The perforating industry has faced challenges due to the 2008-2009 economic downturn, with a significant decrease in sales and slower growth since 2010. Despite these issues, certain sectors, such as food processing and automotive, have shown resilience, while the building sector is experiencing renewed interest as architects incorporate perforation into designs. Looking ahead, the industry must adapt to changes in the economy and market demands, especially in Europe, while seeking growth opportunities in developing regions.

2. An insight into the trends, forces and sectors guiding the perforating
industry globally.
Like many industries, the downturn in world economies of 2008 and 2009 had a profound effect
on the trade of perforated metal and associated products internationally. For an industry that was
formerly extremely robust due to the ever growing number of industries served, the sudden
decrease in sales came as somewhat of a shock to many suppliers of perforated metal in Europe
and further afield.
Most manufacturing industries cited a 30% decrease in sales during this period and unusually this
stark statistic was similar for the perforation industry. From 2010 perforators began to see an
increase in sales, however the rate of growth has remained slower than previously. Many
companies are only now, almost a decade later, seeing real increases to take them back towards
pre-crash turnover levels. As the industry largely follows GDP growth trends, and globally GDP
growth has been relatively flat, this maybe does not come as much of a surprise.
Whilst most perforation companies suffered as a result of the downturn, they did however hold
strong and some sectors experienced little drop in demand. If we look at sectors such as food
processing for example, this has remained strong. People have to eat, and perforated metal plays
a dominant role in machinery components and processing elements of many foods manufactured
globally.
The wider processing sector, specifically oil and gas for example, has experienced quite an
unstable time as a result of the reduction in the price of oil. Other processing sectors, where
exports are quite important, have been affected by political turbulence, such as in Ukraine for
example. This has had a slowing effect on the industry’s annual growth and is of course a result of
uncontrollable and unpredictable market forces.

3. The automotive sector, on the other hand has remained quite resilient, specifically the premium
sector. There remains a strong demand from developing countries such as India and China for
German and other European premium car brands.
China and India have strong growth in the aspirational middle classes and premium car brands
from Europe are particularly in demand here. As a result, automotive perforation manufacturers
have recovered well since 2010 and growth in this particular sector looks set to continue.
Another segment that is unusual and deserves special mention is the building sector, a sector hit
hardest during the recessionary times. This is perhaps the one big key sector where perforation
isn’t required by the customer, it is the choice of the customer whether they use perforation or an
alternative.

4. This sector is expected to continue to see growth because architects have seen fantastic style
opportunities with perforation and a number of our Europerf members are taking advantage of
that. There is an opportunity here for perforation manufacturers to further expand in developing
countries. Kazakhstan for example, is utilising European architects to design buildings that are
going to be highly prestigious and somewhat iconic structures within their cities. When architects
from Europe work with international suppliers, they will often source material from European
suppliers.
Closer to home, if you look at building façades, they can use glass, wood and many other types of
materials creatively or they can use perforation. It’s a feature of the last 5 to 6 years that
perforation has been and actually remains at the moment, a fashionable alternative for architects
to use in building façades. In addition the benefits of perforation in buildings can play a major role
for energy saving, weight reduction and heat control. Sunscreens for example, are very much in
demand to not only reduce glare but as a means of heat control.
This is a strong sector in a number of different European countries and the trends show that
fashion will remain in the perforation industry’s favour in the years to come.
While it can be said that some sectors within the perforation industry have witnessed little or no
downturn in sales, the sectors and industries served have been the key to the level of growth in
individual companies.
Europerf’s order intake figures over the past number of years highlight a noticeable weakness in
southern Europe and particularly in countries such as Spain and Italy. The economies in these
regions have seen weak GDP growth and this has had an understandable impact on some
perforation manufacturers here, although the latest figures in 2016 do suggest an improvement.
The central and northern regions within Europe appear to have seen a greater level of resilience.
Right now there is no denying that there are de-stabilising influences on the European economy,
including the issue of migration, and most recently BREXIT. These are issues that can affect
Europerf members and their future strategic planning and forecasting.

5. Experts expect the issue of migration will be handled over time and in fact it will be a very
important positive factor for some economies, for example Germany. The demographics within
Germany actually require such extra resources so the longer term prospect is for a resumption of
strong growth by that leading European economy.
When considering BREXIT and the UK leaving the EU, there is a general feeling that this one ‘big’
issue will soon be forgotten, as long as it doesn’t kick start a domino effect across member states.
There will certainly be tough times ahead caused by these issues but there are always, in our
industry, strong sectors and if our members in the association can be flexible in their routes to
market, there are going to be opportunities.

6. A general challenge going forward for many Europerf members will be the continuance of the slow
growth and challenges on exports that we are currently experiencing. As a result, there is no doubt
that Europerf members will be consciously searching for growth opportunities within key sectors.
We may also see a re-focus into areas where perforation is becoming more in demand and where
opportunities are predicted. A flexible, pioneering approach can help to ensure a greater demand
and interest in perforated metal across the globe in the coming years.