Enterprise print market getting ready for the start of a recovery

Distributors and resellers have been put on notice that the enterprise printing market should start to recover as soon as lockdown eases.

So far during the pandemic, the commercial printing market has taken a hammering with the focus shifting away from enterprise to consumer products. Offices have been closed and print fleets have been gathering dust as staff were kept away to reduce the spread of coronavirus.

Sales of low-cost consumer products have boomed as workers looked to get hardware for their home offices, but a lot of those sales have not gone through traditional channels. An analysis of May has exposed the impact of the pandemic, but there are signs that things could be swinging back in the favour of enterprise print specialists.

“The shift towards consumer sales has been dramatic and sudden,” said Antonio Talia, head of business analysts at Context. “Now, with lockdowns easing, distributors should be prepared for the market to move in the opposite direction.”

Revenues in the UK were down by 27.2% in May and unit shipments also dipped by 5.7%. Across Western Europe, the revenue split in May was 58.9% business to 41.1% consumer, compared to 73.1% business and 26.9% consumer in 2019.

Context found that unit sales to corporate resellers dropped by 39.4% year-on-year, and sales to e-tailers focused on serving businesses were down by 28% across May in Western Europe.

Not everyone suffered, however, and retail chains saw a 2.2% improvement in sales, and e-tailers were up by 11.2% as home workers bought hardware. Many people bought printers to use for work and to support home-schooling efforts. Inkjet MFPs were popular, with laser products (which are more favoured by enterprises) not benefiting from lockdown.

Context warned that the past few months would have seen inventory levels rise in the channel and, as a result, there might be a few promotions to clear stocks once more normal levels of activity return to the enterprise print channel.

“Although the situation varies by country, the trends over the past couple of months are clear – consumer inkjet MFPs are performing well, business spending is down, and the market has shifted towards consumer printers. As offices begin to reopen, distributors should be anticipating a rebound in business sales in the second half of the year,” said Talia.

At the height of the lockdown in April, Quocirca surveyed the print channel landscape and found that number of businesses that would like financial support from vendors jumped from 39% to 61%.

There was also an increasing desire for personalised guidance from vendors as resellers dealt with an evolving situation where one size had no chance of fitting all.

When Quocirca asked respondents in early April how they felt about the future outlook, original equipment manufacturers (OEMs) were the most positive, with half expecting to be back to normal in six months. ISVs and resellers were less upbeat, with 37% of the former expecting it to take more than a year to return to pre-pandemic levels.