The True Cost of Print

Hidden costs include time, creative design, proofing, liaison, shipping, storage, obsolescence and administration. In 2002, a study was conducted in the US by CAP Ventures that showed the extent of costs associated with a "typical" print order of $14. When all other processes were considered - creating, distributing, storing and disposing, another $96 were incurred. That's 7 times the actual cost of the print order itself!

The following diagram illustrates the total cost of print, on a standard, simple piece. For every R1 spent on print, R6 is spent on the processes preceding and proceeding the actual production:

From this diagram one can see how much of an effect creative has on the overall cost of a print order. Costs are incurred from the time the concept is developed right up to the time the documentation goes to the graphic communication house. Even then the document preparation and proofing can be tedious and timeous if it is not presented exactly as is specified.

Once the materials are produced, costs immediately start adding up again. What happens next? Is the material shipped off straight away or does it need to be stored in a warehouse first? Costs rise no matter what distribution plan you execute but you can limit the amount of unnecessary expenses by ordering intelligently. Too often buyers make decisions based on price rather than considering the potential wastage. Ordering excessive amounts of materials to try and take advantage of bulk discounts generally results in large quantities deteriorating in quality or becoming outdated. In fact, CAP studies show that on average at least 15% of materials end up being destroyed. Further consequences are that your capital has been tied up and is therefore unavailable for other potentially more valuable activities.

Technologies have been developed to try and minimize wastage such as Print On Demand (POD). Printed digitally, POD means only printing when materials are actually needed as opposed to printing in bulk, storing and drawing. With this flexibility, cash can be released for new projects and copy changes can be made if dates or information changes are required to the original piece.

So what are the golden rules to minimize the total cost of print?
1) Ensure that the creative team design for production. The designers need to be aware of how their concepts are converted into finished products.
2) Select suppliers that supply the appropriate level of quality at competitive prices.
3) Select suppliers that can offer you a wide range of services and technologies under one roof. When costs are managed in this way it is less likely that they will escalate unnecessarily.
4) Compare apples with apples. Be sure of what a given quote includes. Many of the larger graphic communication houses include the entire range of services you require in the quote. You cannot compare this to a smaller printer whose quote may look less expensive only because it does not include half the work!
5) Be sure to order and manage materials so that capital is not wasted.

Print is ultimately one of the most cost effective mediums but, in some instances, due to mismanagement, it may seem that costs are forever escalating. To achieve the greatest value, rather than hammering down the print quote, learn to identify and eliminate or doctor activities that generate costs. Check every decision for wastage and try to maximize efficiency - you could save your client a considerable amount of money... or fatten your own margins...whichever way you see it!

If you require additional information on how to manage an optimal relationship with your graphic communication partner, contact Bully Charton, Director at Creda Communications on 021 505 6100.