Visitor numbers at the Print Week Live event held at the Wasps Arena in Coventry last week were estimated to be at around the 2,000 mark raising questions by some over the future of trade shows for the print industry. To be honest it wasn’t very busy although as a talking shop and networking event it had its merits.
In 2014 the print show Ipex recorded about 23,000 visitors to its Excel venue in London down from 2010 when 50,000 passed through the doors of the show but by last year numbers were down to 7,000. The Print Show has usurped Ipex as the industry’s number one exhibition holding their event at the NEC this September having gone head to head last year against Ipex in something of High Noon showdown in which Ipex blinked first.
There has been an increase in open days at print manufacturers showrooms as buyers come under time constraints. One delegate at the Wasps Arena said that once upon a time the whole workforce would go by coach to a trade show. A day out to see new kit – but as he pointed out there was no kit to see at the arena.
Harry’s illustrations and cartoons have appeared in numerous magazines and newspapers. If you would like more information contact him on firstname.lastname@example.org This one is for Print Monthly Magazine to illustrate their Soap Box feature. There are more cartoons and articles by Harry at www.harrymottram.co.uk
Worried about the effects of Brexit on business? Feel like your views are being ignored? Harry Mottram says Brexit will not happen—at least not in the way it was proposed.
The European Parliament where Brexit may or not be at the top of the agenda
Brexit, but not as we know it
When Theresa May emerged triumphant from the post-Brexit referendum Tory leadership battle, she declared that ‘Brexit means Brexit’. It has been her mantra ever since following the decision by her Government to trigger Article 50 to signal that the UK would leave the European Union (EU) and begin negotiations. In late April 2017 all seemed secure and only a matter of time before the country negotiated its way out of the European club. Yes there were concerns and the 48 percent who had voted to remain in the EU voiced their anger, pointing out that Scotland, Northern Ireland, and London voted to stay in the EU, and there were concerns over the economy in the short- to medium-term as the Pound fell against the Euro.
David Davis, Britain’s Brexit minister alongside the EU’s man Michel Barnier during talks
Then came the June general election when the Government lost its overall majority and the Prime Minister was forced to make a deal with the Democratic Unionist Party (DUP) in order to remain in power. Since then the problems for number 10 Downing Street increased to the point to which there were doubts that the Prime Minister could remain in office much longer.
That was until the first week of December last year, when after a marathon session, and an early morning press conference in Brussels, it was announced the EU and the UK had reached a deal in the first phase of the Brexit talks. Sufficient progress has been made to move discussions onto other matters including trade and the transition to a post-Brexit world.
The industry breathed a sigh of relief as it meant clarification of how trade would be affected might be revealed in the forthcoming talks. However, the deal to move to trade talks involves Britain paying a ‘divorce bill’ of around £35 to £39bn, the avoidance of a ‘hard border’ between Northern Ireland and the Republic of Ireland; and it also provides reciprocal protection for EU citizens and their families in the UK and the EU, as well as the European Court of Justice continuing to oversee the rights of EU citizens in the UK for eight years after Brexit.
Before Christmas 2017 the Government was defeated in the House of Commons by members of its own party joining the opposition in voting through an amendment to the Brexit bill that will give MPs the final say on the deal. Some feel this throws the eventual deal into doubt, as no one will accept a ‘no’ deal. So could this spell the end of Brexit if the Commons cannot accept the final settlement? Indeed, is it really going to be worth it if the economy takes a hit? When it comes to industry it really is all about a genuinely ‘strong and stable’ economy.
The British Chambers of Commerce’s (BCC) Dr Adam
Marshall, director general, comments: “The bigger picture is one of slow economic growth amid uncertain trading conditions.” And more damning he continues: “Even the best possible Brexit deal will not be worth the paper it is written on if the Government fails to address the many long-standing and well-known barriers to growth here at home. Ever-rising upfront costs, a labour market at capacity, growing pressure on land use, and a physical and digital infrastructure in need of investment and expansion, all prevent UK firms from reaching their potential.”
