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Progressive printers prevail; computerization, new processes drive printing industry.

Progressive Printers Prevail

Computerization, New Processes Drive Printing Industry

Today, the buzzword in printing circles is pre-press -- the industry term that describes everything that goes on before a piece is actually printed.

This includes color separations and the negative image assembly critical to the printing process. Peerless Engravers, a Little Rock-based color separater, handles pre-press services for 35 magazines, many of them high profile publications from out east.

A telephone conversation with Sam Bracy, president of Peerless, yields information that boggles the mind of any electronic illiterate.

"We used to get in paste-up boards from the advertising agencies. Now we often get our information on a Macintosh disk and it is transferred electronically," Bracy says. "Some of our customers in Dubuque [Iowa] and Omaha [Nebraska] send information to us on an optical disk, which is much like the CD you put in your CD player, only it's larger."

The printing industry is traditionally driven by higher levels of disposable income and the formation of more business establishments. The critical determinant of the printing industry's success, however, will continue to be in the hands of advertisers.

Printing as a national industry consists of an estimated 37,000 to 39,000 firms, with the vast majority -- 84 percent -- having fewer than 20 employees. Its fortunes are directly tied to the dictates of strict advertising budgets.

At the national level, print advertising budgets showed little growth in recent years. In 1989, after price increase adjustments, shipment gains were only 2 percent for catalogs, direct mail and other advertising materials.

There are other factors that influence the demand for printed products both nationally and locally. They include not only the level of advertising expenditures, but patterns of personal consumption, fluctuations in business formations and transactions, and changes in economic activity.

Although advertising is the dominant factor and influences more than 60 percent of U.S. printed product shipments, there are specialized print markets which have unique demand determinants. For example, changes in government regulations, standards and package design affect the demand for labels.

In the Beginning

During World War II, when the United States was experiencing a renaissance in the business community due to advancing technology, the old Arkansas Printing and Lithography company negotiated a contract with the Navy to print multicopy forms. That beginning blossomed into a thriving business for what was to become International Business Forms, a division of International Graphics.

Today, this Little Rock-based printing firm has a healthy edge in the thriving continuous business forms trade, thanks to the overwhelming permeation of computers throughout the modern world. International Business Forms now constitutes 60 percent of the business at International Graphics, supplying customers nationwide, through dealers, with continuous business forms.

Of equal significance is the modest beginning of a small print shop that began operation in Fort Smith in 1898. Today, the Weldon Williams & Lick printing firm, with 320 employees, is one of only a dozen printing firms in the country that specializes in numbered printing items such as tickets for sporting or theatrical events.

The Ringier (Ring-yeah) America printing company in Jonesboro prints Elle magazine and a regional edition of Newsweek. This Swiss based company is one of Jonesboro's largest employers with approximately 600 employees.

And in Little Rock, Democrat Printing and Lithographing Co., which was established in 1871, is winding up construction of an addition to its building, which will house a $3-million webb offset press it just purchased. This new press is the fifth in the company's growing fleet of computerized presses.

Other Niche Markets

Financial printing is strongly influenced by the volume of debt/equity offerings, which in turn is supported by healthy financial markets. Demand for the printing of charts, maps, atlases and globes is largely a function of budgets for libraries and educational institutions.

The soft demand for printing in 1989 increased the level of competition and motivated printers to improve plant productivity. The printing industry invests more than $2 billion per year in new plants and equipment and has experienced notable changes in its pattern of expenditures.

During the 1970s and early 1980s, higher productivity levels were generally attributed to the purchase of web offset presses whose considerable running speeds and addition to plant capacity helped the industry meet the expanding printing needs of the U.S. economy.

But recent shifts in the print marketplace since 1989, when there was a noticeable downturn or leveling off, have indicated the need for sheet-fed presses. This type of press affords quicker turnaround, which is ideal to handle the increase in smaller, but more frequent, production runs of advertising materials.

Sam Sowell, chief executive officer of International Graphics, confirms the down trend in creative printing. "It's my perception that sales are flat or down for the year for most people in the state."

If anyone should know, Sowell should, since he is currently chairman of the Printing Industries of America, the national trade association for printers with 14,000 member firms throughout the United States and Canada.

Another local printer, Frank H. "Bert" Parke Jr. of Democrat Printing and Lithographing Co., is chairman of the regional trade association of printers -- Printing Industries Association of the South.

Continued Growth In Sight

For the future, things look encouraging for printers nationwide.

Continued growth of the U.S. economy and higher levels of advertising expenditures should provide the U.S. commercial printing industry with an average annual rate of growth of 3.5 percent through 1994, adjusted for inflation.

An improved climate for the debt/equity transactions of U.S. business will aid printers of financial and legal documents, a sector that was hurt in the 1980s.

Commercial printers should benefit over the next 5 years from a set of favorable cost factors.

On the materials side, paper mill capacity appears more than adequate to meet growth in demand for printed materials. Workers' wages, on average, were slightly below the U.S. manufacturing in the latter 1980s and are expected to remain at this level in the early 1990s. Growing claims of spot shortages of skilled printing production workers might be the one dark side in an otherwise sunny outlook. This could drive the wage level higher.

Environmental costs are also a concern, since the possible costs of air, water and waste clean-up could have a substantial impact on a geographically dispersed industry made up of essentially small establishments with limited means for environmental controls.

PHOTO : MODERN METHODS: Today's printers employ new technologies and techniques for increased productivity and quality.
COPYRIGHT 1991 Journal Publishing, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

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Author:Mitchell, Ruth
Publication:Arkansas Business
Date:Apr 15, 1991
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