Printing Industry Trends Illustrated in 2022 Printing Impressions 300 Ranking of Largest Printers
What a difference a year makes. Most printing companies appearing on our 39th annual Printing Impressions 300 list of the largest printers in the U.S. and Canada — as ranked by annual sales — reported healthy, often double-digit, sales gains from the previous year. For the majority of them, the most recent fiscal year annual sales they reported constituted their 2021 calendar year revenues. Economic and business conditions largely improved within most printing industry sectors throughout 2021, following the period of COVID-induced uncertainty and widespread shutdowns that began in March 2020.
But the economic rebound has also fostered high inflation, a lack of skilled labor, and supply chain shortages, which combined continue to cut into profit margins and wreak havoc on workflow efficiencies, as well as the ability to accurately forecast and plan upcoming jobs.
Private Equity Firms Target the Printing Industry
As our 2022 Printing Impressions 300 list illustrates, several printing industry trends that emerged during the past several years continue to intensify. Most striking, to me, is the ownership stake that private equity firms have taken throughout the graphic arts industry. Of the top 25 printing companies appearing in our most recent annual ranking alone, at least seven of them are now controlled by private equity firms.
That includes No. 1-ranked RRD (RR Donnelley), which went private after being acquired by Chatham Asset Management as part of a lengthy bidding war between Chatham and Atlas Holdings (the current owner of LSC Communications, Lakeside Book, and several other industry entities). Similarly, Cerberus Capital Management now controls both No. 17-ranked direct mail printing specialist IWCO Direct, which it acquired in February 2022, and No. 18-ranked wide-format/point-of-purchase printing powerhouse IMAGINE, acquired in January 2021.
It’s not just the industry heavyweights, though; private equity investment groups increasingly hold ownership stakes in several mid-tier firms appearing on our list, like No. 62-ranked Prisma Graphic and No. 129-ranked Graphic Village. Selling all, or a partial stake, to private equity has increasingly become an avenue for owners of privately-owned printing companies to cash out. For others, it’s also provided the funding to make needed capital equipment investments that drive automation and efficiencies within today’s high-cost labor environment, as well as to enable platform growth through M&A opportunities.
Consolidation Within All Printing Industry Segments
Industry consolidation also persists as an overall ongoing trend among printing establishments across all market segments. Sometimes it’s being driven by the desire of commercial printers to expand into potentially more profitable print market segments — like labels, packaging, and wide-format digital printing. In other cases, it’s the desire by printing companies to add more equipment capacity and automation, to expand their customer bases, and even as a way to bring on more human talent due to our industry's severe skilled labor shortage.
A newer twist within the direct mail printing market is the desire by many companies to expand their geographic presence, either regionally or nationally, partly in response to rising postal rates and lowered USPS service delivery standards. It’s become a key way for direct mail printers to drive mail cost efficiencies and to meet their clients’ stringent service level agreements (SLAs).
Despite rising postage costs, the outlook for direct mail printing remains an industry bright spot. Unlike the overwhelming quantity of promotional email blasts, some of which get trapped in recipients’ spam folders, marketers realize the effectiveness of today's often highly personalized direct mail they know will at least reach the mailboxes of their targeted audiences.
Book manufacturing, which surged during the height of the pandemic, also remains strong. Although print demand in many book printing segments will soften if the general economy goes into a tailspin this year, as many economists predict, the tactile reader experience, portability, and higher comprehension levels for printed books remain advantageous in comparison to reading books on a computer screen or an electronic reader. Likewise, higher costs for overseas shipping and ongoing COVID-related lockdowns in China have many publishers seeking onshore print providers.
Another ongoing trend is the convergence of print markets and blurring of lines that once separated different types of providers. To survive and thrive, many printers are seeking to enter new markets. As witnessed by the huge crowds at PRINTING United Expo 2022 in Las Vegas last October — which showcased the latest offerings for all print markets — it’s not safe to stay solely in one’s lane. The new highway to success in the printing industry has no rules of the road, nor any speed limits for accessing the on and exit ramps.
Click here to download the complete 2022 Printing Impressions 300 list of the largest printing companies in the U.S. and Canada, as ranked by annual sales.