Continuing Downturn Erodes Sales Gains By Printing Industry
According to the National Association for Printing Leadership (NAPL), printer confidence is fading as prices and profits decline. NAPL’s Printing Business Index has been below the critical 50 mark for five consecutive months.
Sales fell 2.6 percent in February for the Printing Business Panel of NAPL. The decline follows a 4.1 percent sales dip in January, the steepest decrease since last June. The performance more than negated the sales increased logged by the Panel in the last months of 2002, when sales rose 1.1 percent between September and December. The economic analysis comes from NAPL’s Printing Economics Research Center (PERC), which produces research and publications sponsored by Heidelberg, Kennesaw, GA.
Other indicators also pointed to continuing tough times. Prices fell in March for nearly half (48.5 percent) of the Printing Business Panel, the highest percentage of the year. Equally as troubling, only 9.7 percent reported increasing prices. Profitability fell for 47.3 percent of the Panel, greater than the 40.7 percent reporting decreased profitability in December, 2002, and nearly triple the 17.3 percent who reported an increase in profitability. Confidence is the lowest it’s been in 17 months, with just 25.7 percent of printers surveyed expecting business to improve during the six months ahead, and 22.1 percent expecting business to decline.
“Concern about what’s ahead is growing,” said Andrew Paparozzi, NAPL vice president and chief economist. “It’s another setback in our struggle to recover from recession. Compounding the situation is the impact that the uncertainties of war are having on the economy. There’s one hopeful sign—we’re off to a better start than last year, when sales declined 6.7 percent through Feb. 28. The decline for the same period of 2003 has been nearly half as steep, at 3.4 percent.”
The NAPL Printing Business Index
The NAPL Printing Business Index (PBI), the association’s broadest measure of print activity, fell to 44.4 in March. The PBI has now been below the critical 50.0 mark—the point at which more printers report activity is slowing down than report activity is picking up—for five consecutive months.
The PBI combines input from the Association’s Printing Business Panel about work-on-hand, current business conditions, expected business conditions (confidence), hiring plans, profitability, and other key indicators into a single measure of activity.
The NAPL Printing Business Panel is a representative group of more than 300 printers that the association surveys monthly on a range of key printing issues. Since the same companies are surveyed every time, data are strictly comparable from period to period.