Business

John Faulkner - 02 December 2008

I enjoyed [for the most part at least] over 9 years with Hendy Banks - this may be a great loss to our industry, I hope that there is some rescue available. However in the current climate it is most doubtful. There is an immense talent & skill within the organisation, if the business closes I wish all those who knew me, and of course those that didn't, the very best for the future.

Eric Newbegin - 02 December 2008

This likely Administration has been received such advance billing that I suspect every unsecured creditor of the company is fully aware of it. In light of PrintWeek's article last week about Chapter 11, if the unsecured creditors want to do more than bleat after the event about how their interests were ignored, this could be a seminal event were they to take the initiative of forming a committee, organising a moratorium and with the existing or other management, possibly a combination of both, help steer the company through this. It's an opportunity to lead and I wonder if anyone has the gumption to rise to the occasion.

Simon Biltcliffe- Webmart - 02 December 2008

I hope that PrintWeek looks into the issues that are really causing all these great print companies to fail, week-in, week-out.

I'm a born optimist, but I dread the next bulletin coming through with another company going down- God knows what it must be like for all the employees. I was in the same position 18 years ago when GHP Web-Offset went down and the experience is still with me. There must be something we can do as an industry to stop the domino effect we are seeing now and the cost in human distress it is causing.

Happy to pay for some rapid research to see if there is a solution we are all missing- PW & BPIF join me?

Simon Biltcliffe

MD

WEBMART

Jack Sheperd - 02 December 2008

How about Simon you pay the the right price for the jobs you put to the trade that would help!.

- 02 December 2008

This is very disappointing news that another BPIF member as gone out of business.

Why does this happen? It is never to late to survive if the strategy and people are the right people to manage a company in difficult times.

Companies need help to survive, so ask the `right` people for help.

Colin Thompson

Cavendish

www.cavendish-mr.org.uk

Andrew Bartlett - 02 December 2008

iPPSA's solution is simple, COLLABORATION.

iPPSA believes that the whole supply chain is interdependent and the best way to create a secure, predictable future is to work together to deliver a new code of practice for buying print, graphics and marketing services.

iPPSA calls this "Fair Trade". The new environment is fully transparent and all actions and performance levels are visible. Instead of just "one to one" relationships, where many practices are hidden, where there is a lack of accountability and where we make it difficult to learn from our mistakes, iPPSA has created a "many to many" environment with total accountability at every level.

iPPSA also wants to provide buyers with a CSR compliant method of purchasing. The industry has given buyers no choice but to chase the market rate. Existing purchasing models do not give buyers the ability to understand whether the price they pay is helping the supplier to make a profit, allowing them to survive or aiding in their demise. Buyers will then be able to make sure they buy at sustainable prices and apply their stated CSR policies to their purchasing practices.

The rocket science is in the fact that iPPSA is looking at all sides of the industry and providing a single business model that provides answers for all the disparate issues. The model is not an instant panacea but it gives everyone involved a single vision and a "many to many" continuous improvement process that will give us the chance to achieve our goals.

The basic principles that underpin every decision are; ethical, sustainable, profitable, transparent, automated, stable, predictable, environmental and CSR compliant standardisation.

Standardisation is the key to streamlining processes and lowering costs.

Transparency is the key to fast effective change.

This is a stakeholder driven environment that answers the short-term and the long-term needs of its members; this is "Fair Trade".

Peter Printer - 02 December 2008

Alden Hendi is not a problem that occurred today.

If you are owed money it is because you did not reappraise the situation when the merger took place. DO NOT blame the credit crunch, for that is a weak excuse you will hear time and again in the next 3-6 months. If you know anything of the last few months at Alden you will possibly believe that weak directors, lack of clear objectives and ostrich management have created this compounded disaster.

The news bulletin said it all with this line "Alden Hendi chief executive John Pulford was unavailable for comment."

According to the local buzz the staff were not paid for Novemebr but will the directors be struggling this Xmas? and what will they be doing a year from now?

