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The results of FESPA’s first stakeholder Economy Survey suggest that wide format printers and their suppliers worldwide are broadly optimistic about the chances of business recovering to pre-recession levels within the next 12 months.
Some 14% of survey respondents already report signs of recovery, with a further 23% expecting fortunes to improve in the second half of 2009. 25.6% of the sample expects the upturn to come in early 2010, with a similar figure anticipating recovery by the end of 2010. Less than 12% foresee current trading conditions lasting into 2011. 83% of respondents believe themselves to be well positioned to take advantage of the conditions if the market rebounds.
The electronic survey of some 400 individuals during July 2009 was conducted by FESPA in partnership with research organisation InfoTrends. The research, which includes printers, manufacturers and resellers, will be repeated on a regular basis between now and FESPA 2010 (Munich, Germany, 22 - 26 June 2010), helping FESPA and exhibitors to reliably gauge the mood of the wide-format community.
FESPA marketing director Marcus Timson explains: “We found the intelligence from our recent Worldwide Survey so valuable that we decided it would benefit FESPA, our exhibitors and our global community of print service providers (PSPs) to test the temperature of the market more regularly. With the Economy Survey, we’re questioning a meaningful sample of printers worldwide to assess how they’re managing the impact of the global economic downturn, and to understand the measures they’re putting in place to get through the difficult times and equip themselves for a positive future.”
While a quarter of those questioned indicated that their business had stagnated or experienced minimal impact, the majority had seen turnover affected, with 27% of respondents citing a negative effect of 25% or more.
The survey shows that print service providers are still looking to their operational processes for solutions to falling revenues. 76% of printers had developed production-led strategies to address the downturn, with many looking to reduce overheads with lower priced media (35.2%), lower priced ink (28.7%) and by cutting printer maintenance programmes (18.5%). Sustainability practices have benefited, however, with 46.3% of respondents having tightened their waste management practices. Flatbed printing technology has also experienced a boost, with 22.2% of PSPs looking to this technology to trim labour costs.
Unfortunately, pricing is still a popular tactic to attract sales, with 41.3% of respondents resorting to rebates and price promotions to tackle the downturn. Almost a third of those surveyed mentioned flexible payment terms as a means of attracting business, and more than a quarter indicated that their pricing strategy had been driven by aggressive pricing by competitors.
Encouragingly, however, many printers have responded positively to the challenges, optimising their product portfolios, or increasing their focus on different applications such as textile to grow margins (15.7%). 23.9% of printers questioned have implemented fresh sales or marketing strategies, and 12.2% have expanded sales resources to cope with the downturn.
Timson comments: “While the Economy Survey offers clear evidence of the impact of the economic downturn on FESPA’s stakeholder community, it also demonstrates that our community is robust and fundamentally optimistic, and sees the need to continue to innovate to build value and profitability.”
“As we start to shape the FESPA 2010 event, this Survey provides FESPA with an invaluable snapshot of the wide-format service provider community at this point. The results of this and future FESPA Economy Surveys will help us to understand the drivers for PSPs and monitor how the economic backdrop to their businesses is changing. Those insights will allow us to adapt our events, products and services to offer relevant and meaningful support as they steer their businesses out of the current slump towards a more positive future.