The wider graphic arts industry also has some real concerns at the state of the economy as Charles Jarrold of the British Printing Industries Federation (BPIF) observes, and in particular over the hike in exchange rates which has already hit business. He says: “The immediate short-term impact has been an exchange rate-driven-increase in costs of paper and board—now consistently a ‘top three’ concern as shown in our quarterly survey. Longer term, access to labour is an increasing concern—many companies have seasonal and short-term peaks in work, seasonal for instance in the run up to Christmas, and outside that, needs to meet particular client requirements—for example on a major promotion.
Charles Jarrold of the BPIF has concerns about labour shortages
“The UK economy has high employment, and short-term needs are being met by employing EU workers. Our members are concerned that this availability may change. We measure sentiment towards Brexit on a quarterly basis—with the slow progress on the negotiations, and opacity about the details of the final destination, it is not surprising to report that sentiment about the impact of Brexit on the sector has become increasingly negative. Going forward, the sector wants to see greater certainty about what the actual destination is, we want to see continued good access to EU markets, and, ideally, the adverse impact of the decline in sterling fall away.”
Health and safety
The more statements that are made from the industry, the more the same worries about Brexit are aired. That £39bn divorce bill, the slide of the Pound against the Euro forcing up prices, fuelling inflation, and the concerns over what sort of trade deal will be struck.
The much talked about transition period will see the UK disentangle itself from the other 27 members over a period of a few months with the likely end date of December 31st 2020. During the transition the UK will have to accept the full jurisdiction of the European Court of Justice, and all four freedoms, including the freedom of movement of people. The EU says the UK will remain in the single market and the customs union during a transition, while the UK insists that it will leave both on Brexit day—giving rise to a potential road block in negotiations.
No one can say with 100 percent accuracy what the trading terms will be after 2019
There are also other factors in the agreement so far that could bring the whole thing to an impasse including the ‘full alignment’ over the Irish border. Nobody appears to agree what this means in practice, while the concern over the border is linked to the leverage the Democratic Unionist Party has over the Government. Their veto almost put a kibosh on the deal in the first place and the Irish Government could still veto any planned settlement if it felt it would lose out. Manufacturers on both sides of the border do not want physical barriers, or tariffs and red tape that will add costs to production—with many businesses crossing the border with deliveries several times a day.
Glass half empty or half full?
Any trade deal the UK thrashes out with the EU may take longer than expected to agree on with potential vetoes from any one of the member countries. One thing most agree on is it will be more expensive to trade with the EU after 2020 and there lies a problem for many. Business it seems is lukewarm about Brexit because of the financial implications.
So far, so pessimistic. How about a bit of optimism? The CBI obliges as Josh Hardie, deputy director general, comments: “It is now time to focus on the true prize of a new relationship and a deal that starts from 40 years of economic integration. With the same willpower shown today and jobs and living standards at the heart of every negotiating objective, these talks can set the UK up for the next 40 years of close alignment.
The UK faces a so-called ‘divorce bill’ of up to £39bn from the EU
“There are two things that are top of the list. First is the final step for those EU citizens working here, and UK citizens abroad. It must be unequivocal that they are welcome, whatever the final deal. This cannot be their second Christmas where their rights are dependent on negotiations. Next is transition. Concrete assurances will build confidence and help firms across the UK and Europe to pause their contingency planning.”
However, his colleague Paul Drechsler is not so positive and is unimpressed by Theresa May’s bickering cabinet members. He says: “Can you imagine running the board of a company, you evaluate a big investment decision, your board walk out of the room and then they all tell a different story? You could not run a business that way, and you certainly cannot lead the most complex, challenging commercial negotiation ever taken on unless there is one voice behind that negotiation.”
