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A better picture: Fabric graphics markets

August 1st, 2012 / By: / Markets

U.S. and Canadian fabric graphics fabricator and print shop markets continue to show solid improvement.

A market research survey of fabric graphics markets in the U.S. and Canada conducted recently by IFAI shows a decidedly more positive outlook for fabricators and their suppliers and confirms changes in the way that print shops will operate. For years, screen printing dominated, and still dominates, the apparel and home furnishings textile printing markets with 70-80 percent of global output, but it is not used extensively in today’s specialty textile fabric graphics market arena. Inkjet printing (UV, solvent, latex or dye sublimation) is now the usual means of digitally printing graphics onto fabric.

The banner industry is evolving from traditional cut-vinyl banners to banners printed with large-format and wide-format inkjet printers on vinyl and fabrics using solvent and UV-curable inks. Outdoor banners are still largely made of vinyl-laminated polyester secured by grommets, and indoor banners are often digitally printed on polyester, cotton canvas, flexible-face material, nylon and mesh. With extruded framing devices, banners can have a taut, neat appearance that was previously not possible.

Latex ink-jet technology was introduced by Hewlett-Packard (HP) in 2008 for wide-format graphics printing applications in a beta-testing setting and went mainstream in 2010. From the beginning, HP has pushed latex as a green alternative to solvent-based inks because it takes out the odor and users can recycle through HP’s take-back programs, which includes used printed materials. Latex printing can be used for everything from large outdoor hangings, banners, vehicle wraps and soft signage to laminated point-of-purchase (POP) signage.

It’s all about digital

An IFAI fabric graphics survey administered in June 2012 with U.S./Canadian fabricators/print shops reported that 35 percent of print shops print graphics on fabrics, 55 percent of print shops print graphics on fabrics in-house and 45 percent subcontract printing graphics on fabric. Forty-five percent of print shops surveyed reported using mid-range printers ($15,000–$40,000) and another 45 percent reported using high-end printers ($50,000–more than $400,000).

Developments in digital printing of paper are increasingly being adapted for the textile market. Inkjet textile printing is growing, while growth in analog textile printing remains stagnant. The worldwide retail value of wide-format graphics has grown 10 percent per year over the last few years. The largest applications are outdoor signs and banners, indoor signs and banners, and trade show graphics. These were among the first wide-format graphics applications and are now becoming commodities, forcing print providers to look at new areas for printing graphics.

In the 2012 IFAI fabric graphics survey, fabricators and print shops reported a number of different applications for printing graphics on fabric that they’ve added to their product offering in the last 12 months, or they plan on adding in the next 12 months. Awnings and canopies and indoor graphics (retail) were the most mentioned applications at 19 percent. Eco-friendly products, such as green banners, were the next most mentioned application at 17 percent.

Future growth in digital textile printing methods is expected to continue due to improvements in digital printing equipment, advances in pigment-based inks, an increase in textile manufacturers who are able to provide prepared-for-print (PFP) fabrics and growth in some market segments, such as soft signage for banners and trade show exhibitions.

As digital print technologies improve, offering faster production and larger cost-effective print runs, digital printing should grow to become the technology that provides the majority of the world’s printed textiles.

Competition and trends

In 2011, the fabric graphics fabricator market experienced a 1 percent increase in sales compared to 2010—the first time this market has achieved positive sales growth since 2008. In 2011, total fabric consumed by U.S. and Canadian fabric graphics fabricators reached approximately 34.9 million square yards. For 2012, IFAI’s market research is projecting a 2 percent increase in fabric consumption by U.S. and Canadian fabric graphics fabricators with total fabric consumption for 2012 forecasted to reach about 35.6 million square yards.

Results from IFAI’s survey show a more competitive environment. The slow growing economy in the U.S. has led to a plethora of low-pricing tactics among print shop operators in 2011 and 2012, resulting in more sales but narrowed profit margins. The increased cost of business for print shop operators was the result of the pressure to discount prices to get business, the increasing cost of materials and the growth of low-cost, printed fabrics from China.

Fabricators and print shops turned to diversifying with different products (awnings, green banners and wider-width products) to generate sales. Some of the fastest growing digital graphics markets added are in retail, interior design and corporate branding (banners, soft signage and vehicle wraps).

Another recent trend is increased traction in the replacement market. As the first generation of digital printers begins to wear out, print shops are looking for new versatile, faster, and easier-to-operate printers. Investing in new equipment can help shop owners take advantage of opportunities in the soft signage market or in small-scale flatbed printing. Before investing in equipment, though, they must be sure they can amortize the new equipment over the next 3-5 years, or it could be a costly move.

Latex vs. eco-solvent

In IFAI’s June 2012 fabric graphics survey, 50 percent of fabric graphics fabricators and print shops surveyed reported a favorable outlook for sales growth in 2011 compared to 2010, and 68 percent of fabric graphics fabricators/print shops surveyed reported a favorable outlook for sales growth in 2012 compared to 2011.

The biggest growth area for fabric graphic applications should be in dye sublimation products. Wide-format graphics will continue to grow as corporations invest more in product and company promotions and advertising. Noticeable increases in wide-format graphics should occur in vehicle wraps, soft signage—especially POP signage in retail settings—and indoor/outdoor banners.

Solvent ink will remain the technology most used for outdoor graphics on signs and banners over the next few years as printer manufacturers improve eco-solvent printers. Soft signage will continue double-digit growth because it’s lightweight; easy to handle, transport and store; offers consistently vivid colors and is environmentally friendly.

HP defined success in latex as reaching cumulative sales globally of about 9,000 systems, including all products using latex ink, for its fiscal year ending October 31, 2011. That is over a period of about 35 months. That would represent a growth second year over first of about 25 percent. To put this in context, the eco-solvent market (HP’s explicit competitive target with latex) has an installed base of about 106,000 system placements worldwide from five major vendors with a growth rate about half of latex technology’s rate.

The focus on expanding the range of applications for wide-format graphics printers is a key to revenue growth for all stakeholders in the market. Latex inks are HP’s contribution to this objective, and other manufacturers either have, or will be offering, new products that also address this objective. With up to 60,000-90,000 wide-format graphics printers needing replacement annually, the race is on to provide the newest, most versatile ink technology to the market.

Prosper with full service

Web applications and sales will continue to enable small fabric graphics fabricators and print shops to compete nationally for business and service smaller more remote markets, but they should consider adding niche applications or offering additional services to compete with larger, well-equipped fabric graphics shops.

Many larger digital textile print shops employing dye sublimation transfer and direct-to-fabric printing on fabrics for banners and soft signage are looking at offering full-service solutions and focusing on bringing new offerings to their customers. With investments in new technologies, they can expand their business and still lower operating costs and increase productivity, which results in enhanced profits.

The end result is that fabric graphics fabricators and print shop operators may have to expand into new markets with equipment they already own, or invest in new equipment that provides enough of an ROI to ensure that they will prosper in the markets they serve.

Jeffrey Rasmussen is market research manager at IFAI. He can be reached at jcrasmussen@ifai.com or +1 651 225 6967.

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