Innovation and resilience: the cornerstones of Portugal’s printing sector

The printing and packaging industry plays a vital role in Portugal’s business fabric, exporting more than 80% of its production. As a proud member of the European Union, Portugal has embarked on a remarkable journey of economic progress in recent decades. This progress has been driven by a focus on structural reforms, strategic investments in infrastructure, and a strong commitment to fostering strong integration in global markets.

Against this backdrop, Portugal’s economic landscape reveals a rich and varied industry structure, each playing a key role in shaping its growth narrative. Among these industries, tourism, agriculture, industry, and technology have become the cornerstones of Portugal’s economic strength. However, the printing and packaging industry is the anchor that underpins the operations of all the others.

Despite their diverse functions and forms, the printing and packaging industries share one fundamental role: they serve as indispensable supporters that provide vital support and enhancement to numerous other industries. Their importance cannot be overlooked, as they contribute significantly to the country’s economic landscape, leaving a lasting imprint on its GDP and acting as a key driver of economic prosperity.

Portugal has a global reputation for high-quality graphic and packaging products. Widely admired for its expertise and skilled skills in these fields, the country’s exports play a key role in international trade. Significantly, around 83% of Portugal’s printing and packaging products are sold to overseas markets. From the sun-drenched shores of Spain to picturesque France, from the busy markets of the UK to the hard-working heartlands of Germany, Portugal’s products find eager buyers in international markets.

In addition, the United States, the Netherlands and Belgium stand out as important markets, each with a strong demand for Portugal’s printing and packaging products. Beyond Europe, Portugal’s printing and packaging industry extends its global reach across the Atlantic to the United States and to the economies of the PALOPs (Portuguese-speaking African countries), Asia and Latin America.

At the heart of Portugal’s printing and packaging industry is a strong commitment to innovation. Driven by a relentless pursuit of technological advancement, Portuguese businesses continue to raise the bar, ensuring they remain at the forefront of global competitiveness. Likewise, sustainability also takes center stage in the ethos of these industries. Aware of the importance of environmental stewardship, Portuguese companies have begun implementing eco-friendly practices and sustainable sourcing, thus ensuring they keep pace with evolving customer expectations.

The essence of Portugal’s printing and packaging industry is truly found in its small and medium-sized enterprises. These businesses form a vibrant ecosystem of around 21,000 registered companies and are the backbone of Portugal’s industrial landscape. Significantly, over 65% of the companies have been in operation for more than 11 years, highlighting their resilience. Furthermore, with a financial autonomy ratio of over 30%, these figures are testament to their staying power and dynamism.

It goes without saying that Portuguese companies have to face challenges, just like their counterparts in Europe and around the world. These challenges range from the pressing environmental crisis to the looming threat of recession and inflation, rising costs of raw materials and energy, as well as labor shortages and demographic changes. These are important topics to keep an eye on as entrepreneurs navigate an increasingly difficult environment.

Spanish Packaging Printing Market Retains Recovery Trend

Every year, business association Neobis prepares a report on the Spanish Packaging Printing market. The latest report for 2023 confirms that the sector maintains a recovery trend, with an improvement in revenues, performance and net assets, a decrease in the number of debt and bankrupt companies and an increase in the concentration trend of companies with high turnover.

According to the Commercial Registry, there are 6,422 printing companies operating in Spain, and the shrinking market year by year is a reality. In general, counting all the companies operating in the packaging printing sector, there are 13,866 packaging printing companies with a turnover of 19,034.03 million euros, according to data from the Spanish National Statistics Institute INE. Total turnover in 2022 is 15% higher than in 2021 and 2% higher than in 2019, according to the Neobis report. In addition, the number of employed people remains stable at 72,274 people. The good news is that the sector exceeds pre-pandemic performance and billings figures.

Sergi Bellido, CEO of Novoprint and Chairman of impriCLUB, the largest association of private commercial printers in Spain, explains the situation in the country's graphic arts market. He said: “The Spanish packaging printing market is characterized by a high degree of dispersion and fragmentation of companies, many of which are family businesses. With the decline in demand in recent years, supply should have decreased, but this has not been the case. Excess supply is a deep-rooted evil because it depresses prices too much and profit margins suffer. However, overall costs are slightly lower than those in Central European countries, which is an advantage for exports.”

Focusing on the different printing markets, the largest growth in operating income was seen in companies producing packaging and labels, while stressing that more than 90% of these specialized companies declared profits. In the book and commercial printing sector, there were also some companies that confirmed their margins and profitability, confirmed by Álvaro García, CEO of Gráficas AGA and Chairman of Neobis.

Joan Nogues, manager of Norprint and President of the Catalan Association of Packaging Printing and the Catalan School of Graphic Arts, is convinced that the sector continues to show strength and diversity despite major changes in consumption patterns. He believes that “Graphic communication combined with digital processes is an area of ​​potential growth and new business opportunities. We are at the starting point of a renewal of the graphic arts and a global industry consolidation in the field of communications.”

At impriCLUB, they believe that the fastest growing sectors in recent years are labels and large formats. “Advertising at the point of sale will continue to be an important activity in the future to help companies strengthen their brand image. Therefore, the large format sector has a good outlook. The demand for more sustainable products will also force many industries to transform, and cardboard as packaging will gain a lot of prominence. Therefore, the packaging and labeling sectors can enjoy good growth,” Bellido said.

José Ramón Benito, Chairman of the Docuworld Group and Chairman of ASPACK, the Spanish Association of Manufacturers, Packaging and Cardboard Converting, ensures that the printing of cardboard containers has experienced great growth in Spain, as it is a completely circular material. In addition, he elaborated, “Since Spain has a very efficient packaging chain in pharmacies, perfumes and cosmetics, combined with competitive labor costs, and a very high level of graphic arts companies, this means that we expect significant growth in the coming years. ”

José Carrasquel, General Manager of Etygraf and Chairman of AIFEC, the Iberian Association of Continuous Label Manufacturers, affirms that the Spanish market is still growing, albeit at a slower pace than in previous years, but with room for improvement, offering competitive advantages compared to other European countries, in terms of operating costs, with high quality and services adapted to shorter deadlines than in other parts of Europe. ”Jesús Durá, CEO of VinylColor Digital and Chairman of FESPA Spain, points out the segments that are currently in the greatest demand in Spain in the field of visual communications. “Personalization, decoration and interior design, as well as all types of event materials, have emerged strongly after the pandemic”.

In conclusion, in Spain, the commercial printing sector is experiencing positive economic growth, according to the report prepared by Neobis. The label sector saw a 14.25% increase in turnover, with packaging companies showing clear signs of strengthening and strong growth, with a profit margin of 6.24%. Overall, from all the sectors analyzed, there is agreement that the Spanish printing sector has important strengths in terms of innovation, adaptability and commitment to sustainability.