The experience of UK print in the spring and into the summer is one of steady improvement. This overall feeling is, however, a combination on the one hand of companies that have been very quiet and those that been rushed off their feet.
The BPIF’s Printing Outlook report for Q3 finds that expectations for strong growth in the quarter failed to materialise, but that this has been pushed forward into the current quarter. The Bank of England’s interest rate cut will surely help in the growth of confidence.
BPIF economist Kyle Jardine says: “It is important to acknowledge that some companies have reported a quiet spring and summer; while others have rarely been so busy.
“If the UK economy continues to improve – and the new government can find a stable way to support business – then confidence will return more strongly.”
As the general election fell in the period under review, some companies will have suffered as projects were put on hold, while others involved in election work will have experienced a swelling order book.
BPIF chief executive Charles Jarrold says: “While the recent growth status of our industry has been subdued, it reflects the period immediately prior to the announcement of the general election. While it’s very early days there is a new level of energy and focus within government which I hope will feed through to economic confidence going forwards.
“Meanwhile we do know that companies have come away from Drupa with clear intent to continues to invest, automate and innovate and we will of course discuss with the Labour government how to fully support that.”
However, concerns about pricing below cost have once again become the number one issue for printers, replacing Brexit and worries about sales levels. Constraints on growth include the difficulty in recruiting appropriate staff, which surfaced two years ago and has been present ever since. Nevertheless more companies increased staff levels during Q2 than shed people. Intentions for Q3 remain slightly positive says the report. Supply chain issues continue to be a key constraint.
Looking forwards, companies hoping to improve performance plan to do so by controlling costs, attracting 38% of respondents; a further 32% plan on diversifying or further diversification while 30% expect profitability can be increased by managing sales.
Costs have been rising, not least in staffing. With 61% of companies conducting pay reviews in the period, the average pay increase was 4.3%.
