Finding the Sweet Spot
Earlier this year, Print+Promo caught up with Dr. Ronnie H. Davis and his team at the Printing Industries of America (PIA), Sewickley, Pa., to discuss their findings on the current state of the industry.
Davis, PIA's senior vice president and chief economist at the Center for Print Economics and Market Research, addressed the misguided concerns (e.g., shrinking profit margins and a distressing future) shared by industry outsiders. He did his best to debunk these claims, pointing to PIA's research, which measured more than $150 billion in sales in addition to almost 50,000 establishments and one million employees. Still, Davis acknowledged the economy's role in the industry's overall performance.
"The 'sweet spot' for the industry is when the economy is in a mature recovery phase," he remarked. "Actually, we are in this phase now, although it is an extremely tepid recovery."
So, were Davis' statistics reflected in the most recent numbers put forth by the reseller segment? Unfortunately, "tepid" was key, with our 2014 list falling short compared to recent years. The final tally this year was $2.21 billion, a drop from $2.36 billion in 2013 and $2.27 billion in 2012. Some notable heavy-hitters were missing from this year's list, which may account for the discrepancy. For instance, the following companies failed to provide results in time or declined to participate: Magnets 4 media (2013: tied at #4); PRINTSouth (2013: #8); Consolidated Label Co. (2013: #11); and NJBF/InfoSeal (2013: #18).
On a more encouraging note, the top three earners enjoyed increases in revenue. Ennis Inc. reported $542.0 million in sales versus last year's $533.5 million. Meanwhile, 4over Inc.'s numbers jumped to $138.2 million from $115.0 million, and Western States Envelope & Label finished at $102.5 million, compared to $98.2 million in 2013.
Individual product sectors across the board didn't fare too well. Printed forms held on to the No. 1 spot with $475.7 million—but this figure was down from last year's $502.0 million. Labels & tags took second place, overall, with $377.5 million (2013: $442.2 million); commercial print fell to $275.2 million (2013: $319.4 million); promotional products consisted of $234.0 million (2013: $284.0 million); plastic products/cards declined to $106.0 million (2013: $121.1 million); and Web solutions came in at $15.2 million (2013: $17.1 million). The biggest upset belonged to the direct mail category. After last year's showing of $125.4 million, sales plummeted to a mere $64.3 million—no doubt a hit felt from the Top 50 list's missing entrants. Ennis' decision to opt out of this category further explains this number.