Some thoughts from a German perspective about doing business with print
By Andreas Weber, CEO/Country Manager Inkish D-A-CH
What needs to be done with print as a business? — If one looks at scientifically sound analyzes of the economic outlook of the cuts caused by the COVID-19 pandemic, it becomes apparent, with a view to Germany, that more serenity and above all prudence would be good.
The current spring report 2020 of the leading economic institutes (summarized by Globus based on the joint diagnosis spring 2020) essentially shows the following:
• Consumer prices remain relatively stable.
• Unemployment rate increases only very moderately
• Economic growth drops by 4.2%
• Private consumption falls by 5.7
• Export goods and services drops the most at 10.9%
These values are set for 2020. And in the preview of 2021 almost entirely compensated for or even exceeded in the growth rates.
Only the financial balance of the German state (measured in terms of GDP (gross domestic product) will probably not be able to compensate for the 4.7% decline in 2020 next year, since a zero value is assumed for 2021. Experts believe that the necessary higher indebtedness of a rich and prosper country like Germany will hardly cause any problems.
With a view to the print industry, the numbers look different, sometimes much more frightening. Declines in sales of up to 80% are reported, even by printers that are considered to be highly innovative and have grown rapidly so far. The commercial printing sector is particularly affected. Even the internationally operating online printing company like HelloPrint, which has so far been celebrated due to its dynamic growth, is in need of existence, as Web2Print expert Ludovic Martin reported via LinkedIn.
The situation is completely different with packaging printing. The situation is quite stable. In particular, flexible packaging that is produced in flexographic printing is in high demand (see our INKISH interview with DFTZ) as well as outer packaging for online trading and label printing, especially in the FMCG area. Problems do not arise from the demand / order situation, but consist in the procurement of consumables and in the billing of the orders if customers delay payments.
Experienced print expert Rainer Wagner is absolutely right with his analysis in my INKISH Over the Skype interview: The COVID 19 pandemic is polarizing the printing market and will completely change it. The losers are the application areas that have had declining sales for years.
The Viennese journalist Knud Wassermann demonstrated this in a readable analysis. So we know what can no longer work and what was foreseeable for a long time. The fearful question remains: What does the future of the printing industry look like?
But, according to our assessment: relying solely on technology options with digital printing, i.e. being able to produce printed matter individually in edition 1, will not be enough. Firstly, because it cannot deliver enough volume in sales and earnings to print shops. Secondly, because the extremely high needs of the client could not be met.
A company like Procter & Gamble serves over 5 billion customers worldwide. Although only a few individualized printed matter make sense, in spite of everything the number would be huge and hardly manageable. The situation is similar in B2B. In addition, personal contact with customers is decisive. However, it no longer takes place via print, but via digital channels.
How can you win the race and stay alive as a print shop and look to the future with confidence? An important, highly complex question, which I would like to take up with Petra Lüftner via INKISH D-A-CH over the next few weeks in order to develop solution scenarios from a wide variety of perspectives. If you want to participate, please feel free to contact us.
Contact via LinkedIn:
Original German version of the story via ValueTrendRadar.com
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