Labour in waiting
Another more obvious critic of the Government is the Labour Party, which could conceivably be in power before the nation leaves the EU if things go awry in 10 Downing Street. Shadow business secretary, Rebecca Long-Bailey, says: “If we crash out of the EU without a deal, it will destroy what remains of our industrial base, and fire the starting gun in a race to the bottom on wages and workers’ rights.”
That sounds like they might tear up any agreement and start again with Sir Keir Starmer as their negotiator already hinting at a possible second referendum on the final deal. Labour’s vision could not be more different from the Conservative Party’s plans for the economy with their National Transformation Fund. Pumping money in building council houses, opening new railway lines and roads, and injecting cash into the NHS and schools would be welcomed by everyone in the print and signage industries, although there is a doubt as whether it would happen. But Theresa May, for all her Corbyn baiting, is not against borrowing ideas from Labour, and if the economy remains robust, the EU does agree to everything she demands, and the Conservatives see a poll bounce, then Brexit could happen without too many tears.
Labour’s Sir Keir Starmer has already hinted at having a second referendum if his party take power
Kick it into the long grass
The industry is clearly worried about the present situation, the low growth expectations, and rising inflation. If the economy was to slide badly this year then some in business would not object if the Government pulled the plug on the whole thing, kicking project Brexit into the long grass until things improve. A run on the pound, a hike in interest rates, and inflation hitting double figures could change everything.
A seasoned observer of the machinations of Government and the way things pan out for the economy over decades rather than months is Sidney Bobb of the British Association for Print and Communication (BAPC). He comments that when Brexit eventually happens our industry will adapt: “It will be a while before we are affected and whatever advantages Brexit throws up we will make the most of them.
Sidney Bobb of the BAPC is relaxed about Brexit and believes printers will adapt to whatever happens as they have done in the past
“The print industry is reactive rather than proactive and so we will wait and see what happens first. It may not even happen in which case we will react to that. If there is a downturn in the economy well, the print industry is one of the first things to be affected but it is also the first out when things pick up. Prices will rise whether we stay in or come out but in my view the printing industry has seen worse times than this and the culture of the industry has changed so much.”
Bobb says compared to the slumps of the 1970s, the early 80s and 90s, and the credit crunch of 2008, the concerns over Brexit should not be exaggerated.
If Brexit does go ahead and somehow Theresa May stays in post and sees the whole thing through and even wins the next election, she will inherit the Margaret Thatcher prize for political achievement—but not everyone will be applauding her. The arch Brexiteer and arguably one of the most influential politicians of our age, Nigel Farage, will not be impressed. He has already called the current negotiations and concessions ‘a betrayal.’
The Prime Minister Theresa May had a tough 2017 but could still see Brexit through as planned
Following the December breakthrough in talks he denounced the prime minister at the European Parliament: “Now we enter into what perhaps may be the biggest deception yet played on the British public. Theresa May is seeking a transition phase and there are one or two comments here about whether the Brits will get that phase. Well, of course, they will because we are volunteering to go on paying the membership fee to accepting all the existing rules, all the new rules. We will effectively, once transition is granted, have left the European Union at the end of March 2019 in name only.”
In other words it is Brexit, but not as we know it, or were promised it. Or even no Brexit at all if the ill winds of politics conspire to blow the whole thing of course.
Marriage of opposites: the left leaning Mirror and the right leaning Express are now owed by Trinity Mirror
Despite the reassurances from both Unite and Trinity Mirror, there is little belief amongst workers at the media group that the purchase of Northern and Shell will not result in job cuts. It sees the publisher of the Daily Mirror takeover the Daily Express and other titles, with more redundancies likely.
Harry Mottram reports
A year ago, Trinity Mirror made 78 redundancies in its regional newspapers with 40 more in September and more again just before Christmas, while some local titles were shut down altogether.
