By: Toni McQuilken
North American printers are learning to improve their profitability even as top-line challenges in sales remain. Printers participating in this years’ Printing Industries of America (PIA) Ratios Survey attained average profit rates of 2.7 percent on sales—up from 1.8 percent last year. This is the highest level in the past six years, but it is still not back to the pre-recession level of 3.1 percent in 2008.
Profit leaders—printers in the top 25 percent of profitability—saw profits increase slightly to 9.9 percent compared to 9.6 percent last year. This rate of profit brings profit leaders to their highest level since before the recession in 2007.
According to the 2013 survey results, materials accounted for the largest single cost category for the typical printer—approximately 36 percent of sales. Total materials expenses increased slightly in 2013 from their previous level of 35.5 percent in 2012. Paper alone consumed more than one-in-five sales dollars last year. Other major costs incurred by printers last year included factory payroll (24.6 percent of sales) down from 24.8 percent in 2012, factory expenses (16.9 percent of sales) down from 17.6 percent in 2012, and administrative and selling expenses (19.3 percent of sales) down from 19.6 percent in 2012.
Sales per employee for all printers stood at $155,348. Profit leaders’ sales per employee were significantly higher at $171,153. Sales per factory employee for all printers stood at $212,584. For profit leaders, sales per factory employee averaged $238,731.