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Business

UK print hits record low in Q2 – BPIF

The UK printing and printed packaging industry hit a record low in the second quarter due to the novel coronavirus (Covid-19) pandemic, but the market could see improvement in Q3, according to the British Printing Industries Federation (BPIF).

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Some 74% of printing businesses were adversely affected by a decline in output in Q2

In its latest Printing Outlook, the BPIF revealed 74% of printing businesses were adversely affected by a decline in output, while just 15% were able to increase output levels and 11% holding steady.

The BPIF said that the resulting balance – the difference between the ups and the downs – was -59, representing the worst quarterly report on record, surpassing the -51 recorded in Q1 2009 in the immediate aftermath of the financial crisis.

While some level of improvement is expected in Q3 as businesses reopen after the Covid-19 lockdown, the BPIF warned it is unlikely this will be to the levels seen in Q1.

Output growth is forecast to increase for 36% of companies, with 35% predicting they will be able to hold output levels steady in Q3, and 29% expecting output levels to fall.

Should this be the case, this would lead to a balance of +7 for the volume of output in Q3.

Charles Jarrold, chief executive of the BPIF, says: “Dealing with the economic impact of Covid-19 remains the stand out concern for the majority of printing companies; primarily it managing and attempting to operate through a period suffering from a sheer lack of demand.

Dealing with the economic impact of Covid-19 remains the stand out concern for the majority of printing companies

“There are justified concerns about how companies will cope if the furlough scheme winds out before demand accelerates enough to contribute to the ramp-up in business costs.”

In terms of major concerns for printers, 75% of companies listed the economic impact of Covid-19 as their main worry. Some 37% were also concerned about the survival of major customers, and 35% late payment by customers.

Other key concerns included Brexit, with 27% of companies saying that they had lasting worries about how this will impact the market, especially post-Covid-19.

“Responses to the survey make it clear just how undesirable the lingering uncertainty is, and how difficult it is to plan; not an ideal time for Brexit to get back in-the-mix,” Jarrold adds.

“However, there’s some solace in the fact that we are all in this together; government is listening, and we are communicating with Government; and some companies will certainly be looking to benefit from clients reshoring back to the UK.”

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