SPEF director Jim Raeburn said the merchants proposed increases of between 5%-8% was completely unjustified (PrintWeek, 12 February) and added that they would be vigorously opposed by SPEF members.

Raeburn said he was well aware of pricing pressures throughout the paper and printing supply chain but claimed the size of the increases betrayed a singular lack of understanding of the position of printing companies.

Printers customers would not accept price increases, and in some cases continue to drive down prices. In these circumstances, it is unreal that you have increases of more than double the rate of inflation, which can only further damage the industry, he said.

In response, one merchant source said there had been numerous business failures, costing the paper merchanting industry a great deal of money. Due to the demise of a number of printing companies insurers had increased premiums and withdrawn limits leaving merchants more exposed, said the source.

SPEF is also concerned about the lack of competition in the paper merchanting sector in Scotland, with three out of the four big suppliers in the region belonging to one group.

Howard Smith, Donald Murray and Robert Horne are all now part of the giant PaperlinX organisation. Raeburn said this not only took competitiveness out of the market, but also strengthened the hold of the merchants.

Story by Andy Scott