If this company is allowed to "phoenix" then it is not the fault of the administrators but of the FINANCE COMPANIES who have a vested interest in some form of continuance whilst the suppliers chew the debt and the real workers scratch around for crumbs. The sooner the hypocrites of the finance sector bite the bullet instead of sustaining bad business, the sooner we will have a level playing field with more cream for the real players who are left. e.g. the well managed companies who will survive this recession.

Andrew Brockbank - 02 December 2008

It is so sad to hear this news and I sincerely hope that someone comes up with a rescue package.

Aldens gave me 8 good years of employment and I have fond memories of my time with the Group.

I wish everyone at Aldens Witney, all the very best for the future.

Mark Snee - 02 December 2008

Like others, can I add my best wishes for the future to the employees at Aldens.

As far as the growing number of people who are \(i) in disbelief at the continuing collapse of so much of the industry and \(ii) claiming to have answers to the industry's problems, I would say you they are missing the point: we are in an economic firestorm that is taking out swathes of UK industry and commerce. It is unprecendented in this generation and way beyond the personal experience of most living people. Accordingly, few will have provided for a downturn on this scale, and many more have yet to fall.

Speaking with a supplier this afternoon, he told me they had lost 90% of their credit insurance \(on their customers). Are they going to carry on supplying those customers? If they do, how many hits can they take before they fall as well?

My company is having serious problems getting payment in from long established customers, including high street names. Only public sector work seems to be paid on time. The way things are going, I could see inter-company credit becoming severely restricted within the next few months.

I cannot think of any immediate solution to this problem. Most companies cannot simply halve their workforces, as the fixed overheads are too high to survive with hugely reduced turnover. Many probably couldn't afford the redundancy bill. Consolidation \(mergers / aquisitions) might be a potential answer, but with little finance around to do deals like that, they will have to be pretty well self-financing.

Sorry to be so pessimistic, but I think there is no choice but to 'ride it out' if you can. Don't take silly risks; especially don't try to trade your way out, because a few bad debts may well be the end; if you've got cash, preserve it.

In the end, we simply have to believe that there is a future and that an upturn will arrive eventually. At that point, business will carry on as it always has - there will be no new paradigms - sellers will sell and buyers will buy.

Jon Fennell - 02 December 2008

We are stuck in a viscious circle, with little scope.

The banks are not playing ball and out to protect themselves. They should be nationalised.

CI companies are adding to the panic and the mistrust banks felt between themselves is coming down the line.

Companies are now torn between using trust in standing relationships and commercial reason or rely on credit ratings of the client.

Last week saw the death of Woolies whose debt was reported at £385m, now ask yourselves how much Polestar were bailed out for.

Not sure what is supposed to happen, lose long standing clients on the basis of a credit rating or risk the hit should they fail. It all knocks on.

With all the companies that have fallen down it seems we are all still chasing to fill capacity. Perhaps we should all boycott the banks and keep the money under the mattress, until they give us all a break and help trust return.

Richard Head - 03 December 2008

Jon I would agree wholeheartedlt with your comments.

In the coming months managing debt is not just going to be a case of diligence, but will be subject the external issues faced by banks who will are going to start giving low credit and even warnings out against good companies with minor issues in order to minimise their own risk.

I think it will almost be like the health warning on a packet of nuts that says this product contains nuts. An over reaction and desire to put the risk on to other people.

So what do you do when faced with a warning that you might not get paid from a long standing client who has been a prompt payer before. Ironically of course their cash flow may have been messed up by none payment by their own clients ... and thus a spiral begins.

We need Government intervention with regards the banks to keep the wheel spinning. At the same time we need to all be more prudent and reduce get rid of debt.

The money lending to make money days are over people.

Dick

David Millward - 03 December 2008

Every day I wonder which company is next in line to go.

These are bad times and I feel the worst is still to come.

With the annual slow down over Christmas and the New Year, survival is going to be difficult for a lot of companies.

Rob Stevens - 03 December 2008

Previous comments are accurate and appropriate.

Colin Thompson says "Why does this happen? It is never to late to survive if the strategy and people are the right people to manage a company in difficult times".

