Jakub Jirsak
By Ed Avis
Gary Hoskings, owner of Rapid Reproductions in Terre Haute, Indiana, reports that the fourth quarter of 2020 was very strong, which was a relief after seeing business drop about 15 percent overall for the year. But does that mean 2021 is going to start strong? He’s not sure.
“I think it could go either way. That is the problem in this market – it is a real new experience without any way to project the future,” he says.
That’s the dilemma facing many reprographics firm owners. Nearly everyone is relieved to have 2020 over, but the future is uncertain. The future of many elements of reprographics, such as traditional plan printing, have been precarious for years, and COVID certainly didn’t help.
Traditional Reprographics Takes Another Hit
According to an APDSP survey of reprographics firms in early January, 94 percent of companies saw their revenue from traditional reprographics work decline in 2020. Fortunately, the most common amount of decrease was less than 25 percent – 46 percent of respondents put themselves in that category. Another 31 percent reported a decrease of 25 to 50 percent.
There were a few fortunate firms – 9 percent said traditional repro was about the same in 2020 as in 2019, and 9 percent saw an increase.
One of those lucky companies was New England Reprographics in Yarmouth, Massachusetts. Bob Kesten, who just sold the company but owned it throughout 2020, said his reprographics work increased because many people were working from home, so they didn’t have access to their large-format printers in the office.
“A lot of companies were not allowing employees to come in where they had the print equipment, so when they had to have something printed it came my way,” Kesten says.
Another reason Kesten’s business climbed during COVID was because many people from more urban areas decided to move to Cape Cod, where his shop is located, so home construction took off.
“Every builder I talk to is busy,” he says. “And it’s not spec building. It’s large custom building projects that are expensive.”
What About Color? Not So Great Either
Color graphics has been a bright spot for many reprographics firms over the past decade or two, and COVID opened some new opportunities. Many companies started creating social distancing signage, floor graphics and hand-washing signs for clients they didn’t serve before. According to the APDSP survey, 83 percent of repro firms found new clients doing that kind of work. For whom did they do that kind of work? Thirty-one percent did it for restaurants; 24 percent for schools/colleges; and 21 percent for healthcare facilities. And 55 percent reported that they made COVID-related signage for AEC firms that they had not done business with before.
However, the beneficial effects of COVID on color graphics only went so far. Some of the work – such as sneeze guards and face shields – is durable and does not create a renewable income stream. And some simply petered out once the urgency of COVID faded.
“It was done for short-term needs and has dried up,” Hosking says about the COVID-related signage Rapid Reproductions made.
Plus, other color graphics work – such as regular signage for retailers – was crushed with COVID hit because so many businesses closed their doors to walk-in customers.
“That work went down considerably,” Kesten says. “All that retail business – posters, banners – dried up. A lot of them were closed, and some customers who weren’t closed that used to place orders weekly started asking for pricing, which meant I was up against someone’s number. I lowered some costs for good customers to keep the business. It’s a matter of survival at this point…take a little less to do the job.”
The APDSP survey bears this out. Only one respondent said their work for non-AEC customers increased in 2020 over 2019, while about 65 percent said it dropped. The remainder – 26 percent – said it stayed the same in 2020 compared to 2019.
What About the New Year?
The question on everyone’s mind is how will 2021 compare to 2020? There are countless variables at play, none greater than the COVID vaccine and how quickly the economy rebounds once people can shop, dine out, and return to the office.
Once stores and restaurants can fully reopen, reprographics shops that printed signage and posters for those businesses can expect that work to rebound. But neither segment will truly recover until the vaccine is well established.
For traditional AEC work, two big factors will affect business: Will construction increase in 2021? And will digital documentation continue to replace paper, a trend that accelerated during COVID?
First, regarding construction, there are lots of predictions. Dodge Data & Analytics predicts slow growth for the first half of the year, with an overall construction rebound of only 4 percent for the entire year. And that prediction assumes the vaccine is widely available by mid-year. The National Association of Home Builders predicts a 3 percent increase in single-family home building in 2021 but a drop of 1 percent for multi-family housing.
So even in a good scenario, construction probably won’t be growing much in 2021, though it should hold steady.
Regarding digital documentation, anecdotes reveal that more and more municipalities are moving towards digital bid submission. Nobody wanted contractors walking into City Hall with bid envelopes during COVID, and municipalities that switched to digital aren’t suddenly going to switch back once COVID is defeated. That means digital documentation overall will continue to grow at paper’s expense.
As Hoskings noted, it’s tough to predict what the new year will bring because we’ve never been in this situation before. As for Kesten, he sold his company and expects to move to Florida. Good timing!