Big Picture - June/July 2020 - 8

How The Printing Industry is Surviving the Pandemic
BY RILEY MCNULTY

BIG PICTURE

June/July 2020

In April, Big Picture magazine and Keypoint Intelligence
conducted a survey of sign shops and commercial printers to
gauge the impact of COVID-19 on their businesses. The data
from the survey painted a grim picture. Respondents
projected a year over year decline in revenues of 28 percent
in January through April. Approximately three-quarters of
printing establishments reported a drop off in sales. Now, two
months later, the United States, and indeed the world, are
trying to gingerly reopen their economies.
Charting a course of action during this pandemic has
proven to be a daunting task. The diverse range of economic
data doesn't help. The S&P 500 is up 30 percent in the past
three months; however, the Federal Reserve Chairmen,
Jerome Powel, warned a Senate panel the economy faces the
risk of significant long-term damage. In May, retail sales
popped 17.7 percent as pent up demand drove US consumers to open their wallets. Yet, the US unemployment rate
hovers around 13 percent. How is the printing industry
faring under these circumstances? To help answer this
question, Big Picture magazine and Keypoint Intelligence
conducted another survey in June to measure how things
have progressed.
The business closures precipitated by COVID-19 continue
to have severe impact on printing establishments' revenues.
Of the 63 respondents surveyed, 71 percent indicated that
revenues declined between April and June. More than a third
(35 percent) stated revenues were off between 21 percent to
49 percent, and 27 percent indicated revenues declined a
stunning 50 percent or more. The overall decline in industry
revenues was 30 percent.

The question is, where do printing companies stand in
terms of returning to more normal operations? Currently, less
than half of them (46 percent) are fully open with a full staff and
48 percent are open at limited capacity. Opinions on when the
economy is expected to recover are split almost evenly. Nearly
half (48 percent) are expecting a V-shaped recovery, with the
economy starting to improve in Q3 and reaching more normal
economic activity by Q4. However, more than half (56 percent)
are not so sanguine. This more pessimistic group does not see
the beginning of recovery until 2021 or later. As a result, it is not
surprising that only 18 percent of printing companies plan to
make investments in printing equipment.
Nevertheless, a majority (60 percent) are seeing an
increase in demand for COVID-related signage. Moreover, 27
percent are producing personal protective equipment, up from
16 percent in the April survey. Applications that are expected
to see the highest demand are, not surprisingly, floor graphics
and signs. When asked which vertical markets continue to
drive demand, healthcare, schools and teachers, label and
food industry, retail grocery, art scanning and reproduction,
pharmaceutical, police vehicle graphics, machine decals,
boats and RVs, and yard signs for school graduates were all
singled out. Healthcare had the highest emphasis.
Like the myriad of muddled economic statistics and
predictions, the state of the printing industry has its share of
conflicting signs. There are early indications of demand
returning, however, it is well off of 2019 levels. On balance, it
remains a tough market. As states reopen for business, companies will need printed products to reopen safely. However, it
remains to be seen when this demand will pick up speed.

Big Picture - June/July 2020

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