Picking up on that point -

Without question the current economic climate has played a part however did the management at Hendi Di really understood the dynamic of large scale manufacturing in a commerical market. City Print and Book and Periodical printing are completely different markets with different requirements and different needs in respect of management and customer expectations. The opportunities for reducing cost and utilising capacity are great but they need to be planned, managed and most importantly done with the full support of stake holders \(banks, staff, customers and suppliers).

This situation along with the demise of the original B&T and ensuing fiasco with Friary and Goodman Baylis suggest that no real planning is done by some incoming management teams and their ability to actually deliver what they've sold to the stakeholders is woeful. They can talk a good game, but they can't actually deliver to it. What appears to be a knight on a white charger becomes a chap on a donkey who's a bit bewildered by what he's got caught up in.

No doubt there will be opportunities for people to take appropriate advantage of others misfortune, I just hope they think through what they're doing and plan it properly.

160 people are out of work, it's not a good situation and our best wishes for the future must go to them and others in similar circumstances.

Ann O'Dyne - 03 December 2008

I quite agree Gerry Anderson. In these extraordinary times who will make the extraordinary effort to break the cycle of admin to admin. Suppliers need to wake up and be pro-active otherwise they will suffer the consequences of many more Hendi's before this recession is out

Jo Malone - 03 December 2008

Another avoidable tragedy not avoided. Another administration and another wipe out for the unsecured creditors and employees. Somebody has got to reign in these administrators and their factoring bosses who look purely after their own narrow interests without a thought for anyone else. They operate in their own cosy little world seemingly oblivious to the wider damage they are doing to this industry and to society. We need protection against them now!

Philip Wright - 03 December 2008

This is such a shame.

I had many many years employed by the Alden Group and can honestly say that it was at that time run very successfully by Mr. William Alden and his late father.

They were both very fair and successful in what they did.

Since this take over it looks like things have gone pear-shape.

Like a previous comment on this forum I know it will be the workforce that will suffer the most.

My thoughts go to all that will suffer because of the unfortunate happening.

Hopefully all will pick up again one day and the people that have lost their jobs can return to what they do best, being proffessional in their skilled work and producing excellent printed jobs.

the nugget - 03 December 2008

Whilst I understand the nervousness of the credit insurers in the current climes, what they have got to understand is that pulling or drastically reducing the credit limits is making the situation a million times worse.

Printers then find themselves having to pay up front for supplies, therefore severely affecting their cash flow - after all, how many printers have customers that all pay up front before delivery? A lot of printers have been running a tight ship with increased costs and continually falling margins, so to have their credit reduced virtually overnight could well sink them.

As we all know, Woolies eventually went belly up due to running out of cash because it was forced to pay up front for its goods due to a similar withdrawal of credit insurance from its suppliers, and this is precisely the pressure many printers are under right now.

Our industry needs cutting a bit of credit slack, otherwise we will see many more failures within the next six months, and a lot of good companies will disappear.

Only those with the deepest pockets will survive, because not everyone is able to get regularly bailed out like the Polestars of this world.

As an aside, Jack Sheperd is spot on - wake up, print buyers - pay a proper price for print, or believe me, you will pay much more later.

We ain't seen nothing yet

End of rant!

Robert Blackstock - 03 December 2008

As someone who has worked in the UK book Industry \(until, like many others, I went to a foreign printer), to read of the administration of the Alden Press, is another real blow to the remnants of the UK book printing industry.

In the past 18 months, we have seen the closure of book production related businesses at Bath Press and Oaklands Press. Also Butler & Tanner, Biddles, Ebeneezer Baylis and CPD have all had problems. For those of us who work in this sector, this is another blow.

I first went into book production management in the mid 70's and during the next 5 years, the book industry was decimated, losing almost 50% of the established book printing names of the time. I fear we are well into another cycle like this. Possibly by the end of 2009, the UK book production Industry will be 10% of what it was in 1975, yet the volume of publishing in the UK has doubled.

Since then, the UK has had a few start ups in the industry, Bookmarque \(subsumed into CPI), CPD \(bought out of administration by another new start, Cromwell Press), Oaklands \(now closed), Ashford Press and Cromwell Press. Apologies to anyone I may have missed out.

