At the start of the COVID-19 pandemic, many paper mills shut down their machinery or they converted some machines to produce other paper materials such as board stock. Even with the return to normal for many businesses, there is still a struggle to handle increased demands in this industry. Overall, we are witnessing a paper stock shortage that is causing an adjustment in paper prices of various products including printing paper and carton materials.
The entire paper mill industry, including manufacturers, wholesalers, printers, and marketing companies are experiencing difficulties securing the necessary amount of materials and goods. Industry experts say there has never been a paper shortage of this size in the past. Global supply chain issues continue to have a major impact on paper product availability. As we continue to emerge from the lockdown period, the demand for printing paper and direct mail services is greater than 2019 pre-pandemic levels.
For the moment, there looks to be no relief in sight since global supply chain issues will continue well into the coming year. This paper shortage has businesses asking what they can do to mitigate the rise in the price of paper.
So, why is there a paper shortage? The pandemic had a significant impact on the paper industry with short-term and long-term mill closures and reduced workforce. Transportation issues with freight shortages with increased freight costs. Energy and fuel costs went up adding to the increase of paper prices.
While many mills have made changes from paper to packaging services, this switch is not easily reversed due to the amount of money, time, and resources they invested in making the switch. Many printers and marketing businesses are planning ahead and ordering more paper to prepare for the continued shortage that is expected to stay the same through the end of 2023. These speculative purchases are contributing to the current paper shortage and impacting upcoming print jobs for the rest of the year. Hopefully, the end of 2023 or early 2024 will see things level out thanks to reduced demands and an increased paper supply. Having said that, the current uncertainty surrounding the paper product shortage in the market makes people hesitant to make predictions on future outcomes.
Thankfully, improved software and the power of big data helps print companies enjoy an increased level of print marketing accuracy and granularity in their print marketing. Companies will see their print budget maximized in a way that keeps costs low while delivering a return on investment greater than they enjoyed in the past.
Due to the paper shortage for printers, the printing industry was hit hard. The high demand for banners, posters, brochures hasn’t diminished. Our company is taking strategic measures to ensure we can continue to provide our customers with good service. Our printing technology allows us to operate efficiently and minimize paper usage. Overall, with the current paper shortage, we are striving to reduce our paper usage with our efficient printing processes.
When it comes to your business, the annual cost for print and mail must be kept in mind as capital and operating costs will fluctuate which makes it harder to determine the impact changing costs have on your budget. Plus, you will not be able to decrease fixed costs, even if you produce less printed materials, even if your customers switch to digital.
On the domestic front, the print industry is seeing increased paper costs and with the a paper supply shortage. On an international level, freight transportation delays and fuel cost increases have resulted in a decline in the availability of foreign paper stock as well as a growth in paper prices.
To help you avoid significant changes in prices, Advertisers Printing encourages pre-planning on all tasks. This helps our team find more suitable price points for the current paper stock that is in supply from paper mills and also helps you maintain reasonable lead and turnaround times.
Advertisers Printing is here to help you through the ongoing challenges related to the price of paper by using our reputation and relationship with mills and paper merchants to secure the needed raw materials for your projects/orders as quickly as possible. Start planning your next print project today!
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Written by Acumen Studio
Over the past twelve (or more) months, the print industry has had to deal with paper prices going up along with increasing labor costs and higher postage costs. Each of these factors has contributed to paper price increases over the last year and it looks like the paper cost increase trend is going to continue into the near future.
Having said that, do not worry! Yes, prices are increasing but part of the reason is because the cost of print was at an all-time low for over a decade. In fact, the price of printing almost bottomed out but print marketing is still one of the most cost-effective marketing channels. As opposed to in-house print shops, larger scale printers have the ability to absorb this rising cost. Plus, these larger printers will be able to improve the overall quality of their products thanks to enhanced targeting and increased personalization.
At NextPage, we have tripled the available inventory levels we offer on key paper stocks. Even though there are certain grades of stock that are proving impossible to find (for the moment), planning ahead means we can usually provide you a workable solution without a loss in quality.
As mentioned above, paper prices have increased significantly and they are predicted to continue climbing throughout the rest of 2022. The rise in paper prices makes it easy to understand that the final print price will also rise since the majority of printing is done on paper.
Plus, the increase in minimum wage means employees have higher expectations regarding inflated salaries and perks. Once again, it is easy to see how costs could rise when the cost of employee labor also increases over time. Remember, this is an incremental increase in cost related to the efficiencies built into the print process.
Besides what we have already discussed, there are other factors that contribute to the rise in paper costs:
When it comes to operating your business, the costs for print and mail must be taken into consideration. If you are running the operation by yourself, there are capital and operating costs that will fluctuate which makes it harder to determine the impact they will have on your budget. There is also the issue of not being able to decrease your fixed costs, even if you produce less printed materials, because your customers decided to go digital.
Keeping all of that in mind, what are your options when it comes to reducing print and mail expenses? One option is outsourcing to a company like NextPage that specializes in tasks such as printing and direct mail.
Paper costs used to be at record lows and now that paper costs are higher than in the past, at scale, these increased costs are having a big effect on the affordability of print marketing as some sales are only offered for a few days.
The demand for paper and its prices remained relatively flat. Of course there were a few increases overtime that didn’t affect pricing in a major way, but now we are seeing pricing for the wood pulp used to make paper increase almost 50%, which is huge.
Thankfully, the help provided by improved software and the power of big data means print companies can enjoy a level of accuracy and granularity that was not possible in the past. Companies worried about their ROI will see their print budget maximized in a manner that keeps costs as low as possible while delivering a return on investment that goes beyond what they were able to achieve in the past.
NextPage is here to help you through this unprecedented time by using our reputation and relationship with mills and paper merchants to secure the needed raw materials for your projects/orders as quickly as possible.
Contact Us Now for More Information
Phone: (816) 459-8404
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