"A combination of fewer lenders who will actually lend, much stricter underwriting criteria and the printer’s own results deteriorating in line with recent trading," are the cause of their current predicament, according to Murray Booker director at broker BPFL.

Whereas a few years ago most financial queries were in relation to investment in new kit, today, the main demand is for "debt restructuring and keeping one’s head above water," says Close Print Finance director David Bunker.

Bunker expects investment in new machines to increase over the coming months and years as there is a raft of machines in operation that are ripe for replacement or upgrade. That’s if printers can present a stronger business case to their lender of choice. "I think there are still deals to be done but you have to present the case to your financier in a much more robust way and be prepared for giving the bank more support," adds Bunker.

Hire purchase options
When available, the favoured form of financing new kit remains hire purchase (HP), according to Booker, which is "more secure in the books of a lender". Bunker concurs, adding: "I don’t see the point of any other product when making an investment. HP means so you own it at the end and can take the writing down allowances."

In terms of insurance, little has changed with regards the different options that are available, although some policies have been broadened to reflect changes in wider society – you can, for example, take out insurance that covers you against your staff lottery syndicate hitting the jackpot and handing in their notice simultaneously.

The key thing to remember when renewing a policy is whether or not your circumstances are the same as when you first took the policy out.

Whether sorting out finance or insurance, for Booker, it makes perfect sense for printers to call on expert advisors with print industry experience. "You probably only have one chance so make sure that you get it right the first time," he adds.

What's new in finance & insurance

• In August, asset-backed lender Lombard – part of the RBS Group – confirmed that it was pulling out of stocking finance for the print sector. The move will further reduce the pool of lenders available to secondhand equipment dealers that are stocking finance to bridge the gap between acquiring and selling a machine
• Figures from August showed that lending under the Enterprise Finance Guarantee fell almost 27% from £254m in the first quarter of 2009 to £186m a year later. The scheme came in for heavy criticism after it was revealed that a further drop took place in the second quarter of 2010 with lending down 20% on the first three months of the year. In the same month, the British Bankers’ Association released figures showing that year-on-year new-term lending to June 2010 had decreased by £269m
• Also in August, the Bank of England announced it was keeping interest rates at 0.5%. Print finance experts don’t expect interest rates to rise for some time