Whether you’re in a packaging, large format, labeling, or other print business, the biggest challenge in the print industry is razor-thin profit margins, which run in the range of 1 to 3 percent. Understandably, printers spend a great deal of time looking for ways to save money without compromising on quality, time, and price—factors that are equally important to their customers.
One of the areas that has perhaps the biggest impact on profits is print estimating. The more accurate the estimate, the less profits are impacted. An underestimated job costs the printer money, while an overestimated job loses business.
Common Print Estimating Mistakes that Add Up
There are some common Mistakes most printers make when creating estimates. These aren’t the “biggies”—like errors in the print job that force a reprint—but little things that are overlooked or assumed that add up to big hits to the profit margin:
Ignoring overhead costs. This is dangerous because these costs must be factored in for an estimate to be accurate. More than half of printers surveyed admit that not only do they not factor in overhead costs, they also don’t know how much each print job contributes to general and administrative overhead.
Relying on outdated fixed pricing. While a fixed pricing matrix can be an acceptable way to approach print estimating, many printers lose money by using old pricing—“old” referring to pricing older than 90 DAYS.
Inconsistency. After some close scrutiny, printers often realize they do not have consistency in their print estimating. Sometimes this is because quotes are being created by more than one person, sometimes printers are guilty of ball-parking because they’re in a hurry or have created estimates for a job multiple times and are making assumptions. But more often, the culprit is complexity. Print jobs have multiple components, which is a lot to keep up with, so it’s easy to overlook something when creating the estimate.
Not charging for unseen “extras.” There are several items that fall under this umbrella, including not charging for odd quantities (e.g., the customer orders 163 items, but the printer charges for 160), bindery charges, make-ready fees, or delivery-related aspects (boxes, wrapping, packaging, etc.). All these unseen components might seem small when viewed individually but add up when taken as a whole.
Not looking for ways to retain business. This goes for any business; it’s easy to forget to look for ways to keep current customers happy because the day is dominated by filling orders and—to some extent—trying to attract new customers. For example, simply turning a quote around faster could mean the difference between winning and losing a job.
How a Print Estimating Software with a Print MIS Can Help
Most of these common mistakes in the quoting process are a result of simply not having enough time. Fully assessing a job to include every component and cost is simply too much for anyone to handle—particularly someone that is trying to fill orders, manage customer service, and bring in new business. The good news is that there is a solution.
Print management information systems, also known as print MIS software, is built specifically to support printing businesses with the many challenges they face as they fight to maintain (or even increase) profit margins. Accessible and surprisingly easy to implement and use, these systems can quickly hit the ground running, delivering a return on investment out of the gate by:
- Making it much easier to estimate jobs using building blocks, including customized templates, in just a few clicks
- Enabling assignment of fixed costs, mark-ups, and variable costs to a database which automates and speeds up the process of print estimating while ensuring consistency
- Reducing quoting errors by leading the estimator through all the relevant factors that go into pricing a job correctly, including dependencies.
- Providing all the key figures upfront for a complete overview of the economic aspects of a job, such as direct cost, total cost, overhead, mark-up, and ultimate sales price
Print management information systems help printers get their arms around print estimating, but they also ease the burden of the other challenges they deal with every day, including inventory management, production scheduling, and invoicing, and other areas of finance. Most importantly, these systems provide visibility into the entire operation, allowing printers to uncover issues that could turn into problems as well as potential opportunities.
Download this whitepaper for more details on how a print MIS can help with print estimating and more.