Printing Services in the US Industry Market Research Report from IBISWorld Has Been Updated

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Because demand for printing services is tied to the performance of the printing industry and the demand for book, newspaper and magazine publishing, growth will remain weak; additionally, the rising dominance of online media will hurt revenue, as e-books and other digital technologies take the place of printed materials. For these reasons, industry research firm IBISWorld has updated a report on the Printing Services industry in its growing industry report collection.

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A rise in internet use and a decline in print publishing will continue to hurt the industry

The Printing Services industry has been hard-pressed during the past five years due to waning demand for printing and the adverse effects of the recession. The industry provides prepress work like copy editing, proofreading, photograph retouching and print-plate creation. The industry also carries out postpress work, including bookbinding and repair, gilding and foil stamping for specialty books. “Therefore the demand for printing services is tied to the performance of the printing industry and the demand for book, newspaper and magazine publishing, all of which contracted or experienced minimal growth over the past five years,” says IBISWorld industry analyst Jeremy Edwards. “This contraction occurred because of the recession's adverse effects on consumer spending and competition from online media, which reduced print advertising expenditure.” As a result of downstream declines, revenue is expected to fall at an average annual rate of 3.2% to $4.4 billion during the five years to 2013. Nevertheless, the modest economic recovery has fueled slow growth in demand for industry services, leading to an anticipated 1.2% revenue increase during 2013.

Advancements in desktop publishing have enabled many former industry customers to perform prepress services in-house. Consequently the number of industry operators steadily has declined during the past five years, contracting at an annualized rate of 2.9% to an estimated 2,011 companies in 2013. “To counter this rising external competition, printing companies are expanding service offerings to include a greater array of prepress and postpress services,” says Edwards. “Also in response to competition, the price of prepress services dropped during the past five years, curtailing profitability.” From 2008 to 2013, average industry profit, measured as earnings before interest and taxes, has declined from 4.7% to about 2.6%.

The Printing Services industry has a very low level of market share concentration. Although some large nationwide companies do provide prepress work, these companies are primarily involved in graphic services or printing, and as a result, are not included in the Printing Services industry. The Printing Services industry is highly fragmented; most companies have just one facility and employ fewer than 17 employees. Industry operators typically locate close to printers and publishers, in order to generate a steady stream of demand for both prepress and postpress work. Furthermore, because fast turnaround time is of the utmost importance, printing service companies typically locate nearby their clients to limit both delivery time and transportation costs.

While improving economic conditions will boost demand for magazines and books, the continued transition to the internet will limit industry gains during the next five years. The Newspaper Publishing industry (IBISWorld report 51111) is expected to continue declining, while magazine publishing will experience only marginal growth. Furthermore, e-book sales are projected to rise rapidly during the next five years. Also, with commercial printers increasingly offering prepress services, the Printing Services industry will be in a bind. For more information, visit IBISWorld’s Printing Services in the US industry report page.

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IBISWorld industry Report Key Topics

This industry includes companies that offer prepress services and postpress services. Prepress services include imagesetting and typesetting for printers as well as preparing film and plates for printing. Postpress services include activities such as book binding to support printing activities. This industry does not include companies that are primarily engaged in printing, (these are classified in IBISWorld report 32311, Printing in the US).

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About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

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Gavin Smith
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