Printing money Featured

8:00pm EDT September 25, 2009

Whether or not you realize it, print volume at a typical office is increasing by 10 to 15 percent annually. In fact, network printing costs are the largest unaudited expense in business today. According to industry sources, 1 to 3 percent of corporate revenue is spent on internal printing.

Ned Bergen, vice president of sales at Toshiba Business Solutions, says many businesses are focused primarily on their copiers’ flashy features and cost-per-page, overlooking their other document output devices, like printers, scanners and fax machines.

“On average, for every copy-based product you have, you’ll have four to eight printers,” Bergen says. “You’re only looking at a small slice of the pie.”

However, analytical programs can provide an enterprise-wide assessment of your document production.

Smart Business spoke with Bergen about how evaluating your company’s document usage could reveal costly inefficiencies.

How can using an enterprise-wide document output strategy benefit a company?

The benefits begin with significant cost reduction. You get a technology refresh — right-sizing of your technology fleet based on today’s demands and the needs of the current work force. Right-sizing your technology while offering significant cost savings is more appealing than ever.

What steps are involved in a document output analysis?

The first step is to select a document management partner and establish mutual goals along the lines of cost-cutting, technology refresh and workflow analysis, such as moving from paper-based processes to digital business processes.

It requires executive sponsorship because it’s about changing business processes, not about how many bells and whistles a new printer has, or how many pages per minute the copier can do.

Then, the document management partner would do a physical walk-through of the facility and inventory of all the output devices. Next, the partner compiles the hard costs involved with all the devices and reviews some of the soft costs, like labor.

A quality document management partner will set the goals, do the assessment, do an inventory of the devices, interview the users, and then quantify what their needs are. Then that partner will create the baseline based on the current inventory of devices’ usage and cost.

In many cases, businesses do not have all the pieces of the cost puzzle. A good partner will be able to supply them with verifiable street pricing on the cost to run these different devices.

At this point, you have figured out document volume. From there, you can identify fleet needs and end cost. Then you can compare that to national benchmarks and determine how many print devices per employee exist in that organization compared to national benchmarks -— how much volume is being done per employee.

Then, ultimately, you can identify any areas in which the current technology fleet is not satisfying the needs of the staff.

What mistakes do you tend to find businesses making during the ‘diagnosis’ part of the document analysis?

Many people don’t know what their costs are. If your company has 100 employees with 10 departments, each department may be buying their own sets of supplies.

We’ve seen instances in which the same company is buying the same toner cartridge from three different vendors and at three different prices. It’s a decentralized purchase at a department level. The low incremental cost of each component makes the process seem insignificant. Most people in the organization could put a $100 cartridge on their expense account. But, if you have six or seven different people in the organization ordering 10 or 15 of them a month, you could be spending $5,000 to $8,000 a month in print supplies alone.

Another part of the diagnosis is analyzing color usage. Color inkjet printers are a classic example of giving you the razor for free if you buy the blades. There’s a reason why people are giving you these free printers to put on everyone’s desk. The cost per page is extraordinarily high.

Also, multi-function printers are significantly less expensive to operate per page in both black and color ink. Single-function printers can cost three to 10 times more per page than these larger multi-function devices.

There is no doubt that a low-cost or free printer may cost you more than it should, and give you lower-quality results than you need.

What happens after the ‘diagnosis’ part of the document analysis?

The ‘prescription’ part of the analogy — the optimized solution. Your document management partner will show you how their recommendation dovetails with your corporate goals and provide solutions for any areas that might be significantly outside national cost and usage benchmarks.

Of course, that has to be balanced with the organization’s workflow. The logistics of the workflow has to be kept in mind as well. For example, you can’t just put one big multifunction device in the middle of a large building and tell everyone to walk there.

Next, your document management partner would make a recommendation on right-sizing your fleet. It would likely be a combination of new multi-function print devices along with some current print devices. It’s important to note that an optimized technology placement strategy doesn’t mean you’re going to have to acquire all new technology.

Finally, you’ll see a comparison of current cost and proposed cost, which shows you the projected savings. Once the solution is implemented, periodic follow-ups will ensure that the new workflow processes and technologies are delivering the projected savings.