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Savings Corner – Trimming Your Print/Copy/Ad Specialties/Design Costs March 10, 2011

Posted by solutionsbconsultants in Accountability, Business Improvement, Increase Profitability, Internet, Marketing, Procurement, Savings Corner.
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One of the low hanging fruit baskets of savings that you find in almost every business is printing and its related cousins. This broad category includes everything from design, printing, copying, advertising specialities and the internet.
COPYING: Let’s start with copying. If your office is using inkjet printers – especially lexmark or even some laser printers, chances are you are getting eaten alive in cartridge costs. You have several alternatives – First, if you are in love with your inkjets or laser printer, shop around for toner – hint – the big box office supply places are not the place to shop – we have achieved savings of 30% or more by partnering with smaller distributors and giving them a price target to hit. Second, rent a copy machine (or machine) – most copier companies will rent you a machine, provide toner and guaranteed service for a little over a penny per click on black and white. Color will (of course) be somewhat more expensive and is based on volume but it will still be less expensive than your inkjet or laser. Third, do not buy your paper from the office supply store – buy it from a paper merchant or better still – leverage your printing supplier to provide copy paper at their cost in exchange for your printing business. Fourth, if you have large copying jobs – do not take it to your local Fedex Office – I love the guys that work there but we have been able to save 50% or more using copy wholesalers. If you must use Fedex Office then get a discount card from the manager – you can save 15% or more with that little jewel.
DESIGN: Graphic Design staffing is size dependent on your business – that will determine whether you can afford to do design in-house, use freelancers or employ an outside agency. Regardless of who does your design work, demand copies of both the final files and working files. The reason for this is two-fold – 1) You can make your own versions/revisions without paying anyone and 2) If the designer disappears or the agency goes under, you are protected from having to recreate a catalog or web site from scratch. With the exception of very small businesses, I advocate in-house design and conversion of all paper documents to .pdf or web-based forms. If you can’t design from scratch, learn how to make changes – we have trained numerous companies and the learning curve is not as steep as you might think.
PRINTING: Nothing has become more competitive than printing prices whether you are printing digital, offset, half-web, full-web…. you get the picture. Most companies fail to obtain competitive prices by not bidding out jobs deep and wide – deep because you need to poll a statistically significant number of printers (and that doesn’t mean 3) and wide because you must gain understanding of the printer’s equipment capabilities and how you can leverage your job to take advantage of their production sweet spot. Never give all of your business to a single printer and require that they bid out every job every time – this keeps them honest. Don’t fall for the trap that only such and such printer can do a quality job or that your co-worker’s next door neighbor owns a print shop and will give you a “great” deal. The best part about purchasing printing is that printing prices are relatively easy to reverse engineer since equipment speeds are published, labor is relatively constant and the major ingredient “paper” is easy to source and price.
ADVERTISING SPECIALTIES: This is another easy one. Once you understand the industry pricing codes, you can easily negotiate from a position of power if you choose to use a specialty rep. company. Or if you are adventurous, you can deal direct with most specialty companies because they would rather make a sale to you then no sale at all. There are a lot of variations – I have negotiated cost-plus deals with a rep. company because my client didn’t have time to source. I have also purchased shirts direct from the manufacturer (US and China) and then had them contract printed or embroidered. The direction that I go in is oftentimes dictated by my clients internal resources, the size of the job and the amount of savings desired by the client.
INTERNET: Much harder to explain in a short blog but here’s my attempt. Web design should keep your company’s look and feel which means that you can repurpose (not re-design) your graphics which can be done very inexpensively. Most importantly, I can’t stress enough that you (or your marketing person) need to spend a day researching competitors web sites as well as sites that contain the functionality that you would desire in your own site. Make a list of the components that you like, create goals for your site, a statement of work (fancy talk for a brief describing everything you want the site to do) and then bid these out. Not to an agency necessarily – we use a combination of project managers, freelancers, local talent and foreign programmers. The delivered product should be well-documented so that anyone that understands HTML, CSS, PHP, Java, etc. can make programmatic changes. For larger sites, a content management system should be utilized so that you or your wordsmiths can update the site without a degree in computer science. Finally, be smart about promoting your site. You can go broke trying to create traffic and once you bid out a site, you will get bombarded by hundreds of companies that swear they can make your site a success. The truth is that there are recognized companies who have already figured out optimization, lead generation, nurturing, email campaigns, affiliate programs and the like. Regardless of how you approach your site, spend time researching and (please) don’t reinvent the wheel.

