Market Watch

Market Watch

October 14, 2009

NAPL Digitization, Integration and Training Are Keys to Success in the Printing Industry

Enduring success for printing companies will depend not on a company’s size, but rather on its ability to continue to redefine itself and respond effectively to customers’ evolving communications needs, according to the 2003 Future of Print survey from the National Association for Printing Leadership (NAPL).

According to survey participants, essential elements of enduring success include a continuing move to digital, integration of workflow and services, employee training and a commitment to continuous improvement. The Future of Print survey is prepared by NAPL’s Printing Economics Research Center (PERC), which produces research and publications sponsored by Heidelberg, Kennesaw, GA.

Survey participants, 145 printing companies with annual sales ranging from less than $200,000 to more than $200 million, were optimistic about their revenue growth. Respondents forecasted average sales growth of9.3 percent per year over the next five years, far outpacing projected growth for the industry as a whole, which is estimated at only 3.5 percent to 5 percent. The optimistic forecast is based on an expected shift of market share to those printers who are prepared to provide effective solutions to customers’ changing communication needs, according to NAPL.

“In considering which companies are going to be around in five years, the temptation is to conclude the bigger the company, the better the odds,” noted Andrew Paparozzi, NAPL vice president and chief economist. “However, enduring success will be reserved not for companies of a particular size, but for those who understand that they are in the communications business, not the ink-on-paper business, and who are able to meet their customers’ growing demand for new communications options and preferences.”

Other survey findings included:

• Bindery and finishing equipment systems; employee training/education; and four-or-more-color lithographic systems were identified as the top three investment priorities for the next five years by all respondents.

• Lithographic printing and associate preparatory and bindery/finishing services are expected to fall, on average, from 81.6 percent of revenue today to 69.1 percent by 2007. No participants projected that litho’s share of revenue would fall below 64.5 percent.

• Digital printing is expected to rise from 5.6 percent of sales to 12.6 percent in 2007, with companies of all sizes forecasting growth would more than double.

• Value-added/communications support services are projected to increase from 7.8 percent of revenue currently to 14.5 percent in 2005.

Printing Business Index Continues to Drop

In other economic analysis from NAPL’s Printing Economics Research Center (PERC), the NAPL Printing Business Index (PBI) declined for the fourth consecutive month to 47.4 in January from 48 in December. A PBI above 50 means more printers report activity is picking up than report activity is slowing down; a reading below 50 means the opposite.

The decline in the PBI notwithstanding, however, Mr. Paparozzi pointed out that “we have made meaningful progress despite all the ups and downs. Our January reading is the lowest in six months and the third straight below the critical 50 mark, but it’s still 18.6 percent above year-earlier levels.”

Mr. Paparozzi noted that NAPL’s printing industry indicators are generally reliable precursors to how the economy in general is performing. “The printing business reflects an upturn or a downturn in many sectors of the economy almost immediately,” he says. “There’s none of the lag time that there is with many other indicators.”

For further information on NAPL’s Printing Economics Research Center, its economic research programs or its indicators, contact Cynthia Valentino at NAPL members can view the current issue of the Economic Edge newsletter, containing findings from NAPL’s Future of Print survey, January 2003 indicators, and economic analysis onthe NAPL web site,

How to Find and Keep Great Employees

Developing and maintaining a qualified staff is a critical success factor for graphic arts companies, yet many company leaders are grappling with how to do so effectively. They can now draw on the guidance of leading human resources expert Dr. James Harris in Finding & Keeping Great Employees, a two-hour, two-CD audio set from the National Association for Printing Leadership (NAPL).

Featuring an address presented by Dr. Harris at NAPL’s 2002 Top Management Conference, the CDs examine how many companies go awry in their recruiting and retention efforts and provide practical advice and real-world examples of how to get those efforts on track.

Finding & Keeping Great Employees (Product Code ND 112) sells for $34.95 (NAPL members, $27.95). To order, call NAPL at (800) 642-6275, Option #3; email; fax (201 634-0328; or visit