Editor's Note: Joel Salus, a veteran reprographics pro who follows the industry closely, recently sent us two tables that compared ARC's revenue with the Census Bureau's "Construction Put in Place" values, from 2002 to 2021. The tables are pasted below, and you can download the original Excel files by clicking here. I asked Joel to write a few words about the significance of this data. His reply is below.
What was interesting to me about the tables (top table vs. bottom table), was this:
Historically, when construction activity climbed, reprographics industry revenues climbed, almost in direct proportion, year over year.….if they build more, we print more, if they build less, we print less. Boom times and bust times, we went through it together. But that disconnected during/after the “Great Recession”….. construction climbed, but reprographics revenues fell.
ARC being the largest company in our industry, ARC, for some (like me) is used as a barometer (of sorts), a gauge to see how the repro industry is faring, year over year. One might say that it could well be that ARC’s numbers vs. total construction put in place isn’t an accurate gauge, since ARC does have competition and it could be that ARC has lost market share to its competitors. That said, I do not think that’s the case. I do think that ARC is still a good gauge, and I do think that all companies in our industry are going through this together.
The point being that A/E/C customers are printing less per project. What I’m saying is that, if, years ago, a school project generated $100k in print revenues (over the life-span of the design/build process), that same project today would generate (probably) less than $50k in print revenues over the life-span of the design/build process. This was brought about by A/E/C firms not needing printed specification books (now printed to pdf files and distributed that way) and not needing as many printed hard-copy sets of drawings as was previously the case. Take, for example, the case of the City of San Diego, which, right after the set in of Covid, went completely electronic for building permit applications. Building permit applicants are required to file digital files, are no longer permitted to submit hard-copy plan sets.
The trend towards printing less per project is not going to go away; it is here to stay, and it is shrinking reprographics industry revenues. It is a darn good thing that many reprographers added large and grand format color graphics printing services.
