06 August 2017 Business

Concern about Brexit result is increasing says BPIF survey

Printers are less optimistic about the outcome of Brexit than at any time since the referendum.

Printers are feeling increasingly concerned about the state of the economy in the light of progress in Brexit negotiations.

Following the referendum last year, the BPIF created a Brexit Barometer to reflect sentiment from printers participating in its quarterly Printing Outlook survey. In the latest report a net positive +4 feeling of confidence had dropped to -28, getting uncomfortably close to the “very unconfident” category.

BPIF research manager Kyle Jardine explains: “Currently there is no issue that will divide industry opinion more than Brexit. This jumps out from the comments offered and emotions conveyed within the survey.

“On the anti-Brexit side, respondents have expressed embarrassment, anger and concern that the instability and uncertainty is incredibly damaging – in particular there are worries over the price and supply of their raw materials and ability to sell to Europe. There have also been plenty of comments expressing that not enough is yet known about Brexit, that absolutely nothing has yet been negotiated and we can’t yet know how it’s going to work out.

“On the pro-Brexit side most comments refer to a desire to just get on with it, we can make a success out of it and it will be better for us to make our own decisions.”

The change in feeling is perhaps a reflection of ebbing confidence that the survey has uncovered. The second three months of the year, while showing some in volume of orders and sales, failed to live up to expectations at the start of the year and confidence in the state of the trade has dipped since the Q1 survey.

The overall feeling remains positive and trends for the next three months are forecast to continue the pattern to the year so far, even if the the balance of positive over negative has fallen from +27 in the first three months to +14 in Q2. This is still higher than in the previous year. Q3 will continue the trend of growth in output according to two out of five respondents, while 37% anticipate stability. output will fall according to 24%.

But if growth is expected, it will not inflate margins. There is increasing concern that the squeeze on profits will mean that there is not enough cash to pay for the next round of investment. Not unsurprisingly, given this, competitor pricing below cost remains a key concern for 70% of those involved. This is well ahead of paper pricing, mentioned by 42% and under utilisation of equipment for 38% as a top three issue.

But it seems that Brexit overshadows all. Only 2% are very confident that this will turn out well, while 8% describe themselves as "very unconfident” about the outcome.

“It is likely that the Brexit Barometers will exhibit further fluctuations,” says BPIF chief executive Charles Jarrold. “The realities of Brexit are beginning to come out.”

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Europe remains the concern

Europe remains the concern

A year after the referendum in favour of leaving the EU, what happens post Brexit is of increasing concern to printers says the BPIF.

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