24 November 2020

CONFIDENCE IMPROVES IN Q3 BUT Q4 FORECASTS DOWNBEAT

UK printing and printed packaging has rebounded from the record low seen in the second quarter of 2020, but not yet by enough according to new research.

The BPIF’s latest Printing Outlook, a quarterly published study of the health of the industry, found that while Q2 bore the brunt of the impact of the coronavirus pandemic that hit at the end of Q1, and Q3 exhibited a recovery of sorts, forecasts for Q4 are gloomier.

In light of the resurgence of Covid-19, various regional or national lockdowns and climaxing Brexit uncertainty, the path ahead is now expected to take a dip for the worse and risks turning the recovery from a ‘V’ shape into a ‘W’.

The survey found that 35% of printers managed to increase their output levels in the third quarter of 2020. A further 22% were able to hold output steady but 43% were adversely affected by a decline in output.

Printers are not expecting activity levels to continue to improve along the same trend path in Q4. Output growth is forecast to increase for 23% of companies. Almost half (47%) predict that they will be able to hold their output levels steady in Q4 but 30% expect output levels to fall.

Q3 has seen a more turbulent recovery for a significant number of companies. A challenging summer period and concerns over the ‘second wave’ of Covid-19 is affecting confidence and order placement.

The survey also found that, as companies are being weaned off government support measures before their activity levels have recovered, they are needing to further adjust their costs accordingly, and there are rising concerns about keeping skilled workforces intact.