“It may take a while before the industry finally recognizes ‘a turnaround’. We think we saw the market stabilize in the third quarter of 2009. Sales for vendors and PSPs alike are no longer going off the deep end, at least sequentially. Going forward, sales will look more favorably, at least compared to the horrendous results OEMs and PSPs reported in the last three quarters,” said Florek.”Still, it’s going to take a while before the industry returns to its pre-2008 height. The market should see a limited recovery in 2010 and 2011 before reaching 2008 levels in 2012. We expect the market to grow in the long run, but that growth will be constrained.”
“We noticed a slowdown in investment not because business issue, but because of financial issues. The crisis is financial, not economic. Our customers want to invest to produce more for less. For that they need their banks and also be confident in their market. That was not possible the first part of the year, but we see things going very well on the second part,” said Joseph Mergui, president, Caldera.
“As the economy begins to rebound these markets are starting to see signs of improvement, which will only increase over the coming year. The benefits of digital printing are still very appealing, and once company budgets begin to grow again, we expect to see continued growth and success in this market,” said McCarron.
“While we don’t have a lot of empirical data to back this up, it appears that sales of wide-format equipment were hit particularly hard by the economic crisis…perhaps harder than sales of consumables. That condition seems to point to an environment where many PSPs are finding ways to ‘get by’ with their existing hardware by postponing purchases of new hardware. Fortunately we’ve seen signs that sales of wide-format hardware and consumables have picked up considerably lately, if still somewhat below previous high levels. We have high hopes for 2010, both domestically and internationally,” said Oracal’s Grant.
“Manufacturers that rely on sales of equipment as their primary revenue source have also had a tough time. Credit is not easy to come by, especially for smaller, less established shops. Without these new placements, many equipment manufacturers have had a tough time. The economy is seeing some stabilization—whether that is temporary or not we can only speculate—but my hope is that we will see some growth by the summer of 2010,” said Neschen Americas’ Mohni.
“Things are turning around now. Through the recession I’ve stayed in close contact with SGIA members from various sectors of the community. Most are experiencing much better business conditions today than they were during the second quarter of 2009,” according to Michael Robertson, president and CEO, SGIA. “The sectors within our community that were hit hardest are fleet graphics and niche markets, such as recreational vehicle graphics, where disposable income drives sales. But even the hardest hit sectors are seeing things beginning to open up now.”
“It seems there was a very broad impact hitting both large and small companies. Smaller companies should have fared better by being able to make changes more quickly than large ones. Companies there were on shaky financial ground entering this crisis have been hurt the most,” said Randy Paar, Display Graphics Product Manager, Océ North America. “Right now, everyone is still in a holding pattern. Consumer confidence has to return to the general market so manufacturers see demand for product; and inventory and cash flow increases, which fuels advertising budgets. There is still a lot of uncertainty out there. ”
“Because of the time line of the economic downturn, construction and real estate suffered the most and the soonest, followed by financial institutions. And because these industries account for a significant portion of the sign market, it was hit particularly hard,” said Lee Manevitch, technical support director, Signs Now, a division of Allegra Network. “It’s too early to recognize any positive trends, but one advantage of being a franchised system is that we can track same-center sales. We’re confident that the economic turnaround is in the not-too-distant future; when we see our same-center sales trend positive for several months accompanied by other economic indicators that the economy is rebounding, we—and I’m sure the entire country—will breathe a sigh of relief.”
Denise M. Gustavson is the editor of Wide-Format Imaging magazine, sister publication to Printing News.