What does setting the price for a box of letterheads have in common with setting the price for a new minivan? Turns out quite a lot. Both are calculated months before real costs are known, then disconnected from the number of minivans that will actually sell this year or how much printing will come off the presses. Does it bother anybody that this kind of anticipatory pricing involves an ungodly amount of wishful thinking?
Consider this: Cars consist of thousands of parts, all of which are cheaper by the trainload. If the sales forecast is off by even a little, up go the parts costs and down go the profits. Better luck next year, Henry.
In printing, the key factor is utilization of equipment. Virtually all printers use Budgeted Hourly Rates to set their prices. Those rates are usually a mix of how many hours a press or other piece of equipment was used in the past, and how many hours the company thinks it will be used in the future.
You can see how that puts printers into the same pickle jar the minivan guys are in. BHR's do a creditable job of telling us how much we should have charged last year. They can only hint, with no guaranties whatsoever, what our prices should be today or tomorrow.
Just food for thought this month, but I wish some genius would hurry up and discover a better crystal ball. It would make pricing so much easier.
Unitac International Inc.
Webstores for Printers
Often before we go out to dinner we check the internet to see what's on the menu and whether the restaurant is even open tonight. We've gotten used to finding such things on the restaurant's website. When we don't, why take a chance. There are plenty of other restaurants.
Most printers, too, now have a website, even if it's only a single-page billboard. But while restaurants have an easy time rounding up content (menu, opening hours, and some nice pictures of the food and ambiance), where do you even start when you're a printer?
The answer is you're probably going to "need a bigger boat." Unlike Burger King, you'll have to expand your website to include e-Commerce. If you're waiting for our Morning SkyMall, that would mean BigCommerce. Otherwise, check out Word Press e-Commerce or Magento. Nice thing about WordPress? No price tag.
Forums: How to Price Printing
Get right down to it and a more accurate caption could well have been "how not to." Because what you read on forums about how to price printing deals overwhelmingly with archaic schemes you should avoid. There are exceptions, but the lucky few who may have stumbled on a new winning formula are often reluctant to share. Competition being as heated as it is, who can blame them.
Even so, if you're not visiting the widely known PrintPlanet forum from time to time, you should. A quick search for "Morning Flight" while you're there may surprise you. How popular is PrintPlanet? Last I checked, the PrintPlanet link below about pricing with BHR's had garnered 9,995 hits.
Tip of the Month
Setting Hourly Press Rates
When you first install Morning Flight, you could, if you wanted to, start making quotes right out of the gate using the built-in defaults. That's rarely a good idea. Find out why in " Before you dive in," one of the preflight help chapters.
In a nutshell, asking a computer to tell you how much you should charge is like expecting the cruise control in your car to tell you how fast you should be driving. What you can expect is to have the program come up with hourly rates for your offset and digital presses, reverse calculated from your target prices.
The steps for doing that are also spelled out in our help system, but here are a few shortcuts you may not be aware of:
1. When you click the up arrow, the quantity rotates through the three quantities you've entered as your defaults under File > My Preferences.
2. You don't have to click the letterhead symbol to get a quick view of letterhead pricing. Just swipe the magic wand over it.
3. Before you start, make sure you're working with up-to-date plate prices for offset, and click charges for digital.