Technically speaking

Even though official statistical data is not yet available, it is clear that 2006 has been a difficult year for the printing industry in the UK. Competition is tough, some high-profile print service providers have gone bankrupt in the past two years and more industry consolidation is expected.

To see how print revenues and the different product groups are doing, I spent some time on National Statistics Online (www.statistics.gov.uk), searching for 2005 printing industry data. Usually the Office for National Statistics is quite a reliable source, and revenue figures for the printing industry are published in late summer, based on data from the previous year, but revenue figures for 2005 are still not available. There are, however, other sources of information and when looking at the production index for the main statistical category for printing, it is noticeable that the numbers have nose-dived since 2005. The production index in October 2006 was down to 94.5 points, compared to the average production value in 2003 of 100 points.

Charting the industry

We at InfoTrends track and measure the digital print market. In 2005, we estimated the revenue from digital print in the UK would be worth around pounds 3.5bn, which is an increase of 4.9% on 2004 revenues. Compared to the pounds 11.5bn that the Office for National Statistics cites as the revenue of the printing industry in 2004, it sounds like a pretty large share.

However, comparing statistics can be quite difficult. Unlike InfoTrends, the Office for National Statistics only covers the revenue of companies where the main activity is commercial printing. It does not cover packaging printing, newspaper printing and other forms of speciality printing. It does not cover printing within enterprises (such as in-plant or data centre printing) or printing as part of business services. Facility management, copy shops and mailing companies, for example, frequently produce print but are regarded as part of the service industry.

Interestingly, many of the establishments not covered in the printing industry statistics use a lot of digital print. As a result, the digital revenue proportion of the traditional printing industry is much smaller, but that shows only a part of the real print production. Still, a lot of printing, and especially digital printing, is performed within a company. It might be an unfamiliar idea for many of us, but for the majority of businesses in the UK printing is a secondary activity. A general trend at the moment is towards outsourcing of non-core activities. Some high profile deals recently underscored that trend, such as Astron’s pounds 236m document outsourcing deal with ING. In general, the more that’s outsourced, the more that ends up in the service sector. This is one more reason why the manufacturing sector is in decline, while the service sector is booming.

Print as manufacturing

In terms of statistics, print is currently grouped together with publishing, as a subgroup of manufacturing industries. The graphic arts industry has worked hard to establish itself as a manufacturing industry, rather than the historic view of printing as the domain of craftsmen. That was a necessary step to move toward mass production, increase efficiency and standardise processes. However, an increasingly customer-focused orientation and the move to offer a full range of customer services is pushing the printing industry more and more towards being a service industry. In the end, it might well be a natural development for the graphic arts sector to evolve into a service industry. For the time being, we have to get used to seeing print being under-represented in the statistics and remind ourselves that print is produced in many different types of companies.

30-SECOND BRIEFING ON … PRINT STATISTICS FOR 2006

– The British printing industry is facing tough times. Unfortunately revenue numbers for 2005 are still unavailable, however the production index for the main statistical category for printing showed a strong decline since 2005 up until now.

– According to InfoTrends, the estimated revenue from digital print in the UK was around pounds 3.5bn, which is an increase of 4.9% over 2004 revenues.

– The Office for National Statistics reported revenue for the printing industry of pounds 11.5bn in 2005, however that revenue does not cover a wide range of printing environments, such as packaging and other speciality printing, printing in publishing and other enterprises, and printing as part of business services, such as: copying, mailing and outsourcing. Many of these types of companies do use digital print.

– Print is grouped together with publishing as a subgroup of manufacturing industries, according to the statistics. However, an increasingly customer-focused orientation and the move to offer a full range of customer services is pushing the printing industry more towards being a service industry. In the end it might be a natural development for graphic arts to evolve into a service industry. For the time being we have to get used to seeing print being under-represented in the statistics and remind ourselves that print is produced in many different types of firms.