Paper Merchants Start to Look Ahead to a Post-Pandemic Economy
Industry Insights | Annabel Steele | February 01, 2021
Just a few weeks ago, everyone rang in the New Year, albeit without the usual pomp and circumstance that accompany end-of-year celebrations. The turn of a calendar page has rarely inspired such relief around the country and even the world, as many rejoiced to leave 2020 behind for good.
Though the COVID-19 pandemic is far from over, some paper merchants have started looking ahead and planning for a post-pandemic economy. It seems clear the U.S. economy will not experience a V-shaped rebound, but there will be opportunities for paper merchants to grow as the economy starts to recover, agree Scott Hider of Clampitt and Cory Turner of Spicers Canada.
When the pandemic hit, the paper industry, like so many other industries, underwent changes and transformations. According to Hider, paper mills have been hit hard over the past year, with some closing for good and others reducing production. This caused complications for merchants, who were already dealing with a drop in demand as schools and offices went virtual.
As the economy dipped, paper merchants began taking steps to put themselves in the best possible position for the duration of the crisis. Hider says before the pandemic came to the United States last March, Clampitt was on track to outperform its 2019 numbers and record a great year. All of a sudden, the pandemic hit and the company had to scrutinize its operating costs and identify ways to cut down.
“From top to bottom, we reduced the hours people were working,” Hider says. “We put a stop on inventory purchases unless absolutely needed.”
At Spicers Canada, Turner says the company focused on assuring speed to market, aware that amid the ongoing crisis, customers did not necessarily have the luxury of waiting very long to receive paper for a reduced number of print jobs. Spicers therefore worked to enhance inventory availability in key Canadian markets.
Both Hider and Turner say their companies used the pandemic to invest in themselves and focus on the future. “All these initiatives or investments that maybe you were debating really get brought forward in a much quicker fashion” during a crisis, Turner says. Last year, Spicers Canada completed a new facility in Calgary, and this spring it will open a new building in its Montreal location. Likewise, Clampitt began expanding its converting operations and acquired a small paper distributor in Denver.
With the end of the pandemic closer than ever, there will be opportunities for paper merchants to rebound, Hider and Turner say. Hider believes paper merchants will start to build their inventories back up as the economy starts to recover, focusing especially on digital papers capable of personalization for end users. Additionally, he thinks there is an opportunity to “hire new talent and young people who are going to invigorate this industry going forward.”
In Turner’s estimation, paper merchants will continue to improve efficiencies and make investments in themselves as the economy starts to recover. It is crucial, Turner believes, to demonstrate “reliability, stability and long term business sustainability” to customers in the coming months. But perhaps most important of all, Turner says, is making sure paper merchants support diverse product portfolios both inside and outside of their core paper business.
Hider concurs, predicting that more paper merchants will start to diversify the products they carry, including packaging. This will help insulate merchants against future damages, especially as e-commerce has driven demand for package deliveries during the pandemic.
No matter what the future holds for the economy and the paper industry, companies will continue to work together and provide support to their colleagues, Turner predicts. He lauds the “real sincerity to the partnerships” in the industry, saying it has certainly helped during the pandemic. “We’re all in this together. I feel that now more than ever,” Turner says.
As paper merchants start to shake off the gloom of 2020 and move toward a post-pandemic economy, there are real opportunities to make gains, Hider and Turner agree.
“I wouldn’t underestimate the resilience and creativity of this industry,” Turner says.