Price Forecast: Industrial Printing Services

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Recent Price Trend - Industrial Printing Services


The price of industrial printing services has fallen at an estimated annualized rate of 1.0% in the three years to 2016. From 2013 to 2016, a shift in consumer and business preference from print to digital products has led to demand declines for industrial printing services. Publishers have been increasingly distributing books through digital medium such as tablets, while marketing departments have cut back on print advertising expenditure in favor of online advertisements. In light of this falling demand, suppliers have been forced to slash prices to remain competitive with digital substitutes. While growth in the number of businesses has moderated the fall in aggregate demand, overall demand declines have caused prices to decrease in this market during the past three years.

The fall in paper prices from 2016 to 2019 has also contributed to price declines in this market. Faced with lower market demand for industrial printing services, suppliers have been compelled to pass on lower paper cost to buyers in the form of lower service prices. And while wage costs have risen slightly in the past three years, suppliers have been unable to pass these costs on to buyers because of falling demand. Rising paper costs, in conjunction with falling service prices, have caused supplier profit margins to decline during this period, which has made suppliers less willing to offer further discounts or to negotiate further down on price.

During the three years to 2016, suppliers have been consistently bringing prices down to grapple with declining market demand.. The resulting low price volatility has benefited buyers by allowing them to budget more accurately for future costs, which allows buyers to delay purchasing decisions without risking significant shifts in price. Furthermore, buyers gain additional negotiation leverage with the knowledge that prices will consistently decline in the coming years.

 



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