Commercial Printers

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 23,400 commercial printers in the US produce brochures, ads, books, packaging, business cards, and other output for clients. They are in the midst of a transition to digital technologies and electronic media.

Rapid Technological Change

The transition to digital technology has accelerated the rate of equipment change in the printing industry.

Weak Printing Demand

The commercial printing industry has seen falling demand for printed advertising materials caused by the shift to electronic media.

Industry size & Structure

The average commercial printer has about 16 employees and generates $3.3 million in annual revenue.

    • The industry consists of 23,400 firms with 377,800 employees and revenue of $78 billion.
    • Digital communications are replacing print for advertising, direct mail, magazines, books, and other business publications.
    • Digital printing has reduced the barriers to entry for commercial printing. The new competition consists of quick printing companies and companies doing their own printing in-house.
    • Industry-wide employment fell 20% from 2011 to 2020.
    • Most firms are privately-held and 85% of firms have less than 20 employees.
    • Large firms include RR Donnelley, Quad/Graphics, Transcontinental Printing, and Cenveo.
                                    Industry Forecast
                                    Commercial Printers Industry Growth
                                    Source: Vertical IQ and Inforum

                                    Coronavirus Update

                                    Apr 29, 2022 - Russia’s Invasion of Ukraine Disrupts Paper Trade Flows
                                    • Russia’s invasion of Ukraine is disrupting global wood product trade flows, especially in Europe. According to Wood Resources International, Russia, Belarus, and Ukraine exported 34 million tons of lumber in 2021, and 25% of that volume was exported to countries that have sanctioned Russia and Belarus. Europe’s timber imports from Russia and Belarus accounted for nearly 10% of the continent’s consumption in 2021. Wood certification organizations Forest Stewardship Council (FSC) and Programme for the Endorsement of Forest Certification (PEFC) have designated all timber from Russia and Belarus “conflict timber,” which cannot be used to manufacture certified products, including pulp and paper. Even after peace returns to Europe, timber trade flows have likely been permanently altered.
                                    • Industry stakeholders must avoid the temptation to believe that this is just another cycle, according to Marco Boer VP of I.T. Strategies. "... if you look at the history of commercial printing and writing papers we’ve been seeing since about 2012, the supply of printing and writing papers go down about 3% a year,” Boer said. “What’s happened is along the way a lot of the capacity that was once there has now been taken out, so as things start coming back out of COVID you may not see the capacity come back.”
                                    • Boer explained the actual accelerant behind all of this goes much farther back in history than we realize and that the printing industry as a whole has been devaluing for years. “If you talk to the paper mills, what they get for a 100 weight of paper is basically the same as it was 10, 20, maybe even 30 years ago,” Boer said. “Right around 2017/2018, we saw an onslaught of paper imports coming into the US and Europe and so all of sudden there was this surge of excess capacity and that resulted in people trying to jockey for market share and it caused the prices of paper to go down.”
                                    • Commercial bankruptcy filings increased 26.4% month over month in March, according to Epiq Bankruptcy Solutions. For the first quarter of 2022, total commercial bankruptcy filings were down 25% compared to the same period in 2021. “March is typically the month with the largest number of new bankruptcy filings on an annual basis,” says Chris Kruse, senior vice president at Epiq. “We continue to watch closely the bankruptcy activity as we emerge from the global pandemic and expect a return to a more active market in the months to come.”
                                    • In March 2022, advertising firm MAGNA downwardly revised its outlook for 2022 US advertising spending from 12% growth to 11%. The war in Ukraine and resulting higher inflation are expected to hinder ad sales growth slightly. Ad spending for direct mail is forecast to decline 2% in 2022 after growing 8% in 2021. However, election-year ad spending will be a bright spot for commercial printers in 2022 as campaign-related direct mail spending is expected to rise by $600 million.
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