What the Global Trends Reports from 2015 to 2019 Show
After publishing the 6th drupa Global Trends Report annually, we thought it’s time for a comparison – to see what happened over the last five years. How did printers and suppliers develop and have the forecasts been confirmed?
In April 2019, we published our 6th drupa Global Trends Report. The idea that eventually resulted in starting this series of reports was to monitor economic and market developments in the global printing industry. It seems to us that it’s been ages since we published the first drupa Global Trend Report in 2014 and therefore it’s time for an interim report. What has changed over the years? How did printers and suppliers develop? Could their forecasts be confirmed? So, let’s take a look at our comparable values from the years 2015 until 2019!
What Happened So Far: drupa Global Trends Report 2019
First and foremost, we’re looking at the printer and supplier barometer of economic confidence of each year. But before we get into detail, we start by summarising some facts of this year’s Global Trend Report: Nearly 850 companies from around the world participated in the industry survey conducted in October 2018 with most regions and markets well represented. Overall, the global printing industry is in good shape. Most of our global indicators have increased over the past five years. One thing is particularly remarkable: North America and Europe are developing well, while Africa, Central and South America and the Middle East show subdued developments and face challenges. There are also differences between the market segments: strong figures in packaging printing and functional printing and cautious indicators in commercial printing and publication printing. Nevertheless, the industry has regained its fundamental optimism after the shock of the global economic crisis and the increasing influence of digital media over the past decade.
Printer Barometer of Economic Confidence 2015 – 2019
At the beginning of each survey we asked the participants, i.e. printers as well as suppliers, two general questions concerning their assessments of the current economic situation of their company and the outlook for the next 12 months. The results were illustrated in the drupa barometer of economic confidence. Let’s get started with the printer’s barometer.
For 2015, the results of these questions were already surprisingly positive. 34% of the print service providers surveyed worldwide described their situation as ‘good’ and only 13% as ‘bad’. The results show a positive balance of 21%. In comparison to this year’s survey, we see small but positive changes: According to the drupa printer barometer of economic confidence, a positive balance of 27% was recorded for 2018.
In our report of 2016, 37% of the printers described their situation at that time as ‘good’ and 12% as ‘bad’. This results in a positive balance of 25%. Overall, the printers back then had a more positive outlook on the future. 50% expected their economic situation to improve in the following year, while only 6% expected it to deteriorate. This resulted in a positive balance of 44%, which is more than in 2015: In 2015, 48% of the respondents worldwide expected their economic situation to improve whereas 7% thought their economic situation would decline, which adds up to a positive balance of 41% after all. The state of affairs of the 4th Global Trends Report 2017 is quite similar. Here, we have a positive balance of 31%: 42% of the printers were satisfied with their performance, only 11% were not.
If we compare 2019 and 2018 the results show a positive net balance of +27% in 2018. 40% of the print service providers described their company as in a ‘good’ condition and 13% described it as ‘poor’. The remaining participants responded with ‘satisfactory’.
It’s interesting that the number for print service providers, who described their situation as bad, remains the same (13%) for the first year as well as this year’s report.
The strongest market segments are clearly packaging printing and functional printing. After several years of growth, commercial printing is less optimistic (positive balance of 20% compared to 31% in the previous year).
Supplier Barometer of Economic Confidence 2015 – 2019
Let’s move on to the supplier barometer of economic confidence and the developments over the years so far. Regarding their view on the current economic situation of their company, the suppliers surveyed in the 6th drupa Global Trend Report share the optimism of the print service providers. Since their inclusion in the study, suppliers appeared to be more optimistic year after year, with the balance rising from 18% in 2014 to 25% in 2015, 34% in 2016 and 53% in 2017.
This year, the balance decreased to 28%. Furthermore, almost all forecasts for the coming year were more cautious than in the previous year but remain positive. In this case, we need to be aware of the fact, that print service providers all over the world challenge lower margins, because costs are rising faster than prices. In simple terms, the solution is to enlarge revenues by increasing utilisation while holding down costs as low as possible. Whilst this broad pattern still holds, we can report a moderate +4% net balance improvement in prices – in spite of severe increases in paper/substrate prices.
The suppliers also show enormous regional differences: North America radiates great optimism, while Africa faces challenges. In 2015, there were varying future prospects: Globally, 51% of the suppliers expected their economic situation to improve and only 8% expected the situation to change for the worse. Looking at the barometer in 2015, 36% of the suppliers stated that their company was in a good position. Only 17% pointed to a bad situation, which shows a positive balance of 19%. With a positive balance of 49% in 2016, the prospects are overall confident. In the drupa Global Trends Report 2017, 56% of the suppliers stated that their company is in a ‘good’ economic condition, whereas only 6% rate their situation as ‘bad’, which means a positive balance of 50% – just like the year before.
Conclusion & Forecast: drupa Global Trends Report 2020
Now that we’ve observed the developments for years now and listed the changes, we can see that the regional characteristics follow the same pattern: North America is a strong growth region, Europe is growing and Africa is in decline. Almost all global indicators have grown in the course of the past five years. The positive prospects for most print service providers in 2018 is nothing compared to the continuously growing confidence gained by suppliers, whose positive balance has been rising steadily since 2014. This optimism is evident even in regions facing challenges such as Africa and the Middle East.
Although some of the main indicators are possibly challenging, these are mostly aspects outside the printing industry, such as political and economic uncertainties and general economic conditions, like Brexit in Europe or the threat of trade wars. The most frequently cited concerns by printers and suppliers are economic and political uncertainties, as the following examples show:
“The economic situation in our country.” – Packaging printer, Argentina.
“US trade wars, and uncertainty in UK over Brexit.” – Publishing printer, Malaysia.
The aims of the companies for next year are also clearly defined. For many the time has come to diversify, whilst others will stick to their core markets but ensure they become more efficient and stay close to their customers:
“We believe that companies like ours offer a solid and reliable alternative for niches of specific products. We firmly believe that our experience and proximity to our customers make us more of a trusted communicator, who as a partner can offer them and ourselves a good future.” – Supplier, Commercial and Packaging markets, South/Central America.
After this thorough analysis, we are already looking forward to the drupa Global Trends Report 2020. However, the upcoming drupa in June 2020 is causing just as much excitement! Are you ready for us?
What do you think of the developments of the past years? Tell us in the comment section.