Other than that, Mrs. Lincoln, how did you like the play?” That slightly sick old saw could well apply to what our industry has been going through for the past 18 months or so. “Other than losing 30% of your business, how did you like 2009?”
It’s hard to put on a brave front when you see that some companies in this year’s Quick Printing Top 100 lost 30% of sales or more. However, there were signs that some of the folks on the list understand how to cope with economic hard times better than others.
Karen, who has been the Top 100 honcho for 18 years, noted in a recent blog: “One of the things that impressed me was that a number of printers who, despite a decrease in overall sales, were actually able to increase productivity last year. When sales fell off, they also decreased the size of their staffs, which resulted in higher sales per employee (SPE) on the year. At the other end of the spectrum, I was absolutely baffled by printers who responded to falling sales by adding staff or, in at least one case, opening a new location.”
As NAPL noted in its spring 2010 report, Quick and Small Commercial Printer Trends, all printers do not deal with crises in the same way. “Success in any market—even hot markets like variable-content digital, static-content digital, and Web-to-print—still hinges on individual company initiatives and execution—i.e. far more on what you do than on what the market does.”
That report also notes that the latest NAPL numbers find more printers reporting sales increases (55.8%) than sales decreases (44.2%). A year earlier, only 31.6% of printers said sales were growing, while 68.4% said sales were dropping. This year, 65% of printers with sales of $3 million or less reported profitability either higher or holding steady. That compares to 35.5% this time last year. So, have things really gotten that much better or have more printers figured out how to better deal with the situation? It’s probably a little of both.
Even with an improving market, there sadly will be a percentage of printers, even among the Top 100, who may not survive in the long run. As QP columnist John Stewart, who authored the latest NAPL/NAQP Financial Benchmarking Study for Quick and Small Commercial Printers, lamented in a recent email: “The differences in how owners of similar size companies manage their key operating ratios is nothing short of startling. Profitability in the industry ranges from minus 2% to companies reporting owner’s compensation of 25% or more.”
For me, all of these findings reinforce my long standing belief that it is much more important to be a good business person than it is to be a good printer.