On average, companies spend 14% of their revenue on document and print-related expenses. That is an eye-opening statistic. An even more surprising statistic, according to Keypoint Intelligence, is that upwards of 90% of companies fail to track their printing costs. Taken together, these two statistics present us with an unbelievable conclusion, that the overwhelming majority of companies have no clue how 14% of their hard-earned revenue is being spent!
Gartner has found that many companies could potentially reduce their printing expenditures anywhere from 10-30 percent. Let’s take a moment and break this down to understand what this really means. If your business does $10 million a year in revenue and 14% is going towards printing costs, that’s $1,400,000. If you reduced that by 30%, that would be a savings of $420,000 per year!
And it all starts with understanding your print costs.
Calculating the current cost-per-print is the starting point on your path to tracking and controlling your print expenditures. It will provide a picture of how much each printing device costs to the operation. This will enable you to create more efficient processes and workflows for your organization. It will also help you be a more informed buyer when the time comes to purchase new equipment.
The easiest way to determine your cost-per-print is to work with a print provider and install software on your network that tracks and reports the printing in real-time. This method will produce the most accurate results. The alternative option is to manually gather the information needed and do the math. Here’s how…
How to Calculate Your Cost-Per-Print in 4 Easy Steps
- Determine Your Printer Manufacturer and Model Number(s)
Determine the make and model of your printing devices first. These details can be located directly on your printer, within the manual, by printing out the configuration report, or by accessing your computer’s control panel.
2. Determine Your Yield-Per-Cartridge
Most manufacturers share their page yield figures on their website or on the side of their toner cartridge packaging. The page yields are often different for the black toner than they are for the color toner cartridges. If you are trying to determine the cost-per-print for a color printer, but sure to get the page yield for each color.
3. Determine the Price of Each Toner Cartridge
If you are calculating your exact cost-per-print you will need to identify the cost of the toner cartridges. If you have difficulty obtaining this information, you can use average retail prices for the toner cartridges you use. You can find these figures on print manufacturers’ websites or a simple Google search.
To determine the black & white cost-per-print you will only need the price of the black toner cartridge. For color, however, you will need the cost of all cartridges: black, cyan, magenta, and yellow. You need the cost of all 4 colors because a typical color print utilizes all four toner colors.
4. Calculate Cost-Per-Print
When you have gathered all the above information, you can calculate your cost-per-print; for black and white cost-per-print you will divide the cost of the toner cartridge by the page yield.
Toner Cost Cartridge ÷ Page Yield = Cost-Per-Print
$84.99(cost of cartridge) ÷ 2,200(page yield) = .038(cost-per-print)
Quick tip: if all of the color cartridges cost the same, you can calculate the cost of one of the toner cartridges using the same method as above for the black toner, and then just multiply by 3 (for magenta, cyan, and yellow). Take your total from the 3 color cartridges and add the cost of the black to it.
[((Toner Cartridge Cost of 1 Color Cartridge ÷ Page Yield of 1 Color Cartridge) x 3)] + Black and White Cost-Per-Print = Color Cost-Per-Print
[(A ÷ B) x3] + Z = Color Cost-Per-Print
[(119.99 ÷ 2600) x 3] + .038 = .176
Additional Factors that Impact Cost-Per-Print
Upon first consideration, you might think all print expenses are obvious: equipment, service, and supplies. However, these expenses only paint part of the picture. True print costs also include the soft costs: employee burden rates and lifecycle of the equipment. Let’s take a quick look at each of the expenses that make up your true print costs:
- Equipment: cost of acquisition, which may be a purchase price, lease, or cost-per-page agreement.
- Supplies: an ongoing expense that includes toner, developer, paper and other print media, staples, and more.
- Service/Maintenance: monthly service agreements or one-time maintenance charges.
- Burden Rates: the time spent for employees to fix equipment, order supplies, schedule maintenance, etc.
Gathering this information can be time-consuming, but it is essential for understanding exactly what you pay for printing every month.
Next, let’s look at each of these areas in greater detail.
EQUIPMENT AND SUPPLIES
The price paid for your printer is a primary component of your true cost of printing. This expense may be in the form of an initial purchase price, lease payment or cost-per-page contract. Your accounting department and/or print provider will have this information.
