The impact of the epidemic on the label printing industry

In the face of the sudden outbreak of the epidemic, except for a few industries such as pharmaceuticals, protective equipment, disinfectants, and online entertainment, most other industries find it difficult to be self-sufficient, and the label printing industry is no exception. However, unlike industries such as tourism, catering, and cinemas that enter winter overnight, the overall impact on the label printing industry is not yet apparent. This is because some companies engaged in label printing for drugs, protective and disinfectant products have already started accepting orders for production during the Spring Festival period due to supporting guarantees and the need for epidemic materials, working overtime to print various label products related to epidemic prevention and control.

Exploring the Impact from Three Perspectives

Firstly, from the perspective of market regions, the epidemic has had a significant impact on label printing companies that primarily operate in overseas markets, while having less impact on label printing companies that primarily operate in the domestic market. The reason why the former is said this is twofold: firstly, due to the embargo; secondly, besides China, many European countries have also been affected by the epidemic, and the number of new infections is on the rise, which will inevitably lead to the shrinkage of overseas markets. For the domestic market, based on the current trend of the epidemic, it is generally developing in a positive direction. 1. Although the epidemic in February left us feeling confused, with the correct guidance of the government, markets in areas other than Hubei may soon recover. In addition, many people are also saying that there may be a retaliatory rebound in the economy. Of course, I prefer to call it a compensatory rebound, because now everyone has been in home quarantine, staying at home, not traveling, not meeting friends... Although this part of consumption is not there now, when the situation improves and everything returns to normal, most industries including alcohol, beverages, fuel, etc. will experience a compensatory rebound.

Secondly, from the perspective of products, the labeling needs of disinfection and sterilization products need not be mentioned, and the epidemic situation is now obvious to all. This epidemic has mainly had a significant impact on the labeling demand for other types of products.

Again, from the perspective of enterprise scale, the impact of the epidemic on larger label printing enterprises is relatively small, while the impact on smaller label printing enterprises is relatively large. This is mainly caused by the resumption of work policies in various regions and some situations in the upstream and downstream supply chains. For large-scale label printing enterprises, local governments also attach great importance to it. The resumption of work is relatively early, and the supply chain corresponds to some relatively large suppliers who also resume work early. Therefore, the supply chain of these label printing enterprises is not greatly affected, and the overall impact is relatively small. For smaller label printing companies, the situation is different. They resume work relatively late, and many companies may not have started work yet. Moreover, their supply chain also has many small suppliers who resume work relatively late, so the impact will be significant.

The 'Six Major Suggestions' to Assist in Response

Of course, when everyone finds it difficult, there are also some benefits, which are that it can make every enterprise start to reflect and standardize their management actions, and improve their emergency response capabilities. So, how should label printing companies respond to similar emergencies in the future?

Actually, after the outbreak of this epidemic, I have been thinking about a question. What should we do if the lockdown is not in Wuhan but in Guangzhou? My answer is difficult or unsolvable. Of course, we have some branch offices and factories in other regions, which is relatively better. But what if there are no other factories? So my suggestion here is:

Firstly, the layout is dispersed regionally. After the outbreak of this epidemic, there was a company in our labeling industry that did a great job. They received orders in Jiangsu and then produced them at the Guangdong factory. Because everyone knows that the requirements for resuming work in Kunshan are relatively high and the resumption of work is slow, the company has placed orders in the Guangzhou factory for production, which is the benefit of resuming work in another location. The decentralized layout of this area is worth learning from, as it can improve service levels in normal times and mitigate risks in special situations.