Yours in procurement,
Steve

Steve Gordon specializes in procurement and logistics cost saving initiatives – call him today at 865.356.3575

Remember what the Aberdeen Group says……….

“For a typical enterprise, it takes an increase
of $5 in sales to equal the impact of
a $1 reduction in procurement costs.”

Solutions is happy to complete a complimentary audit of your firm’s expeditures. Just call or write to get started.

If you want to learn how to save money on a particular commodity, just send me a comment or email me directly. I will do my best to answer your request in a future post.

Respectfully,

Steve Gordon
Senior Consultant
Solutions Business Consultants
http://www.costavoidance.org
__________________________________
”Bringing Service, Value, and Efficiency to the Supply Chain”

steve@costavoidance.org
(865) 356-3575
Skype: stevegordskype
Blog: https://innovativeconsultant.wordpress.com/
Linkedin: http://www.linkedin.com/in/stevegordonthecostsavingsguy

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The Savings Corner – Part I – Cleaning up Janitorial Spend April 5, 2010

Posted by solutionsbconsultants in Accountability, Increase Profitability, Procurement, Savings Corner.
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I have received more than a three dozen requests from executives who want to know how to drive instant or (near instant) savings for their company’s bottom line. 40% have come from CFO’s, and the rest from President’s and CEO’s. The Savings Corner will detail lowest prevailing pricing for a variety of commodities. And not just for Fortune 1000 businesses but for businesses from 10 to 100 employees.

Let’s start with an easy one, janitorial. First, don’t fall into a trap by signing up with a pure janitorial company. They have no way for them to take a small 10-15% profit without going out of business. Sure, they will razzle dazzle you with their “cleaning systems” that mount on the wall and their claims that their products will clean 40% more than the household equivalent. Besides, most of the cleaning systems that I have experienced over the years have a proprietary mount that will only allow that company’s product to be used with it – locking you into an overpriced solution. Best practices disallow proprietary solutions unless there is a huge (and I mean HUGE) benefit for your company – Let it be said now that any company that fails to use a universal dispensing system should be hustled away from the negotiating table.

Many of your other suppliers have drifted into the janitorial supplies arena because of the enormous profit potential. A good example of this is your Office Supplies vendor. Oftentimes, you can leverage the office supply store by requiring them to sell janitorial products at 10% over cost – or you take the entire block of business elsewhere.

And now for a secret. The single best place for janitorial supplies is not Walmart or Sams or Costco – it is your local dollar store – Dollar Tree, Dollar General, Dollar Store, etc. – Where else can you pick up 21oz of Comet for a buck – which is half the price of Amazon or Staples. And they have a wide breadth of cleaners, mopping agents and the like The key to buying these supplies is to have your procurement specialist do it once a month, write a number on each product (with a Sharpie) and have your cleaning staff perform a daily inventory. Don’t forget to invest five dollars for a hasp and padlock.

Incidentally, requiring a daily or regular inventory (not only for cleaning supplies) deters shrinkage – thieves usually take advantage of a place that is operationally sloppy – if they know you are watching, they will choose an easier target.

Annual savings for a small company averages more than $1500 annually including the monthly staff time for picking up the cleaning supplies. For larger companies, it makes sense to look at outsourcing the janitorial function – one company that I audited had the in-house staff emptying office trash cans three times a day just so they could appear busy. I favor limited outsourcing, making the employees responsible for keeping their desk, kitchen and common areas clean and using the janitorial service for dusting, mopping and zone cleaning.

Steve Gordon specializes in procurement and logistics cost saving initiatives – call him today at 865.356.3575

Steve

Remember what the Aberdeen Group says……….

“For a typical enterprise, it takes an increase
of $5 in sales to equal the impact of
a $1 reduction in procurement costs.”

Solutions is happy to complete a complimentary audit of your firm’s expeditures. Just call or write to get started.

If you want to know how to save money on a particular commodity, just send me a comment or email me directly. I would like to hear from you!

Respectfully,

Steve Gordon
Senior Consultant
Solutions Business Consultants
http://www.costavoidance.org
__________________________________
”Bringing Service, Value, and Efficiency to the Supply Chain”

steve@costavoidance.org
(865) 356-3575
Skype: stevegordskype
Blog: https://innovativeconsultant.wordpress.com/
Linkedin: http://www.linkedin.com/in/stevegordonthecostsavingsguy