If you’re including the equipment in your cost-per-print analysis, then you will need to incorporate a time component in your calculation. For example, if the equipment is on a lease that is paid monthly, you would find the total number of pages printed on the device over the course of a month. Then you will divide the lease payment by the total number of monthly prints.
Leased Equipment Example:
Lease Payment ÷ # of Pages Printed p/Month = Equip Cost p/Print
$300(lease payment) ÷ 10,000(prints p/mo.) = .03(equip cost-per-print)
You would now add the equipment cost-per-print to the toner cost per print. If we use the examples provided for Black and White toner (.038) and Leased Equipment (.03), we would add these for a sum of .068.
If your equipment was an outright (or cash) purchase, the calculation does get a bit trickier, and the reason for this is that not only do you need the price paid for the equipment, but the depreciation write-off amount as well. The depreciation doesn’t matter that much on a $300 desktop printer, but it makes a huge difference if you are finding the cost-per-print of an office copier that cost several thousands of dollars.
SERVICE AND MAINTENANCE
If the printer your office uses is outdated or not functioning properly, it can increase print supply use and negatively affect employee productivity. Older print devices can cause numerous problems, and when the costs of maintaining and repairing an old printer start to stack up, it may be worth investing in a new machine.
Regardless, some level of printer repair and service is inevitable, and your true cost of printing should reflect that. Repairs and services can be performed by a number of people:
- Your employee(s)
- The device manufacturer
- Your print provider
The complexity of the problem likely determines whether one of your employees can handle it or if an expert needs to be called in. Each scenario has a cost associated with it, ranging from employee time (for fixing the issue or scheduling the maintenance), to the cost of your service contract or maintenance agreement.
EMPLOYEE BURDEN RATE
The employee burden rate is essentially the cost of paying your employees. Between paper jams, connectivity problems, replacing toner, and everything else, printer care can take up a lot of company time. And if your employees are tied up with a printer issue, that means they’re unavailable in other areas.
Because the employee burden rate is what is referred to as a “soft cost”, it’s often missed and left out of the equation. However, there is definitely a cost associated with it. It is best to include some factors of employee burden rate if possible.
Knowing your true cost of printing is an important first step in determining ways you can save. Once you’ve uncovered all these costs, you can determine areas for improvement. After all, you can’t manage what you don’t measure!
Next Steps: Implementing Cost-Saving Print Tactics
In most organizations, some changes have to be implemented in order to lower printing costs. Here are some ideas, both big and small, that could help you reduce your organization’s printing costs:
- Ask, “Is It Necessary?”
- Decreasing the number of prints, especially for unnecessary projects, can positively affect your print costs. Coach your users to ask themselves, “Does this need to be printed?”.
- Include a “Green” Message
- Including a “green” message at the end of your emails requesting that recipients only print if necessary may help deter unnecessary printing.
- Utilize Secure Print Feature
- Most copiers and printers manufactured today include a secure print feature. This feature sends the document to the printer but doesn’t actually print the document until the user is physically at the machine and tells it to release the print. This is commonly used by HR and accounting departments to protect data, but it can also be used as an everyday tool to eliminate needless printing.
- Install a Print Accounting Solution
- Installing print accounting software that requires a user to scan an ID or enter a pin number to retrieve their print can instantly reduce unnecessary printing. This type of software also enables management to identify erroneous printing and costs.
- Set Efficient Defaults
- When configuring color printers, you can set them to black & white printing by default. All color printers are set to “auto” by default. This means that color will print in color, and black & white will print in black.
- Eliminate Personal Printers
- Having personal printers in an employee’s office encourages bad printing habits. This is simply because the printer is within arm’s reach. Studies show that if someone has to get up and walk to retrieve their print, they will print significantly less. Additionally, getting rid of personal printers will also reduce the supply inventory needed for these devices.
- Initiate a Managed Print Services (MPS) Program
- Managed Print Services (MPS) is a program offered by many print providers that manage all aspects of your company’s document and print solution, including copiers, printers, scanners, and fax machines. The optimization of these devices enables companies to save money, reduce frustration, and increase efficiency. For more information on how MPS programs work, click here or call Tech Wise Office Solutions at (832) 699-7471.
Cost-per-print is an important factor to take into account when determining which printer to purchase. It can also be used to monitor the efficiency of your machine and supply usage. If you are like 90 percent of organizations that don’t track their print costs but want to get started, call Tech Wise Office Solutions today and we’ll guide you through the process and answer any questions that you have.