Business Spotlight: COVID’s impact on the printed word
12 January 2021: ICAEW Insights speaks to Catherine Rossiter, Chief Strategy Officer in the UK for one of Europe’s largest printers of books, about the effect COVID-19 has had on the company’s commercial decision-making process.
While some employees may have used the festive break as an opportunity to wind down, the last few months have left little time for curling up with a good book for Catherine Rossiter.
As Chief Strategy Officer in the UK for CPI Group, one of Europe’s largest printers of books, she has been working hard to respond to the impact of COVID on the business, and work with the operational teams to make sure the UK’s bookshelves were well-stocked for the festive rush on the printed word.
It’s fair to say, Rossiter’s move into the world of book printing happened at a challenging time, having joined CPI’s UK board in June 2020, just as the country was emerging from its first national lockdown. She was appointed with a remit of restructuring post-COVID and applying financial rigour to the commercial decision-making process.
CPI Group, headquartered in France but with 16 factories across the UK, Germany, France, Spain and the Czech Republic, was under relatively new ownership, having been sold in April 2019 for the second time in the space of a year to a private investor. The UK business publishes a staggering 160 million books a year (plus journals and loose-leaf publications). CPI has a 40% market share in the UK – there’s a good chance that your bookshelves feature the fruits of its labours.
Rossiter describes her role as providing a bridge between the vast book printing experience of the company directors and growing shareholder interest in metrics, including EBIDTA, quality of earnings and the assessment of commercial decisions.
There’s plenty of scope for entrepreneurialism, helped largely by the privately-owned structure of the organisation. “It’s exciting that If you can demonstrate the benefits of a project, you can be one to two conversations away from an agreement on investment,” she says.
A commercial challenge
By her own admission, business partnering and a passion for supporting commercial and operational teams have been recurring themes of her 20-year plus career, even going back to her time as an audit trainee at PwC. “I loved going into businesses and understanding how they operated, particularly tangible businesses in manufacturing and distribution,” she explains.
Despite relishing the commercial challenge, the experience of the past few months could hardly be described as easy. Although the enduring appeal of books continues to make them a regular fixture on most Christmas lists, the first lockdown prompted book publishers to cancel orders and postpone the launch of new titles as all-but essential retail outlets remained open for business.
Meanwhile, CPI’s STMA (Scientific, Technical, Medical, Academic) printing business, which in 2019 generated around 35% of its £120m turnover in the UK, was badly hit by the pandemic as libraries and schools closed and question marks hung over universities’ strategies for a return to teaching.
The market in trade books has bounced back strongly, further buoyed by the printing of titles postponed in the spring. At the same time, consumer behaviour is fuelling demand as we increasingly turn to books as a form of comfort and to pass the increasing amounts of time at home. Booksellers up and down the UK reported a boom in sales since readers returned to bookshops after lockdown 1.0, with the first wave of Christmas titles giving them their best first week of September since records began.
“Normally, volumes get a little bit easier in the run-up to Christmas, after the autumn peak in production, but that hasn’t happened this year,” Rossiter explains. “We are beyond capacity; our January order book is full, and the market is very busy.” While STMA printing is picking up slowly, uncertainty surrounding the academic return has resulted in suppressed volumes.
New ways of working
Despite the longstanding heritage of the business – CPI Group owns some of the oldest book printing businesses in Europe including Mackays in the UK dating back to 1857 – investments in digital technology are giving it more flexibility to cost-effectively print shorter runs of STMA books, with the advantage of reduced stock and waste in the supply chain.
New technology and ways of working are also transforming the book printing landscape – whether it’s through auto stock replenishment or on-demand digital printing facilities that make it financially and technically viable to print a single copy of a book. A recent partnership with Wiley means the STMA publisher now has a print facility embedded in its UK distribution centre.
“That’s very much STMA-focused at the moment, but we are looking at opportunities to expand that model into other areas,” Rossiter outlines. “Whether it’s one book or one million, it’s about working out the pricing model and making the printing process as seamless as possible for the publisher.”
Day-to-day, she does spend some time poring over spreadsheets, but not in the traditional accounting sense of the term. “It’s about looking at the business holistically together with market trends to make decisions about the kinds of projects that should be prioritized while making sure they are in line with our overall strategic intentions. It’s what I describe as lifting our eyes to the horizon,” she says.
And it’s a horizon that’s already looking positive.
Read more interviews from ICAEW’s business spotlight series here.