Fri, Aug

BPIF survey shows slow second quarter

The latest ‘Printing Outlook’ survey from the BPIF shows 34% of printers polled experienced a decline in output in the second quarter of 2019, another 34% held output steady, and 32%actually increased output levels. This was an underperformance in comparison to the forecast for Q2 said the BPIF.
As commented on last quarter, this year’s late Easter provided a boost to Q1 and a drag to Q2. Furthermore, whilst the Brexit extension provided a late boost to Q1 as clients were keen to get work ordered and invoiced before March financial year-ends, the hangover to this was a contraction of output in Q2. Perhaps exacerbated by a perceived reduction in the necessity to stockpile and even a stimulated desire to run down some stocks. Looking ahead to Q3, printers are expecting to see their activity levels increase. Output growth is forecast to increase for over two-fifths (42%) of companies. 35% of respondents predict that they will be able to hold output levels steady in Q3, and 23% expect output levels to fall. Brexit remains the most voiced business concern - on this occasion 61% of respondents selected it as one of their top three business concerns (down from 70% in Q2). Competitor pricing is once again held to the second ranking with selection from 52% of respondents (up slightly from 50% last quarter). Paper and board prices completes the top three, with 34% of respondents selecting it (quite a bit fewer than the 47% selecting it last time). Late payment by customers was further back in fourth, closely followed by access to skilled labour. With a new deadline of 31 October the reality of Brexit is drawing closer – again. So far a no-deal Brexit has been avoided by simply extending the deadline. The prospects of this happening again are diminishing, not least due to Boris Johnson being installed as the new Prime Minister. In the latest survey respondents were asked what their preference was – no Brexit, Brexit with a deal, or a no-deal Brexit. No Brexit topped the poll with the smallest of majorities, 51%. Brexit with a deal attracted a 36% share of respondents, whilst a no-deal Brexit received a 13% share.   Kyle Jardine, BPIF economist, said: “The second quarter of the year is the period which has traditionally been when many companies review wages, and it still remains a popular period for reviews and pay awards to be introduced. It is now also the period when National Minimum Wage and National Living Wage rate increases come into force - as a result more companies now conduct a pay review slightly earlier - in Q1, or early in Q2, with a view to activating any changes in Q2. Almost half (48%) of respondents reported that they had conducted a pay review in Q2. The target for many companies offering increases remains around 2%.”

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