Australian Paper has revoked its Reflex office paper agreement with CPI-owned Edwards Dunlop Paper. The reseller is due to stop selling the cut-sheet brand by the end of May.
CPI chief executive Bernard Cassell (pictured) told ProPrint that Australian Paper had “merely decided that they want to do the major distribution of Reflex office paper and its other grades by themselves”.
“They’re going to force customers to buy Reflex from them, even if the customer doesn’t want to,” he said.
It is understood that CPI will continue to supply the Reflex Laser brand of roll-to-roll paper through its Boomerang Paper business.
Australian Paper could not be reached for comment.
Meanwhile, CPI also announced today that it had completed the “first step” of its “warehouse consolidation program”, which will see the company move all of its warehousing operations in each state onto one site.
Cassell told ProPrint that the move was the result of CPI possessing a surplus of warehouse facilities following its acquisition of Red Paper in 2007.
“What we’re doing is rationalising,” he said. “When we acquired Red Paper we inherited a large number of warehouses in addition to our own, which has been both inefficient and costly.”
Over the next two years, the company will be adopting a state-by-state policy of moving to a single warehouse, as leases at the warehouses formerly used by Red Paper expire.
The first stage has seen CPI close its warehouse in the Adelaide suburb of Regents Park and concentrate its warehousing operations at its Athol Park site, which has been “expanded and modernised” to handle the increased load. An “overflow” warehouse formerly leased by Red Paper in Adelaide has also been closed.
Cassell said that “Perth is next cab off the rank” with the move from two warehouses to one expected to be completed by the end of 2010. The NSW and Queensland consolidation is expected to be completed by mid-2011, and the Victorian consolidation by the end of 2011.
Cassell said he was not aware if any job cuts would take place as a result of the reorganisation.
CPI has said in a statement to the ASX that the move was expected to save the company $5m a year once it is completed.
Comment below to have your say on this story.
If you have a news story or tip-off, get in touch at editorial@sprinter.com.au.
Sign up to the Sprinter newsletter