is reflecting this trend. Printers are showing signs of growth and increased profitability, both of which were seemingly unattainable during the financial crisis.
Now that the economic storm has subsided, consumers and businesses alike are turning to printers once again – but the industry's key offerings have largely shifted. For example, the rapid expansion of digital technology and devices has effectively displaced the print media, as people are increasingly valuing online publications for their news over traditional sources. Because of the widespread changes that have affected the industry, printers are providing new services and products in order to remain relevant within the market – and it appears to be working, in many cases.
Printing market sees growth in 2014, and more should be on its way in 2015
Printing Impressions contributor Erik Cagle reported that the print industry's growth reflected that of the U.S. GDP in 2014, enjoying a 2 percent bump. This figure is also likely to remain steady in the immediate future – Cagle cited Dr. Ronnie Davis, senior vice president and chief economist for Printing Industries of America, who projected a an industry-wide expansion of between 2 percent and 2.5 percent by the end of 2016.
While print media suffered in 2014, the printing and related support activities sector more than made up for it, gaining $1.7 billion in profits and heavily contributing to the 2 percent growth, according to Cagle. He also noted the increase in industry profit rate averages over the course of the past decade – 10 years ago, these averages were at 1.7 percent for printers, while market leaders experienced 8.7 percent profit rates. These figures jumped up to 2.7 percent among all printers and 9.9 percent for market leaders by 2013, Cagle said, indicating growth and stability within the industry.
In addition, the author pointed out sales increases that printers are experiencing, as they have experienced growth in each of the past four quarters as of Q4 2014, at rates of 2.7 percent, 2.5 percent, 1.5 percent and 3.3 percent. Cagle lauded these numbers, which represented print's strongest growth during four consecutive quarters since the pre-recession and pre-mass digitalization days of 2007.
Success in the paper packaging industry is coming from a number of new sources
PrintWeek's Sarah Cosgrove reported on a recent white paper produced by Smithers Pira, which noted several of the most impactful trends within the lucrative paper packaging industry. For example, the source found that GDP growth, ever-evolving demographics, environmental concerns, technological developments and the consumer's quest to find value were all factors that contributed to innovation in packaging.
The white paper addressed the fact that while plastic and other forms of packaging are prominent, the paper and board segment accounts for 35 percent of all the industry's sales throughout the world, adding up to a value of $280 billion. Cartonboard and containerboard also make up a significant portion of the packaging market, at 31 percent, signifying that paper-based products are predominant in the sector. Cosgrove noted that in luxury packaging, paper and board are dominating the market and experiencing consistent growth, estimated at an averaged of 4.4 percent per year.
The printing industry certainly took some knocks during the financial crisis, but in recent years, companies have found innovative ways to remain relevant in the market and grow their profits. Looking forward, the industry appears poised to enjoy continued strength and stability, experiencing slow but steady growth over the course of the next several years.