Of course there are some commercial printers who have entered into the book print market, saw the awful margins and made a very quick exit. Remember, this sector of the industry is the only one that deals on a truly International basis where Europe have been roughly 15% cheaper, India and the near east are 25% cheaper and China and the far east can be up to 40% cheaper.

However, all of these book industries abroad are having their own set of problems at present, namely the 25% drop in sterling against the Dollar and a 21% drop against the Euro from December last year. However, there is no major UK book printer, that I am aware of who is trading in Europe, in any size. There are better margins there too.

Yes I work abroad, but I am still a strong supporter of the UK book industry and thank God there are still some strong book printing companies like Clays, CPI and MPG books.

I wish all the staff at Alden Press and the other book printers who have been affected, all the best and hope that Alden find a new owner for the sake of the staff and this segment of the UK print industry.

Bryn Oakley - 03 December 2008

What a shame! Good luck to all those poor employees who now will no doubt have a rotten Christmas.

All of the 'we know better than to do that' commentators above should be careful what they say. Sure it is easy to be 'cocky' if you have a full order book and say 'look at me; I'm a roll-model!' Whether you have lots of employees or a few, overheads, cash-flow and profitable orders are the dictators of survival or failure. Mark Snee and Rob Stevens are both right; one can have a reasonable order book one month \(but one that doesn't quite meet the overheads) and easily survive. What then if your most regular and loyal customers don't order the next month, and you have a failed order intake. Depending on the size of your company, and your overhead; the lack of profit in this months order book will hit you with a vengance in next month's cash flow. suddenly you don't have the money to pay employees or suppliers. What do you do? Make half the workforce redundant? Then get caught the next month if those loyal customers come on and order twice as much! In the meantime you have half of your loyal employees on the dole having just an awful time of life as all the others that are out of work.

Please everyone, stop making this type of thing seem like it is bad management planning in every case, if you are doing well, good luck to you, keep on doing what you do, but don't preach to everyone else that you have the top notch management skills to run any company! You may too one day find yourself on your knees because the latest digital print widget that you bought is suddenly out of favour with your customers because something new and better has replaced it; yet you have to pay the lease.

If you are that good, there are plenty of Companies out there who would be prepared to pay top dollar for your self-called management skills. Ford, Chrysler and GM in America need your help! So do Woolies, MFI, and plenty of others.

We all have to do what we can to survive at this time, but everyone in business has to be optimistic.

By the way Andrew Bartlett, you try telling your bankers that you have just made half of your workforce redundant, so aren't you a good boy for letting them know and for being so transparent! Then watch as they pull in all the loans, overdrafts etc they have given you, because they don't think you can now survive, as you do not have enough staff to actually produce the work for the turnover you need! Transparency is the glass in the door on tthe way out of the bank, after they have taken the rug away!

Alistair Brewin - 03 December 2008

Tragic news, we have placed orders with this excellent company for many years and they have always lived up to their fine reputation. William Alden did his very best to secure the business for the future such a shame that it doesn't seem to have worked out.

Gavin O'Mahoney - 03 December 2008

I'm sure those who haven't been paid will take much Christmas cheer from John Faulkner's 9 happy years at Hendy Banks.

But really, Hendi bought Alden in June and were looking for extra bank funding 5 months later! Thereafter it falls off a cliff. It suggests to me someone hasn't done their due dililgence properbly as 2 + 2 in this case clearly make 0.

Is Hendi another highly leveraged business buying something it can't really afford with a management out of their depth from the start. While you are working it out, its the employees, suppliers and local economy which will bear the brunt of this fiasco.

To come, will be the smoke and mirrors blaming our economy, the world economy, China, India, EU, the colour of your shirt, your dog, my dog, in fact anybody rather than turn the spotlight on those involved. I do hope some deep and meaningful questions are asked of the people involved because to take over a 175 year old company trash it and its London subsidiary all in a few months is truly spectacular.

Happy Christmas.

Alan Partridge - 03 December 2008

Colin?

John Graham - 03 December 2008

This is just the start. I am sure that come the new year the cull of printing companies will be fast and furious. In the end if a market has seen prices/margin fall for7 or 8 years, as soon as a downturn hits and bail out cash is not available> BANG! out go the weaker players.

