Gosh. The news that St Ives is proposing to close its Crayford site is something of a bolt from the blue. I don't think many people would have seen that one coming, after all it was less than a year ago that the plant installed an all-singing all-dancing manroland 700 press with DirectDrive. Speculation about which plant St Ives would close next had centred elsewhere.
Crayford represents many millions of pounds of investment over not that many years. St Ives moved the former Displaycraft point-of-sale business into the site after the collapse of Rival Envelopes left a nice new factory unit going begging back in 2001. It spent £6m acquiring the factory, and further £2m on new kit at the time, and has invested millions more since including that Roland 700. The Tunbridge Wells and Romford businesses were also incorporated into the site, and maybe that was one of the problems - merging businesses is never easy and Crayford also suffered from something of a revolving door in terms of plant management, and from a somewhat schizophrenic divisional approach over the years.
However, like the customer quoted in the story, I thought Crayford was well-invested and something of a "hidden gem", but the operation never really had a chance to prove itself. Just as it seemed to have found its niche with award-winning creative packaging and high value-added commercial print, the market dried up.
Another multi-million pound write-off hot on the heels of closing the books on its costly foray Stateside gives a taste of the tough job in store for chief executive-in-waiting Pat Martell, who already knows he will preside over the first cut in full-year dividend at the group for the best part of a decade.
It's worth noting, though, that St Ives is at least in a position to take these difficult decisions and absorb the accompanying financial hit. That the group intends to close a relatively new and efficient plant like Crayford makes me look around at some of the weak and loss-making factories that aren't closing simply because their owners can't afford to do it.
Share price update: up a whole 2p to 48p this morning.
