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Offset Growth: An Oxymoron?
Traditionally, the printing industry has tracked the GDP at a slightly higher rate. With the advent and growing popularity of color reproduction from the late 1980s through the early 1990s, the industry embarked on a course of significantly above-GDP growth that peaked when a hot economy kicked it into unsustainable overdrive in the late 1990s. More recently came the sobering correction of 2001-2003, followed by a slow, painful climb back to prosperity. What is the size of the offset market today?
William C. Lamparter, president of the PrintCom Consulting Group, maintains that offset lithography is not growing and is actually declining, citing the industry’s downward trends in paper and ink consumption. This leads him to conclude, “If the industry is not depositing more ink on paper, print is probably not growing. If the industry uses less ink and less paper, it means that we’re producing less traditional print.”
That’s not necessarily bad news. “In the last decade, we’ve made a round trip in nominal terms, such that the commercial offset market today is about what it was 10 years ago,” says independent consultant John Zarwan. However, “We also have 8,000-9,000 fewer printers. So while the market really isn’t growing, it appears to be thriving,” as printers reporting double-digit growth year over year continue to pick up business that other firms are losing.
Consolidation works well (or not) depending on where your bread is buttered, Lamparter confirms. “We see three printers that existed as independent entities five years ago. We look at their volumes five years ago. Today those three printers are one, and the total volume for the one is less than the combined total for the three back in the early 1990s. The surviving printer reports that his volume is up 15 percent. What he doesn’t reveal is that he replaces two other guys whose volume is now zero.
“I’m not sure that holds true for the consolidators, but Cenveo, Quebecor and Donnelley all have been closing plants,” Lamparter adds. “Why is all this going on? Because there are too many cylinders chasing too little work. Total commercial print in 2006 is down, compared with the late 1990s.”
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