The cliché “one man’s trash is another man’s treasure” can be turned into “one repro shop’s blessing is another shop’s bust” when it comes to energy prices. Oil prices have dropped dramatically over the past year, which has helped the overall construction boom. As the IRgA Index reveals, many reprographics shops are reporting increased AEC business this year. At the same time, repro shops that serve the oil community have seen a hit to their bottom lines.
“With commodity prices dropping more than 50 percent and still unstable, with recovery no where in sight, naturally budgets have been cut by billions….yes billions of dollars have been cut,” says Tony Militano, owner of Carbon Copy Digital, a reprographics shop in Calgary, Alberta, which houses the headquarters of every major oil and gas company in Canada. “Eventually those cuts make their way into the services we provide as well. In addition a lot of these customers are asking for additional discounts, so less volume at a lower price. And like typical downturns, competitors lower prices to try and win more business.”
Militano reports that about 35 percent of his Calgary office’s business comes from energy companies, though the effect of dropping oil prices ripples through other clients’ businesses, such as industrial construction and engineering.
Naturally, the drop in oil prices has affected IRgA members in Texas, too. Steve Coyle from Miller Imaging & Digital Solutions in Austin says printing for the oil exploration industry is a small part of their business, and the volume of that work has dropped slightly since oil prices crashed.
“Since the peak of the fracking boom and the drop in oil prices we've seen the volume of printing oil well logs and other exploration documents decrease. However, that decrease would be no more than 5 percent,” Coyle says. “The nature of the oil business means that oil exploration is a continuous process.”
Despite the challenges, Militano remains positive: “We have focused on what we can control: customer service, on-time delivery, getting in front of our customers or talking to our customers on a regular basis, more expectations from our front line people. We have actually kept hiring if we can replace people and get better.”