As a business, we all want to strike a strong financial deal. Supplies are purchased by every company, so striking a balance between lower rates and quality retention is really the key. So, how can you pay less for your print?
Of course, some discounts are easier to achieve than others. But what options are available to businesses who feel they should be getting a better deal from their print supplier? As with everything else in the print industry, a number of different factors will determine the discount that works best for you. To give you an initial idea, we’ve listed the five discounts you are most likely to come across when speaking to your print supplier:
As it is available to every customer, this is one of the most common discounts, on the basis they need to print using a litho or continuous reel-to-reel set-up. The minimum quantity typically starts at around 250 units for more common items such as business cards, leaflets and brochures and the price breaks all depend on a number of factors such as size, finishing, pagination and quantity. Being aware of the technology your printer is using and their capabilities will allow you to understand where the best price breaks should be. Much of the price you pay will come from setting up the print run and from that point on, the cost is mostly effected by the amount of paper used to complete the job. As is always the case with the manufacturing of a product, quantity dictates the production cost – so the larger the amount, the lower the unit cost – which can then be passed onto the customer.
This is a less common method of discount because as you will know, cash flow is king when it comes to the payment of invoices. A simple example of a settlement discount is offering a 5% deduction from the invoice, if paid within a 15 day period (half of the standard 30 day terms). In an ideal world many companies would like to take advantage of these offers but quite often are not able to because of ongoing financial commitments elsewhere in the business. With the volatile state of the economy, especially with the looming grey clouds of Brexit, printers are open to discussing this option because they rely heavily on funding, which comes with its own costs and overheads. Offsetting some of these is always welcomed, so if you are in a position to consistently pay invoices early, this is a good starting point to open negotiations.
As alluded to above in Quantity Discounts, manufacturing relies heavily on the quantity of materials used to produce the finished product. A rebate scheme is similar to a Quantity Discount in some respects, because it is based on the final amount produced. However, the key difference is ensuring there is a firm commitment from both parties. If the targets are hit, then either a cash rebate or credit for the following year is issued. These arrangements typically last for twelve months, upon which they are reviewed and if both parties are satisfied, renewed for a further year. In order for this to work effectively, the agreement must be clearly structured and monitored throughout the year to ensure there are no unexpected surprises when it concludes.
The print industry remains fiercely competitive and over the years, the retention of customers has become more important than ever. A Loyalty Scheme rewards a customer for providing ongoing work to a printer, either through additional free printing or some other form of subsidy that suits the client. As with a Rebate Scheme, this is typically based on an annual spend and the idea is to demonstrate in tangible terms how the printer recognises and appreciates the commitment shown to them as a supplier. There will usually be a number of percentage markers available that will dictate what a customer will receive in kind. Again, these are usually laid out clearly at the beginning of the agreement and monitored closely on both sides to gauge what the end result will be. There are clear benefits for both parties to achieve the higher thresholds, which can be budgeted for on a monthly or quarterly basis.
Yearly Budget Prices
Companies that spend a significant amount will benefit most for this option, as it is based on the idea that the monetary spend will remain the same as the previous twelve months, or is planned in meticulous detail for the year ahead. This is particularly important to the printer as based on this signed agreement, they will then be able to purchase a larger bulk of materials upfront which will enable them to keep the prices down to the pre-agreed levels. That also means the specification has to be locked in place for the agreed period so the materials purchased are maximised. Companies that like to update or rethink their marketing on a regular basis can still benefit from this discount, although shorter 3-6 month periods are advised. Businesses that produce larger quantities of brochures/catalogues, using the exact same pre-determined specifications, will reap the rewards of negotiating an annual plan.
How to Pay Less for Your Print!
It must be remembered that achieving a great discount does not always equate to a good deal. Lowering your costs should never be the only criteria used when negotiating with a print supplier, as you must ensure that quality and service remain at a high level. You will find that most printers are willing to discuss the various discount options available, provided you are able to offer tangible reasons as to this should be arranged. Use the above information as a start point to look at your own print budgets, historic spend and future plans, so when you do approach your supplier, you will do so from a more informed position.