Whether you are trying to cut your company’s expenses or simply looking to improve visibility into your budget, it pays to know how much your office supplies cost each month.
Did you know, however, that printing expenses from copiers and printers can be one of the largest unmanaged costs for small to medium-sized businesses? In fact, a study from Gartner estimates that organizations spend approximately 1-3 percent of annual revenue on printing - yet 90 percent of North American companies have no idea what their annual printing costs are.
Gaining visibility into printing prices will help your company save money each month, improve your bottom line and allow your company to become more profitable - but how can this be done?
In this blog, OT Group explains how your business can significantly cut down on its printing costs.
How does printing pricing work for most small to medium-sized companies?
A typical small to medium-sized company uses a lease to cover the capital cost of acquiring their device. They typically also use printing service plans to cover the ongoing supply and maintenance costs involved with running the device. In a typical service pricing plan, your provider will service those devices based on cost per page.
Fast, cheap and good, all great options but you can only pick two
Cheaper devices seem like a good option until you realize that the low acquisition costs are often offset by higher costs per page service agreements. Even if your company chooses to forgo a service plan, the higher costs for consumables like toner and parts make these devices a poor financial choice for all companies except those with the lowest volume (less than 500 pages per month).
Moderately priced devices are a good overall fit for most organizations. The operational costs on these devices, whether through a service agreement or not, make them much more cost-effective in the long run. You also get access to features that usually aren’t included with the less expensive alternatives.
Most people understand how outright purchases work, and some understand leasing (if you want a refresher you can read our blog posts on “Should My Business Purchase or Lease a Printer? The Pros and Cons” and “5 Common Copier Lease Pitfalls Your Business Should Avoid”). Most companies do not understand how cost-per-page service plans work.
Service plans, in their most basic form, allow customers to spread out the cost of operating supplies, parts, and labour costs into more manageable amounts. By taking the average of these costs, support companies are able to spread these charges down to a cost-per-page. This means you only pay for the cost of toner, parts and labour by the amount you use the page.
Generally, service plans do not monitor the amount of toner which is put onto a page, meaning no matter how much toner you print on a document, it will be the exact same price as every other document. If you print documents that have lower amounts of toner on a page, you end up paying the same amount as clients that place high amounts of toner on a page.
The other nuance is that while black and white devices usually only have one service rate. Colour devices typically have two rates, one for black and one for colour. If your company's total page outputs are in excess of 90 percent black and white, it will be more cost-effective to purchase a black and white copier.
How can OT Group help save money on your printing expenses?
To help your company save money on printing costs, OT Group has created an innovative Colour-Coded Pricing Plan that ensures your small or medium business only pays for the colour toner that you actually use.
Through our Colour-Coded Pricing Plan, we have created three rates that will make sure your business will only pay based on the amount of toner that you actually print on the page.
- Simple: Simple documents are those with a low percentage of the total printed page being colour. This is perfect for documents that include email addresses or logos.
- Standard: Standard documents are those with more a typical office percentage of the total printed page being colour. A typical standard document would be a word file with colour letterhead, a few email addresses and a colour excel chart.
- Complex: Our complex colour pages are documents that have more than the standard amount of colour. An example of complex colour documents might be a full-colour PowerPoint presentation.
The typical Colour-Coded Pricing Plan client will experience between 30 percent and 50 percent total savings versus the normal two-rate service program.
How does this compare to other printing pricing plans?
Today if you use a colour device on a service contract you usually pay:
- The rate of black pages typically range from as low as $0.01 - $0.02.
- The rate of colour pages typically range from as low as $0.06 and up to $0.12.
The colour rates are significantly higher than black because a huge percentage of the cost in these rates is for toner. Parts and labour are generally less than 20 percent of the total cost of printing.
However, OT Group’s Colour-Coded Pricing Plan allows our customers to pay based on the amount of toner on the page. We have found this reduces the printing price for 90 percent of all office clients.
Based on a 27 million page samples, Simple and Standard documents under our Colour-Coded Pricing Plan represent over 60 percent of our customers’ printing. OT Group customers have paid less than $0.03 per page for these pages (on average).
Compared with typical printing industry rates, this represents somewhere between 45 percent and 80 percent savings.
Are you looking for more information about our unique Colour-Coded Pricing Plan, industry-specific estimated total service rates and how it can save your business money on printing costs? Contact our team of experts today. We would be more than happy to answer any questions you have.
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