Kzenon (c) Kzenon
By Ed Avis
At the APDSP Regional Workshop in Denver last week, Kevin O’Hea from Academy Reprographics explained that he has used per-sheet pricing instead of square-feet pricing since he opened his company two decades ago. The conversation that followed revealed that he was definitely in the minority among attendees – everyone else still charges by the square foot. Is it time we discussed this topic again?
The last time APDSP debated the topic was in 2014. The debate was initiated by then-president Paul Fridrich, who pointed out that square-feet pricing reinforces the concept that prints are commodities, which may hold down price.
Here is the heart of Paul’s 2014 article:
1) Our services are not commodities, but pricing by the square foot makes them seem that they are. Just like price-per-barrel in the oil industry and per-bushel in the agricultural commodities trade, price-per-square-foot for document services makes it seem like our products are entirely interchangeable with any other provider. That’s not true, and we shouldn’t let our customers think that it is.
2) Many of our customers these days are asking for half-size prints, and we are charging them per-square-foot for those, even though the work to create those prints is exactly the same as full size prints. If we adopt the model described below, we will be able to more accurately charge for prints based on the labor involved, not just the paper consumed.
3) We all print a lot less hard copy than we did in the past – jobs that once required 100 sets now require 5 sets, for example -- but we are often providing the same high-volume discounts we did in the past. A different pricing model could address that.
Let’s change the old way of pricing before it morphs into color CAD printing and other important new business segments.
The new model more accurately charges customers for the value we provide. It consists of several elements:
1) We stop charging by the square foot and instead charge by standard sheet sizes. If a document falls between sheet sizes, we charge for the next larger size. Why is this better? It removes the focus from the paper consumed and more accurately places it on the final product. Furthermore, odd size jobs will result in slightly more revenue, since they will bump up to the next largest size. Finally, charging by the sheet makes billing easier – imagine how much more quickly and accurately you can determine the price of 50 copies of odd size sheets if you can just bump each sheet to the next standard size rather than calculate square footage.
2) We charge for all of the services and extras that accompany a print job. Those services add value to the project, thus we deserve to be compensated for them. Several years ago IRgA developed a digital services chart that includes 77 services (yes, 77!) that can be charged for (click here to see the chart), but it was not widely adopted. If we adopt that now as an industry, our bottom lines will benefit. (Click here to read the full 2007 IRgA report on digital services.)
3) Consider summary invoicing, with all prints and related services rolled into one fee. As with standard sheet pricing, summary invoicing takes the focus off the commodity aspect of printing. The client sees one price and thinks, “OK, this is how much my document services cost this month.” Simple.
Click here to read the whole article from 2014.
Now, let’s re-open the conversation. Please start by clicking here to take a survey about your own firm’s pricing practices. Then comment on this topic using the comment section below. Stay tuned for more articles on the topic as the debate develops.