B&W Volume pricing

[Steve_S]

Interested to know approximately what folks from other areas are paying for click rates on high volume B&W - docutechs, etc. We seem to have a bunch of "heel nibblers" locally that are charging barely enough to even turn on our equipment on B&W copies. Just curious.

 

[rbailleu]

I have seen trade pricing as low as 1.3 cents in volume like 10,000 copies. I dont have a docutech, but we are under .5cents/click for maintenance. I would not think anyone would sell for less than 1.5 cents to end users.

 

[lfelton]

Interested to know approximately what folks from other areas are paying for click rates on high volume B&W - docutechs, etc. We seem to have a bunch of "heel nibblers" locally that are charging barely enough to even turn on our equipment on B&W copies. Just curious.

Xerox production b&w machine click rates are about 65% (ish) less than b&w run on a Xerox production colour machine. So realistically if all you have is production colour, your competitor will be selling at around the same rate it costs you to run the job. Basic arithmetic I know, but that's the deal.

 

[Craig]

My click rate on a Ricoh MP9000 is $0.003 per 8.5x11.

 

[X33]

You could get $0.0039 in some Xerox Production Monochrome units regardless of paper size. Not sure about DocuTechs though.

 

[Steve_S]

We have a Docutech, so we don't run B&W on the color devices unles we have a machine down. How do you justify paying utilities, labor, maintenance costs, etc. and sell at 1.3 cents? I don't get the math on that part?

 

[lfelton]

Sorry Steve, I had wrong end of the stick on that, I got it into my head that we were comparing b&w clicks on a colour vs a production b&w.

FWIW I agree that there are people out there setting prices who can't do basic arithmetic and have no clue how to run a business. I remember having a conversation with someone who'd set up a printing business (his background was in something completely different) who told me with a straight face that his plan was to undercut all the local printers, and then when he'd grabbed all their business, put his prices up again. That kind of kindergarten level Gordon Geckko thinking literally left me speechless. Needless to say, he went bankrupt, but not without leaving a lot of debts and pissing a lot of people off.

 

[CSimpson]

We have a Docutech, so we don't run B&W on the color devices unles we have a machine down. How do you justify paying utilities, labor, maintenance costs, etc. and sell at 1.3 cents? I don't get the math on that part?

If you have a 6250 and you print 4 million tabloid sheets a month you pay $15,600.00 at a .0039 click rate. If you sell the output at .013 for a letter size impression your revenue is $104,000.00. Making money isn’t that difficult if you have the the proper equipment and the volume to support it.

 

[Steve_S]

If you have a 6250 and you print 4 million tabloid sheets a month you pay $15,600.00 at a .0039 click rate. If you sell the output at .013 for a letter size impression your revenue is $104,000.00. Making money isn’t that difficult if you have the the proper equipment and the volume to support it.

I understand - these people are selling Letter, Legal, and Tabloid all at the same price - it is asinine. No one in their right mind can think selling all three the same is acceptable, but the customer is going to take dirt cheap as long as they can. It totally cuts the tabloid 2 up option out of the puzzle.

 

[doubting_thomas]

We couldn't make any money at $0.013 cents per click. Our service is $0.004 and paper on top of that?
What's the point?

 

[Steve_S]

We couldn't make any money at $0.013 cents per click. Our service is $0.004 and paper on top of that?
What's the point?

That is my point!!!!!!

The thing that sucks, is that we know for a fact that one of these "competitors" has 6 plus months outstanding bills from their machine vendor - how do you compete against that?

 

[doubting_thomas]

You keep providing the other two points of the printer's triangle: Service and Quality. There will always be someone with a lower price.

 

[Steve_S]

We couldn't make any money at $0.013 cents per click. Our service is $0.004 and paper on top of that?
What's the point?

...and light bill, warm body cost, uncle barack's cut, your governor's cut ...

 

[rbailleu]

so at what price can you make money. $.02 or $.03

 

[Morning Flight]

I remember having a conversation with someone who told me with a straight face that his plan was to undercut all the local printers, and then when he'd grabbed all their business, put his prices up again.

Back when I was Marketing Manager for a Fortune 500, we called that predatory marketing. It was illegal then, and is probably still illegal now. Unless you have very deep pockets to pull it off, it's also a sure-fire road to bankruptcy.

Hal Heindel

 

[[email protected]]

Some of you are forgetting some important points in all this...it's not just about selling a print for 1.2 cents when your click charge is .002 or .003 or whatever...:

1. As CSimpson pointed out; real money can be made;
2. Even with a razor thin profit, you're still keeping your employees busy and therefore employed, and your machines running and adding some amount of profit to your bottom line;
3. You're doing work for some customer that may want you to do something in the future, maybe something more profitable...the b/w at 1.2 cents may be a marketing "loss leader";
4. There's a whole slew of opportunities for more lucrative work such as binding, finishing, color, etc.;
5. These people probably are not buying their paper at staples...rather they're buying rolls or large cut sheets by the pallet and doing their own cutting down to further reduce paper costs;
6. Even though color and digital color has been growing exponentially, b/w is still the most affordable and common print job out there.
7. Many print providers are not paying a click charge so there real cost might be .001'ish for parts/supplies.

 

[MailGuru]

I think maybe the conversation went off track. I think the question being asked by SnappySteve is "what we are paying our vendors for a B & W click". Not what we sell for to our customers. On our Xerox Color Equipment, we pay $0.0149 (not recommended - but, sometimes necessary). On our B & W Equipment (Konica Minolta Pro 1200), we pay $0.0039 - fixed. While these numbers are definitely taken in to account when quoting & estimating (as is paper cost, laser run cost, laser setup & merge cost, etc) they have nothing whatsoever to do with what I'm going to price a job out at (except to make sure that my costs are covered and a reasonable profit is built in)

 

[[email protected]]

Hey MailGuru,

I've seen 0.003'ish come up a bit on high volume b/w. I'm curious if there's a minimum volume commitment for those rates for you or for others.

I always look at the click rates two different ways in terms of volume...1)if a lot of volume is done I can make more money on the clicks and 2)if a lot of volume is done, the machine might break more often

I think maybe the conversation went off track. I think the question being asked by SnappySteve is "what we are paying our vendors for a B & W click". Not what we sell for to our customers. On our Xerox Color Equipment, we pay $0.0149 (not recommended - but, sometimes necessary). On our B & W Equipment (Konica Minolta Pro 1200), we pay $0.0039 - fixed. While these numbers are definitely taken in to account when quoting & estimating (as is paper cost, laser run cost, laser setup & merge cost, etc) they have nothing whatsoever to do with what I'm going to price a job out at (except to make sure that my costs are covered and a reasonable profit is built in)

 

[MailGuru]

Hey kingpd!

We got a real good deal. Our .0039 came with no min volume committment, no monthly base, fixed for the life of the lease, and 1 million free clicks (special incentive from KM as we were replacing a Kodak Digimaster). The secret is to negotiate-negotiate-negotiate until you get what you want......

 

[[email protected]]

That is a really great deal. You're absolutely right on the negotiate...amazing how far some will come down the second they know you're talking to so and so about equipment.

I wonder if they'd do the same deal on the 1050 model. I know some people that service them and there's more of them around. I rarely see the 1200 but I think it's very similar to the 1050; both are very reliable I hear.