Printers Indicate How They Are Dealing With Cost Inflation As It Remains a Top Concern As the Industry Heads Into 2022
The PRINTING United Alliance/NAPCO Research State of the Industry Series provides timely, accurate analysis of the printing industry’s performance and prospects. The series includes a State of the Industry Report, published in November, and SOI Updates, which will be published in February, May, and August. The State of the Industry Series is sponsored by Premier Sponsor, Konica Minolta
An industrywide survey is an important part of our methodology. This survey tracks key indicators and industry trends across a cross section of printing companies, including commercial printers, graphic and sign producers, apparel decorators, functional printers, and package printers/converters. Download the in-depth executive summary to understand the current status of the printing industry.
Here are the key findings from graphic and sign producers and all printers participating in the first State of the Industry survey.
More than 50% of Cost Increases are Offset by Raising Prices According to Printers
In the most recent State of the Industry Survey, we asked respondents to tell us how they are dealing with increases in both labor and material costs. In times like these, companies typically have three options. They can pass these price increases along to their customers, they can offset them by increasing efficiency or they can simply absorb the costs. Typically, companies opt to use some combination of these solutions, so we asked printers to give us their percentage breakdown of each.
Figure 1 below shows that most of these costs (50.9%) are offset by raising prices, while nearly one-third (31.3%) are absorbed by the company.
- Approximately what percent of the increase in your TOTAL operating costs so far this year have you offset by raising prices, offset by increasing efficiency/productivity, or absorbed?
Current Industry Issues are Expected to Linger into 2022
As we enter the new year, we will do so with many of the same industry issues that were present throughout 2021. To gauge what 2022 will look like, we asked survey respondents, in an open-ended question, to describe the issues that they are likely to face in the coming year. Figure 2 below shows that many of these challenges are simply a continuation of what we are currently seeing.
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The full version of the State of the Industry Report digs deeper into the data mentioned above plus much more!
The report includes sections on:
- Trends for sales, production, employment, prices, profitability, quote activity, work-on-hand, payroll production hours, and confidence
- How 2021 third quarter sales compared to the same period in 2020
- Employment hours worked in the printing industry
- How companies are responding to labor shortages
- Cost inflation – How much prices have changed and what companies are doing to offset these additional costs
- Three critical questions to answer as we head into 2022
- The outlook for the print industry in 2022
- An introduction to the Print Market Atlas – a snapshot of the establishment, industry, and employment trends by region
- “What we show know” – quotes from printers that give a more in-depth pulse of the industry
- Economic indicators to watch
Printing United Alliance members can download a full version of the report: https://www.sgia.org/resources/research/state-of-the-industry-series-2021
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ABOUT NAPCO RESEARCH
The combined NAPCO and PRINTING United Alliance research teams develop research and economic models that solve customer business problems. Market research is valuable for making strategic business decisions, solving challenges, and pursuing opportunities and the NAPCO Media research teams survey, analyze, and monitor critical trends related to marketing, printing, packaging, non-profit organizations, promotional products, and retailing. To learn more about how the team can leverage its research and industry subject matter experts to support your organizations needs contact NAPCO’s Vice President of Research, Nathan Safran, at email@example.com.
About Premier Sponsor, Konica Minolta
Konica Minolta Business Solutions U.S.A., Inc. is committed to the success of its customers, the industry, and theassociations that support it. It is our honor to support PRINTING United Alliance’s industry-leading economicreports. By providing invaluable insights for industry leaders regarding critical economic conditions, KonicaMinolta is proud to continue to be a trusted advisor and an indispensable partner to help businesses prosper.
Konica Minolta Business Solutions U.S.A., Inc., a leader in industrial and commercial printing and packagingsolutions, ignites print possibilities. It delivers the latest innovations in printing, applications, and expertise throughits comprehensive portfolio of production print offerings that provide businesses more creative avenues, agility,and versatility to confidently capitalize on market opportunities. Together, the future of the print world can betransformed for the better.
David Wilaj reports on economic and industry trends which aim to help printers navigate an ever-changing business environment
He joins the Printing United Alliance research team after beginning his career at Printing Industries of America where he analyzed, reported and spoke on key trends in commercial print and aided in the revitalization of the historic Performance Ratios program.