Don’t Bank On Consolidation
As we mentioned in our previous post, more and more the benefits of consolidation, as well as those of an improving economy, are going to be reserved for companies that are best prepared for what the commercial printing industry is becoming. While there is no question that the industry is consolidating—NAPL estimates that the commercial printing industry consisted of 25,242 establishments in 2012, down almost 5,500 or 17.8% since 2007—and that consolidation is going to continue, it doesn’t necessarily translate into less competition for everyone remaining.
Remember, we’re just not competing with printing companies anymore, but also electronic alternatives to print, companies with advanced digital capabilities, whether they call themselves printers or not, and printing management companies that don’t even own printing equipment. Furthermore, companies are entering the industry without the legacy mindsets and systems of the companies leaving—a new breed of competitor. Digitization and the Internet are letting everyone into everyone else’s business—our competition is being redefined not eliminated.
Similar to companies counting on an improved economy, companies counting on consolidation to thin out competition and boost business also may end up being disappointed. There are no guarantees on capturing a piece of market redistribution. A growing share will be going to companies that focus on the following question: What are we doing to make our best clients more successful? The upcoming NAPL State of the Industry Report to be unveiled in the KBA booth at PRINT 13 will have an in-depth review of market redistribution and what companies are doing to get on the right side.
Andy Paparozzi Joe Vincenzino