Are you REALLY realising savings on marketing print? Part 1

We are delighted to publish this guest post from Santosh Reddy of GEP, whose Knowledge Bank is a rich and varied source of procurement thinking. In this post GEP explains the various means at your disposal to start saving on your print spend.

Companies are spending more on marketing print now than prior to the recession. The supply base that was contracted through the 2008 recession did not completely recover for various reasons, which has provided a good opportunity for businesses to rethink their print sourcing strategy.

Are you making the most of the imbalance?

Print has been around for a while and there are many simple, easy-to-use solutions that have done wonders for managing print spend better. Most initiatives involve sourcing and vendor management, however there are more ways to realise savings.

Here are some tips to tap into the savings potential:

1. Sourcing: the usual tips and tricks of strategic vendor management:

  • Pre-qualify and consolidate your vendor base to few printers.
  • Ensure vendors have at least one print shop within reasonable distance from your primary centres of consumption to save on transportation cost.
  • Ensure a subset of these suppliers have print production facilities in low-cost countries (although you might want them to use your organisation’s logistics partner or a consolidator when shipping.
  • Bid every job within this group of vendors, make them earn the jobs – their supply on a given day drives the price, so capitalise on their supply-demand misalignments.

2.  Technology: selecting the right tools and making them work for you:

  • Configure the tool for all job requests to be routed through the category manager for action.
  • Bid every job, it not only lets you do the bidding but provides you valuable benchmarks in competing quotes, benchmark cost and savings estimate. It gives you the history to ask for preferential pricing from vendors on future jobs.
  • Establish catalogues, particularly as Web Shops.
  • Tools work much better if the procurement policy says “No PO, No Pay,” so talk to the CPO.

3.  If establishing a contract:

  • De-couple cost of print and cost of raw material, track the cost of paper using an index.
  • Create an exhaustive price list, or ensure the calculation mechanism allows for price derivation of all possible print jobs (paper quality and size, colours, quantity).
  • Ensure there is a section that addresses cost of rush orders.
  • Budgets are allocated well in advance, not a few days before consumption. Work with the business users to understand the budget and expected consumption timeframe so you know when to engage them for specifications. The sooner these specs are available, the better.

4.  If you do not have a category manager to do these activities -- outsource. My colleague Mayank Saxena captured some good insights into service outsourcing here. For Print, such an outsourcing partner is a Print Management Company. While they are a very good option to improving your ROI on print spend, be proactive in managing the baggage that comes with them.

More to come in part 2 tomorrow.


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