Print.IT Reseller - issue 85

01732 759725 RESEARCH 20 Quocirca’s fourth COVID-19 Business Impact Survey sees market consolidation, ecosystem building and innovation on the horizon, as businesses recognise need for rapid change Innovation on the horizon n Revenue recovery is expected. 55 per cent expect to see strong or very strong revenue growth in 2021/22, with a further 27 per cent expecting revenue to remain flat. Organisations that view themselves as market leaders have stronger expectations for revenue growth than ‘fast followers’ and ‘middle of the pack’ businesses. n Print volumes continue to decline. Full recovery is not anticipated. 85 per cent say they have seen a decline in print volumes; 53 per cent have no or not much confidence that print volumes will return to pre-COVID levels. n Cloud-based services are expected to offer opportunities. 91 per cent expect to see greater demand for cloud- based digital workflows; 81 per cent expect to see demand for cloud-based print management. n The threat of Amazon looms for the channel. 45 per cent of channel respondents are worried about the move of customers to online purchasing. Commenting on the findings, Quocirca Director Louella Fernandes said: “As the effects of COVID-19 begin to recede in many countries, the shape of the hybrid workplace is starting to emerge. There is a strong sense that now is a critical time for the print industry to position itself to recapture its relevance with customers. However, this will not be achieved through the historical model of product sales and print volumes. “Our survey respondents accept that print volumes are unlikely to return to pre-pandemic levels and that future revenue growth must be linked to diversification and a change in operating model. Digital workflow solutions, cloud- based print management, and security assessment services that address the new challenges of home and hybrid workers are all major areas of opportunity.” Strategic alliances The importance of strategic alliances and the development of a digital ecosystem are also key features of the future market. “We are already seeing some interesting partnerships and new businesses emerging focused on the needs of the new-style workplace ecosystem. This is a positive sign and will help businesses map their offerings onto the changing needs of customers,” Louella added. MPS offerings must be repositioned Asked which areas were likely to be of greater interest to customers as a result of changing working patterns, the top three responses – selected by more than 80 per cent of respondents in each case – were cloud-based digital workflows, collaboration services and digitisation of paper-based processes. Managed print services were least expected to be of greater interest, selected by only 36 per cent of respondents. “This shows that MPS is viewed as a commodity offering, but it can be the basis for the higher value services that are of more interest to decision-makers. MPS providers must urgently reposition their offerings to take advantage of more software-centric solutions,” Louella warned. The fourth edition of Quocirca’s COVID-19 Business Impact Survey contains detailed analysis and recommendations for print industry organisations on the key areas of focus for future strategy. This is the final edition of the COVID-19-specific research, although the impact of the pandemic on the workplace and the print industry will continue to form a key part of Quocirca’s Market Insight Reports in future. www.quocirca.com The majority of print industry organisations (81 per cent) now see the COVID-19 pandemic as bringing opportunities to drive innovation within their business, despite the negative impact it had on the sector over the past year, according to the fourth edition of Quocirca’s COVID-19 Business Impact Survey . The study, conducted among 157 respondents from OEMs, channel organisations and ISVs during April and May 2021, found that 71 per cent expect to see OEM market consolidation in the next 12 months. 62 per cent believe strengthening alliances will be critical to the future for OEMs, while 86 per cent believe that a thriving digital ecosystem is important between now and 2025. Overall, positive sentiment is improving compared with the previous survey: 68 per cent now report that the pandemic has had a negative impact on their business, a reduction from the 86 per cent who said the same in May 2020. Key findings An urgent need for industry transformation. 61 per cent say that the biggest challenge they face is moving from a product-centric to a services-led model, an obstacle that existed prior to the pandemic, but that has been brought into sharper focus. Louella Fernandes Quocirca Business Impact Tracker Study (Fourth Edition) Survey conducted April to May 2021 amongst print industry executives. 157 respondents participated from a mixture of OEMs, Channel Partners and ISVs. COVID-19: Accelerating Print Industry Transformation DOWNLOAD EXECUTIVE SUMMARY FINDINGS www.quocirca.com Impact of COVID-19 on business Market disruption will drive innovation Agree or strongly agree responses COVID-19 presents an opportunity to drive innovation 81 % COVID-19 has caused significant disruption to our industry 80 % We will need to change our operating model as a result of COVID-19 63 % 1 % Significant decline The majority have seen a decline in print volumes 56 % Marginal decline 29 % No change 7 % Marginal increase 4 % What impact are you seeing on customer print volumes? Significant increase 4 % Critical impact business may have to close permanently Significant impact critical threat to business that can be mitigated Limited impact minimal threat to business No impact no threat to business Can be seen as an opportunity for business Positive impact 3 % 8 % 46 % 19 % 22 % Collaboration, cloud and digitisation opportunities Anticipated future customer interest COVID-19 presents a transactions opportunity for my business (merger/ acquisition) 48 % Optimism on revenue growth Very strong growth (>15%) Strong growth (6% - 15%) Stable/Flat Declining (6% - 15%) Strong decline (>15%) 13 % 42 % 27 % 11 % 8 % Expected growth 2021/2022 Only a quarter are confident that print volumes will bounce back Alliances are key to future relevance 62 % Strengthen alliances 20 % Remain independent 38 % Merge with other OEMs 15 % Be acquired by another OEM/organisation 11 % None of the above 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Neither confident nor unconfident Very confident Not very confident Confident No confidence at all Don’t know 22 % 18 % 43 % 10 % 2 % What is best future strategy for OEMs? 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 4 % Cloud-based digital workflows 91 % Device-as -a-Service 73 % Cloud-based print management services 81 % Digitisation of paper-based process 83 % Collaboration services 87 %