The potential casualty toll was being measured in the likelihood of bad debts and job losses at the third-largest group in the region. At time of writing, much was still unknown. Tom Sturgess had just acquired the New Zealand labels business, and pledged to repay trade creditors. With at least $16 million of unsecured debts across the wider group, many suppliers will be hoping to see a similar outcome for the other parts of Geon.
It is fair to call the Geon situation a disaster. Yet plenty of the people I speak to have responded with a sense of excitement at the collapse. Some are giddy at the prospect that they will be able to raise prices. A flood of work will apparently rush back into the industry. Some see the collapse as just desserts for a group that epitomised private equity-driven consolidation.
Call me cynical, but I don’t foresee a sudden uplift in volumes or prices for small printers. The major groups should soak up most of the work, particularly Blue Star, IPMG and Opus, all of which have Canberra connections – bound to come in very handy in an election year.
I’ve spoken to many print people who can see a silver lining. That may seem insensitive when there are a thousand jobs at stake. I’m certain that I’m not alone when I say my heart goes out to workers who don’t know where their next pay cheque will come from. But I don’t take issue with printers if they want to find the upside to this black saga. They aren’t personally responsible for jobs at the group. Why should they lose sleep over a mess a competitor brought on itself?
If there’s another group I feel sorry for, it is the paper merchants. They are truly damned if they do, damned if they don’t. They were applauded for taking a stance on Geon. But by stopping supply, they cut off a multimillion-dollar customer – the biggest buyer of sheetfed paper in the country. It can’t have been an easy decision to consciously wipe that much revenue off their books. Although someone will surely point out, it would only have been revenue if it had been paid.
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
