Widthwise Discussions
THE WIDTHWISE DISCUSSIONS
HOW HAS 2023 BEEN FOR THE WIDE-FORMAT DIGITAL INKJET PRINT SECTOR, AND HOW DO WE EXPECT IT TO PERFORM IN 2024? THAT WAS THE THEME OF THIS YEAR’S ANNUAL WIDTHWISE DISCUSSIONS WITH PSPS AND SUPPLIERS. HERE’S THEIR THINKING…
The PSP participants:
by having customers coming back time and again. We have seen that so I am optimistic. Our target is 25-30% growth and we’re seeing that with this new business model. Kapoor: I’m actually mildly pessimistic. Increased raw material and staff costs are a major issue. The real living wage for example increasing by 10% is all great, but it needs to be funded from cashflow.
L-R: Richard McCombe, Matic Media, managing director Greg Forster, Embrace Building Wraps, managing director Shevy Kapoor, Eastern Exhibition and Display, managing director
SALARY EXPECTATIONS HAVE BEEN PUSHED UP TO A POINT WHERE THAT CAN’T BE
SUSTAINED. RICHARD MCCOMBE
How do your benchmark your business? If understanding how you’re doing in relation to your colleagues and competitors is part of your measurement criteria you’ll want to read on. Early this year Image Reports conducted its 16th annual Widthwise Survey of domestic PSPs operating in this space. We had 176 responses, allowing us to publish an in-depth Widthwise Report in the summer on how the sector was performing and feeling. The overriding message was one of optimism, with many reporting increases in turnover and margin, and expecting market and business growth. So how are things looking now - and how do we expect things to pan-out over the coming couple of years? I recently held two Widthwise discussions - one with PSPs and another with suppliers - to get their take. Here’s a precis of those chats - the full video interviews can be found on the Image Reports website.
As I’ve mentioned, when we conducted the Widthwise poll at the start of 2023, the mood was one of real optimism. So, my first question - are you now more or less optimistic for your business in the near term than you were at the start of 2023 - and why? Forster: I’m very optimistic. Of course, at the start of each year you wonder what’s going to happen - there’s no crystal ball - but we tend to look at our business over a ten-year period and monitor each year compared to the one before. Over the last ten years or so it’s been moving in an upwards trajectory. The year before last we had a record year so it’s quite hard to compare this past year to that one when we had a couple of really big projects. But overall the business is continuing to show growth, and we’re also increasing our margins. McCombe: We’ve changed direction with our business. In 2017 we decided we wanted to move away from project-based work where we didn’t feel we had control of the outcomes - things like installation which perhaps didn’t go as smoothly as we’d hoped. So we looked at where we were most successful and could control things ourselves and from there formed Graphic Warehouse, something on which we felt we’d get compound growth
8 | December 2023 / January 2024
So, do you think doing business in Britain is now harder or easier than it was at the start of the year - and what needs to change in the general economic/political landscape to make things better? Kapoor: There are too many external political factors locally in Scotland and UK that have an impact on client budgets. Political decisions made that impact business by the Green Party who just don’t have the knowledge or experience of business. Red tape is now a massive issue working in Europe and increased costs will make UK firms less competitive in the exhibition market for example. McCombe: The sales guys, who are heavily influenced by what’s said in the media, then start using that to try and rationalise our data on things like customer engagement etc. But I’m always trying to take a bit of a different view. I’m not entirely convinced that we’re that affected by what’s stated in the media. Forster: Our focus is really on the construction business and that industry is pretty buoyant and has been pretty busy throughout the last four years or so - even through Covid it was doing quite well because of the nature of the beast. In a way we have had to become cattle herders because there are so many people involved in the chain - often up to ten parties on our projects where a lot can happen between year one and year three.
Almost two-thirds of those polled in the Widthwise survey had seen turnover grow over the last year, a large proportion by more than 10%. Crucially, almost half had seen a rise in profit margins. How are your turnover and profit margins faring now - and what’s having the biggest impact on them? McCombe: I think Covid was actually quite good for a lot of businesses because it made people sit-down and have a proper look at how they were operating, what their margins were and where they might be experiencing difficulties. For me, I’d realised that one of our biggest costs were our installation crews. I don’t mean to be disparaging but when you need overtime it doesn’t seem to be available and when you don’t it appears the job is taking a bit longer that planned. I was never very happy with that, so that was one area where I wanted to strip out expense. We now no longer do installation, or creative, and that has really reduced overheads. There are obviously areas that we don’t have any control
over, such as electricity costs, and of course things like materials costs, but I think the biggest issue is staffing costs. What I hear from colleagues across Scotland is that we’re all under pressure to increase salaries and offer additional benefits to remain competitive in the jobs
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