Pricing Concerns Grow Amidst Poor Economy

Pricing is a business challenge that has increased by leaps and bounds since the beginning of TrendWatch surveys. [See cover story in this issue, beginning on page 28].

In spring 1998, pricing was in the midst of a decline as a business challenge, cited by only 22% of survey respondents. It bottomed out at 21% in fall 1998, then gradually climbed again before plummeting to an all-time low of 17% in fall 2000. It's been growing ever since, and in the most recent survey—at an all-time high of 31%—is the number-two business challenge for all print and prepress businesses.

Although economic conditions and other forces have been negatively affecting print shops, printing itself has continued its progress as a commodity product. Advances in printing technology have made it increasingly difficult for printers to compete with one another on issues of output quality. Today's automated systems allow most printers to produce acceptable-quality jobs, and the shift among print buyers to good-enough color has made the quality issue largely a moot point. This trend has further exacerbated printers' concerns about pricing.

Many printers believe that when they lose business, it's largely because of price competition. This was less of an issue in the past, but in today's economic climate it has become one of the chief concerns of all print businesses responding to TrendWatch surveys. When business gets competitive, price appears to be the most obvious culprit, thus many companies cut prices.

TrendWatch advocates an alternative approach of determining what services printers can add that will address all of their customers' needs, as well as attract and retain a wider customer base. Focusing merely on pricing misses the point entirely.