The acquisition of Northern and Shell will see yet more job cuts in Trinity Mirror with so-called duplication being the main reason for redundancies. Print Weekly reported Unite’s Louisa Bull claiming that print workers’ jobs may not be affected with expected cuts expected amongst ‘white collar’ workers in editorial. This suggestion may ring hollow as the Mirror have shut print plants in Newcastle-upon-Tyne and in Wales in the last two years with the loss of scores of print jobs.
The Times reported last week that: “Significant job losses are expected after the owner of the Daily Mirror agreed to pay £126.7m for titles including the Daily Express, the Daily Star, and OK! magazine. In one of the most significant deals in the newspaper industry in decades, Trinity Mirror is buying the publishing assets of Northern and Shell, owned by Richard Desmond.”
Significant job losses are expected after the owner of the Daily Mirror agreed to pay £126.7m for titles including the Daily Express, the Daily Star, and OK! magazine
It went on to say that Simon Fox, chief executive of Trinity Mirror, (who earns in salary and benefits around £2m a year), says: “Job cuts are inevitable as the company seeks savings of £20m a year.” One worker who wished to remain anonymous told Print Monthly that workers had been reassured of job security in October in one Trinity Mirror centre only to be made redundant a month later.
The National Union of Journalists’ Michelle Stanistreet comments: “The NUJ is concerned that Trinity Mirror, with its long record of making cuts to its newspapers, will not be the knight on the white horse they were hoping for.”
Fox comments: “This deal is a really exciting moment in Trinity Mirror’s history, combining some of the most iconic titles in the UK media industry. It is good for our readers, good for our customers, and good for our shareholders. Northern and Shell’s titles have a large and loyal readership, a growing digital presence and a stable revenue mix and offer an excellent fit with Trinity Mirror.”
The deal sees the left leaning Daily Mirror and the right leaning Brexit supporting Express owned by Trinity Mirror, who will also acquire the Daily Star and magazines such as OK! but not Richard Desmond’s stable of porn magazine titles as they were sold in 2004.
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The ‘official address’ of the print farmer in Canary Wharf
The notorious print farmer Neill Malcolm Stuart John is back in business offering his services as The Book and Catalogue Printer after being roundly condemned by previous customers as ‘fraudulent’. Harry Mottram reports.
Despite the letterhead of The Book and Catalogue Printer he uses as his base for his business operation the website www.thebestprinter.co.uk and even having the slight handicap of having no printing presses and living in Barry in Wales he lists his address at Canary Wharf in London implying he is a major player in the industry.
He tells customers that his is “a bona fide and legitimate organisation which is irrefutable” and goes on to claim he prints hundreds of jobs every month. Delivery times are three to five weeks but somewhat in contradiction reminds clients in his terms and conditions that: “in the event of supplier failure. The Seller has a 20 week window to fulfil an order before agreeing to terminate the contract with the customer.”
Alarmingly his claims are in complete contrast to the scores of complaints sent to Print Monthly with more arriving every day. Exasperated former customers complain of late or no delivery, no ISBN numbers being printed on books, little or no communication after they have paid up front, and legal threats when they complain.
Remarkably he states: “The Best Printer are a London based Printing Company who have exclusive arrangements with the largest partners in the UK and Europe. Our annual spend with them is significant enough to afford us an unparalleled level of service from them with the added bonus of dealing with a UK firm. We specialize in jobs with lots of pages and lots of finishing. We are highly competitive at medium runs of 500 – 5000 copies. Our staff have over 20 years of experience within the industry and are here to hold your hand throughout the entire process. We take your artwork, troubleshoot it for problems, offer to fix any errors that may impair the job, proof, print and deliver your job to your door quickly and seamlessly.”
An open letter signed by more than 50 of his ex-customers has been circulated to the media, the trade press, the BBC, the police and trading standards calling for action to stop him. So far all attempts have failed.
