The latest Audit Bureau of Circulations’ Fas-Fax report on U.S. newspaper circulation promises to be another downer. As this is being written, prior to the report’s Oct. 30 release, early indications are that newspapers, especially large ones, will take another significant hit in the number of papers printed and distributed.

So where does this leave the industry’s vendors?

Busy.

Not all of them, of course, but publishers’ never-ending search for more efficient ways to do business is fueling a mini-boom of sorts for suppliers.

Topping the list: press vendors and contractors such as Masthead International and Pressline Services, whose schedules are being filled by papers that want to trim their machines’ web widths in order to conserve newsprint.

Newspapers are still investing in color, witness October’s announcement that Dow Jones will spend $30 million to add color capacity to The Wall Street Journal in a three-year project ending in 2009. That’s on top of the $43 million the publisher just spent retooling its presses for the skinnier, 48-inch Journal that will debut Jan. 2.

“We project rapid growth in color demand in excess of current Journal capabilities,” said L. Gordon Crovitz, a Dow Jones executive vice president and Journal publisher.

Burgeoning color needs also led Morris Publishing to purchase a new press to produce the Bluffton (S.C.) Today, a 16,500-circulation tab whose growth has taken off since its 2005 debut. See our story on page 1.

How about the Daily Sun in The Villages, Fla.? That paper is doubling its production capacity in order to accommodate what it expects to a doubling - yes, you read that correctly - of its circulation, from today’s 36,000 copies to north of 70,000, according to General Manager Jim Sprung. You can read about the Daily Sun’s expansion plans on page 18.

Postpress, as Newspapers & Technology wrote in-depth about last month, is also bubbling, thanks to growing insert and commercial publishing traffic. Papers are also upgrading their control software and other related systems in a bid to automate as much of the postproduction process as possible.

Suppliers are also able to take advantage of the international market. Last month’s IfraExpo drew more than 10,000 to Amsterdam, with more than 330 companies trying to market their services and products to newspaper publishers. Goss International, WIFAG and MAN Roland, for example, used IfraExpo to publicize press sales in Europe, The Ukraine and India.

Vendors are rolling out new technology to meet demands, ranging from Koenig & Bauer’s new compact Commander press to newspaper-class digital printing systems from both Kodak and Oce.

Does all this mean everything is looking up for every vendor in the industry?

Of course not. Consolidation is always occurring and, like it or not, some trusted names in 2006 may be out of the industry in 2007. That’s the nature of the business.

I’m not wearing my rose-colored glasses. Newspapers face serious challenges, not only in retaining readers, but in keeping advertisers.

Circ and ad downturns aside, the U.S. newspaper industry remains a $59 billion industry, responsible for the employment of tens of thousands of people (me included). Publishers want to improve their product and serve their markets, and vendors, happily, will go along for the ride.