Growing But …

By Andrew Paparozzi
In August 9, 2012

Sales were up 4.3% during the first quarter of 2012 for participants in the NAPL/NAQP Quick and Small Commercial Printers Trends Report. Nearly 57.0% grew, up from 48.8% in 2011, with nearly one-third growing by at least 10.0%.

Those numbers are very encouraging. But they don’t mean all will soon be well. Here’s why:

• Business is still very inconsistent. One owner summarizes the consensus when he describes business as “one month it’s up; one month it’s down—we can’t seem to win.” Another reminds us that even fast growing companies have doubts about what’s ahead: “We have seen a significant increase in business during the first quarter—but I am not certain that trend will hold.”

• Growth is far from a given. Over two-fifths of our survey group report that sales are below year-ago levels, by at least 5.0% for 28.4% and at least 10.0% for 20.9%.

• Cost inflation is accelerating. Total costs have increased 3.5% so far this year, driven by a 9.9% jump in the cost of goods sold. A sobering number: Over 66.0% report that rising costs are affecting profitability.

The good news is that many of the owners we survey are doing something to protect themselves from rising costs. They are also moving aggressively to grow revenue because they know that they can’t cut their way to prosperity. NAPL members can access the full report at www.napl.org.

Andrew Paparozzi

Epicomm's Andrew Paparozzi, Vice President/Chief Economist, is well-known for his accurate and thoughtful discussions on the economy and US commercial printing industry. A foremost author and speaker on economic business trends in the printing industry, Paparozzi heads Epicomm's Printing Economic Research Center.

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