Staff at envelope manufacturer John Dickinson are facing potential job losses after they were told on Friday that the plant may close due to declining demand.
All 62 staff as well as union representatives have entered a 30-day consultation period to determine the future of the plant, based in Washington, Tyne and Wear, and discuss alternative options to closing the facility.
Business area manager Mark Cooper at parent company Bong UK said that production could transfer to associated UK bases but all jobs would be lost if John Dickinson was to close.
Bong's Milton Keynes head office and London’s Surrey Envelopes, also owned by the pan-European mailing and packaging specialist, have the capacity to manufacture similar reel-fed envelopes as those currently produced at John Dickinson.
The Milton Keynes and Washington operations have shed 15% of their combined workforce in the past year in attempts to streamline the size of the business with declining demand. Ten jobs were cut from the North East base and a further 20 staff at the Milton Keynes site were let go.
Cooper said that postage increases as well as the continual shift towards online communication and transactions was a major factor in the falling volumes of the envelope market.
He added: "We have been working hard to replace the lost volumes. However, the long-term future is one of continuing volume decline and that has driven us to look at plant consolidation.
"We are committed to staying competitive and whilst the closure would be regrettable we feel that consolidation is necessary for the long-term security of our UK business."
He claimed that there would be no adverse effect on customers as production would be transferred within the country, and added that the closure could enable the company to invest and enhance capacity at the remaining UK sites.
Bong, which is headquarted in Malmö, Sweden and has subsidiaries in 15 countries across Europe, recorded operating profits of SEK 11.8m (£1.1m) in the six months to June 2012 on sales of SEK 1,528m (£144.1m).blog comments powered by Disqus