With over 23,000 registrants and over 500 displays, the 2015 SGIA Expo was a solid indication that the speciality imaging field is alive and well. It also revealed some storylines that show great promise for business owners thinking of selling in 2016.
- 5 percent growth in sign makers
- 14 percent growth in apparel decorators
- 6.8 percent increase in commercial printers, marking the third year of growth for this industry sector
- 26 percent increase in printers using flexography or flexo printing, marking a significant move to digital solutions in packaging
These numbers reveal what we’re seeing is a settling of an industry, after the upheaval following the 2008 recession and the onset of digital.
We’re beginning to see that old parts of this business written off for dead are very much alive, and that new sectors and technologies are coming on fast and furious. And walking the floor, I found myself bumping into private equity and strategic investors at every turn.
People with deep pockets have become very interested in this business, folks. So let’s take a look at some of the hot spots I found that are sparking particular interest:
Quality and durability a top priority for brands
Thomas Friedman, who wrote the pivotal book back in the ‘90s called The Earth is Flat, noted that things won’t be outsourced if they have a physical presence to them. Your local doctor can’t be outsourced to India.
I feel the same principle applies to some of our technologies that people thought would be wiped out by digital. Big brands want customization, reliability, quality and durability in their printed materials.
For example, the hotel chain in Alaska wants the green in its sign to look exactly the same as the sign in Florida - and the printed material must be able to withstand elements and achieve the same color in each location.
Digital is king for short-run jobs. But screen printing and offset litho have cemented their presence in the quality realm. If you battled through the digital revolution and held true to your company’s niche, you’re going to find investors becoming more interested in your business.
Next generation of sheet-fed and web-fed equipment at attractive price points
For the screen printers who want to diversify at a reasonable price, the next generation of label printers with sheet-fed and web-fed capability offers an attractive option.
Companies like iColor Printing Solutions (@iColorPrinting) provide digital labels for flexographic printers looking to enter the short run market to augment their business, or manufactures looking to produce labels in house.
The price tag of these types of machines run in the $15,000-25,000 range, which is much more attractive than the $1.0 M+ machines that used to dominate the marketplace.
It’s a quick, simple way for you to diversify your business, which could magnify bottom line value for a potential investor. This is especially true if you have a sizable customer list that you could sell to with the new equipment and capabilities.
3D printing is here
When I walked the floors of the SGIA Expo several years ago, I was amazed by the emerging 3D printing technologies onto various substrates. One company that caught my eye was Direct Color Systems (@dcs_us).
Their printers will output high-res 3D prints, include ADA-compliant/Braille signage. They also do standard flat prints on plastics, metals, woods, tiles, glass and more. Amazing technology that’s now part of our mainstream.
Investors on the floor
As I mentioned earlier, I can’t remember a show I’ve attended where I saw so many private equity groups and strategic buyers. The industry has become very attractive to buyers once again.
If you’re thinking of selling your business in the future, I’d strongly recommend attended the AWA Mergers and Acquisitions Executive Forum on February 29, 2016 in Chicago, Illinois. AWA (@awa_worldwide) provides you with a tremendous opportunity to meet face-to-face with investors in the industry, and get a good perspective of where you stack up.
I love walking the SGIA and any industry trade show because they always act as a barometer for the industry. (Be sure to attend the SGIA Expo in Las Vegas!) You get an aggregate of insights, feelings, thoughts and predictions. It gives you a vibe for what’s coming, and for me, the vibe was all good.