Ian Carrott of ICSM the print credit intelligence group who specialise in keeping their members in the know about fraud, bad debts and late payers says it beggars belief that Neill Malcolm Stuart John is able to get away with daylight robbery. He has consistently warned of paying money up front from an unknown supplier and to contact those purporting to give testimonials as they can be fictitious.
One printer who wished to remain anonymous told this publication that: “I’m amazed nobody has been round to sort him out.” It is a sentiment shared by many who have contacted Print Monthly.
As the new year begins with the potential of new technology, new products and new innovations within the printing industry, it is worth a moment or two to reflect on what was in the minds of printers a few years ago.
By chance, I came across a copy of Litho Week (published by Haymarket) from November 1992 and flicked through the pages to see what caught the eye then. It was the era of the John Major Government, high interest rates and a time that was largely before the arrival of email and the internet. Some senior members of the industry will tell you that before the internet, the printing industry was an agreeable way to make a living with profits somewhat higher than they are today. But in many ways not much has changed – at least as far as news is concerned, as the issues reported back then are not much different from those of today.
Bracknell Magazines had gone into receivership leaving printers, repro houses and paper suppliers with unpaid bills of more than £2m. There was also considerable anger in the press over the demise of Falcon Litho, because as Karen Buchanan reported at the time, the boss Bob Frost simply set up shop ‘with a clean slate’ a week later. In her comment column, she wrote: “We feel strongly that the case of Falcon Litho illustrates the plight of small creditors and will campaign vigorously to see creditors are treated as more than second class citizens.”
Although there have been some changes to the laws regarding insolvencies sadly unsecured creditors are often still left unpaid.
Another perennial of the print trade press that sees little change is the continued hike in prices for consumables. Back in 1992, David Pryke of the National Association of Paper Merchants defended an increase in paper prices in a letter, following criticism of the increases planned by Colin Stanley. Stanley had reacted strongly to the rises, as inflation hit more than 3.7 percent having been nearly 10 percent just two years earlier. This year prices are again expected to go up by more than inflation, putting pressure on margins and the bottom line. Pryke’s argument was that there had been a huge investment in paper mills to improve quality and increase product range, and he said that the huge fluctuation in the value of the pound had aggravated the situation. This, remember, was just weeks after the then-chancellor Norman Lamont pulled the UK out of the European Exchange Rate Mechanism (ERM) as interest rates hit an eye watering 15 percent.
The ERM was a system created in 1979 to bring stability and reduce variability to currencies within the European Community, ahead of the eventual union and introduction of the Euro. And it was not just paper that was seeing inflation, the cost of plates and ink were also on the rise, as Anthony Savvas reported. Kodak announced the increases would be between five and 10 percent with the devaluation of the pound getting the blame. Similar increases were also reported to take place from Agfa and Du Pont-Howson, with inflation blamed for the hikes planned in the New Year. The New Year, that is, of 1993. It could easily have been 2018.
The word of the year in the world of print and paper has been “pre-pack.” Initially welcomed by the industry as a method to salvage insolvent companies, giving them time to live again under a new name and retaining their workforce, pre-pack deals have become tainted.
Pre-packs began life in 2002 under the Enterprise Act, to allow for the sale of an insolvent firm’s business and assets before the company goes into administration. Its main advantage is to retain all or some of the workforce, and essentially keep the business afloat and prevent the company from disappearing. However, the downside is unsecured creditors may not get paid and it can leave a bad taste among suppliers and customers, who are left high and dry. They may not wish to deal with the new company having been stung once, especially if those running the new company are more or less the same as before, and worse still, appear not to have changed their business model to prevent the business collapsing again.
As the fall-out continues from Carillian’s collapse, a political and economic crisis is developing. Already it is changing the nation’s conversation over the ethics of giving massive infrastructure contracts to companies who don’t pay their sub-contractors on time.
With the back drop to stories of unpaid invoices and stories of the defunct construction company not paying their bills for more than four months, ICSM has released a list of printing industry firms who hit the rocks this winter.