I just wonder who will be left a year from now?

The companies left of course will re-group and be the winners. Whoever has the market share now will probably win and ride through in most sectors of print. As has already happened in many other industry sectors.

Jon Fennell - 03 December 2008

Its time to beat up the banks and go sell in europe, they were quick enough to hit the UK, with the current exchange rate we should be hassling the buyers to come away from placing fat contracts abroad. Its hard to see how they can compete against UK web, it all should have gone full circle.

Will be interesting to watch the CI ratings on the travel businesses, mot of us will be holidaying in the UK from the look of it.

In answer to JG, yes the weaker businesses will continue to be weeded out, but looking at the happenings with MFI, Woolies and current rumours surrounding Dixons Group, do any of us really know who the stronger businesses are anymore.

Its more a case of who's the busiest fool and how many more will follow. Busy business does not always equal profit. Does consolidation work, looking at retail not convinced.

Bendy Banks - 03 December 2008

Gavin has a point! It was a great company to work for in the sense that it had good people and management who generally tried to do the best for their employees but I guess that is not the way to do things these days. It is a measure of the staff that they kept working even after they were told \(At 6pm on the night before payday) that they wouldn't be paid. It was an immoral thing to do as someone knew long before this that no wages would be paid but all along the staff believed something could be done. It does seem strange that there was not a proper business plan that guaranteed at least a year of money after the merger but I guess the banks realised they couldn't trust the management after the comedic cock-up of the proposed move of the London office to new premises. Not fair to say more but no-one held their hands up to this rumoured loss of 500k on a botched move - staff still being told 'it was the banks fault'.

The Mighty wind - 03 December 2008

"Does consolidation work"

not in this market the funds are not there to finance the debt required in the process

John Faulkner - 03 December 2008

Not quite sure what point Mr Mahoney is making in his opening para - nonetheless I must concur with the need for some serious investigation into the actions of those responsible. I suspect that their Christmas, and future prospects, is not going to be as troubled as those on the shop-floor.

Damian - 03 December 2008

Like John I had many happy years at Hendi \(Hi John). I was shocked to hear of its demise and I am really saddened that so many of the good people I worked with over the years are facing such a bleak future. It really does feel like the death of a close friend and is a great loss to the industry.

Jack Sheperd - 04 December 2008

Update

Just spoken to KPMG and they say company in too poor a condition to save, most of customers already pulled work to new printers, so no customer loyalty there then!.

Sorry staff have been shafted must be very hard xmas for them and their families.

Alan Partridge - 04 December 2008

Damian, if it feels like the death of a close friend I think you may be over-reacting slightly. Yes, it's very sad, but you need to get things in perspective. Michael - Shamoooooon yeah

Richard Head - 04 December 2008

I think its shocking that staff where not paid but am also not suprised.

There needs to be some legislation that makes it a legal requirement for companies to tell employees they are not going to be paid as soon it is known that this is the case by Directors. The current situation is just stealing ... employees sell their time.

In response to Jack Shepherds comment about customer loyalty. Customers can only be loyal to the extent that they do not expose their own business to risk. This seems reasonable after all they have a duty of care to thier own employees.

MJ ... Shamon

Alan ... AHA !!

Dick

bob coombs - 04 December 2008

thanks aldenhendi for the great christmas present.

I really hope that there is no phonex to rise from this.all the staff did not deserve this.

all the production staff where the best asset that aldenhendi had.just flushed down the drain.

even with no pay we all went to work.

now houses are on the line.christmas.what christmas.thanks

Jacob Marley - 04 December 2008

If HenDi can't be bothered to pay me then I can't really be bothered to post a comment - didn't even receive a good luck, sorry or shake of the hand!

Damian - 04 December 2008

Alan Partridge. Think you're right close friend is probably a bit strong...

Bendy Banks - 05 December 2008

The bank stopped the supplier accounts a month before and paid cash for supplies. This meant that all the money paid for the free work \(THE BANK MUST HAVE TOLD THE DIRECTORS THEY WOULD NOT PAY THE WAGES??) that the staff did during November went toward reducing the overdraft and therefore the liabilities of the directors - which was nice - wouldn't want them to lose too much.

