Tuesday, July 17, 2007

Research on economics of small business printing

It's interesting when on occasion one of the major industry players releases marketing research reports for public consumption. Of course, the motivation of making available expensive and typically proprietary research is normally to prove a marketing point with the help of a theoretically neutral third-party company. This "neutrality" logic fails a bit when thinking it through and realizing the research design, if not the actual results, is commissioned by the sponsoring vendor just to prove their point.

But beyond this rather cynical view, it's great to have access to insider research if only to get a glimpse of the methodology employed. Following up on the subject I introduced several months ago, HP (NYSE HPQ) is making available selection of InfoTrends research reports focused around the question of the costs of printing small business marketing materials on an in-house Color LaserJet versus taking the job outside to a print shop. Seven separate reports cover seven countries (Brazil, Cananda, China, Germany, Sweden, the UK and the US), each basically comparing the cost of color laser toner and paper with print-shop prices for different-sized runs of simple marketing materials. And surprise? Doing the work in-house on a Color LaserJet, even with relatively heavy coverage of 60%, was less per image at run lengths of hundreds for an HP Color LaserJet 2600 or up to 1,000 and even more for an HP Color LaserJet CP3505 in many markets. For jobs with light to medium coverage the economic cross-over point is generally well into the 1,000’s. This compares VERY FAVORABLY with my original supposition that in the May post print shops would win out when quantities get into the 100's.

However, one way this research falls short is on the breadth of what's compared. The essence of the results can be summarized easily -- in simple one-sided and two-sided marketing documents printed on letter or A4 paper, in-house printing has many advantages, including cost. The charts contained in the reports are interesting because while the in-house costs are coverage dependent, print shop prices are not. In other words, because they charge a flat per-piece price independent of coverage, let the print shop do the larger quantities of the toner-sucking heavy coverage jobs, and leave the simpler, mostly textual jobs for in-house. The reason for going outside, however, is often where media, binding, size, and other challenges have come up, and these reports don't address those jobs at all. The reports also ignore the hassle factor. An example of this is that one of the test documents is duplex, and the HP Color LaserJet 2600N is a manual-duplex-only machine. Meaning it can be done, but requires some intervention, and even a share of good luck at least in my experience!

1 comment:

max said...

I think they are still missing the mark and the point with that in-house printing. They definitely need to invest more in finishing: cutting, creasing, binding and laminating. A good choice of paper should be available.

You are absolutely right that Legal or A4 is fine. What if I want a tri-fold double-side DL size brochure?

The other big thing are designs. It's all good to print business document, but they are pushing for printing marketing collateral. Print shops provide full service and will do designs if needed.

Anyway, we'll get there :-)