UK economy experiences ups and downs

Wide-format print and signage companies are continuing to navigate choppy waters as the UK economy puts strains on potential business opportunities.

Retail, hospitality, and the public sector are all areas that many signage companies rely on for work, meaning the success and results of these industries can heavily impact business.

For the retail sector, sale and peak seasons rely on large amounts of point of sale and signage. Spending habits and shop sales can indicate how much the public is spending, dictating the success and budgets of businesses and organisations.

According to the Office for National Statistics (ONS) sales rose by 0.5% in January, following a fall in sales in December.

Many businesses and retailers experienced boosted sales in January, such as Next, B&M, Greggs, Primark, Tesco, Sainsbury’s, and Marks & Spencer.

However, the ONS has also reported the volume of goods people purchased fell by 1% in December, and retail sales fell by 3% between 2021 and 2022, the largest decline since records began in 1997.

The ONS has also posted statistics showing shoppers are spending more but buying less, prioritising value over volume. The success of brands like Primark and B&M indicate that more high-end businesses will have to work harder to capture the attention of UK consumers.

Many industry experts anticipate the rest of the year will be tougher due to the fact the sales period was utilised by people to make savings before tightening their belts due to continued rising costs and the arrival of winter bills.

Specialist in industry mergers and acquisitions, Richmond Capital Partners, has recently commented on a change in how companies have looked to bring print services in-house and source more in the UK.

Chief executive officer, Paul Holohan, says: “We are receiving many more enquiries, several from large well-known brands, to identify print companies who offer the specific services they need and to act for them with a view to an acquisition or major supplier, or both.”

The change is believed to be brought about by supply issues, labour force problems, and transportation.

“Security of supply has become a major factor in the increased interest in acquiring in-house print facilities” adds Holohan. “Businesses need their supplies when they want them and can’t afford to wait or to incur additional costs to maintain higher stock levels to insure against these delays.

“Added to these supply and transport issues, production costs have also been rising in hitherto low-cost production areas. These are the factors which are leading to the reassessment of supply and the repatriation of print back to the UK.”

In its recent Executive Survey, manufacturing organisation Make UK has pinpointed low costs, competitiveness, and regaining confidence as priorities for manufacturers this year.

The choices of manufacturers of machinery and materials will also dictate the state of the economy as UK businesses traverse a number of challenges like the effects of the pandemic, energy costs, and stagnant investment.

The organisation says: “Manufacturers are breaking new ground by exploring new ways to stand out in their market, while also focusing on keeping costs low.

“Funding upskilling and retraining programs for staff helps them develop new skills and adds value to their sector. Using energy efficiency measures, like the adoption of green technology, is also a means of reducing expenditure across the value chain.”

Despite profits being squeezed and consumers spending less, print and display companies may still find business operates in a similar state to the past two years, as customers and partners balance expenditure and exposure.

In its 2023 Retail Outlook, services brand PricewaterhouseCoopers (PwC) comments: “For retailers, rethinking savings and investments is critical. Cutting costs across the board is an ineffective strategy that is likely to undermine future success.

“A better option is to focus on the ‘good costs’ that boost capabilities and drive value while eliminating the ‘bad costs’ in areas such as process inefficiencies and working capital leakage.”

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