News

- 10 June 2008

The current state of the Printing and Graphics Arts industry has been variously described as stagnant, revolutionary and on the brink, set against the vendor hype associated with all things Digital. In the middle of all this, the bedrock of the industry, Commercial Printers, are fighting to survive. So what is happening to this vital sector across Europe, USA and the developed world? Will the predicted fall in revenues from traditional offset happen, and if so how quickly? The change will be rapid! In many cases, Commercial Printers are finding the pace of change in technology far to rapid and cannot cope with the uncertain business conditions facing the industry. Also, many Commercial Printers have no succession planning and are `life style` companies and the true worth of the company is not at the same value as the owner.

It is the general consensus that the USA and European Print Industry is experiencing pressing times, but this is a challenge and such despondency should be looked at with a fresh and open view at the changing global market.

We should look at the growth of print markets around the world - from China`s ride along the Domination Highway to the more emerging markets of Eastern Europe. We need to open up our minds to the opportunity in the world - while growing markets are usually seen as a threat, we need a much needed `kick-in-the-backside` and motivation for the West's metamorphosis from a manufacturing industry to a service industry. Just look at the impact of the Print Management Services companies have made over the last 37 years!

Despite all the doom and gloom and despondency that Printers are complaining about, the market is an opportunity and challenging. We are in `business`, so act and perform as business people do! Printing is a by product/service of the business, so business methods are the most important - what is required are skilled and experience people in all areas of `the business`. Plus, business models to help the business perform to global standards.

China's not the only emerging market; emerging Europe is still a place of significant growth. In a five-year period to 2007 printing employment in the Czech Republic grew 5%, Spain's grew 12%, and Hungary's grew 84%. This was all at a time when the developed economies of Europe's printing employment were either stagnant or declining.

Economic freedom is not turned on like a spigot; it takes time for economies to grow and to benefit from new capital investment. The Eastern European economies have shown steady progress, with some impressive growth rates, while still behind the other mainland economies in terms of incomes and per capita GDP. In practical terms, Spain and Portugal can be considered emerging economies as well.

Growth can be found in many places. Ireland's rise as a notable economy has caused its printing shipments to double in the same time period with help from the EU. Trade agreements account for a great deal of this growth, but modern communications technologies further erode the natural barriers to trade and widen opportunities for buyers and sellers to meet. Constantly improving logistics play a major role as well.

It's essential to realise that just because print may not be growing in the developed European countries does not mean it is not growing elsewhere. `Business people` go where the opportunities lead them, to give them a `bottom-line` return on their investments. The realisation that there is now an interconnected world print economy rather than a collection of discrete print economies is hard for many to get used to... but it's critical that global thinking become second nature to all managers.

Companies in the developed countries are asking themselves - `what can I do to stop my customers leaving? ` You can help your company by being `service driven` in the first place; add value to what you produce. It is these added services that are changing the industry. Plus, implementation of business models to raise the `bottom-line` and training people of `all` ages in `all` sectors of the company!

Latin America and emerging Asian countries have just bypassed traditional print and gone straight to Digital printing. China has gone absolutely mad on wide-format. Digital is growing, but would not take over from conventional methods in the short to medium term.

China will be a major player and is expected to grow by 11.6% and India to grow by 8.2%, helping Asia to over-take Western Europe, with a value probably in the region of £114billion plus. This being almost a third of the total global market in five years time. The massive growth of China`s print industry has inspired many Western organisations to invest `big time` in the future of China and the financial rewards for the future. There are two in-depth reports available from Colin Thompson, compiled from his visit to China:

`The Current Status and Perspective of the China Printing Industry`

`The Printing Industry of China and Asian Printing`

The above reports are included in the comprehensive research report;

`The European Printing Industry and the Impact of China on the World

The Print Industry is re-inventing itself all the time, and as long as you get pressure from the customers, it will continue to do so.

" It`s not the strongest species that survive, nor the most intelligent, but the ones most responsive to change" by Charles Darwin

Colin Thompson

Cavendish

www.cavendish-mr.org.uk