The new year is always a good time to review and raise prices. Printers have seen a great deal of price pressure from customers and they are closely reviewing their prices. Many experts are expecting pricing to remain fairly consistent in the coming year and pricing increases to cover rising paper costs.
Over the years, pricing for typesetting and design produced by quick printers has remained very low. In many shops the total sales for typesetting and design services barely cover the salary of the staff. Unless printers increase prepress prices to cover the department’s costs and turn it into a profit center, the black hole of printing will continue to suck away profits from other departments.
Most printers have pricing structures that would allow the prepress department to make money, but the pricing standards are ignored by the sales staff. Most printers attempt to sell based on having the lowest price, and prepress just adds to the charge. No one monitors the prepress selling prices, so they become unimportant. The prepress costs are discarded so the printer can get the job.
Establishing policies and procedures related to prepress pricing is easy. Standard pricing can be created that can be understood by both the selling staff and the customers. But unless someone is making sure that the standards are applied, the prepress prices will disappear and printers won’t make anything for their prepress work.
Would a $35 charge for every digital file a printer accepted cause the printer to lose the job? Would an extra $20 for every typesetting job chase away customers? Would charging at the same design rates as the online sources drive customers to the nearest competition?
Customers are price sensitive, but printers should charge for the work they do, and that includes prepress. In the scheme of things, prepress prices are only a small percentage, but they could mean the difference between a successful company and one that can’t pay its bills.
Bumping up prices for prepress shouldn’t cause a wide spread panic among customers, but cutting prices could send the wrong message. James Surowiecki recently wrote about price wars in The New Yorker. He surmised that when there are a lot of competitors selling the same product, pricing is the easiest way for a company to distinguish itself. He said companies hope to increase market share with lower prices, but usually it isn’t the case. Surowiecki believes everyone loses when a price war begins.
He believes the best way to win a price war is not to play in the first place. He suggests that a business compete with customer service or quality. A price-matching guarantee mentality will only lead to failure.
The lesson is to concentrate on service and quality and make sure it is promoted among customers and employees. It is all well and good if a printer can become the low cost producer, but most can’t because their product line is to wide and varied. Most printers are job shops that produce custom work. If a printer can build a reputation on service and quality, then pricing becomes less of an issue with the customers who matter.
What are you doing to build your reputation or your “brand” in your local community? Do you have a state-of-the art website? Are you actively sending out newsletters that educate and demonstrate what your company can produce? Are you in front of customer telling your story and showing what value you add to the printing job?
There will always be someone who will sell the job cheaper, but is the cheapest price what the customer really needs? How valuable is the job if it is a week late? Or if the quality is bad? Or if getting the job took up too much of the customer’s time?
Pricing is difficult. You want to get the right price that will help sell the product and provide a margin for profit. Don’t just try to be the cheapest price. You should be the best price, and the best price will include a prepress charge that allows the printer to make a profit and provide better service to the customer.
Do Your Customers Talk About You?
Speaking of brands, you might not know it, but customers are using the reviews in Google, Bing, Yahoo, and other search engines to either give a business a pat on the back or slam them. Anytime a customer is looking for a specific business on several of the search engines, they also have the ability to read reviews or to add a review themselves.
If you are really into protecting your brand, you will need to monitor these sites and see what customers are saying about you. You can easily find reviews when you use a search engine’s maps.
You might be surprised by what is being said about your company. Disgruntled customers may be adding poor reviews that will affect how other Web surfers perceive your company and its service. You also need to worry about disgruntled employees and unethical competitors who might want to sabotage your business.
Is Print Media Effective?
The Print Council is funding new information source published by the Printing Industry Center at RIT. Printing in the Mix summarizes research on the effectiveness of print advertising and marketing, and demonstrates the role of print as a viable medium in the marketing mix. The information can be shared with customers to promote print-based solutions.
Shippers Get Aggressive For Printing
FedEx Office has introduced its Design & Print Center solution, a digital self-service tool for creating and ordering custom business cards, letterhead, and marketing collateral. Most FedEx centers now feature a Design & Print Center kiosk. The application is also accessible at computer rental stations in the centers. Customers can customize templates or upload their own designs. All orders are processed, shipped, and delivered within seven business days via FedEx with no delivery charge. The website is: www.fedex.com/designprint.
The Wall Street Journal reports that UPS is now making a push into Web-based printing where customers can send documents to UPS retail stores via the Internet to have copies printed. This service will compete with what FedEx offers. This move should cause a stir among UPS customers in the printing business.
Smart Phones Add Print/Design Apps
Designers can now get color support in the palm of their hand with new applications for the iPhone. Pantone has released myPANTONE as an iPhone application for graphic designers. It allows users to capture, create, and share Pantone Color Palettes without the need to carry around cumbersome guides. The app provides access to all the Pantone Color Libraries. Colors can also be extracted from photos taken with the iPhone camera and matched to the closest Pantone colors.
Neenah Paper has introduced Think Ink: Color Unleashed to allow iPhone users to build custom color palettes using the Dewey Color System. It can be downloaded for free at http://tinyurl.com/oujv4o. This tool begins with one of four approaches: a photo, a product from Neenah Paper, a predetermined color swatch, or the Psychology of Color with the Dewey Color System. After the color is selected, users can place their palette on a variety of Neenah papers to see which works best for their selection. They can then save and email their custom color palette, order coordinating samples of Neenah Paper, and see the palette in different proportions.
The Think Ink: Color Unleashed application is the latest in a series from Neenah Paper. It has released a series of BlackBerry applications such as Paper Math which provides mobile access to its online paper calculator, the Stocking Guide for specifying paper, and the Eco Calculator which calculates environmental savings realized by choosing recycling papers with different levels of post consumer fiber content.
John Giles is the author of “12 Secrets for Digital Success” and “The DTP PriceList.” He is technology director and a consultant for CPrint. He can be reached at 954/224-1942 or firstname.lastname@example.org. You can also find John on Twitter (search for JohnG247) and Linkedin.com. Visit his website at www.johngiles.com and link to his blog.