Downturn hits UK printers hard confirms BPIF survey

The downturn in the UK economy has hit printers hard according to the latest BPIF Directions survey, to be published next week. Reflecting the slowdown in the economy as a whole, the summer months (June-August) saw the highest negative balance for the general state of the trade since April 2006. While polarization of fortunes within the industry has been a feature for some time, it is increasing in the current difficult economic climate. Companies have closed and more seem certain to fail. But at the same time many survivors are going from strength to strength, with order books and prospects boosted in some cases by the failure of competitors.

Employment too has suffered. The highest negative balance for employment in 15 months was recorded this past quarter. The net reduction in staff numbers in the six months June-November is around 150, more than 1 percent of the survey population. Although rising costs have made price increases inevitable for many companies, with the highest positive balance for selling prices since October 1995 reported, respondents were still unable to post a positive balance for margins on sales as faster-rising costs outstripped higher selling prices.

Print firms confirm that they will continue to invest in plant and machinery to replace equipment, but not surprisingly the focus right now is on more efficient, time-saving kit rather than looking to increase capacity.

The outlook for the coming three months (September-November) is more promising, as the industry gears up for the Christmas season. Without the fortuitous timing of Christmas, it is possible that this survey could have been one of the bleakest in recent times.

BPIF corporate affairs director Andrew Brown commented: ‘The latest Directions survey results make for grim, though not unexpected, reading. The summer months were disappointing with a number of negative balances reported when positive ones had been forecast last time. Hopefully Christmas will bring the relief that respondents are predicting, given the very real danger that if current economic conditions continue we will face some of the toughest conditions our industry has experienced since the early 1990s recession.’