The Washington, Tyneside company has formed a formal consultation group of staff and is working with representatives to discuss options should it lose a large proportion of its work once St Ives takes on Sainsbury's print management in September.

Employees are waiting to find out how much work will be lost to St Ives after Communisis, which used Simpson Group to produce point-of-sale work, was outbid in a competitive tender for the supermarket's print management earlier this month. The tender is said to have been worth £20m a year.

Mark Simpson, executive chairman of Simpson Group, told PrintWeek he will make a decision as to the future for his staff, who number around 80, after it becomes clear what the fallout from the Sainsbury's contract will be.

He said: "A fair percentage of our trade is a result of the Sainsbury's contract and, as with any multimillion pound contract loss, job cuts are always a possibility. We do however have a large amount of work coming in from other contracts, so the future of the business is secure."

He added: "If there are job cuts, we will do our best to ensure that the people affected find work elsewhere. There is still the possibility we can pick up more work from Sainsbury's so we are in a waiting period."

The Sainsbury's contract officially moves to St Ives on 1 September.

It is understood that there is no union involvement at the plant.