So, can any useful lessons be learned from recent depressing events in Frome? Mike Dolan has been widely painted as the villain of the piece, but B&T’s problems stem from way, way before his involvement and it’s worth reminding ourselves of the pre-Dolan back story. Five years ago, I developed a rather unhealthy obsession with pension deficits in general, and printing industry ones in particular, as the implementation of accounting standard FRS17 drove companies to recognise pension surpluses or deficits on their balance sheets.
Look at the B&T results to 31 May 2003. Turnover down a tad at £42.5m; operating profit £302,000 (down 83% on the prior year, not exactly auspicious in itself); pension deficit under FRS17: a whopping £27.8m. That’s an eye-watering figure, and a potentially ruinous one for a company of B&T’s size and balance sheet. It was a problem that loomed large over the business, and in my opinion, B&T’s board should have taken radical (and undoubtedly highly unpopular) action to address it far sooner than they did. The deficit was still around the £8m mark last year before the pre-pack sale to Dolan.
Meanwhile, despite diversifying into seemingly logical areas like annual reports (where B&T could compete against both sheetfed and web offset using the firepower of its large-format presses), and digital photo books (where it could use its binding skills in a new, supposedly high-margin area), colour book printing remained at the heart of the business, and the heart of the problem. B&T’s publishing clients had their cake and ate it too: send the work abroad when timescales and exchange rates suited; send it to convenient old B&T when you need books for the Christmas market in a relatively short window. The obvious solution would be to have had some extremely frank conversations with said publishers, pointing out in no uncertain terms that if you want world-class colour book printing on tap and on your doorstep at peak periods then you have to provide a realistic level of work for the rest of the year as well.
Apparently B&T did try this, but obviously not convincingly enough. Publishers, it seems, simply didn’t believe them, and perhaps in a world where print buyers have benefited hugely from having it their own way for so long, who could blame them? How ironic, then, to learn that after things did indeed go seriously pear-shaped, those same publishing clients were happy to pledge work in support of Kevin Sarney’s rescue plan. It seems they are belatedly appreciating what they had now it’s gone.
Jo Francis is associate editor, Print Group Haymarket
Print can learn from drama at Frome
What does Joni Mitchell have to do with the printing industry? Not a lot that I know of, but while reading up on the latest twists in the tale of Butler and Tanner, I found myself humming the refrain from Big Yellow Taxi: "Don't it always seem to go, that you don't know what you've got till it's gone". While it is wrong to talk about B&T as if it has "gone" - at the time of writing a rescue deal involving mercurial publishing gazillionaire Felix Dennis had emerged out of leftfield - it is safe to say that the resurrected business will be a shadow of its former self.
