Falling sales and $200,000 in bad debts have forced Sydney UV printing specialist Graphics Plus into administration owing $1.5m.
Administrators at Insol Group were appointed on Monday and have put the $3.7m turnover business up for sale as a going concern, calling for expressions of interest by April 10 – the same date as the first creditor's meeting.
Former employees say the company, famous for its high-quality printing onto plastic, has been struggling for the past year, following big hits from several failed clients including Geon and Focus Press.
They say the last straw was the lease on its Silverwater plant ending and the landlord wanting a five-year renewal. Phillip Delaney, owner for 26 years and nearing retirement, did not want to commit to a long-term deal with the business in the shape it was in.
Delaney is said to have been shopping the company around for several weeks but has so far been unable to find a buyer.
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Administrator Thomas Dawson says the business is operating with eight of its 16 staff, with the rest still employed but stood down until the future of the business is clearer.
He says work is continuing on outstanding orders and new orders will be taken depending on their profitability.
“This is a constantly changing situation while we assess the viability of the business,” he says.
“By all accounts this is a good business and we hope to save as many jobs as possible.”
Employees are owed about $300,000 in entitlements.
The former employees say Delaney ‘is the kind of person who would want to settle all his debts’ before winding up the company and exiting the industry, rather than leaving creditors out of pocket.
Delaney also owns a building in Alexandria next door to SOS Print and Media, where Graphics Plus used to be based.
Graphics Plus lost $61,500 from the Focus Press collapse and the former employees say it is out of pocket about $40,000 from Geon and $110,000 from a design agency that went bust last year.
They say the agency, a first-time client, collapsed soon after the printer completed a big wide format job it commissioned for the Daily Telegraph that required lots of overtime and had no upfront payment.
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Things seemed to be going well for Graphics Plus 18 months ago when it installed an Agfa Anapurna M1600, its first wide format printer, to complement its manroland UV offset press.
The former employees say with runs getting shorter, the offset work would become less profitable and margins and sales were falling across the market.
They say the company may have cut its prices to retain business, especially with competitors entering the market putting more pressure on margins.
These include its own polypropylene sheet material supplier Megara, which recently began supplying finished products outsourced to Melbourne printer John Herrod & Associates.
The company pioneered offset printing onto plastic more than 30 years ago. It supplies many commercial printers with plastics work and is widely considered to be one of the best in the business.
Its services included UV printing and printing on plastics, as well as packaging, point-of-sale, commercial print, retail graphics, digital printing, digital finishing, design and prototyping.
“It is really sad that such a good operation could go to waste, but that’s the nature of business,” one industry source says.
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