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The Global Recession’s Impact on Print

December 23, 2009
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India and Brazil will also boast sizeable print markets in the coming years. In 2009, the graphic communications industry in India was at $16 billion. It is expected to expand to $24 billion by 2014, a growth of nearly 49%. Brazil’s print market is predicted to expand by 38% from 2009 to 2014, to nearly $21 billion.

Russia’s printing industry, though not as strong as the other BRICs, remains a viable player as well, at about $8 billion in 2009. Russia’s print market is forecast to grow to almost $14 billion by 2014.

And, two other print markets show particular promise: Mexico and Indonesia. By 2014, Mexico’s print market is expected to hit $18 billion and be the eleventh largest in the world. Indonesia’s graphic communications industry, meanwhile, is predicted to grow by almost 45% between 2008 and 2014, to a little more than $8 billion.

The promise of inkjet, digital
Drilling down through the data, a few trends begin to emerge. Inkjet is big. So is digital (also called “electrophotographic”). These print processes are so big, in fact, that they are expected to enjoy a near doubling of their market share between 2008 and 2014. While it’s true that their market share is still minimal compared to the more traditional print processes, inkjet and electrophotographic are showing their great potential for the future. (Sheetfed printing is the only other print process expected to increase its market share between 2008 and 2014.)

The promise of inkjet and electrophotographic becomes even more apparent when considering the global machinery market. In 2008, the global machinery market tells a fairly standard tale: Sheetfed presses claim a $5.6 billion market, greater than any other equipment category. By 2014, however, the sheetfed press market will have contracted by over 8%, to $5.1 billion—while inkjet sales will have shot up from $1.9 billion in 2008 to $4.8 billion in 2014, almost the same as sheetfed. (See pie chart, “Global Machinery Market, 2008 – 2014.”) The forecasted growth for inkjet, by the way, is 160%.

Other segments of the global machinery market expected to experience significant growth is, naturally, electrophotographic and also flexo and postpress. At $1.4 billion in 2008, the electrophotography market is predicted to increase by 49% between 2008 and 2014 to just more than $4.7 billion. Based on the significant growth of package printing over the study period, flexo equipment is forecast to grow a steady 12% to over $2.7 billion by 2014.

With the importance of high-end finishing to increase the value-added of print products, postpress equipment will see growth of almost 8% by 2014 to $1.75 billion. All other markets are predicted to suffer significant declines with some more than 20, 30 and 40%. (Film imagesetters, not surprisingly, will plummet by 65% between 2008 and 2014.)

Package printing, postpress stand out
Finally, for those wondering which print products and company types we can expect to see more of in the future: How about package printing? Package printing, a $203 billion market in 2008, is forecast to grow by 21% to $246.4 billion in 2014.

Demographics play an important role in this area. A growing middle class, particularly in such population-heavy developing countries as China and India, has led to millions more people in the world buying packaged goods. At the same time, a rising number of consumer households—not to mention time-poor consumers—in developed nations has created a demand for single-portion packs and other convenience-oriented formats.

Also predicted to experience marked growth (23%) in coming years is the outdoor point-of-purchase (PoP) and signage sector. (The growth of this sector, in fact, may be a contributing factor in the rise of inkjet technologies between 2008 and 2014.) At about $9 billion in 2014, it’s true that this category is well behind the traditional print categories of magazines ($69.0 billion in 2014), newspapers ($45.0 billion), books ($34.9 billion), catalogs ($33.4 billion), and brochures and pamphlets ($33.1 billion). But it’s also true that all of these “traditional” categories will undergo a decline between 2008 and 2014.

Given all these trends, it’s no surprise that package printers are expected to increase their share of the market between 2008 and 2014 by nearly 20%. Revenues from package printers will account for about $227.8 billion of the total $725 billion global graphic communications market.

Companies specializing in postpress will also fare well in the 2008 — 2014 time period. This category is forecast to grow by 12%, to $16.8 billion in 2014. Because of the growing savviness of the typical consumer and the multiple end-uses often required for products, more print clients are requiring special finishing. Those who can deliver on that, then, will profit.

The post-recessionary environment
It’s clear going forward that the way we did business even a few years ago will not cut it in the post-recessionary graphic communications environment. It’s a small (global) world out there, and success in the future will require making it smaller still, by looking beyond our borders—or even on the other side of an ocean—for the most advantageous markets, partnerships and opportunities. It’s also a changing world, in terms of the technologies and print products most important to the end client. Yes, the global recession did make quite an impact on our industry. But if we consider these trends, the future holds much promise.

Ralph Nappi
NPES President



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