Up the workers eh?

Mark Edwards - 05 December 2008

This is a real shame - I suspect that it was downhill from the move from Osney, and the current economic situation merely signalled the "coup de gras". However, Alden was a good employer for me and hope that my former colleagues will manage to find employment, or at the very least have a good Christmas. Best wishes to you all!!

Simon Biltcliffe- Webmart - 05 December 2008

I agree with other posts on this subject...I'm staggered it's not illegal to avoid paying people wages. It should be...and backed up by the individual directors personal assets if the business can't . They were the only ones who would have KNOWN that the wages were not to be paid, and long time before that disgraceful email was sent -so it is a conscious choice they have made.These are loyal and trusting staff here and they deserve better.

I'm happy to put £5000 as interest free loans \\( up to £500/ person) into a fund to help people with with any exceptional distress - could the Printers Charitable Trust administer it? It is available now so please email me if you are unfortunate enough to need some immediate financial help. Will forward onto someone who will evaluate your need and deal with it appropriately. and VERY QUICKLY if needed.

I'm sometimes ashamed of the so- called leaders of \\(not just print) businesses- they seem to leave their morals in at home sometimes...

Simon Biltcliffe

MD

WEBMART Ltd

simon.biltcliffe@webmartUK.com

Bendy Banks - 06 December 2008

Cheers Simon, nice thoughts. The shame is, it WAS a good company to work for. All the employees were long-time and wanted it to do well. At the end of the day someone made the decision to move plant and begin production into a premises where they had not signed the lease \(Aldgate). Amateur stuff! When the landlord said no, it was too late. I believe certain directors \(AG) really were trying to get the wages payed. whereas others \(JP) were just trying to protect their own interests. Despite places on the boards of several organisations the print world is small and slimey amateurs will be found out eventually. Hendi were a great company to work for and , I hope, produced some good work. But at the end of the day the directors seemed more concerned with having a good website than sorting out the real issues so it has all gone to waste.

Andrew Bartlett - 06 December 2008

Ladies and Gentlemen, I can't believe we are all so surprised about the current economic down turn, the writing has been on the wall for years.

House prices out stripping wages, personal debit rising to a point where it had to implode, personal credit fueling growth, the destructive share price culture coming to Europe from the USA, UK manufacturing disappearing, business and banks rewarding short term growth not long term stability and rewarding heads of large institutions for failure with massive pay offs, government debit being so high (great news for our children) and the Government selling off the countries gold reserves...

It all became a vicious circle with totally predictable results.....

Andrew Bartlett - 06 December 2008

Ladies and Gentlemen, I can't believe we are all so surprised about the current economic down turn, the writing has been on the wall for years. House prices out stripping wages, personal debit rising to a point where it had to implode, personal credit fueling growth, the destructive share price culture coming to Europe from the USA, UK manufacturing disappearing, business and banks rewarding short term growth not long term stability and rewarding heads of large institutions for failure with massive pay offs, government debit being so high (great news for our children) and the Government selling off the countries gold reserves... It all became a vicious circle with totally predictable results.....

Chris Lavers - 10 December 2008

Ok Printweek commentary folks, we're getting there. I reckon Alden Hendi must have been a quality print facility to stimulate this kind of intelligent/well thought out commentary. Anyone who has lost out has received plenty of sympathies. Anyone still in the game may well appreciate your sacrifice \(not your choice, I realise). If you are good enough and your mindset is up-to-date then you should be able to jump back into the sector when the dust settles, if you truly want it enough. Stay positive, work hard, think of others, take responsibility for your actions, take out the trash, embrace the Chinese and then beat them at their own game, everyone.

Is this a bit preachy? Oh never mind. It's meant with the best intentions and whatever the weather we will have a leaner, meaner print industry that can compete with the rest of the world because we care, we are good at what we do and we have our own market and are respected pre- and post-press throughout the world.

I hear it'll get worse before it gets better, so hold onto your hats and get ready for the ride of your lives. And by the way, please keep up the commentary and never hold back. IT IS A FREE COUNTRY, AFTER ALL.