Defeating the Desktop Menace

Think your main competition is that copy center down the street? Think again. The humble desktop ink-jet or laser printer may be hurting your business even more.

By Linda Formichelli

Your in-plant may be quick and cost effective, but a desktop printer is...well, it's right there. It's convenient. Being able to print to a machine that's mere inches away from the computer—instead of having to walk projects over to the in-plant and then wait for them—is appealing to many customers.

It's also a big waste of money.

Vic Barkin, manager of Northern Arizona University Printing and Reproduction Services, tells the story of one NAU department that bought a desktop color printer and used it for jobs with offset-like run lengths.

"They needed to produce 10,000 color copies, and they did it all in-house, and it took forever," says Barkin. "On a laser printer, they paid somewhere around 30 to 60 cents apiece for supplies alone based on 30-percent coverage. I estimate that $2,000 was wasted on that project."

Barkin isn't the only one facing this dilemma.

"Four years ago we were doing 11 to 12 million impressions per month," says Joe Tucker, administrator of state printing for the state of Ohio. "Now we're doing about six." Some of the decline is due to budgetary woes, he admits. But a good part of it is state agencies using personal machines.

"We've found agencies with 500 to 600 employees going through 14 to 15 pounds of paper every two months on walk-up copiers and printers," Tucker adds. "It's a tremendous waste."

It's a boon, though, for makers of ink-jet and laser printers. Hewlett-Packard, for example, is reporting record profits thanks to the desktop printers and supplies it sells.

Part of the issue is that the cost of using desktop printers is invisible to the employees who are churning out thousands of prints on these machines. At many organizations, purchases below a certain threshold, say $500, don't have to be approved by the purchasing department. So not only do items like printers and ink cartridges seem to be cost-free, they're not even tracked by the institution.

"Agencies have tight budgets, so their perception is that if they run 1,000 copies of a five-page booklet on a printer it doesn't cost anything," says Tucker. "But if they go to the in-plant they have to pay for it"—even if the real cost is less.

Back To School

Customers don't seem to understand that they're wasting the organization's money by using desktop printers instead of the in-plant. So how can you educate the culprits?

"They need to be made aware of the costs," says Tucker. "Sure, a printer costs $200, but let's look at volume and supplies and do a cost-per-copy analysis. It's been an eye-opener for them. There are some things you need a printer for because it's convenient, but there's a significant cost."

So true: According to Ken Weilerstein of the Gartner Group, printing a monochrome page with 5-percent coverage on a personal laser or ink-jet printer costs more than 2.5 cents just for the consumables, not including the paper and overhead. This cost can go as high as 20 cents a page on a color ink-jet printer (assuming 5-percent coverage for each color, or 20-percent coverage across the four colors).

When you add in costs for paper, electricity, depreciation, labor and a higher coverage rate, "that could top a dollar a pop easily," notes NAU's Barkin. By comparison, his in-plant charges just 39 cents a page for high-volume color work. He points out this cost difference to customers when they bring in large jobs.

"If they do newsletters or communications on campus, there are resources and cost comparisons available, and I present those numbers to the customers," he says. "Even if they just bring something to you for folding, that's a start. Overall you should make your presence known and tell them you want their work and can get them great prices."

If you supply paper to customers, you can use paper usage as an indicator of large jobs, then contact the people responsible and offer to counsel them on their printing needs.

"We'll have to learn to live with the problem to a certain degree, but we always counsel customers when we hear of a large job," says Barkin. "We don't needle the customer or say 'I told you so.' We say, 'Maybe next time we can help you get it done quicker and you can concentrate on your core business.' "

Another idea is to create a printing handbook for customers. State Printing of Ohio, for example, proposed a handbook to the governor. The handbook asks agencies to let State Printing make recommendations before purchasing desktop printers, and also warns that companion printers are very expensive to use.

"We say that you shouldn't send a document to a printer and then take it to the walkup copier. You can do that electronically," Tucker says.

Get The Word Out

There's a reason that top-earning businesses spend billions of dollars every year on marketing and advertising: It works.

Marketing services that customers can't do on their own will not only bring in more revenue to make up for the shortfall due to desktop printers, but will also help customers remember your in-plant when they're considering running off prints on their own.

"We've been trying to center in on what other people don't have expertise in," says Barkin. "We want to be the provider of the more difficult types of projects, such as those that are more graphics-intensive, that require more quality or a longer run, or that include bindery."

Barkin also markets variable data projects, which many departments don't have the capabilities to do in-house. He promotes his in-plant's capabilities via e-mail news, hard copy news and plant tours.

"Whenever we can, we have dog and pony shows for customers," he says. "When we first get a new machine, we invite every department over to view our equipment and capabilities. When someone new comes on board with the administration, we like to have them come over for a demo. They've been very receptive to it; the admissions department has been a very big supporter of our capabilities."

Take It Over

If all else fails (or even if it doesn't), why not think like Microsoft? If desktop printers are bugging you, take them over.

Getting the printers on a network is a good way to begin.

"You can start controlling volume and identify what kind of work people are sending over," says Tucker. "You can say, 'Last month you made 20,000 impressions. If you had sent it to the production facility, here's what it would have cost you.' "