The commercial printing market is a huge one, generating a combined revenue of $84 billion with over 25000 establishments. It has been a means of livelihood for more than 400,000 employees. However, even with its evident growth, the industry has been faced with many setbacks that slow it down. Fuel prices, paper prices, and new technology have impacted the industry in one way or another. Some of these problems include;
1. Profit Management
A competitive industry, the commercial printing industry is one that puts pressure on product pricing. This can lead to low bottom-line profit margins. The industry has to put up with all these and still function as efficiently as possible. It does so by properly managing capital types of equipment such as cutting materials, printing equipment, and folding tools.
The challenge comes in when it is time to pay for expenses. Rent, Insurance, employees, and equipment add up to huge costs. These geis expenses can drain the companies up to the last cent. With poor management, the firms can experience serious bankruptcy within a very short period.
However, most of the entrepreneurs have gone the extra mile to try and save their firms. They are now seeing to it that everything is working efficiently; employees are up and running, the equipment is being utilized for 96%+ of the tome, maintenance is of the highest level. Some have even cut down on indirect spending.
2. Digital Substitution
Digital substitution is one of the biggest challenges threatening the commercial printing industry. Over the course of the last decade, technological changes have been emerging now and then. The printing industry has had to deal with electronic media such as E-books. Contrary to the situation ten or so years ago, downloading a book is now just several clicks away. People do not have to walk into book stores. Mobile phone and computer applications are spread all over. Yes, all this is making everything easier and faster, but at the expense of what? They have cut into the revenue sources that were traditionally owned by the commercial printing industry.
3. Environmental Concerns
Did you know that paper waste represents a staggering 25 percent of the total landfill waste and 32 percent of municipal waste? The commercial printing industry is not the best when it comes to efforts towards environmental conservation. It is a major contributor to vital environmental issues such as air pollution, poor handling and disposal of waste, energy use, and waste management. The industries release volatile organic compounds (VOCs) when they use solvents. Other waste materials include photographic chemical wastes. These hazardous materials pose substantial environmental risks, contributing to global warming and poisoning nature when they come into contact with animals and plants.
In an effort to correct this, the printing industry is being encouraged to embrace proper methods of waste management, such as reusing and recycling reusable materials. Also, owners should see to it that all hazardous waste is correctly disposed of.
4. The COVID 19 Pandemic
The demand for commercial printing products has hit an all-time low as a result of the COVID 19 pandemic. When the disease broke out, many businesses had to move into remote working, which meant that paperless operations were the way forward. Advertisers also started focusing more on online marketing as opposed to their previous physical methods.
The industry was also directly hit. The production rate declined drastically. It has become harder to acquire the raw materials needed for production. The firms had to devise and implement ways that would help them run their businesses while at the same time abiding by the COVID 19 restrictions and regulations such as social distancing.
5. Price Pressure
The commercial printing industry produces magazines, phone books, brochures, catalogs, newspapers, and corporate reports. Over time, those who have used these products know that the unsteady rise and fall of the products’ market prices in this industry is unmatched. However, over the last few months, the cost of products has been skyrocketing. This is mainly because the expenses incurred during the production process are also high; transport costs, raw material costs, salaries, rent, and many others. Financial metrics have projected that these products’ prices will continue to rise if the operating costs remain steady.