In-plant Purchasing Decisions in a Recession
IN FEBRUARY, InfoTrends, a market research and consulting firm, partnered with North American Publishing Co., In-Plant Graphics' parent company, to conduct a survey entitled Purchasing Decisions and the Current Economic Climate. Readers of both Printing Impressions and IPG were asked to answer 18 questions pertaining to actions their organizations have made to weather these tough economic times.
Of the 601 respondents, 408 were from commercial printing companies and 193 were from in-plants. In-plant respondents were mainly management-level employees, with over 75 percent qualifying themselves as key decision makers. The organizations poled had a median in-plant operational size near 20 employees. The top three industries represented were educational institutions (37 percent), government and public sector employers (14 percent) and general manufacturers (13 percent). Overall, the median budget for in-plant printing related services was $300,000.
To begin the survey, we wanted to gauge where print revenues were prior to the economic crisis, and gain insight into where things were headed in the future. The year 2008 started out as a relatively healthy one for much of the printing industry. Nevertheless, the economic events that occurred in the latter half of the year inevitably took a toll on the industry. With that time frame in mind, we asked respondents to compare their facility's 2008 revenue from printing services with their 2007 year-end revenue results. In-plants reported a mean decline of approximately 0.4 percent for 2008.
The Full Story
While at first glance 0.4 percent does not seem like a large decline, the data tells a slightly different story. Cumulatively, 61.6 percent of respondents stated that their revenues remained flat or declined, with nearly 25 percent showing a significant decline of more than 5 percent. This means that only 38 percent of respondents showed any growth in 2008. Of those that did grow, 15.5 percent showed growth equal to or greater than 5 percent.