The industry has already suffered the hottest summer on record in 2006, which caused the worst water shortage in seven decades. In January, the UK suffered its worst storms in 17 years during which 11 people were killed, thousands of properties were left without power and delivery lorries were overturned. In December last year, north-west London was hit by tornadoes, while this summer’s flash flooding has cost insurers more than £2bn. If these conditions are set to continue then it’s time for printers to get prepared.

“This summer, the extreme weather was caused by the position of the jetstream, which is a ribbon of very strong winds in the upper atmosphere,” explains Sancha Lancaster, spokeswoman for the Met Office. “For much of this summer the jetstream has been further south and stronger than in a typical summer. This has resulted in many depressions crossing southern and central parts of the UK, bringing with them some severe weather.”

Although no single weather event can be attributed to climate change, the Met Office is expecting more unpredictable weather. “There may be greater rainfall over the UK during the winter as the climate warms. And although summers are expected to become generally drier, when the atmospheric conditions are favourable for wet weather, as in this summer, there may be an increase in the frequency or intensity of extreme rainfall events,” says Lancaster.

Wider implications
What does this mean for UK printers? London printers escaped the effects of the 2007 drought thanks to the BPIF securing an exemption from the proposed drought order on the basis that it could potentially shut down the region’s print industry. However, faced with the risk of future water shortages, firms could be left unable to clean or run their most vital printing equipment.

Printers didn’t escape this year’s floods as easily. The downpours that plagued the UK this summer caused thousands of pounds worth of damage to equipment and facilities and collapsed both local and national infrastructures, hitting both distribution and supplies.

“It wasn’t just a factory flood. There were vast implications beyond that,” says Les Dalton, operations director at Pindar in Tewksbury, which was flooded in July. “We learnt a big lesson during the flooding, which occurred at an unnatural time of year just prior to our busiest period.” Roads were blocked, so it was almost impossible to get anything on or off the site. Staff were unable to get to work and the firm’s water supply was cut due to contamination. “Keeping up morale was one of the hardest parts,” explains Dalton.

Other print firms affected by the flooding include Pershore-based Polestar Varnicoat, Newbury-based PCP, Gloucester-based HB Digital Printing and Sheffield-based MDP Primecard, which lost its account and order records when its plant was flooded. “We have been situated by the river for 12 years and never had any problems. There was a definite lack of information and we were taken by surprise,” says Mike Dibb, managing director at MDP Primecard.

Although extreme weather can’t be avoided, there are ways to prepare. “Contingency planning is vital, and it should be carried out by firms of all sizes – not just the big ones,” says Douglas Barnett, risk control strategy manager at Axa. “If you are calling your insurance firm then you are already in trouble. Firms must try to help themselves first,” he adds. “It’s the best and most reliable way to either prevent a disaster or minimise the effects of something unavoidable.”

Disaster recovery planning (DRP) is a substantial undertaking, and naturally not all severe weather events can be catered for. Firms’ measures vary widely. MDP Primecard now keeps a supply of sandbags for emergencies and has created a list of priority items that must be moved to safety first. “We have also reconsidered our storage systems and keep all back-up disks off the premises,” says Dibb.

Yet preparing for the aftermath is just as important as preventing the damage. Pindar’s problems were eased by the company’s DRP and thorough insurance coverage. “Remember to document everything and don’t underestimate the time involved in tracking relevant documents,” says Dalton.

Printers can also get protection advice from a range of organisations including the Office of Government Commerce and Axa, which provides a free contingency plan guide. “Businesses need to be aware of all the implications and impacts of extreme weather conditions. For example, as we saw in July, there may be risk of disease and infection caused by water contamination,” says Barnett. Firms can also register with the Environment Agency (EA), which provides flood-plain maps and early warning schemes. Its preparation plan also includes information on updating employee manuals and storing hazardous materials during extreme weather conditions.

Contingency planning
The EA also recommends that businesses know where their cut-off points are for energy supplies and water, and should mark these on a map that is stored with the DRP. A list of firms from which you may need help after a flood is also useful, particularly in relation to outsourcing the work that you can not complete. Pindar, which damaged its perfect binder in the flood, found that many nearby print firms were already fully booked. “Luckily we were able to keep the majority of work by shunting it between group sites, but it was still a significant challenge,” comments Dalton.

But however much you prepare, severe weather will have an impact. This is where insurance is vital. “Everything will be all right as long as firms are properly insured. The biggest problem is companies that are underinsured due to out-of-date evaluations,” warns Barnett. In fact, in a survey carried out by Axa on 2,070 of its corporate clients revealed a £700m insurance shortfall.

Business interruption cover is another area where firms fall down. Companies can protect themselves against loss of profits, and in the print industry where large and expensive kit could take months to replace, firms will need to be able to offset the loss. “Firms often think it will only take a matter of weeks to clear up the damage. But when it comes to winning back customers and replacing kit it could easily take up to two or three years to recover completely,” says Barnett.

For those underinsured firms there may also be support available through tax breaks. “There are tax implications for the real cost outlays that you can’t fully recover, which means you can get tax breaks,” says David Teale, director of tax at corporate accountancy firm DTE. When it comes to replacing kit, firms could claim up to 25%-50% relief during the first year and up to 25% thereafter, he says. However, strict rules do apply. For example, a facility rebuild is unlikely to qualify, whereas plant refurbishment would. “Also, be aware that any compensation received for loss of profits will be taxable in the same way as normal trading profits,” he cautions.

The most important lesson that printers can learn from the recent severe weather is to be proactive. “Don’t wait until you get your feet wet,” says Axa’s Barnett. “There’s a job to do in preparing and protecting your company while the weather is fine.” Many printers have so far escaped drought and flood unscathed; however, the recent severe weather events should act as a caution, that all eventualities must be considered, before it is too late.

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CASE STUDY
Pindar

On Friday 20 July 2007 one of Pindar’s Tewkesbury-based sites – the ex-Cooper Clegg site, acquired earlier this year and responsible for printing magazine work for publishers including Emap, Conde Nast and Seven Publishing – was flooded in 18 inches of river water from the Avon and Severn. Flooding blocked the local roads and shut the M5, halting both the firm’s delivery and supplies. On the following Monday, the plant’s water supply was switched off due to contamination.

Pindar had anticipated the cessation of water supply and ordered in a tanker of water from surrounding areas together with bulk containers from its Scarborough plant. The firm managed to keep its five web presses running, and by Monday 95% of staff had returned to work. Some of the firm’s perfect binding work had to be outsourced, though the majority of jobs were kept within the group.

Pindar knew its plant was located close to a flood plain and had appropriate insurance and business interruption cover as well as a detailed disaster recovery plan. Yet the company is still coping with the aftermath of the flood, which it says could take until next year to completely resolve. The firm is now considering measures such as local flood defences, new storage options and lowering the building’s driveway to lessen the effects of future floods. The firm hopes to have regained financial stability by the end of this month (October).