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Print Industry Leader Calls for More Federal Government Work to Private Sector Printers

September 22, 2009
CHAMBERSBURG, PA—September 22, 2009—No business sector is more representative of small business than printers, according to William Gindlesperger, chairman and chief executive officer of e-LYNXX Corporation. There are approximately 36,000 commercial printers (not including neighborhood print shops) in the United States. However, this number is falling dramatically as more and more printers fail due to the recession, an increase in bulk mail rates by the U. S. Postal Service, and the government’s on-going unwritten policy of manufacturing print in-house rather than reliance on the private sector.

"Not too long ago, 51% of everything printed ended up going through the mails. When the bulk mail rate went up, direct mail volumes went down in favor of on-line advertising and other less expensive forms of marketing. This changed the print business dynamics," Gindlesperger said. "Not only did the U. S. Postal Service get itself into deeper financial trouble by reducing this major source of contribution to its overhead, but it hurt the print industry. Now, instead of printers utilizing 70% of their capacity on a day-by-day basis, the utilization figure dropped like a rock. In some cases the capacity utilization is now 20% and less."

According to the Printing Industries of America (PIA), the print industry consists of nearly a million small business people. In fact the average commercial printer had 27 employees and revenues of about $4.5 million. This is no longer true, as many of these printers have been hit hard and are seeking work wherever they can find it.

Approximately 10,000 of these print companies are registered to do work for the United States Government Printing Office (GPO), and of those 400 have historically been active, depending on workflow from the GPO to remain viable businesses. The GPO sends work valued at about $400 million a year to the private sector.

However, that number just a few years back was more than $500 million.

Last year, total GPO work to the private sector was $440 million. There has been roughly a 27% drop in GPO derived income by private sector printers over the past dozen years. Factor in inflation and the drop is even more dramatic. "The reason for the drop is not better management, more efficiency, or even less print. Au contraire, the reason for the drop is the uncontrolled growth of the in-house print plant operated by GPO, the granting of waivers by the government for the operating of thousands of other in-house print plants, and the active efforts by many government agencies to get around the rules," Gindlesperger explained. "This does not bode well for the print industry — especially now that the sky may be falling in for many printers."
 

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