In a staggering blow to the local job market, Communisis, a long-standing print giant based in Leeds, has closed its doors, resulting in a heart-wrenching loss of 256 jobs in the city and a total of 638 across the United Kingdom. The closure comes as a consequence of the accelerating shift towards digital statements by high street bank customers.
Communisis, headquartered in Manston Lane near Thorpe Park, operated not only in Leeds but also had significant facilities in Liverpool, Cramlington, and Northumberland. The announcement of its closure was confirmed by administrators at Interpath Advisory, who revealed that over half of the 1,000-strong UK workforce received the devastating news of their job losses.
Liverpool bore the brunt of the cuts with 196 job losses, followed by Cramlington with 37, and seven in Copley. The situation, however, is not entirely bleak, as a buy-out has salvaged 581 jobs. Paragon Customer Communications, trading as Paragon, has emerged as the saviour by acquiring Communisis’ Brand Deployment business, responsible for providing marketing services to major brands, and its Customer Experience arm, which offers secure print and mailing services to banks and public institutions. This acquisition also encompasses the Communisis entities Twelve, Editions, and Vox Group.
The demise of Communisis traces back to a failed rescue attempt for the ailing business. Complications arose when its former parent company, OSG Holdings, based in the United States, filed for Chapter 11 bankruptcy last year. Although Communisis severed ties with OSG, it faced additional setbacks, including contract losses. The financial woes deepened, as the company reported operating losses exceeding £6.5 million in its 2021 accounts.
Administrators shed light on the print sector’s inescapable decline, exacerbated by the pervasive transition to digital technology. Rising production costs, including energy and paper prices, added further strain. The digital transformation, spearheaded by the Indian multinational Tech Mahindra, proved to be more intricate and costly than initially anticipated.
The managing director at Interpath Advisory and joint administrator expressed empathy for the affected employees, acknowledging the devastating impact of the redundancies. The immediate priority is collaborating with impacted workers to provide comprehensive support and explore potential employment opportunities with competitors and other companies in the field. Urgent discussions with the Job Centre Rapid Response Unit and the Insolvency Service regarding the timing of redundancy payments are also underway.
The managing director at Interpath Advisory and joint administrator highlighted the significance of the deal with Paragon. The transaction not only enables the historically profitable Brand Deployment business to continue under new ownership but also ensures the seamless provision of services to Lloyds Banking Group. Praise was given to the collective efforts of stakeholders, including the dedicated Communisis workforce, customers, suppliers, Pensions Trustees, and regulatory bodies, in facilitating the agreement with Paragon.
As the print industry undergoes a seismic shift, marked by the relentless advance of digital technology, Communisis becomes the latest casualty in a landscape grappling with evolving consumer preferences and technological innovation. The ripple effects of this closure extend beyond the company itself, touching the lives of hundreds of workers and signalling a broader transformation in how businesses navigate the challenges of the digital era.